Corrective Action Plans

2024-015 Oregon Department of Human Services/Oregon Health Authority Strengthen review over direct costs charged to the program Management Response: We agree with this recommendation. Interest related to past due amounts will be charged to general funds only. Expenditures will be reviewed both by staff and approving parties to ensure only allowable expenditures are charged to the federal grants. The questioned costs of $68 will be refunded and reported to CMS on the CMS 64. The agency will ensure that future contracts that include any incentive funds for surveys will be structured such that incentives are billed under separate coding that will be charged to general funds only. The questioned costs of $28,801 will be refunded and reported to CMS on the CMS 64 Anticipated Completion Date: April 30, 2025 Contact person: Jennifer Stallsworth, Chief of Staff, ODHS APD, April Gillette, OHA Medicaid Division, Strategic Operations & Improvement Director

2024-014 Oregon Department of Human Services/Oregon Health Authority Implement control procedures around cost allocation system inputs Management Response: We agree with this recommendation. The Office of Financial Services will review the existing controls in Cost Allocation system and identify areas that need additional or new control procedures to ensure system inputs are appropriately identified and processed. In addition, we will review the noted errors and make appropriate corrections. Anticipated Completion Date: June 30,, 2025 Contact person: Jennifer Stallsworth, Chief of Staff, ODHS APD, April Gillette, OHA Medicaid Division, Strategic Operations & Improvement Director

2024-015 Oregon Department of Human Services/Oregon Health Authority Strengthen review over direct costs charged to the program Management Response: We agree with this recommendation. Interest related to past due amounts will be charged to general funds only. Expenditures will be reviewed both by staff and approving parties to ensure only allowable expenditures are charged to the federal grants. The questioned costs of $68 will be refunded and reported to CMS on the CMS 64. The agency will ensure that future contracts that include any incentive funds for surveys will be structured such that incentives are billed under separate coding that will be charged to general funds only. The questioned costs of $28,801 will be refunded and reported to CMS on the CMS 64 Anticipated Completion Date: April 30, 2025 Contact person: Jennifer Stallsworth, Chief of Staff, ODHS APD, April Gillette, OHA Medicaid Division, Strategic Operations & Improvement Director

2024-014 Oregon Department of Human Services/Oregon Health Authority Implement control procedures around cost allocation system inputs Management Response: We agree with this recommendation. The Office of Financial Services will review the existing controls in Cost Allocation system and identify areas that need additional or new control procedures to ensure system inputs are appropriately identified and processed. In addition, we will review the noted errors and make appropriate corrections. Anticipated Completion Date: June 30,, 2025 Contact person: Jennifer Stallsworth, Chief of Staff, ODHS APD, April Gillette, OHA Medicaid Division, Strategic Operations & Improvement Director

Dear Mr. Waguespack: The Department of Children and Family Services (DCFS) has received the finding titled “Control Weakness and Noncompliance Related to Cost Allocation Process" and appreciates the opportunity to provide this response to your office's finding. Finding: The Department of Children and Family Services did not have adequate controls in place to ensure the correct allocation of expenditures in accordance with the Cost Allocation Plan, which assigns costs to federal programs. Recommendation: DCFS should strengthen internal controls over the cost allocation review process. DCFS Response: DCFS concurs with the LLA's finding and recommendation. Corrective Action Plan: DCFS's Division of Management and Finance has implemented a corrective action plan aimed at addressing the identified issue and strengthening internal controls. 1. Internal Procedure Revisions: The Division of Management & Finance has trained relevant stakeholders on proper cost allocation procedures, emphasizing compliance with federal regulations and accurate reporting. Additionally, internal procedures have been revised to strengthen the review process, ensuring expenditures are correctly allocated in accordance with the Cost Allocation Plan. 2. Strengthening Internal Controls & Ongoing Monitoring: To prevent recurrence, the Cost Allocation team has implemented a more rigorous review process for cost allocation supporting documentation. This includes, but is not limited to, generating a LaGov report during the three-day fiscal month close to proactively identify any expenditures incorrectly allocated to a closed grant. This step will ensure a real-time review process, allowing errors to be detected and corrected promptly. DCFS acknowledges the importance of accurate cost allocation to ensure compliance with federal regulations and the proper distribution of expenditures across programs. Strengthening our internal controls and reviewing processes remains a top priority to prevent misallocations. Should you require additional information, please contact Christopher Bahm at Christopher.Bahm.DCFS@la.gov or (225) 219-0536.

