Corrective Action Plans

Views of Responsible Officials: AHCMC acknowledges that it does not have a formal and open procurement policy that requires full and open competition for purchases of goods and services. AHCMC will implement a procurement policy that conforms to the Uniform Guidance. AHCMC will also maintain documentation to support that the procurement policy is adhered to. AHCMC will also develop internal controls to maintain documentation that required suspension and disbarment searches were performed on the SAM website.

We will give instructions to the Contract Division to use a contract model that includes all the required federal clauses for contracts formalized that are subsidized with federal funds

FINDING 2023-002 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Summary of Finding: For three vendors, the School Corporation did not obtain price or rate quotes as required. The School Corporation did not maintain documentation to support the rationale and justification to limit competition, and there was no documentation of the history of the procurement which would include the rationale for the method of procurement, the selection of the vendor, and the basis for price. Contact Person Responsible for Corrective Action: Food Service Director, Maggie Caudill Contact Phone Number and Email Address: (812) 649-2591 / maggie.caudill@sspencer.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Small Purchase Procurement: The Food Service Director will maintain a binder/Google Drive folder with documentation of price and/or rate quotes and documentation of the attempts made from at least three vendors that fall within the small purchase threshold. If price and/or rate quotes cannot be obtained from at least three vendors, documentation of the reasoning will be maintained. Suspension and Debarment: The Food Service Director will ensure that all vendors are not suspended or debarred by either ensuring the suspension and debarment verbiage is included in the contracts, providing a clause to the vendor to sign that they are not suspended or debarred, or checking the SAM.gov website. Documentation of these records will be maintained for audit. Anticipated Completion Date: June 2024

􀀃 Finding􀀃2023􀍲007􀀃 􀀃 Finding􀀃Subject:􀀃Special􀀃Education􀀃Cluster􀀃􀍲􀀃Procurement􀀃 Summary􀀃of􀀃Finding:􀀃The􀀃district􀀃does􀀃not􀀃have􀀃a􀀃procurement􀀃policy􀀃outlining􀀃 procurement􀀃standard􀀃for􀀃all􀀃federal􀀃programs.􀀃􀀃Internal􀀃Controls􀀃were􀀃deficient􀀃in􀀃 preventing􀀃noncompliance􀀃and􀀃not􀀃maintaining􀀃methods􀀃of􀀃procurement.􀀃 Contact􀀃Person􀀃Responsible􀀃for􀀃Corrective􀀃Action:􀀃Director􀀃of􀀃Business􀀃 Contact􀀃Phone􀀃Number􀀃and􀀃Email􀀃Address:􀀃(260)431􀍲2030,􀀃msnyder@sacs.k12.in.us􀀃 􀀃 Views􀀃of􀀃Responsible􀀃Official:􀀃We􀀃concur􀀃with􀀃the􀀃finding.􀀃 Description􀀃of􀀃Corrective􀀃Action􀀃Plan:􀀃 The􀀃school􀀃board􀀃will􀀃adopt􀀃a􀀃procurement􀀃policy􀀃for􀀃all􀀃federal􀀃programs􀀃to􀀃comply􀀃 with􀀃procurement􀀃standards􀀃and􀀃the􀀃policy􀀃will􀀃be􀀃implemented.􀀃􀀃Additionally,􀀃The􀀃 Director􀀃of􀀃Special􀀃Education􀀃and􀀃the􀀃Special􀀃Education􀀃Treasurer􀀃will􀀃ensure􀀃 procurement􀀃procedures􀀃are􀀃followed􀀃for􀀃all􀀃purchases􀀃and􀀃if􀀃the􀀃total􀀃is􀀃between􀀃 $50,000􀀃and􀀃$150,000􀀃a􀀃contract􀀃will􀀃be􀀃awarded.􀀃􀀃All􀀃documents􀀃are􀀃to􀀃be􀀃signed,􀀃 dated,􀀃and􀀃retained􀀃by􀀃school􀀃year􀀃by􀀃both􀀃the􀀃Director􀀃of􀀃Special􀀃Education􀀃and􀀃the􀀃 Special􀀃Education􀀃Treasurer.􀀃 􀀃 Anticipated􀀃Completion􀀃Date:􀀃On􀀃or􀀃before􀀃June􀀃30,􀀃2024􀀃

