Corrective Action Plans

Corrective Action: While program and finance staff historically performed certain informal procedures such as checking for debarment and suspension, verifying SAM status, reviewing available audit reports and related findings, and holding meetings or teleconferences with each subrecipient, these steps were not standardized, consistently applied, or formally documented. The Foundation acknowledges that this lack of a formal, documented risk assessment process does not meet the requirements of 2 CFR 200.332(c). To correct this, the Foundation will establish, document, and maintain effective internal control procedures over annual subrecipient monitoring to provide reasonable assurance that subrecipients are managing federal awards in compliance with 2 CFR 220.332 (c). Risk factors to be evaluated and documented annually will include: • Subrecipient’s prior experience with federal awards; • Results and findings from previous Single Audits and Uniform Guidance monitoring; • Verification of subrecipient's debarment and suspension status, and confirmation of the timely receipt of the subrecipient's annual audited financial statements or Single Audit reporting package, as applicable; • Whether the subrecipient has new personnel working on the grant, including leadership or new or substantially changed systems; • The extent and results of any Federal agency monitoring; • Ongoing programmatic and financial progress monitoring, including tracking of required match/cost-share contributions relative to federal expenditures, with follow-up action when match is not being met proportionally or is trending out of compliance with award terms. The risk assessment will be built into the subaward issuance checklist so no future subawardee agreement is executed without a completed and documented risk assessment on file. Name of Contact Person: Kristin Karlin, Controller Projected Completion Date: The Foundation projects the new policy documentation to be completed and the process for internal monitoring documentation to be established and shared with all grant subawardees by December 31, 2026 with all annual grant subawardee risk assessments completed no later than January 31st for the previous year during all relevant grant performance periods.

CAPI USA has developed and implemented formal written subrecipient monitoring procedures, which have been incorporated into the Organization's Financial Handbook. These procedures require verification and documentation that subrecipients are not suspended, debarred, or otherwise excluded from participation in federal programs through review of SAM.gov or other appropriate sources. In addition, the Organization has revised its subaward agreement and related templates to ensure all information required under 2 CFR 200.332(b) is included. The updated subaward agreement has been provided to the current subrecipient for review and execution. To support ongoing compliance with Uniform Guidance requirements, CAPI USA will periodically review its subrecipient monitoring procedures and subaward agreement templates and update them as necessary to reflect regulatory changes and organizational practices. The Financial Handbook and template revisions have been completed as of the date of this corrective action plan. Full implementation of the corrective action will be finalized upon execution of the revised subaward agreement by the subrecipient. The Organization strives to remain compliant with Uniform Guidance in all respects to present both accurate and transparent records. If Minnesota Department of Human Services or U.S. Department of Health and Human Services have questions regarding this plan, please call Mary Niedermeyer, Chief Executive Officer, at 651-392-4069.

Corrective Action Plan • Implementing mandatory risk-based monitoring, including annual risk assessments for all subrecipients, with follow up actions documented. • Adopted standardized monitoring tools, including desk review checklists, on-site review templates, financial reconciliation forms, and CAP follow-up templates. • Conduct staff training for program and fiscal personnel involved in oversight of SSBG-funded subrecipients to ensure consistent understanding and application of monitoring requirements. • Establish an internal compliance review, performed by fiscal management, to confirm monitoring activities are timely, complete, and appropriately supported. Action Date September 4, 2026 Final Implementation Date December 31, 2026 Name And Phone No. Of Person Responsible For Implementation Jennifer Cicero-631-854-9331