Lower East Side Tenement Museum will adopt written policies and procedures, and standards of conduct as required by 2 CFR 200, Subparts D and E.

Views of Responsible Officials and Planned Corrective Action: Moving forward the Department will require recipients to provide a list of invoices with the invoice date, period of performance, invoice amount and amount requested/disbursed from ARPA and/or other funding sources to be included with each disbursement request. Staff training will be modified to ensure staff understand allowable expenditures and period of performance restrictions. Anticipated Completion Date: June 30, 2025 Contact Person: Debby Dickson Water Development Division Manager Arkansas Department of Agriculture-Natural Resources Division 1 Natural Resources Drive Little Rock, AR 72205 (501) 225-1598 Debra.Dickson@agriculture.arkansas.gov

Views of Responsible Officials and Planned Corrective Action: The Arkansas Department of Education (ADE), Division of Elementary and Secondary Education (DESE), Health and Nutrition Unit (HNU), concur with the finding. The HNU Finance staff implemented procedures for meal claim payment requests which include an initial and final review of all requests to be conducted by two (2) staff. The review process includes, but is not limited to, ensuring expenditures are assigned correct codes related to the appropriate funding source within the appropriate grant year, mitigating the Child Nutrition Program (CNP), Child and Adult Care Food Program (CACFP) Sponsor Administrative expenditure errors going forward. When the request is determined to be compliant, the Associate Director of Finance and Training approves payments before being forwarded to the ADE Finance team for payment. Anticipated Completion Date: March 15, 2025 Contact Person: Sheila Chastain Associate Director Arkansas Department of Education, DESE, Nutrition Services #4 Capitol Mall, Box #12 Little Rock, AR 72201 (501) 324-9502 Sheila.Chastain@ade.arkansas.gov Pamela Burton Director Arkansas Department of Education, DESE, Nutrition Services #4 Capitol Mall, Box #19 Little Rock, AR 72201 (501) 320-8978 Pamela.Burton@ade.arkansas.gov

Management’s Response: The Finance team of Financial Controller and Senior Accountant are responsible for the reconciling grant revenue, grant receivables and unearned revenue accounts monthly. Proper monitoring and accurate documentation of COVID-19 related activities, including any and all expenditures will be tracked, properly documented and reconciled. Training and monitoring of grant activity will continue in fiscal year 2025. This will be completed by September 30, 2025. Estimated Completion Date: September 30, 2025 Responsible Position: Brochelle Shirley, Financial Controller, and Dawn Bowens, Senior Accountant

Over the past year, CAPNC has continued to make significant improvements to its fiscal practices, particularly in navigating the software conversion from an archaic, unsupported system to Sage Intacct. This new software has modernized and deployed the levels of internal controls that were previously missing due to inadequate fiscal personnel oversight and technical capability. Current staff have been trained under Sage Intacct and Wipfli consultants to properly track accounts payable (A/P), accounts receivable (A/R), payroll, and grant management, ensuring data integrity and compliance. Resulting journal entries are in place to bring system in alignment and current as of July 2024, alleviating any further discrepancies related to past staff and old software. The old system will be archived as required under retention. To further stabilize and formalize these improvements, a Certified Public Accountant will be added as a consulting CFO. This role supports the ongoing development of fiscal operations. Additionally, it is recognized that the payroll vendor, ADP, was initially slow to address issues with uploaded data when notified by CAPNC, responded officially after CAPNC alerted repeatedly that it had now elevated to an audit issue. This issue has since been remedied. Staff have shown marked improvement over previous legacy staff in documentation, accountability, and monitoring. Payroll services in general are able to provide real-time features and accountability for time, resulting in more accurate, reliable, and allocable time recording. Payroll records are reviewed, and time studies are performed for all staff to ensure the allocation methodology is appropriate, consistent, and aligned with staff performance. Wipfli Consulting is providing technical assistance over an additional contract period to update policies and procedures for the fiscal area, in accordance with Uniform Guidance, and allow for advance reporting, as well as provide CPA support. The curriculum includes comprehensive training for all administrative leadership staff, covering fiscal oversight, grants management, and compliance. Allocations are regularly reviewed by the leadership team to ensure appropriate methodology and consistency with grant expectations and regulations. Board members have access to the accounting software through a Board portal for further oversight, enhancing transparency and accountability. Review of finance in conducted monthly by Board of Director’s Finance Committee.