􀀃 Finding􀀃2023􀍲006􀀃 􀀃 Finding􀀃Subject:􀀃Child􀀃Nutrition􀀃Cluster􀀃–􀀃Procurement􀀃and􀀃Suspension􀀃and􀀃Debarment􀀃 Summary􀀃of􀀃Finding:􀀃Internal􀀃Controls􀀃were􀀃not􀀃effective􀀃and􀀃did􀀃not􀀃ensure􀀃procurement􀀃 is􀀃done􀀃properly􀀃and􀀃allowed􀀃the􀀃district􀀃to􀀃enter􀀃an􀀃agreement􀀃with􀀃a􀀃vendor􀀃that􀀃did􀀃not􀀃 have􀀃proper􀀃documentation􀀃that􀀃they􀀃were􀀃not􀀃excluded.􀀃 Contact􀀃Person􀀃Responsible􀀃for􀀃Corrective􀀃Action:􀀃Director􀀃of􀀃Food􀀃Service􀀃 Contact􀀃Phone􀀃Number􀀃and􀀃Email􀀃Address:􀀃(260)431􀍲2030,􀀃msnyder@sacs.k12.in.us􀀃 􀀃 Views􀀃of􀀃Responsible􀀃Official:􀀃We􀀃concur􀀃with􀀃the􀀃finding.􀀃 Description􀀃of􀀃Corrective􀀃Action􀀃Plan:􀀃 Procurement􀀃–􀀃Region􀀃8􀀃 The􀀃Director􀀃of􀀃Food􀀃Service􀀃has􀀃the􀀃responsibility􀀃to􀀃ensure􀀃participation􀀃with􀀃IDOE􀀃 approved􀀃SFA􀀃Cooperatives􀀃only.􀀃􀀃We􀀃now􀀃utilize􀀃Food2School􀀃and􀀃have􀀃the􀀃 necessary􀀃documentation.􀀃􀀃􀀃If􀀃we􀀃consider􀀃other􀀃Cooperatives,􀀃the􀀃Director􀀃will􀀃 ensure􀀃they􀀃are􀀃approved.􀀃􀀃􀀃All􀀃documents􀀃are􀀃to􀀃be􀀃signed,􀀃dated,􀀃and􀀃retained􀀃by􀀃 school􀀃year􀀃by􀀃both􀀃the􀀃Director􀀃of􀀃Food􀀃Services􀀃and􀀃the􀀃Asst.􀀃Director􀀃of􀀃Food􀀃 Services.􀀃 􀀃 Procurement􀀃􀍲􀀃SACS􀀃 The􀀃Director􀀃of􀀃Food􀀃Services􀀃and􀀃the􀀃Asst.􀀃Director􀀃of􀀃Food􀀃Services􀀃will􀀃ensure􀀃 procurement􀀃procedures􀀃are􀀃followed􀀃for􀀃all􀀃purchases􀀃and􀀃if􀀃the􀀃total􀀃is􀀃between􀀃 $50,000􀀃and􀀃$150,000􀀃a􀀃contract􀀃will􀀃be􀀃awarded.􀀃􀀃All􀀃documents􀀃are􀀃to􀀃be􀀃signed,􀀃 dated,􀀃and􀀃retained􀀃by􀀃school􀀃year􀀃by􀀃both􀀃the􀀃Director􀀃of􀀃Food􀀃Services􀀃and􀀃the􀀃 Asst.􀀃Director􀀃of􀀃Food􀀃Services.􀀃 􀀃 Suspension􀀃and􀀃Debarment􀀃 The􀀃Director􀀃of􀀃Food􀀃Service􀀃has􀀃the􀀃responsibility􀀃to􀀃ensure􀀃that􀀃all􀀃vendors􀀃are􀀃free􀀃 from􀀃suspension,􀀃debarment,􀀃or􀀃aren’t􀀃otherwise􀀃excluded.􀀃Suspension􀀃and􀀃 debarment􀀃documents􀀃are􀀃to􀀃be􀀃collected􀀃on􀀃a􀀃yearly􀀃basis.􀀃If􀀃such􀀃documents􀀃are􀀃 not􀀃available􀀃through􀀃the􀀃SFA􀀃Cooperative,􀀃it􀀃will􀀃be􀀃the􀀃responsibility􀀃of􀀃the􀀃 Director􀀃of􀀃Food􀀃Service􀀃to􀀃acquire􀀃them􀀃through􀀃SAM.gov􀀃website􀀃or􀀃contacting􀀃the􀀃 vendor􀀃directly.􀀃All􀀃documents􀀃are􀀃to􀀃be􀀃signed,􀀃dated,􀀃and􀀃retained􀀃by􀀃school􀀃year􀀃 by􀀃both􀀃the􀀃Director􀀃of􀀃Food􀀃Services􀀃and􀀃the􀀃Asst.􀀃Director􀀃of􀀃Food􀀃Services.􀀃􀀃 􀀃 􀀃 INDIANA STATE BOARD OF ACCOUNTS 51 􀀃 Preparing today’s learners for tomorrow’s opportunities. 􀀃 Anticipated􀀃Completion􀀃Date:􀀃3/18/24􀀃