Finding 2025-001 Audit Finding: In accordance with 2 CFR § 200.332(a) of the Uniform Guidance, pass-through entities are required to clearly identify to the subrecipient certain information and requirements at the time of the subaward, including federal award identification information, applicable compliance requirements, and additional terms and conditions imposed by the pass-through entity. The agreements should also include the applicable U.S. Department of Transportation and Federal Aviation Administration award terms, conditions, and assurances. The Town executed written subrecipient agreements with Fishers Island Ferry District for $2,401,993 passed through for the Airport Improvement Program (Assistance Listing 20.106), however the agreements contained errors and omitted required information. Recommendation: We recommend that the Town develop and implement procedures to ensure that all subrecipient agreements are reviewed for accuracy and completeness and include all required information specific to the grant award. Corrective Action Plan: In coordination with the Supervisor’s office, Town Attorney’s office, and Comptroller’s office, formal subrecipient agreements will comprise an additional level of review for accuracy and completeness, and include the applicable U.S. Department of Transportation and Federal Aviation Administration award requirements and disclosures. Responsible Individual: Albert J. Krupski Jr., Town Supervisor Benjamin Johnson, Town Attorney Michelle Nickonovitz, Town Comptroller Planned Date of Implementation: Corrective action plan procedures have already been communicated and implemented to ensure that all formal written subrecipient agreements with pass-through entities are reviewed for accuracy and completeness and include all required information specific to the grant award.

Forth and Affiliate respectfully submits the following corrective action plan for the year ending December 31, 2025. Audit: January 1, 2025, to December 31, 2025. The findings from the schedule of findings and the questioned costs are discussed below. The finding is numbered according to the schedule. FINDING - FEDERAL AWARD PROGRAMS AUDITS U.S. Department of Energy, Conservation Research and Development Cluster 2025-001 Subrecipient Monitoring – Non-Compliance and Material Weakness in Internal Control Over Compliance (Partial Repeat of Finding 2024-002) Recommendation: Forth should strengthen its implementation and oversight of its existing subrecipient monitoring policy to ensure that the policy is consistently followed and applied prospectively to all applicable subrecipients. Specifically, Forth should: 1. Apply and document the required risk assessment for all subrecipients, including existing and previously engaged subrecipients, and establish procedures for periodic reassessment as appropriate; 2. Ensure that the results of each risk assessment are documented and used to determine the appropriate nature, timing, and extent of subrecipient monitoring; 3. Maintain complete and accurate documentation of subaward information and ongoing monitoring activities, including meetings, technical assistance, performance reviews, follow-up, and resolution of identified issues; and 4. Establish management review and other internal controls to verify that the subrecipient monitoring policy is consistently implemented, documented, and applied to all applicable federal subrecipients. Management should also perform a review of existing subrecipient files to identify and remediate instances where required risk assessments, monitoring documentation, or other award documentation were not completed in accordance with the established policy. Explanation of disagreement with audit findings: There is no disagreement with the audit findings. Action Plan: We agree with the auditor's comments. Forth made meaningful improvements to subrecipient monitoring in FY2025, including establishing a documented monitoring policy, a risk assessment process for new subawards, and inclusion of required federal award information in subaward agreements. To fully resolve this finding, Forth will complete the following in FY2026: • Apply and document a formal risk assessment for all subrecipients with subaward agreements active during FY2026, including those previously engaged prior to the current risk assessment process - target completion December 31, 2026. • For subrecipients whose awards closed prior to FY2026, complete a lighter-touch closeout review confirming there are no open compliance issues or unresolved audit findings, so that all subrecipients affected by this finding are documented as addressed - target completion December 31, 2026. • Formalize a written process linking each subrecipient's risk assessment results to a defined monitoring plan - target completion December 31, 2026. • Implement a standard monitoring log/template to formally document ongoing monitoring activities for every subrecipient on a rolling basis - target completion December 31, 2026. • Establish a semi-annual management review to confirm the monitoring policy is being consistently applied across all subrecipients - first review by December 31, 2026. Name(s) of the contact people responsible for corrective action: Gina Avalos-Limardo, Senior Director of Finance & Operations and Aleda McMonagle, Senior Operations Associate Plan completion date for corrective action plan: December 31, 2026

Management of Sunrise Community for Recovery and Wellness, Inc. will revise the subrecipient MOU template to include the federal award identification information required by 2 CFR 200.332 and will implement a documented review process to ensure completeness before agreements are executed. Management will also evaluate existing subrecipient MOUs and issue amendments or supplemental award notifications, as necessary, to communicate missing federal award information.