FINDING 2024-003 Finding Subject: Title I Grants to Local Educational Agencies - Earmarking Summary of Finding: Material Weakness, Other Matters The School District is required to set aside a reasonable amount of funds to meet the needs of the homeless population in the school community. These funds cannot be used for any other purpose than the needs of the homeless population. At the end of the grant period, unspent funds must be carried forward to the next grant year. If the school district meets the obligation of attempting to spend the homeless set-aside funds, the funds may be carried over into the general Title I award for the next grant. The funds are not required to go back into the homeless reservation. The 2021-2022 grant award homeless reservation was $8,600. The School Corporation did not spend any of these funds, but was determined to have met their obligation based on documentation provided. The School Corporation did not provide evidence that the $8,600 was carried over to the next school year. However, it was determined that $276 of the $8,600 was used inappropriately in the current school year for other Title I, Part A activities, and not for the needs of the homeless student population. This noncompliance and lack of internal controls was isolated to the 2022-23 school year. Contact Person Responsible for Corrective Action: Kari Dyer Contact Phone Number and Email Address: (574)825-9425; dyerk@mcsin-k12.org Views of Responsible Officials: The School District concurs with this finding. Homeless Reservation funds should only be used for the needs of the homeless student population. Description of Corrective Action Plan: The School District is implementing new monitoring procedures for the Title I Fund to verify unspent funds for the Homeless Reservation are not used for any other Title I expenses. After the 2022-23 school year, the School District changed the way in which it expends the Homeless Reservation by utilizing these funds for salary and benefits of a Homeless Laision. Monitoring these expenditures requires dual signature approvals by the Business Assistant and the Title I Program Director prior to being released. Anticipated Completion Date: Immediate

CORRECTIVE ACTION PLAN FISCAL YEAR OF FINDING: June 30, 2024 AUDITOR FINDING: 2024‐001 Finding: Allowable Costs and Allowable Activities Certain cost principles were not consistently applied to all expenses. The Organization received a grant for the purpose of expanding electronic health record systems, which ended in February of 2024; however, the contracted vendor had not completed work for which the grant funds had been appropriated within the 120 day grant close out period. The Organization did not have adequate internal controls in place to ensure cost principles under Uniform Guidance were consistently applied. The Organization should coordinate with HRSA to determine allowability of expenditures incurred. The Organization should add internal controls to monitor that cost principles under Uniform Guidance are consistently applied. PLANNED ACTION: The project period for the HRSA Optimizing Virtual Care (OVC) grant ended on February 28, 2024. The project in question relied heavily on a contract agreement to implement a new Electronic Health Record (EHR) system. The original timeline called for implementation to be complete by January 1, 2024, well within the project period. Due to unforeseen circumstances, the EHR launch date was delayed several times until a confirmed completion date of January 28, 2025 was established. The project scope was fully defined by the contract in place and that contract was paid in full prior to the end of the project period with the OVC funds. The organization has worked with HRSA to determine the best course of action. In addition, training was conducted with the responsible staff to ensure adequate knowledge of federal contract compliance requirements and the appropriate application of “no‐cost extension” requests. Modifications to the internal control procedures regarding federal grant expenditures are under review and will be updated no later than January 31, 2025. RESPONSIBLE PARTY: Ryan Pierce, VP of Finance COMPLETION DATE: January 31, 2025

Finding 2024-002 Lack of Internal Control / Noncompliance over Activities Allowed or Unallowed and Allowable Costs/Cost Principles Name of Contact: Elena Begojevic, Business Manager Corrective Action Plan: Management will ensure that the system of internal controls over cash disbursements is designed appropriately and operates effectively to ensure all transactions are coded, reviewed, and approved before payment is made. The Business manager and the Superintendent will conduct a review of claims to determine whether they are proper and valid charges. Once reviewed, all transactions will be authorized. DocuSign will be used for electronic signature approval. The accounts payable clerk will ensure that all transactions include copies of receipts for the goods or services purchased. Finally, the Finance department will work with the program directors to ensure that expenses are coded accurately and within a reasonable timeframe to allow for timely submission of grant reports. Proposed Completion Date: Fiscal Year 2025