DHS has established a process for ensuring all Open Market Purchases above $24,999.99 are directed to a competitive solicitation per the State of Georgia Procurement Manual. The new DHS Office of Procurement Services is accountable for monitoring all Open Market Purchases and the DHS competitive solicitation process.

Food Worker Relief Program – Assistance Listing No. 10.181 Recommendation: We recommend that the Organization strengthen its controls and processes to identify all procurement transactions, ensure the appropriate procurement policies and levels are followed and clearly documented, and to verify vendors are not suspended or debarred. These procedures will help ensure compliance with Compliance Supplement and the Code of Federal Regulations related to procurement and suspension and debarment provisions. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management has taken the follwing steps to ensure procurement policies are followed : 1) Management has begun the hiring process for additional staffing in the Procurement Department to help support all operations. 2) Management will review and update current policy to be in line with Federal Procurement policies. 3) Procurement department will provide training to all personnel authorized for purchases. Name(s) of the contact person(s) responsible for corrective action: Jesse Satterlee, Interim CFO, 778-730-1155 Nancy Lipman, SVP Compliance, 602-257-0700 Planned completion date for corrective action plan: 6/30/2024 – Ongoing action and Implementation

Action taken in response to finding: The Organization agrees with the finding. The Organization will adopt a formal procurement policy in accordance with federal requirements. Name(s) of the contact person(s) responsible for corrective action: Paula Culp, Chief Administrative Officer Planned completion date for corrective action plan: March 2024

CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS, ASSISTANCE LISTING No. 21.027, DIRECT ALLOCATION, GRANT No.’s AC-22-0014, AM-22-0013 AND AM-22-0096 Name of contact person: Cherrie McAlexander Corrective Action: The city will review all ARPA Grant agreements and make sure that the Engineering Firm the city is working with on the projects is fully aware of the requirements in the ARPA Grant agreements. If the agreement calls for Suspension and Debarment verification the city will make sure that the Engineering firm makes this part of the bidding process. Proposed Completion Date: Before the next ARPA Grant project begins the city will make sure that all ARPA Grant requirements are met.

FINDING 2023-002 Finding Subject: Child Nutrition Cluster – Procurement and Suspension and Debarment Summary of Finding: We did not use the formal bid process for a vendor purchase over the simplified acquisition threshold. We did not ensure that all vendors over the $25,000 threshold were not suspended or debarred from conducting business with us. Contact Person Responsible for Corrective Action: Leeanne Koeneman Contact Phone Number and Email Address: Leeanne.Koeneman@nacs.k12.in.us; 260-637-8768 Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Food Service Director will track cumulative expenditures for Vendor by Fiscal Year to ensure that compliance requirements related to procurement thresholds are met. Simultaneously, the Treasurer’s Office will provide reports to the Food Service Department on a monthly basis detailing the cumulative expenditures by vendor paid from the Food Service Fund. With thresholds being actively monitored, the Food Service Director will request quotes or bids, as applicable by individual and cumulative thresholds. Utilizing the procedures outlined above, individual and cumulative expenditures over $25,000 will be verified to ensure that the potential vendor(s) has not been suspended or debarred. Upon checking the status of vendor(s) at the Food Service Department, the results will be sent to the Treasurer’s office for review. Anticipated Completion Date: June 30, 2024

