Corrective Action Plans

Condition: The District submitted the Sp. Ed. IDEA Preschool 2024 grant budget late and claimed costs preceding the budget submission date, resulting in questioned costs of $4,646. Recommendation: The District should take steps to submit grant applications in a timely manner to ensure that they are able to claim all expenses as budgeted. We recommend reviewing the general ledger to the expenditure reports before submitting for more accurate reporting. Management Response: The District will take steps to submit grant applications in a timely manner. The District will review the general ledger to the expenditure reports before submitting.

Condition: The District submitted the Title I 2024 grant budget late and claimed costs preceding the budget submission date, resulting in questioned costs of $114,912. Recommendation: The District should take steps to submit grant applications in a timely manner to ensure that they are able to claim all expenses as budgeted. We recommend reviewing the general ledger to the expenditure reports before submitting for more accurate reporting. Management Response: The District will take steps to submit grant applications in a timely manner. The District will review the general ledger to the expenditure reports before submitting.

Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. The Health System has finalized the standard work procedure titled, Request for Funds/Reimbursement Claims (2-201’s), to ensure costs are appropriately charged based on the contract’s performance periods. Review of cost activity will occur in fiscal year 2025 to ensure policy is followed.

FINDING 2024-002 Subject: COVID-19 - Education Stabilization Fund - Activities Allowed or Unallowed Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listing Number: 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Finding: Material Weakness Condition: An effective internal control system was not in place at the School District to ensure compliance with requirements related to the Education Stabilization Fund and Activities Allowed or Unallowed. FINDING 2024-002 (Continued) Context: During the testing of payroll disbursements charged to the Education Stabilization Fund grant awards during the audit period, the following exceptions were noted: • For 16 payroll disbursements, in a sample of 40, management was unable to provide an approved employee contract or hourly rate ordinance to support the selected employees' bi-weekly pay rate. • For one transaction selection, an employee received a $730.43 one-time payment for a Teacher Appreciation Grant (TAG) funded by the 84.425U award. The Teacher Appreciation Grant has its own fund and is a state/local grant received to reward high-performing, eligible certified staff. The selected employee is a noncertified employee and did not qualify for a TAG award. There was no documentation provided to support work performed under this award to support allowability of the cost incurred. Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Management will ensure records of approved contracts are maintained for all employees and that payroll charged to federal awards is reviewed each pay period for allowability. The HR Coordinator is currently storing each contract both by hard copy in the employee file and digitally in our software. The Deputy Treasurer/Payroll Coordinator reviewing the distribution report prior to payroll submission. The Treasurer is also reviewing and will sign off on the distribution report for each payroll. Responsible Party and Timeline for Completion: Kelli Kizzee - HR Coordinator, Jessica Elliot - Payroll Coordinator, Moriah Crane - Treasurer. The process is already in place.

FINDING 2024-004 Subject: Special Education Cluster (IDEA) - Activities Allowed or Unallowed Federal Agency: Department of Education Federal Program: Special Education Grants to States, Special Education Preschool Grants Assistance Listing Number: 84.027 Federal Award Numbers and Years (or Other Identifying Numbers): H027A220084, H027A230084 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Finding: Material Weakness Condition: An effective internal control system was not in place at the School District to ensure compliance with requirements related to the Special Education Cluster and Activities Allowed or Unallowed. Context: During the testing of a sample of 40 payroll disbursements charged to the Special Education Cluster during the audit period, the following exceptions were noted: • For eight transactions selected, management was unable to provide an approved contract to support the selected employees' bi-weekly pay rate. • For two transactions selected, management was unable to provide approved timecards for the selected hourly employee and time period. • For seven transactions selected, management was unable to provide time and effort logs to support the allocation of one employee's salary between the federal grant and the Education fund. The lack of controls was systematic throughout the audit period. Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Management will ensure records of approved contracts and approved timecards are maintained for all employees. Management will ensure payroll charged to federal awards is reviewed each pay period for allowability. The HR Coordinator is currently storing each contract both hard copy in the employee file and digitally in our software. The Deputy Treasurer/Payroll Coordinator will review the distribution report prior to payroll submission. As time cards are being approved in our software system, a print out of the approvals will be maintained for each payroll. The Treasurer will review and sign off on the distribution and approval report for each payroll. Responsible Party and Timeline for Completion: Kelli Kizzee - HR Coordinator, Jessica Elliot - Payroll Coordinator, Moriah Crane - Treasurer. The process is already except for the printed time card approval report which will be in place starting with the January 2025 payrolls.

Corrective Action Plan: The District has developed and implemented a Federal Funds Manual. Anticipated Corrective Action Plan Completion Date: November 18, 2024 Contact Information: For additional information regarding this finding please contact Blaise Paul, Chief Business & Finance Officer, at 414-768-6140.