Recommendation We recommend a verification process be established to ensure accuracy in manual journal entries and to prevent the occurrence of duplicate recordings. Regular reconciliations should be enhanced and additional review steps should be incorporated during the financial close process to identify and correct errors promptly. Furthermore, future Federal Financial Report should take this error into account to accurately reflect cumulative expenditures. Management Response Corrective Action: Four Corners REC has added additional verification processes to ensure the accuracy of manual journal entries to prevent duplicate entries. Reconciliations will be done timely and accurately with added steps. Additional reviews will be done during financial closing and future federal expenditure reporting has been corrected. Due Date of Completion: Completed as of September 9, 2024 Responsible Party(ies): Finance Director

Name of Contact Person: Elena Begojevic, Business Manager Corrective Action Plan: Human resources manager will collaborate with both a business manager and a grant manager to ensure that employees’ time is being charged to the correct programs and grants in accordance with approved budgets. The human resource manager will prepare a payroll action form that will list available and applicable funding sources to cover the payroll expenses of an employee. The independent payroll contractor will maintain payroll action notices (PAN) for employees who are covered by multiple funding sources or funding sources other than general fund. In addition, she would update payroll distribution coding in the accounting software to match PAN. She would also match coding on timesheets with coding on PAN and in the accounting software. In case of a discrepancy, she would reach out to a business manager and/or a grant manager on how to resolve it. The Superintendent will review account coding each payroll while performing a review of the payroll check register. In addition, budgeted account codes will be compared to the actual codes being used in payroll on a periodic basis. Proposed Completion Date: Implemented July 1, 2024

Name of Contact Person: Elena Begojevic, Business Manager Corrective Action Plan: Human resources manager will collaborate with both a business manager and a grant manager to ensure that employees’ time is being charged to the correct programs and grants in accordance with approved budgets. The human resource manager will prepare a payroll action form that will list available and applicable funding sources to cover the payroll expenses of an employee. The independent payroll contractor will maintain payroll action notices (PAN) for employees who are covered by multiple funding sources or funding sources other than general fund. In addition, she would update payroll distribution coding in the accounting software to match PAN. She would also match coding on timesheets with coding on PAN and in the accounting software. In case of a discrepancy, she would reach out to a business manager and/or a grant manager on how to resolve it. The Superintendent will review account coding each payroll while performing a review of the payroll check register. In addition, budgeted account codes will be compared to the actual codes being used in payroll on a periodic basis. Proposed Completion Date: Implemented July 1, 2024

Name of Contact Person: Elena Begojevic, Business Manager Corrective Action Plan: Management will ensure that the system of internal controls over cash disbursements is designed appropriately and operates effectively to ensure all transactions are coded, reviewed, and approved before payment is made. The Business manager and the Superintendent will conduct a review of claims to determine whether they are proper and valid charges. Once reviewed, all transactions will be authorized. DocuSign will be used for electronic signature approval. Accounts payable clerk will ensure that all transactions include copies of receipts for the goods or services purchased. Finally, reasonable timeframe to allow for timely submission of grant reports. Proposed Completion Date: Implemented July 1, 2024

Summary of Findings During testing of program expenditures, one of thirty-seven expenditures (2.7%) tested was determined to be an unallowable cost under the grant. The amount identified totaled $13,247. This instance was identified as noncompliance with Allowable Costs/Cost Principles requirements. The finding is not considered a repeated finding. Statistical sampling was not used in making sample selections. Statement of Concurrence or Nonconcurrence MNADV concurs with the finding and recommendation labeled 2023-005. The administrative agent that administers the organization’s health insurance changed their name. As a result, the health insurance bill ($13,247.02) was coded to the wrong GL code. Instead of being posted to the health insurance expense code, this was erroneously posted to the GL code for other consultants. Corrective Action A. Immediate Corrective Action Taken 1. Management reviewed the specific expenditure and confirmed that it was erroneously assigned the wrong GL code. 2. The unallowable cost of $13,247 was removed from the federal award, and properly reclassified. 3. Supporting documentation of correction was retained. Completion Date: Completed prior to issuance of audited financial statements. B. Long-Term Corrective Actions The organization will develop a Vendor Change Monitoring Procedure that will require documentation and review when a vendor changes name, ownership, or payment structure. This will Include verification that the vendor is mapped to the correct GL account before payment is processed. Responsible Parties: Executive Director and Contractual Bookkeeper Completion Date: Within 60 days of the date of this memo.