FINDING 2023-002 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Summary of Finding: Procurement The School Corporation failed to award contracts to four vendors totaling $314,783, which were considered small purchases. For small purchases of over $10,000 but less than $150,000, an informal process allows securing rate quotations from an adequate number of sources; however, the process still requires a written contract between the vendor and the school corporation. Suspension and Debarment The School Corporation failed, due to the lack of effective internal controls, to provide adequate oversight of the suspension/debarment process to ensure compliance to the process prior to paying vendors that were expected to be paid an amount equal to or exceeding $25,000. Contact Person Responsible for Corrective Action: Carla Gambill Contact Phone Number and Email Address: 812-847-6020 ext. 1004 cgambill@lssc.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Procurement When quotes for small purchases are received, the Director of School Finance will acknowledge a quote provided by a vendor that will be accepted by the corporation by written letter acknowledging the school corporation’s acceptance of the quote. The contract as well as the quote will be retained by the Director of School Finance and the Director of Food Services for comparison to invoices. INDIANA STATE BOARD OF ACCOUNTS 30 Suspension and Debarment On an annual basis, all vendors that are expected to be paid in excess of $25,000 will be searched by the Director of School Finance for suspension or debarment or the vendor will provide certification, either as a separate document, or as part of a written contract, that the vendor is not excluded or disqualified to receive federal funds. Those searches or other documentation will be reviewed by the Superintendent and acknowledged by signature. Anticipated Completion Date: This Corrective Action Plan will be put in effect March 2024.

FINDING 2023-007 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Summary of Finding: An effective internal control system, which would include segregation of duties, was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Procurement The School Corporation did not complete or submit the fiscal year 2023 Procurement Plan as required to the Indiana Department of Education. Suspension and Debarment The School Corporation was a member of the East Central Educational Service Center (ECESC) during fiscal years 2021-2022 and 2022-2023. ECESC verified that vendors were not suspended or debarred when securing bids for food, dairy, and bread products on behalf of the member schools. However, for purchases of goods and services exceeding $25,000 handled by the School Corporation, 3 of the 5 vendors selected for testing were not verified for suspension and debarment to ensure vendors were not suspended or debarred from participation in federal programs. Contact Person Responsible for Corrective Action: Julie Cramer Contact Phone Number and Email Address: 765-932-4186 cramej@rushville.k12.in.us Views of Responsible Officials: We concur with the finding. Explanation and Reasons for Disagreement: N/A Description of Corrective Action Plan: Due to turnover in the Superintendent position and Food Service Director, position there was no access to SAM to verify vendor. This has been now been corrected and the Superintendent and Assistant Superintendent have access to SAM. They will verify for the Food Service Director any company will wish to deal with over $25,000. Future purchases will meet the school corporation’s procurement policy. All vendors in which expenditure exceed $25,000 will reviewed by the Food Service Director and either the Superintendent or Assistant Superintendent. Procurement – A 2023 procurement plan has been developed and will be sent to the Indiana Department of Education. Anticipated Completion Date: April 2024

FINDING 2023-002 Finding Subject: Child Nutrition Cluster -Procurement and Suspension and Debarment Summary of Finding: The School Corporation had not properly designed or implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance with Procurement, Suspension and Debarment. The School Corporation entered into more than $50,000 of like/kind transactions with a single vendor during FY2022 and FY2023 without entering into a contract or properly verifying that the vendor was not suspended or debarred. Contact Person Responsible for Corrective Action: Tracy Troesch Contact Phone Number and Email Address: 812-817-0900; tracy.troesch@sedubois.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Business Manager will review the vendors related to covered transactions and determine if like/kind transactions with any vendor are approaching or are expected to exceed $50,000. For vendors that meet the criteria of requiring a contract, the Business manager will obtain a contract, which will be reviewed and approved by the school board. The Business Manager will upload the purchase order and quote or other documentation of any purchase over $50,000 on Indiana Gateway for Government Units (Gateway) after board approval. Southeast Dubois County School Corporation followed the corrective action that was issued during the prior audit for Suspension and Debarment. During the current audit, the State Board of Accounts indicated that the corrective action and steps that were taken to verify compliance that the School Corporation was instructed to do were not adequate. Going forward, the Business Manager will run monthly vendor reports to determine if any vendors are close to the $25,000 to get a Certification Regarding Debarment, Suspension, Ineligibility, and Voluntary Exclusion form from the IN Department of Education needs to be issued to a vendor. If a vendor is close to the $25,000 mark, the Business Manager will send the Certification to be returned prior to future payment. Anticipated Completion Date: September 2024

NONCOMPLIANCE WITH PROCUREMENT, SUSPENSION & DEBARMENT REQUIREMENTS, CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS; AL No. 21.027; GRANT No AM-23-0262, YEAR ENDED JUNE 30, 2023 Name of contact person: Fallon County Commission/Clerk and Recorder Corrective Action: Procedures will be developed that will provide reasonable assurance that procurement of goods and services are made in compliance with applicable federal regulations and other procurement requirements specific to a federal award or subaward, and that no subaward, contract or agreement for purchase of goods or services is made with any suspended or debarred party. Proposed Completion Date: Immediately