All Chicago will: • Develop and implement a standardized pre-award Risk Assessment Questionnaire and scoring matrix. • Develop and implement an official Subrecipient Monitoring Policy that mandates risk scoring before any subaward agreement is fully executed. • Draft and formally adopt procedures requiring a suspension and debarment check via SAM.gov or an alternative verification method for all subrecipients on federal awards. • Obtain, review, and document All Chicago’s internal review of a subrecipient’s single audit report. • Conduct mandatory training sessions for all staff involved in subaward administration regarding this compliance requirement. • Complete a retroactive assessment on active subrecipients.

2025-002 – Subrecipient Monitoring Corrective action plan: 1. The subaward template was corrected in September 2026 and is in use. The corrected form was used for the subaward executed September 18, 2026 and carries the full set of federal award identification elements required by 2 CFR 200.332(b)(1). 2. Obtain the current unique entity identifier for each subrecipient from SAM.gov and confirm it against subrecipient records. 3. Issue Modification No. 1 to each of the seven Round 1 subaward agreements, adding the Assistance Listing Number and title, the subaward budget period start and end dates, and the unique entity identifier where it was omitted, and issue an amended award notification supplying the same information for the Round 1 award made by award letter. Article IV, Section 6.11 of each subaward agreement permits NFEAIE to issue non-substantive modifications unilaterally in writing, so issuance is not contingent on subrecipient countersignature. Each modification will be transmitted to the subrecipient's authorized official and fiscal contact by email and the transmittal retained in the subaward file. 4. Issue Modification No. 1 on the same basis to Round 2 subawards R201 through R206, which were executed on the prior template. 5. Adopt a written subaward issuance procedure incorporating a checklist of the information required by 2 CFR 200.332(b)(1), completed, signed, and retained in the subaward file before execution, with CFO review of the executed instrument required before any disbursement. Personnel responsible for corrective action: Nicholas Cunningham, CFO Estimated corrective action completion date: November 30, 2026

The County will download the sam.gov page for each subrecipient prior to issuing subawards for proof of verification.

Management agrees with the finding. Management will spend additional time reviewing CFR Part 200 for familiarization. Policy templates will also be reviewed, and assistance will again be requested to develop/finalize the necessary policies in accordance with Uniform Guidance. Policies will be reviewed and approved by the Board regularly.

The Franklin County Department of Jobs and Family Services (FCDJFS) will revise its internal processes by or before July 1, 2026, to ensure proper communication of all referral, program, and documentation requirements. The FCDJFS Management Team members will be trained on the revised internal procedure by August 1, 2026. In October, FCDJFS will be having an additional training at its full managers meeting to go over the revised procedure.

A Corrective Improvement Plan (CIP) has been submitted, and the subrecipient is actively working to complete the outstanding annual audits for fiscal years 2019 through 2025. Additionally, the current risk assessment process is being revised to place greater emphasis on the completion of required annual audits for the preceding year. If an audit has not been completed when applicable, the subrecipient will be classified as high risk. As a result, the subrecipient will be subject to an annual monitoring review conducted by our monitoring team.

Finding 2025-001 – Subaward Documentation and Subrecipient Monitoring-Corrective Action Completed or In Progress: • In September 2026, SI2 completed documented risk assessments for five subrecipients using a form addressing the factors in 2 CFR 200.332(c), and documented its cost-share review process in a written narrative. SI2 will complete the assessments for the remaining subrecipients, prepare an assessment at the time of each new subaward, and update assessments as circumstances change. • SI2 will execute a formal subaward agreement with Kearns & West for the SUDS engagement, in the form used for the SEEDS subawards, and will adopt a standard subaward template and execution checklist for all future subawards. • SI2 will perform and retain evidence of the monitoring activities (invoice review and approval, determination of applicable subrecipient audit requirements and verification of compliance with those requirements, including review of Single Audit reports when applicable) beginning with fiscal year 2026. • SI2 will expand its Accounting Policies and Procedures Manual to specify how subrecipient monitoring activities are performed, documented, and retained.