Audit Finding: 2023-002 – Lack of Documentation of Review and Approval Planned Corrective Action(s): SIG-NAL will enhance internal controls by implementing formal review and approval processes for payroll, expenses, and financial reporting. The organization will require documented evidence (digital or written) of all reviews and approvals and will maintain these records in a standardized, centralized system. The Finance Team will ensure that all controls are performed and documented in accordance with 2 CFR Part 200 requirements. Updated internal control policies and procedures adopted in 2025 address these requirements and are being fully implemented. Anticipated Completion Date ● March 2026 Responsible Party ● Director of Operations, with support from the Finance Team and Executive Director

Juel Fairbanks Chemical Dependency Services will implement signature approval of all timecards and invoices before the payroll and invoices are printed. Changes made to payroll and monthly reports being actual expenses started in Quarter 4 in 2023.

2023-003 ALLOWABLE ACTIVITIES AND ALLOWABLE COSTS - SIGNIFICANT DEFICIENCY Federal Program Emergency Rental Assistance ALN 21.023; passed through the County of Berks. Condition/Cause For 23 out of 60 cases tested, the amount paid for rent or utilities did not agree to a lease agreement or bills on file for the following reasons: (I) clerical errors, (2) duplicate payments due to multiple staff working on the same file, or (3) failure to request or maintain support before payment was made. Known questioned costs associated with the 23 exceptions noted in our testing were $9,867. Based on the projection of the sampling results to the remaining population, we project additional likely questioned costs of approximately $173,400. The Authority did not have controls in place to detect the noncompliance prior to issuing payments. We recommend the Authority revisit and strengthen internal controls over tracking individual payments for transactions entered as batches, particularly when related to federal awards. We encourage the Authority to continue working to identify the individual transactions making up the remainder of the federal expenditures under this program. We also recommend the Authority revisit and strengthen internal controls over allowable activities and allowable costs related to grant programs. Management Response The Authority launched the Emergency Rental Assistance Program (ERAP) with little administrative guidance from the U.S. Treasury. The Authority contracted with the Berks Coalition to End Homelessness (BCEH) to undertake various aspects of the Emergency Rental Assistance Program and in the late fall of 2021, the Authority began reviewing all case documentation provided by BCEH. This review eliminated the vast majority of the errors noted. The Authority also updated case documentation checklists as well as provided training for staff involved with ERAP. Current Status of Corrective Action Plan The Authority has resolved this finding. An additional review was added at the close of each case.

Finding: 2023-004: Significant Deficiency - Payroll Allocations Description of Finding: Payroll costs were allocated to grant programs using manual spreadsheets rather than an entity-wide time-tracking system, making it difficult to clearly demonstrate the proportional benefit required. This manual approach increased the risk of allocation inconsistencies and made documentation less robust than needed. Cause: The use of manual spreadsheet-based timekeeping did not provide an auditable system for allocating payroll costs to grants. Statement of Concurrence or Nonconcurrence: SacAsian agrees with the finding. Corrective Action: SacAsian acknowledges the significance of this finding and the potential for misstating staff expense and has taken steps to strengthen its time-tracking and payroll allocation processes. Beginning January 1, 2025, SacAsian implemented a new accounting system that includes electronic timesheets for staff to track their time daily to specific grant activity. Timesheet training has been performed and timesheet completion is required for all employees each day, providing support for hours worked/billed, as well as documentation of the certification and approvals that all staff time entered is accurate and in compliance with contract requirements, and providing proper support for all grant direct labor and indirect costs. Monthly reviews by the Project Directors/Managers, with secondary review by the accounting team are performed, ensuring ongoing compliance with federal requirements. Responsible Party: Ryan Fong, Director of Finance, 916-446-7883, rfong@sacasiancc.org Karen Wood, Not-for-Profit CFO (Creating Answers LLC), 916-930-0777, kwood@creatinganswers.com Pat Fong Kushida, President & CEO, 916-446-7883, patfk@sacasiancc.org Projected Completion Date: January 2025