NONCOMPLIANCE WITH PROCUREMENT AND SUSPENSION AND DEBARMENT REQUIREMENTS, CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS, ASSISTANCE LISTING No. 21.027 AND DISASTER GRANTS-PUBLIC ASSISTANCE (PRESIDENTIALLY DECLARED DISASTERS), ASSISTANCE LISTING No. 97.036 Name of Contact Person: Loni Hanson Corrective Action: The City appreciates the clarification regarding the required compliance certifications for all contractors receiving federal funds. The City has worked with its engineering contractor to update processes to correct the identified deficiency. Proposed Completion Date: April 1, 2024

NONCOMPLIANCE WITH PROCUREMENT AND SUSPENSION AND DEBARMENT REQUIREMENTS, CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS, ASSISTANCE LISTING No. 21.027 AND DISASTER GRANTS-PUBLIC ASSISTANCE (PRESIDENTIALLY DECLARED DISASTERS), ASSISTANCE LISTING No. 97.036 Name of Contact Person: Loni Hanson Corrective Action: The City appreciates the clarification regarding the required compliance certifications for all contractors receiving federal funds. The City has worked with its engineering contractor to update processes to correct the identified deficiency. Proposed Completion Date: April 1, 2024

MUNICIPALITY OF TOA ALTA CORRECTIVE ACTION PLAN SINGLE AUDIT REQUIREMENTS AS OF JUNE 30, 2023 ____________________________________________________________________________________________________________________________________ FINDING 2023-005: U.S. DEPARTMENT OF THE TREASURY CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS (ALN 21.027) PASS-THROUGH P.R. FISCAL AGENCY AND FINANCIAL ADVISORY AUTHORITY PROCUREMENT SUSPENSION & DEBARMENT (I) SIGNIFICANT DEFICIENCY AND NONCOMPLIANCE Corrective Action We implemented policies and procedures in accordance with Uniform Guidance 2 CFR 200.214. Statement of Concurrence and Responsible Persons We concur with the auditors' finding. Kristian Rivera Santiago Finance Director Implementation Date Fiscal year 2023-2024.

Corrective Action: On November 23, 2023 MHC updated its Procurement Policy to require formal documentation of all rate quotes related to federal funding in accordance with federal procurement standards. This updated policy was then shared with MHC personnel responsible for contracting for services and has been implemented for transactions after this date. Name of Contact Person: Jennifer A. Pulse , CFO; Telephone number: 860-856-7963; Email address: JPulse@mhconn.org. Projected Completion Date: Completed 11/23/2023 If the Office of Management and Budget requires any additional information or has questions regarding this Plan, please call Jennifer A. Pulse at 860-856-7963.

FINDING 2023-004 Finding Subject:􀀃Child􀀃Nutrition􀀃Cluster􀀃􀍲􀀃Procurement􀀃and􀀃Suspension􀀃and􀀃Debarment Summary of Finding: An􀀃effective􀀃internal􀀃control􀀃system􀀃was􀀃not􀀃in􀀃place􀀃at􀀃the􀀃School􀀃Corporation􀀃to􀀃ensure􀀃compliance􀀃with􀀃 requirements􀀃related􀀃to􀀃the􀀃grant􀀃agreement􀀃and􀀃the􀀃Procurement􀀃and􀀃Suspension􀀃and􀀃Debarment􀀃compliance􀀃 requirement.􀀃 Contact Person Responsible for Corrective Action: Lela Simmons Contact Phone Number and Email Address: (219) 391- 4100, lesimmons@ecps.org Views of Responsible Officials: We concur with the finding Description of Corrective Action Plan: All􀀃purchases􀀃will􀀃require􀀃three􀀃quotes􀀃to􀀃ensure􀀃the􀀃Vendor􀀃is􀀃compliance􀀃with􀀃purchase􀀃of􀀃$150,000􀀃or􀀃exceed􀀃 micro􀍲purchase􀀃threshold􀀃of􀀃$10,000􀀃all􀀃quotes􀀃will􀀃be􀀃attached􀀃to􀀃the􀀃APV.􀀃This􀀃will􀀃ensure􀀃all􀀃documents􀀃are􀀃 available􀀃upon􀀃request.􀀃The􀀃School􀀃Corporation􀀃will􀀃work􀀃with􀀃State􀀃to􀀃receive􀀃approval􀀃of􀀃Food􀀃Service􀀃 Management􀀃Company.􀀃􀀃 Anticipated Completion Date: We anticipate having the above corrective action plan in place by September 30, 2024.