Corrective action planned: Community-Minded Enterprises (CME) agrees with the finding and has implemented a formal Subrecipient Risk Assessment and Monitoring Policy and related procedures to strengthen its subrecipient oversight process and ensure compliance with 2 CFR §200.332. Under the new policy, CME will conduct and document a risk assessment prior to executing a subaward. The assessment evaluates factors including prior experience with similar awards, financial stability, audit and monitoring history, internal controls, management or staffing changes, prior corrective actions, fraud risk indicators, and SAM/debarment status. Each subrecipient will be assigned a documented risk rating of Low, Moderate, or High, and the results of the assessment will determine the appropriate level and frequency of monitoring throughout the subaward period. CME has also established defined responsibilities for risk assessment, financial review, program monitoring, compliance oversight, and documentation. Risk assessments and related monitoring documentation will be maintained as part of the subrecipient file to demonstrate compliance with federal requirements. Anticipated completion date: October 1, 2026 Contact person responsible for corrective action: Director of Risk & Compliance, Finance, and applicable Program Director

Action taken in response to finding: The County will review the subrecipient monitoring requirements and work with the County Auditor to develop a formal policy that includes internal controls, monitoring procedures, and documentation requirements.

CORRECTIVE ACTION PLAN FOR FINDINGS REPORTED UNDER UNIFORM GUIDANCE Spokane Conservation District January 1, 2025 through December 31, 2025 This schedule presents the corrective action planned by the District for findings reported in this report in accordance with Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Finding ref number: 2025-001 Finding caption: The District did not have adequate internal controls for ensuring compliance with federal subrecipient monitoring and suspension and debarment requirements, and it did not comply with federal suspension and debarment requirements.Name, address, and telephone of District contact person: Cori Turntine, Operations Director 4422 E 8th Avenue, Spokane Valley, WA 99212 (509) 535-7274 Corrective action the auditee plans to take in response to the finding: The District concurs with Finding 2025-001. The District acknowledges that although staff performed searches of the Federal Audit Clearinghouse for both subrecipients and were aware of the suspension and debarment requirements, the District did not retain documentation demonstrating these verifications, as required by 2 CFR 200.303 and 2 CFR 200.332. The District has taken the following corrective action: Subrecipient Monitoring: District staff performed searches of the Federal Audit Clearinghouse for both subrecipients during the audit period; however, documentation of those searches was not retained. The District has since followed up in writing with both subrecipients and obtained written confirmation that neither subrecipient exceeded $1,000,000 in federal expenditures during fiscal year 2025 and that neither expects to exceed the single audit threshold in fiscal year 2026. This written correspondence is retained in the subaward files. Going forward, all subrecipient monitoring activities - including Federal Audit Clearinghouse searches, single audit determinations, follow-up on audit findings, and management decisions - will be documented and retained in each subaward file at the time the verification is performed. Suspension and Debarment: The District concurs that documentation was not retained for the suspension and debarment verification of the contractor paid $185,998 in federal funds. The contractor was subsequently verified as not suspended or debarred, and no further contracting activity occurred under the affected award. The District has implemented controls requiring verification of suspension and debarment status (via SAM.gov exclusion checks, written certification, or contract clause) before entering into any contract or purchase expected to equal or exceed $25,000, paid in whole or in part with federal funds, consistent with 2 CFR 200.214 and 2 CFR Part 180. Documentation of each verification is retained in the procurement file at the time of award. Project Management System: To provide sustained assurance and to address both components of this finding, the District is implementing a project management system with automated reminders and checklists covering the full life cycle of federal awards, subawards, and procurements. Training: Suspension and debarment and subrecipient monitoring requirements will be incorporated into the District's annual contract and procurement training for all relevant staff. Anticipated date to complete the corrective action: 12/31/2026

After conducting a review of our existing subawards, TTCD will continue implementation of our revised subrecipient monitoring policies and ensure that monitoring procedures are performed and documented for all current and future subawards and well as ensuring those monitoring requirements are communicated to the subrecipient. Monitoring activities should include review of financial and performance reporting, verification of Single Audit requirements, review of applicable audit reports, and documented follow-up of audit findings when required.