Condition: The School District's controls did not prevent or detect and correct, in a timely manner, costs charged to the grant that were more than the related invoices. Planned Corrective Action: The Grant Accounting team will develop a standard operating procedure on review and approval of journal entries. The Grant Account Team will provide training to Grant Compliance staff members on the defined process. Grant Compliance Senior Director and Assistant Director will be responsible for ensuring journal requests are submitted following the outlined operating procedure. Grant Accounting staff members will review submitted materials to ensure no invoice is overcharged and then process journal request. Contact person responsible for corrective action: Jeremy Vidito, CFO Anticipated Completion Date: 3/1/2025

2024-002 Finding: Allowable Costs and Allowable Activities Federal Assistance Listing Number 84.425U - COVID-19 - Elementary and Secondary School Emergency Relief Fund (ESSER III) Passed-through Colorado Department of Education Award Number - 4414/4431/9414; Award Year 2021 Summary of Finding: The District did not have adequate internal controls in place over the ESSER grant which resulted in unallowable costs being applied to the grant and inconsistently applying indirect costs to the grant. Status: Corrective action in progress Client Planned Action: The District concurs with the recommendations and is currently developing and implementing internal controls to ensure compliance. The inadequate internal controls that caused the inconsistency in supporting payroll information involved the End-of-Year Closeout process. The District will ensure End-of-Year Closeout procedures are up to date and adhered to. These procedures will include a second review of calculations used to determine the expenditure amount in accruals, to ensure it recalculates. The District will also conduct a second review of the supporting detail used to determine Indirect Costs to ensure they are consistent with CDE recommendations and District policies and procedures. Client Responsible Party: Annette Bass, Director of Grants Completion Date: Review of department End-of Year Closeout process began in September 2024. Adjustments and revisions will be made to these processes as needed, prior to End-of-Year Closeout, June 30, 2025.

Federal Program Title: Postconviction Testing of DNA Evidence; Capital Case Litigation Initiative ALN: 16.820; 16.746 Recommendation: We recommend the University review its current procedures to ensure disallowable costs are not being charged allocated to federal programs. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: Boise State University is reminding faculty and staff about lobbying and the basics of charging costs to a sponsored project with an emphasis on cost allocability. Name(s) of the contact person(s) responsible for corrective action: Jen Lutke Planned completion date for corrective action plan: December 31, 2024

Corrective Steps Taken – The District will implement the reinforcement of its internal controls. Expenditures will be verified against the MDE approved budget.

The Payroll Department has taken immediate action to develop additional safeguards to avoid duplicate pay. When Central Payroll adds to a payline, we will notify the requestor to inform them of this action and ask that they review their payline for accuracy. This should trigger a response from the requestor if they had also added the missing hours via a CU Special Pay. Additionally, as of 06/21/2024, the Late Timesheet option was turned off on CU Special Pay to strengthen controls. Individuals now contact payroll@clemson.edu for assistance. Once contacted the payroll/timekeeping team will update the timecard and ensure the missed pay is added to the next payroll cycle, assuming an emergency/off-cycle check is not needed. The College of Engineering and Applied Sciences (CECAS) will take action to strengthen internal controls to ensure accuracy and compliance. We will establish clear procedures to verify employee payroll data via paylines, as well as cross checking with CU Payroll to ensure changes are properly documented and authorized. We will provide ongoing training for departmental payroll staff on best practices and compliance requirements. Anticipated Completion Date: September 17, 2024 Person Responsible: Central Payroll – Ami Hood, Payroll Director; CECAS – Keri Cortese, Director of Procurement and Payroll Operations Contact/Responsible Party: Ami Hood, Payroll Director Contact Information: hooda@clemson.edu

2024-005 Period of Performance Corrective action planned: The Fiscal Supervisor and/or the Director of Fiscal Operations will review expenditures before payment to ensure that GAAP and the accrual basis of accounting are being followed. Month-end closing procedures will include a review of all prepaid expenses to assure that a separate schedule is maintained and reconciled to the general ledger. Anticipated completion date: 11-30-2024 Contact person responsible for corrective action: Cathy Liles, Director of Fiscal Operations

Reference Number: 2023-011 Finding: Improve Controls and Compliance with Approval of Allowable Costs Name of Contact Person: Lorina Esposito Corrective Active Plan: The City will implement a policy mandating documented approval for all invoices before they are paid or charged to federal programs. In addition, the City will conduct regular, scheduled reviews of invoice processing to verify compliance with allowable cost procedures and address any deviations promptly. Training will be provided to staff involved in invoice approval and payment processes to ensure understanding and adherence to these internal control requirements. Proposed Completion Date: 6/30/26

Contact Person – Benjamin Schafer, Executive Director Corrective Action Plan – Training will be provided for all employees involved with the grant if the Cooperative receives a similar grant in the future. Completion Date – As needed.