Finding 2023-002 – Significant Deficiency Award No.: 97.083, Staffing for Adequate Fire and Emergency Response (SAFER) Federal Grantor: U.S. Department of Homeland Security, Federal Emergency Management Agency Compliance Requirement: Reporting. Condition: The Federal Financial Reports (SF-425) for the semi-annual period December 31, 2022 included expenditures through October 31, 2022 instead of through December 31, 2023 and the report for the semiannual period ending June 30, 2023 included expenditures through January 31, 2023 instead of June 30, 2023.Criteria: According to 2 CFR Section 200.327 and the terms and conditions of the federal award, including the Notice of Funding Opportunity (NOFO) for the SAFER grant, Federal Financial Reports (SF-425) were required to be filed for the period July 1 – December 31 by January 30 and for the period January 1 – June 30 by July 30. Cause: The District’s staff did not have enough time to summarize the payroll necessary to include expenditures through the period end specified in the NOFO. Effect: Expenditures reported in the SF-425 were not in compliance with 2 CFR Section 200.327 and the terms and conditions of the SAFER grant. Recommendation: We recommend the summary report of payroll information claimed under the SAFER grant be updated after each pay period and before the end of the next pay period so it is available by the SF- 425 reporting deadline of 30 days after the end of the semi-annual reporting period and recommend the District revise the SF-425 Report for the periods ending December 31, 2022 and June 30, 2023 to report the final accrual basis expenditures used in claims. Management Response and Corrective Action Plan: The District will refile the SF-425 Reports for the semiannual periods ending December 31, 2022 and June 30, 2023 using the accrual basis expenditures claimed. Procedures will be put into place to ensure the payroll is summarized after each pay period so the accrual basis expenses are available for the SF-425 Report and training will be provided to the staff preparing the SF- 425 Report regarding the appropriate basis of accounting to use in the Report. Anticipated Completion Date for Corrective Action: June 30, 2024

Audit Report: Reports on Compliance and Internal Control in Accordance with Government Auditing Standards and OMB Super Circular Uniform Guidance Audit Period: July 1, 2022 – June 30, 2023 Fiscal Year: 2022-2023 Principal Executive: Hon. Rolando Ortiz Velázquez, Mayor Contact Person: Mrs. Eunice Diaz, Finance and Budget Director Phone: (787) 738-3211 Original Finding Number: 2023-005 Statement of Concurrence or Non concurrence: We concur with the finding. Corrective Action: Although the sample selected in relation to the contracts did not contain the required federal clauses, the contracted companies did comply with the main provisions established by 2 CFR Section 200.327 in Appendix II Part 200, such as equal employment opportunity under 41 CFR Part 60, Davis-Bacon Act as amended 40 USC 3141-3148 and the Contract Work Hours and Safety Standards Act 40 USC 3701-3708. Also, for the three contracts, it was reviewed and validated that they had their SAM registration on the day prior to the formalization of the contract and/or disbursement of any payment. However, this situation has already been remedied since the federal clauses required by 2 CFR Section 200 Appendix II Part 200 were and are included in all contracts financed with federal funds. Implementation Date: During fiscal year 2023-2024. Responsible Person: Mrs. Natasha Vásquez Federal Programs Director

FINDING 2023-003 Finding Subject: Special Education Cluster (IDEA) – Procurement, Suspension and Debarment Summary of Finding: Insufficient documentation provided for proof of Procurement and Suspension and Debarment verifications Contact Person Responsible for Corrective Action: Ghirmay Alazar (Procurement) Phyllis Ritenour (Suspension & Debarment) Contact Phone Number and Email Address: 317-845-9400 galazar@msdwt.k12.in.us pritenour@msdwt.k12.in.us Views of Responsible Officials: We concur with the finding Description of Corrective Action Plan: Procurement - At our educational institution, we prioritize the unique leaning needs of our students by actively seeking vendors who can effectively meet our expectations. To ensure transparency and fairness in the vendor selection process, we examine total costs estimates from each vendor and analyze their reputations, experience, customer feedback, and ability to provide innovative solutions. We use this information to make informed decisions and the rationale behind our vendor selection process. When searching for vendors we will keep documentation that displays the cost from each vendor and the rational for selecting a specific vendor. Suspension and Debarment – Beginning July 2024 the Assistant Accounting Manager will run reports annually in July from sam.gov and from FMS and compare the 2 files to make sure that we don’t have vendors in our system that are on the debarment list. The files will then be forwarded to the Accounting Manager via email for review and approval. The approval email and the 2 reports will be saved in our shared drive as proof of file review. All new vendors will be checked in sam.gov before allowing purchases to be placed. The review sheets will be emailed to the Accounting Manager for review and approval, these will also be saved in our shared drive. Anticipated Completion Date: Procurement – December 2024 Suspension & Debarment – July 2024