Management agrees with the finding. Management will spend additional time reviewing CFR Part 200 for familiarization. Policy templates will also be reviewed, and assistance will again be requested to develop/finalize the necessary policies in accordance with Uniform Guidance. Policies will be reviewed and approved by the Board regularly.

Finding: Subrreceipient Monitoring Assistance Listing Number: 10.698 - State and Private Forestry Cooperative Fire Assistance Cause: Management indicated that documentation supporting completion of monitoring activities and related communications could not be located due to turnover of personnel responsible for administering and documenting subrecipient monitoring procedures. Auditor Recommendation: We recommend management strengthen procedures for retaining subrecipient monitoring documentation and establish controls to ensure monitoring activities are consistently documented and maintained, including during personnel transitions. Management's Views: Management agrees with the finding and has implemented the accompanying corrective action plan. Views of Responsible Officials: Jacy Hyde, Executive Director Jessica Martinez, Deputy Director Julia Marsili, Associate Director, Wildfire Programs & Grants Contact Person: Jessica Martinez Corrective Action Taken: California Fire Safe Council (CFSC) agrees with the finding and recommendation. Since the audit period, CFSC has significantly strengthened its organizational structure, subrecipient monitoring and compliance procedures, and the documentation and retention of monitoring activities. CFSC began increasing management capacity within its Programs and Grants team in 2025 through the addition of two dedicated Program Manager positions, hired in June and July 2025. One Program Manager provides oversight of federal and private grant programs, while the other is responsible for the oversight of state-funded grant programs. These positions increased management-level capacity for programmatic oversight, grant administration, compliance and subrecipient monitoring. In July 2025, all CFSC grant staff participated in a Subrecipient Monitoring Training, which reinforced subrecipient monitoring best practices, required forms, documentation standards, and file retention requirements. CFSC also built and adopted a Grants and Programs System (GAPS) subgrant monitoring tool in August 2026. This tool allows grant staff to track all communication touchpoints with subrecipients and receive automated reminders for monitoring actions and deadlines for subrecipient requests. CFSC’s Subrecipient Monitoring policy establishes formal responsibility and procedures for subrecipient monitoring, including pre-award risk assessment, ongoing review of programmatic and financial performance, review of required reports and deliverables, expense to budget monitoring, documentation of monitoring activities, and follow up on identified compliance concerns. CFSC has also implemented standardized controls to support these monitoring procedures. The Subrecipient Invoice Review Checklist requires grant staff to review relevant risk assessment and monitoring information prior to processing payment; verify the subaward period of performance and available funding; review expenditures against the approved budget; verify indirect costs, cost share, and supporting documentation; assess whether expenditures are reasonable and consistent with program activities; and hold payment and seek management direction when information is insufficient. CFSC’s Subaward Agreement Policy & Procedures further requires subaward agreements to establish applicable reporting requirements, performance monitoring expectations, compliance requirements, and audit requirements at the outset of each subaward. In September 2026, CFSC further strengthened the Programs and Grants organizational structure by elevating the senior grants leadership (formerly the Senior Wildfire Programs & Grants Manager) to the Associate Director level and assigning Program Managers formal supervisory responsibility for Grants staff. These changes provide clearer accountability and increased management capacity for ensuring required subrecipient monitoring activities are completed, appropriately documented, reviewed, and maintained within organizational grant records. CFSC has also strengthened its compliance and monitoring protocols and documentation practices, as described in CFSC’s Subrecipient Monitoring Policy, last updated in September 2025. Subrecipient monitoring documentation and related communications are maintained within CFSC's organizational grant records in SharePoint file and within each subrecipient’s profile within ZoomGrants. This reduces reliance on individual staff’s records or institutional knowledge. Together, these changes provide greater continuity, oversight, and accountability and help ensure that required monitoring documentation remains complete and accessible during personnel transitions. Additionally, records are retained in accordance with CFSC’s Records Retention, Access and Privacy Policy, which establishes records-retention requirements applicable to CFSC’s finance and program records and includes specific requirements governing federal awards and subrecipient records. CFSC retains financial records, supporting documentation, program documents, and other records pertinent to federal grant awards for the required retention period of at least three years following the date of submission of CFSC’s final financial report for any particular grant, or longer when required to due audits, claims, litigation, award requirements, or other applicable Exceptions. CFSC believes these actions address the condition and underlying cause identified in Finding 2025-001 by strengthening management oversight and accountability, formalizing subrecipient monitoring training and tools, and reducing reliance on individual staff members for institutional knowledge and recordkeeping. Corrective Action Status: Implemented Completion Date: September 2026

