Corrective Action Plans

FA 2025-001 Strengthen Controls over Employee Compensation Compliance Requirement: Internal Control Impact: Compliance Impact: Federal Awarding Agency: Pass-Through Entity: Assistance Listing Number and Title: Federal Award Number: Questioned Costs: Allowable Costs/Cost Principles Significant Deficiency Nonmaterial Noncompliance U.S. Department of Education Georgia Department of Education 84.027 - Special Education Cluster Grant to States 84.173 - Special Education Cluster Preschool Grants H027A230073 (Year: 2024), H027A240073 (Year: 2025), H173A240081 (Year: 2025) $1,283 Description: The policies and procedures of the School District were insufficient to provide adequate internal controls over the employee compensation process as it relates to the Special Education Cluster. Corrective Action Plans: The District concurs with the finding and is committed to strengthening internal controls. While the identified discrepancies were isolated, we recognize the need for enhanced reconciliation during personnel transitions. The Human Resources and Finance departments will enhance our review process. This pre-payroll validation step will ensure that all salary adjustments and position changes align with Board authorized pay documentation prior to disbursement. Estimated Completion Date: 3/31/2026 Contact Person: Julie Wiley, Chief Financial Officer Telephone: 229-316-1878 Email: juliewiley@lowndes.k12.ga.us

Finding Number 2025-002 Condition: The District could not provide supporting documentation for one (1) invoice charged to the program. Management Response/Plan: The District acknowledges the finding and has strengthened internal controls over disbursements by implementing centralized invoice retention procedures and requiring verification of supporting documentation prior to payment approval. Staff have been retrained on documentation requirements, and periodic monitoring will be conducted to ensure all expenditures are properly supported and maintained. Anticipated Date of completion: June 2026 Name of Contact Person: Dr. Joe Mullikin

Finding Number 2025-001 Condition: The District was unable to provide documentation for three invoices charged to the program. The District was also unable to provide supporting documentation for one employee time card. Management Response/Plan: The District acknowledges the finding and has strengthened internal controls over disbursements by implementing centralized invoice retention procedures and requiring verification of supporting documentation prior to payment approval. Staff have been retrained on documentation requirements, and periodic monitoring will be conducted to ensure all expenditures are properly supported and maintained. Anticipated Date of completion: June 2026 Name of Contact Person: Dr. Joe Mullikin

Material weakness in internal control over compliance - Lack of control over monitoring of excess costs Planned Corrective Action: The District is developing procedures to adequately monitor the calculation of excess costs during the year. Program staff and business office personnel will meet regularly to identify any potential issues for noncompliance with excess costs and develop a plan accordingly to ensure compliance is met. Staff training and utilization of the calculation tools provided by TEA will be provided to ensure all involved gain the necessary understanding. Responsible Contact Person: Farrah Jernigan, Chief Financial Officer Anticipated Completion Date: June 30, 2026

Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and will document the allocation methods used for employees and expenses.

The City concurs with the finding. The Department of Health, Housing & Homelessness will review the allocation of fringe benefits to grant payroll charges on a quarterly basis to ensure fringe benefits are properly allocated to funding sources. The reconciliations will be prepared by fiscal staff and approved by the Fiscal Manager. Additionally, the DFAS Grant Administrator will perform a semi-annual review of excess leave payouts to ensure they are charged to the correct grant funding string.

Recommendation: CLA recommends the Agency follow established policies to maintain supporting documentation for expenses incurred including their review and approval. Explanation of disagreement with audit finding: There is no disagreement with this finding. Action taken in response to finding: We have established a policy to maintain our supporting documentation in our expense management software. We lost our access to Concur when we terminated the contract in March 2025. This finding is related to the Concur system, which we have no access to. Going forward we have the Ramp expense management software that retains all the relevant supporting documentation. Name of the contact person responsible for corrective action: Dhiren Shah, CFO Planned completion date for corrective action plan: Completed as of January 1, 2025 for all future transactions, implemented via Ramp Software.

The University concurs that costs charged to federal awards must be incurred within the approved period of performance in accordance with Uniform Guidance and the OMB Compliance Supplement. The instances identified during the audit were attributable to personnel turnover within Research and Sponsored Programs (RSP), which resulted in isolated lapses in the consistent application of existing period of performance review procedures during the period under audit. Upon identification of these items, the Office of the Controller (OoC), in its oversight role for financial reporting and compliance, coordinated with RSP to address the questioned costs. RSP initiated the process to remove the costs from the affected grants and, where applicable, to consult with the sponsor and refund the disallowed amounts. As part of the corrective action plan, RSP will reinforce existing period of performance controls through targeted communication and training with responsible personnel involved in grant administration and expenditure processing. RSP will continue to perform pre- and post-expenditure reviews to ensure that costs charged to federal awards are incurred within the approved budget period and are appropriately documented. These actions are focused on reinforcing the timing review of expenditures charged to federal awards and are intended to ensure ongoing compliance with Uniform Guidance requirements and to prevent recurrence of the condition.