Finding: 2023-003: Material Weakness and Questioned Cost - Grant Claim Support Description of Finding: SacAsian’s accounting system design did not align grant billings with the general ledger’s underlying expenses, as only direct costs were coded to the grant and other allowable costs flowed to unrestricted. As a result, the ledger detail did not clearly demonstrate the grant claim support without additional reconciliation. Cause: A comprehensive system for allocating and documenting grant-related costs had not yet been implemented. Statement of Concurrence or Nonconcurrence: SacAsian agrees with the finding. Corrective Action: SacAsian understands and acknowledges the significance of this finding and the potential that it creates for documentation gaps. The Controller and Director of Finance have implemented an ERP system which allows for better cost reporting and reviews of the grant-related expenses for accuracy, reliability, and reconciliation. While the general ledger details do not align, SacAsian did provide full documentation to substantiate the expenses claimed in each billing. Moving forward, all expenditures that have been billed will be reconciled to the general ledger monthly by the Director of Finance, Controller, and external CFO firm to ensure that billings match to expenditure detail and have been correctly allocated. Responsible Party: Ryan Fong, Director of Finance, 916-446-7883, rfong@sacasiancc.org Karen Wood, Not-for-Profit CFO (Creating Answers LLC), 916-930-0777, kwood@creatinganswers.com Pat Fong Kushida, President & CEO, 916-446-7883, patfk@sacasiancc.org Projected Completion Date: October 2025

Finding Reference Number: 2023-004 Description of Finding: The allocation of payroll costs to programs are done manually instead of done based on entity-wide timesheets. Statement of Concurrence or Nonconcurrence: The California Asian Pacific Chamber of Commerce (CalAsian) agrees with the finding. Corrective Action: CalAsian acknowledges the serious nature of this finding and the potential for damage to relationships with the grantors and Federal entities. The Controller and Director of Finance have implemented an ERP system which allows for better cost collection, reporting and reviews of the grant-related expenses for accuracy, reliability, and reconciliation.We also understand these findings are repetitive from the 2021 and 2022 audits; however, due to catch-up of the prior year audits, we were unable to address these issues prior to completion of the 2023 audit. This delay was caused by a change in auditors as our previous auditor did not have the capacity to retain us as clients due to staff shortages related to COVID. The implemented ERP system includes electronic timesheets for daily charging to specific grants, as well as more visibility into the proper separation of direct, indirect, and unallowable costs per the CFR. Timesheet training has been performed and timesheet completion is required for all employees each day. This began effective January 1, 2025 and provides support for hours worked/billed, as well as documentation of the certification and approvals that all staff time entered is accurate and in compliance with contract requirements and provides proper support for all grant labor costs and indirect costs. Monthly reviews by the Project Directors/Managers plus Accounting will be performed to identify any potential cost charging issues and corrective action(s) required. Name of Contact Person: Ryan Fong, Director of Finance, 916-446-7883, rfong@calasiancc.org Susan Wright, Controller, 256-689-7055, swright@calasiancc.org Pat Fong Kushida, President & CEO, 916-446-7883, patfongkushida@calasiancc.org Projected Completion Date: January 2025

FINDING 2023-003 Finding Subject: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Contact Person Responsible for Corrective Action: Tyler Pearson, Clerk Treasurer Contact Phone Number and Email Address: 574-739-1416 clerktreasurer@cityoflogansport.org Views of Responsible Officials: We concur with the findings. Description of Corrective Action Plan: As a measure of corrective action, I will be implementing a check sheet that will be attached to every claim sheet. This new procedure requires that you go through the check sheet and initial each item to ensure that all procedures have been followed correctly before submission. Additionally, I will also maintain a check sheet in my office since I am the last person to review each claim. This will help to ensure thoroughness and accuracy in our claims processing. Furthermore, moving forward, any grant funds will be placed into their own individual funds and distributed through an individual account. This approach will allow us to track payments for any expenses associated with these funds more effectively. Additionally, the BOT expenditure is done and in the future we will do a better job. Anticipated Completion Date: October 31,2025