Views of Responsible Officials: While BCHC did not have separate policies for subrecipients and subcontractors, all subs (regardless of category) were monitored by appropriate BCHC staff, which included routine check in meetings and review of deliverables and invoices associated with those deliverables. BCHC understands the need to have clear, distinct policies and processes for subrecipients and subcontractors and has revised existing policies and checklists and created new ones specific to subrecipients.

State of Missouri Single Audit Corrective Action Plan Year Ended June 30, 2025 State Agency: Missouri State Emergency Management Agency Audit Finding Number: 2025-014 – SEMA Subrecipient Monitoring Name of the contact person responsible for corrective action: Nikol Enyart Anticipated completion date for corrective action: Completed Corrective action planned is as follows: Since the discovery of the shortfall in the monitoring of subrecipients, SEMA has taken action to get the program back on track. SEMA has maintained forward momentum in completing the risk assessments within the time dictated by the policy. SEMA has completed all desk monitoring reports for the medium-risk subrecipients and all site visits for high-risk subrecipients. SEMA has also crosstrained multiple employees in the steps and processes to achieve high output for this process. SEMA has created a separate tracker to focus directly on the desk monitoring and site visits that have been completed or still need to be completed. This tracker is monitored by the Deputy Recovery Division Manager. SEMA also generates reports on the 15th and 30th of each month outlining progress made during those two weeks, which are submitted to the Recovery Division Manager. This report was first created and submitted on January 31, 2025.

State of Missouri Single Audit Corrective Action Plan Year Ended June 30, 2025 State Agency: Office of Administration Audit Finding Number: 2025-009 - SLFRF Program Subrecipient Monitoring Name of the contact person responsible for corrective action: Stacy Neal Anticipated completion date for corrective action: Already Completed Recommendation A: Continue to work with the state agencies to ensure documented determinations are prepared to determine whether all recipients of SLFRF program funds are subrecipients or contractors. OA agrees with the auditor’s finding. Corrective action has already been accomplished. After receiving the FY24 audit finding in FY26 (specifically September 30, 2025), OA established Memorandums of Understandings (MOU) in November of 2025 with partner agencies. These MOUs clarify the definition of a subrecipient as provided in 2 C.F.R § 200.1 and delineate responsibilities for making and documenting subrecipient versus contractor determinations. Because these corrective actions are already complete, OA considers this a timing-related finding. Because these corrective actions are already complete, OA considers this a timing-related finding. Recommendation B: Develop policies and procedures outlining pre-payment monitoring procedures and document monitoring performed prior to making payments. The OA should also continue to ensure subrecipient monitoring tasks delegated to state agencies are adequately communicated. Procedures should be established to ensure subrecipient monitoring procedures are appropriately completed in accordance with the Uniform Guidance, including performing risk assessments for each subrecipient, monitoring for compliance with federal requirements and subaward terms and conditions, and ensuring subaward goals and objectives are achieved. OA agrees with the auditor’s finding. Corrective action has already been accomplished. After receiving the FY24 audit finding in FY26 (specifically September 30, 2025), OA established Memorandums of Understandings (MOU) in November of 2025 with partner agencies to ensure agencies understood their responsibilities for subrecipient monitoring included subrecipient specific risk assessments and monitoring. Because these corrective actions are already complete, OA considers this a timing-related finding.