FA 2023-003 Strengthen Controls over Expenditures Compliance Requirement: Internal Control Impact: Compliance Impact: Federal Awarding Agency: Pass-Through Entity: AL Numbers and Titles: Federal Award Numbers: Questioned Costs: Repeat of Prior Year Finding: Period of Performance Procurement and Suspension and Debarment Material Weakness Material Noncompliance U.S. Department of Education Georgia Department of Education 84.027 - Special Education Grants to States 84.173 - Special Education Preschool Grants HO27A210073(Year: 2022), HO27A220073 (Year: 2023), HO27X220073 (Year: 2023) $28,390.10 FA 2022-003 Description: A review of expenditures and journal entries charged to the Special Education Cluster revealed that the School District's internal control procedures were not operating to ensure that appropriate reviews and approvals occurred and the School District's procurement procedures were followed. Corrective Action Plans: All journal entries related to the grant will be submitted by the Finance Director to the Director in charge of the grant for approval. Estimated Completion Date: June 30, 2026 Contact Person: Dr. Angela Williams, Superintendent Telephone: 706-554-5101 Email: amwilliams@burke.k12.ga.us

FA 2023-001 Improve/Strengthen Controls over Expenditures Compliance Requirements: Internal Control Impact: Compliance Impact Federal Awarding Agency: Pass-Through Entity: Assistance Listing Number and Title: Federal Award Number: Questioned Costs: Repeat of Prior Year Finding: Activities Allowed or Unallowed Allowable Costs/Cost Principles Period of Performance Procurement and Suspension and Debarment Material Weakness Material Noncompliance U.S. Department of Education Georgia Department of Education 84.371C - Comprehensive Literacy Development S371C190016-19A (Years: 2017-21) $124,399.84 FA 2022-002 Description: A review of expenditures and journal entries charged to the Comprehensive Literacy Development program revealed that the School District's internal control procedures were not operating to ensure that appropriate reviews and approvals occurred and the School District's procurement procedures were followed. Corrective Action Plans: The School District will review established internal controls and procedures with pertinent staff to ensure all are being followed. Expenditures related to the grant will be reviewed by the Director in charge of the grant to ensure proper approvals are maintained and packing slips are submitted with the invoice for payment. In the event a packing slip is not received, a note will be included to indicate such. All journal entries related to the grant will be submitted by the Finance Director to the Director in charge of the grant for approval. The School District will review established internal controls and procedures with pertinent staff to ensure all are being followed. Procurement transactions related to the grant will be reviewed by the Director in charge of the grant to ensure proper supervisor review and approvals are maintained. The Director in charge of the grant will review and update the current procedures to ensure that the required procurement methods are properly identified and followed and that required procurement documentation is properly identified, safeguarded, and retained. Estimated Completion Date: June 30, 2026 Contact Person: Dr. Angela Williams, Superintendent Telephone: 706-554-5101 Email: amwilliams@burke.k12.ga.us

View ofResponsible Officials and Planned CorrectiveActions:Managementacknowledges anisolated payrollprocessingerrorduringfiscalyear2023in which overtime hours werenotproperlyenteredforoneemployee.Thiserrordidnotresultinquestionedcosts,asreimbursedpayrollexpenseswere less thanactualpayrollcosts incurred. We retrained staffonpayrollprocessingwithemphasis onovertimeentry andverification.Weupdatedpayrollprocesses toensurepayrollstaffarenotifiedwhen overtime isapproved.Weimplementedpre-processingpayrollreconciliation andsupervisoryreviewpriortofinalsubmission.Payrollentries are subjectto supervisory reviewand periodic spotchecks.Correctiveactions havebeenimplementedand are operating onanongoingbasis.

View ofResponsible Officials and Planned CorrectiveActions:Managementacknowledges this findingrelatedtoinconsistentretentionoflease extensionsorrenewals forrentalassistanceprovided beyond originallease terms duringfiscalyear2023.Originalleases were retained forallparticipants;however,extensionswerenotconsistently obtained. We implementedalease trackingprocess to monitorlease expirationdates.Weupdatedproceduresto requirelease renewalsorextensions priorto issuingassistancebeyondtheoriginallease term.Weimplementedstandardizedfile checklists.Supervisorystaffconductperiodic filereviewsto confirmleasedocumentation coverage.Corrective actionshavebeenimplementedand are operatingonanongoingbasis.