Type of Finding: Significant deficiency in internal control over compliance relating to inadequate records retained, CCS is at risk of noncompliance with the standards of Procurement. Management accepts the finding. Effective internal control over the documentation of procurement and suspension and debarment, which can be attributed to the documentation not being retained detailing the history of the procurement, including the rationale for the method of procurement, selection of contract type, basis for contractor selection, the basis for the contract price, and suspension and debarment. More thorough training of staff, along with careful supervisory review and documentation of procurement and suspension and debarment would likely have prevented these errors. Corrective action: A organization-wide federal compliance training is being developed and will include a refresher on procurement requirements. In addition, the review process of contracts has been strengthened regarding secondary review of proper procurement documentation.

FINDING 2023-004 Information on the federal program: Subject: Special Education Cluster (IDEA) – Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.027X, 84.173, 84.173X Federal Award Numbers and Years (or Other Identifying Numbers): 19611-022-PN01, 20611-022-PN01, 21611-022-PN01, 22611-022-PN01, 22611-022-ARP, 23611-022-PN01, 20619-022-PN01, 21619-022-PN01, 22619-022-PN01, 22619-022-ARP, 23619-022-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Qualified Opinion Condition: The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the procurement and suspension an debarment requirements. The Cooperative had not designed or implemented adequate policies or procedures to ensure that proper procurement procedures for micro or small purchases were followed. There was no oversight, review, or approval process in place and documented at the Cooperative to ensure proper procedures were followed and price or rate quotations were obtained, if required, or documentation to support limited procurement procedures. Context: The School Corporation is a member of the Greene-Sullivan Special Education Cooperative (Cooperative). During fiscal year 2021-2022 and 2022-2023, the Cooperative operated the special education programs and spent the federal money on behalf of all its members.  As the grant agreements were between the Indiana Department of Education (IDOE) and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. However, there was inadequate oversight performed by the School Corporation in order to ensure compliance with the Procurement and Suspension and Debarment compliance requirement. Procurement Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold, which is set at $250,000 unless a lower, more restrictive threshold is set by a non-Federal entity. As Indiana Code has set a more restrictive threshold of $150,000, informal procurement methods are permitted when the value of the procurement does not exceed $150,000. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds. Micro-purchases, typically for those purchases $10,000 or under, and small purchase procedures for those purchases above the micro-purchase threshold, but below the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive price rate quotations. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. For fiscal year 2022, three vendors, totaling $88,772, were identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $10,000 micro-purchase threshold. One of the three vendors was a bankcard used to pay several different vendors; however, individual determinations of amount spent by vendor could not be determined, and thus it was considered under this threshold. All three vendors were tested. For all three, the Cooperative did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. For fiscal year 2023, six vendors, totaling $264,106, were identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $10,000 micro-purchase threshold. One of the six vendors was a bankcard used to pay several different vendors; however, individual determinations of amount spent by vendor could not be determined, and thus it was considered under this threshold. All six vendors were tested. For five of the six, totaling $252,906, the Cooperative did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Suspension and Debarment Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. “Covered transactions” include but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAMs exclusions, collecting a certification from that vendor, or adding a clause or condition to the covered transaction with that vendor. Upon inquiry of the School Corporation in order to review the procedures in place for verifying that a vendor with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded, the Cooperative disclosed they relied on a clause to be included in the vendor contracts to ensure compliance. Two covered transactions that equaled or exceeded $25,000 were identified. Both transactions, totaling $192,218, were selected for testing. One of the two transactions, totaling $44,883, included the appropriate clause. For the other vendor, the Cooperative did not verify the vendor’s suspension and debarment status prior to payment. The lack of internal controls and noncompliance regarding suspension and debarment were isolated to fiscal year 2023. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and will take the following corrective action: 1 – Southwest School Corporation will ensure a system of internal control and procedures are in place and appropriate procurement procedures for goods and services are followed. 2 – The Cooperative will post any openings that exceed the small purchase threshold in the local newspapers, within the office, and on the cooperative website. Any and all proposals will be presented to the Cooperative Board of Directors for approval. Responsible party and timeline for completion: Chris Stitzle, Superintendent – April 1, 2024