State of Missouri Single Audit Corrective Action Plan Year Ended June 30, 2025 State Agency: Department of Health and Senior Services Audit Finding Number: 2025-011 - CACFP Subrecipient Monitoring Name of the contact person responsible for corrective action: Sarah Walker, Administrator, Bureau of Community Food and Nutrition Assistance (BCFNA), Division of Community and Public Health Anticipated completion date for corrective action: Not Applicable The Missouri Department of Health and Senior Services (DHSS) disagrees with this finding because the BCFNA subrecipient monitoring, claim recoupment and risk assessment procedures comply with the U.S. Department of Agriculture (USDA), the federal funding agency. In addition, the similar fiscal year 2023 audit finding was closed by the USDA after reviewing DHSS’s corrective action plan and supporting documentation. The SAO stated, “While our review found the sample monitoring reviews were performed in accordance with the policies and procedures outlined in the Internal Nutritionist Manual, we identified areas where these policies and procedures could be strengthened and improved to ensure facilities/sponsors comply with program requirements and submit proper claims.” The SAO is holding DHSS to higher performance audit standards instead of Single Audit compliance audit standards as well as to higher standards than required by federal guidance and regulations. The SAO’s stated, “In May 2024, when the BCFNA changed the risk assessment and scoring system, the BCFNA ceased assigning a grade of A, B, B-, or C to each review and widened the score ranges and associated review requirements. DHSS officials indicated the scores assessed by the new system are frequently higher than those assessed under the previous manual system. The impact of these changes on the frequency and effectiveness of the monitoring reviews is unclear.” While working with the software provider during the development, testing, and implementation stages over the course of several years, the new point range was thoroughly reviewed prior to implementation. This ensured reviews are classified appropriately for risk categories. The new system provides a monitoring process more stringent than USDA requirements. All monitoring is reviewed by supervisory staff to ensure a comprehensive assessment. During testing, it was found that the new system frequently returned a higher point level, as every finding now results in a point. The increased score range was required to more precisely reflect monitoring reviews and reflects an even more stringent monitoring process than is required by USDA. The SAO reported “….BCFNA only identifies and seeks recoupment for the overclaims made during the test month.” As noted in previous CAPs, BCFNA pursues recoupment of overclaims of only the test month per USDA requirements, although when warranted, additional reviews are conducted beyond the test month. In addition, BCFNA officials pursue recoupment of overclaims for facilities/sponsors with terminated contracts on a case-by-case basis, taking into consideration various factors. The USDA established an acceptable level of risk with respect to the CACFP program and provided approved risk management processes and requirements. The previous and current risk assessment processes are in compliance with federal requirements. BCFNA has a structured risk assessment process that informs its monitoring extent and frequency, which leads to subrecipients being monitored more frequently than every three years as required by the USDA. The USDA is aware of the risk assessment process used by BCFNA and did not require any changes to the process after the previous three similar findings by the SAO. As stated in previous CAPs on similar findings, the DHSS is in compliance with USDA guidelines and requirements for CACFP and implementing the SAO’s recommendations would cause undue burden on the participants and providers of this program which USDA warns against. In addition, the SAO applied the same testing methodology and error projection approach to determine materiality for this finding as it did for finding 2025-010. Accordingly, DHSS maintains the same position and arguments previously presented.

Financial Statement Finding: 2025-002 Significant Deficiency in Internal Control over Subrecipient Monitoring Name and Contact Person: Pete Kelly, Chief Executive Officer Corrective Action: A process is being developed to ensure that the review performed is properly documented and retained for all subawardee’s risk assessments through reviewing their status via sam.gov. Proposed Completion Date: March 2027

The BoatU.S. ADVs contract will be amended for fiscal year 2026 contracts to include the ALN, and the need for a Single Audit for subrecipients that expend over $1,000,000 in federal funding in their given fiscal year. BoatU.S. will implement stricter deadlines for subrecipients to submit their biannual reports in 2026. Progress monitoring will be done throughout the year and documented by BoatU.S. personnel. This should also include project cost documentation of the subrecipient is used for authorized purposes. These reports may need to include photos of the tasks completed, if necessary. BoatU.S. plans to only reimburse for progress costs as incurred by the subrecipient.