View of Responsible Officials and Planned Corrective Actions: Management acknowledges this finding related to documentation retention for a single participant-related expense during fiscal year 2023. While isolated in nature, management recognizes the importance of complete documentation to support allowability under Uniform Guidance. We updated procedures to require receipt and verification of all required documentation prior to charging costs to federal awards. We implemented standardized documentation checklists to support consistent compliance. We reinforced documentation standards through staff training and supervisory review to ensure proper adherence. Supervisory staff conduct periodic file reviews prior to reimbursement and drawdown activity. Corrective actions have been implemented and are operating on an ongoing basis.

The Department of Human Services (DHS) adopted the electronic Timeforce (STATS) system for payroll, replacing manual processes. Time and attendance are approved through management levels, with payroll based on Notice of Personnel Action (NOPA) cost centers. Financial Analysts reconcile payroll, and a workflow ensures accurate NOPA listings for payroll purposes. Additionally, in order to ensure that Notice’s of Personnel Actions are updated on a timely basis, ensuring that salaries are charged to the respective account, DHS has implemented the following process: (1) Provisional Payroll Codes are requested prior to the close of the Fiscal Year by the Department of Finance through the Office of Management and Budget through the established process. (2) Once the codes are received, the Division of Human Resources will update the most current Personnel Distribution Sheets to reflect active employees. (3) The sheets will be submitted to Fiscal certification by the CFO, (4) NOPAS are updated with the provisional codes.

Once payroll is processed by the Department of Finance, on the payday, a Flex Earnings Report is generated by the staff. A reconciliation is performed to ensure that all employees and their respective fringe benefits are captured and drawn. The Department of Finance posts said payroll. Staffing continues to identify deficiencies in the posting which occur in varying periods after the actual pay day. DHS has incorporated into its internal controls a step to ensure that the accounts, in retrospect, are reconciled to the actual Flex earning report. DHS intends on meeting with the Department of Finance to identify the nuances that create postings to occur contrary to the Flex Earning Report account coding.

VIDE acknowledges the audit findings regarding the Special Education Cluster payroll discrepancies and concurs with the recommendation. VIDE is taking immediate action to align payroll controls with established fiscal improvement plan. To address the pay rate discrepancies between NOPAs and the payroll register, the Budget Team and the Deputy Commissioner of Fiscal and Administrative Services will review and approve every personnel action in the ERP prior to the NOPA being executed. This review matches the action against the approved grant application or staffing list to ensure the pay rate is accurate before the payroll cycle begins.

VIDE acknowledges the audit findings regarding the Special Education Cluster payroll discrepancies and the unreported fraud incident and concurs with the recommendation. VIDE is taking immediate action to align payroll controls with the established fiscal improvement plan and to institutionalize a mandatory federal reporting protocol for fraud. To address the pay rate discrepancies between NOPAs and the payroll register, the Budget Team and the Deputy Commissioner of Fiscal and Administrative Services will review and approve every personnel action in the ERP prior to the NOPA being executed. This review matches the action against the approved grant application or staffing list to ensure the pay rate is accurate before the payroll cycle begins. To address fraud reporting, VIDE will implement a Federal Mandatory Disclosure Policy in strict accordance with 2 CFR §200.113 that designates the Office of the Commissioner and the Internal Audit Division as the responsible parties for reporting any credible evidence of fraud, bribery, or gratuity violations to the Federal awarding agency and the OIG. Accordingly, the specific incident cited in the finding regarding the $5,221 theft related to bus driver timesheets will be immediately reported to the U.S. Department of Education’s Office of Inspector General via the online hotline and formal written correspondence to cure the non-compliance. Furthermore, to prevent recurrence of the specific falsified timesheet scheme, VIDE will implement a Service Verification Log for bus drivers and similar service staff wherein supervisors will be required to cross-reference timesheets against daily trip logs or service logs before approving time in the payroll system. Finally, to ensure ongoing compliance, the Office of Fiscal and Administrative Services will conduct monthly spot checks of ERP logs to ensure pre-execution reviews are occurring, and the Internal Audit Division will maintain a log of all investigations to verify that a Notification of Federal Disclosure is attached to any file involving federal funds.

We acknowledge that some timesheets were currently unavailable because the employees in question are no longer employed at DPNR, and as a result, their user profile is no longer active within the system. We have requested assistance from the Department of Finance in retrieving the necessary timesheets unfortunately, the required information has not yet been provided. DPNR will continue to collaborate with the Department of Finance to ensure the retrieval of any relevant files or reports, and we remain committed to resolving all the findings. We recognize that these findings highlight areas where improvements are necessary to ensure better compliance with applicable policies and regulations governing payroll and grant management. We are committed to implementing corrective actions and enhancing internal controls to prevent recurrence.

The Government concurs with the finding. OTAG implemented enhanced payroll controls including a dual manual and electronic timesheet system, verification of pay rates against NOPA forms, and separation controls to discontinue benefit charges upon employee separation or retirement.