FINDING 2023-006 Information on the federal program: Subject: Special Education Cluster (IDEA) – Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Programs: Special Education Grants to States, Special Education Preschool Grants Assistance Listings Numbers: 84.027, 84.027X, 84.173, 84.173X Federal Award Numbers: 19611-022-PN01, 20611-022-PN01, 21611-022-PN01, 22611-022-PN01, 22611-022-ARP, 23611-022-PN01, 20619-022-PN01, 21619-022-PN01, 22619-022-PN01, 22619-022-ARP, 23619-022-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Qualified Opinion Condition: The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the procurement and suspension an debarment requirements. The Cooperative had not designed or implemented adequate policies or procedures to ensure that proper procurement procedures for micro or small purchases were followed. There was no oversight, review, or approval process in place and documented at the Cooperative to ensure proper procedures were followed and price or rate quotations were obtained, if required, or documentation to support limited procurement procedures. Context: The School Corporation is a member of the Greene-Sullivan Special Education Cooperative (Cooperative). During fiscal year 2021-2022 and 2022-2023, the Cooperative operated the special education programs and spent the federal money on behalf of all its members. As the grant agreements were between the Indiana Department of Education (IDOE) and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. However, there was inadequate oversight performed by the School Corporation in order to ensure compliance with the Procurement and Suspension and Debarment compliance requirement. Procurement Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold, which is set at $250,000 unless a lower, more restrictive threshold is set by a non-Federal entity. As Indiana Code has set a more restrictive threshold of $150,000, informal procurement methods are permitted when the value of the procurement does not exceed $150,000. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds. Micro-purchases, typically for those purchases $10,000 or under, and small purchase procedures for those purchases above the micro-purchase threshold, but below the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive price rate quotations. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. For fiscal year 2022, three vendors, totaling $88,772, were identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $10,000 micro-purchase threshold. One of the three vendors was a bankcard used to pay several different vendors; however, individual determinations of amount spent by vendor could not be determined, and thus it was considered under this threshold. All three vendors were tested. For all three, the Cooperative did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. For fiscal year 2023, six vendors, totaling $264,106, were identified as being less than the simplified acquisition threshold of $150,000, but exceeding the $10,000 micro-purchase threshold. One of the six vendors was a bankcard used to pay several different vendors; however, individual determinations of amount spent by vendor could not be determined, and thus it was considered under this threshold. All six vendors were tested. For five of the six, totaling $252,906, the Cooperative did not obtain price or rate quotes nor was there documentation detailing the history of procurement, which must include the reason for the procurement method used. The lack of internal controls and noncompliance were systemic issues throughout the audit period. Suspension and Debarment Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. “Covered transactions” include but are not limited to contracts for goods and services awarded under a non-procurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the SAMs exclusions, collecting a certification from that vendor, or adding a clause or condition to the covered transaction with that vendor. Upon inquiry of the School Corporation in order to review the procedures in place for verifying that a vendor with which it plans to enter into a covered transaction is not suspended, debarred, or otherwise excluded, the Cooperative disclosed they relied on a clause to be included in the vendor contracts to ensure compliance. Two covered transactions that equaled or exceeded $25,000 were identified. Both transactions, totaling $192,218, were selected for testing. One of the two transactions, totaling $44,883, included the appropriate clause. For the other vendor, the Cooperative did not verify the vendor’s suspension and debarment status prior to payment. The lack of internal controls and noncompliance regarding suspension and debarment were isolated to fiscal year 2023. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and will take the following corrective action: 1 – Northeast School Corporation will ensure a system of internal control and procedures are in place and appropriate procurement procedures for goods and services are followed. 2 – The Cooperative will post any openings that exceed the small purchase threshold in the local newspapers, within the office, and on the cooperative website. Any and all proposals will be presented to the Cooperative Board of Directors for approval. Responsible party and timeline for completion: Mark A Baker, Superintendent Effective April 2024