Context and Cause – During the year ended June 30, 2025, a severance payment was issued to an employee that worked on more than one federal program. The payment was an allowable cost, but was not allocated across the other federal programs based on time and effort per their policy. While internal controls and procedures have been established for payroll expenses, the procedures were bypassed when processing the severance payment. It should be noted that the employee spent the majority of their time on the program the severance was allocated to, and the transaction was isolated. Recommendation – The Organization should follow establish written policies and procedures for allocation of costs. Allocation spreadsheets currently used for the allocation of payroll should be used for all payroll related costs. Action Taken: OMEP will utilize standard allocation procedures for all payroll related payments going forward. Responsible parties: Controller. Anticipated completion date: June 30, 2026.

FINDING 2025-002 Finding Subject: Special Education Cluster (IDEA) - Earmarking Contact Person Responsible for Corrective Action: Meghan Damron Contact Phone Number and Email Address: 219-650-5300, mdamron@mvsc.k12.in.us Views of Responsible Officials: We concur with the finding. We have taken the audit finding, conclusions and recommendations and created a corrective action plan to correct our earmarking for the future. Description of Corrective Action Plan: Although Merrillville Community School Corporation left Northwest Indiana Special Education Cooperative (NISEC) as of July 1, 2024 we continue to track time and effort logs for individuals servicing our non-public students with disabilities. These are housed in the special education office located at Pierce Middle School. Since staff are performing special education duties only, reports are logged semiannually. NISEC has reported that for the 2023-2024 school year the corrective action plan was implemented fully. Anticipated Completion Date: This was completed fully as of July 1, 2024.

Response and Corrective Action Plan prepared by: Leanne Green Person Responsible for Implementing the Corrective Action: Leanne Green Anticipated Completion Date of Corrective Action: Vickie Dunaway, School Nutrition Director, corrected and resubmitted the claim in question, as soon as the issue was revealed. USDA paid the difference owed on October 28, 2025. Planned Corrective Action: Once the School Nutrition Director completes the monthly claim, Leanne Green, Finance Director, reviews the paperwork, verifying that all is correct before the claim is filed.

Management at SAHA PM notes its responsibility to establish and maintain effective internal control over financial reporting to provide reasonable assurance that transactions are properly recorded, processed, and summarized to permit the preparation of reliable financial statements in accordance with generally accepted accounting principles (“GAAP”). We plan to establish a checklist for the property accounting team that includes a comparison of gross rent potential to the HUD approved rent schedule.

Audit Finding: The Authority did not have sufficient internal controls to ensure that payroll expenditures submitted to FEMA were incurred within the applicable period of performance prior to submission of the project worksheet. Recommendation: The Authority’s policy and procedures should be designed to strengthen the internal controls over the review of the submissions to ensure accurate reporting as required by the Uniform Guidance. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned/taken in response to finding: 1. Enhanced Review of Period of Performance (POP): The Authority will implement a formal verification step requiring the Finance Department to confirm that all costs included in FEMA project worksheets were incurred within the approved period of performance prior to submission. This verification will specifically address payroll costs that span multiple pay periods. 2. Payroll Cost Allocation Controls: Payroll expenditures that cross fiscal periods or project periods of performance will be allocated based on actual days worked within the applicable period. Payroll reports will be reviewed to ensure that only eligible dates are included in each FEMA project. 3. Secondary Review: The Authority will require a secondary review by a finance staff member not involved in the initial preparation of the FEMA project worksheet to ensure accuracy, completeness, and compliance with FEMA eligibility requirements. 4. Correction of Identified Error: Management has corrected the duplicated payroll costs of $104,434 by removing them from the project ending June 30, 2022 and ensuring they are only reported in the project beginning July 1, 2022. Total FEMA expenditures reported on the Schedule of Expenditures of Federal Awards were adjusted accordingly. In addition, VCUHSA has voluntarily prepared a letter to VDEM to alert them of the identified issue and request assistance on next steps to return the funds that were received in error. The letter will be followed up by an email. The Finance team has also notified the CFO of both the findings of the audit and the related corrective actions. Name(s) of the contact person(s) responsible for corrective action: Min Cummings, VP of Finance and Accounting, 804-827-0545 Planned completion date for corrective action plan: Notification of error to be sent to VDEM within 60 days of audit completion. All other planned actions to be implemented immediately for any future costs and expenditures.

Finding Reference: 2025-001 – Activities Allowed or Unallowed Costs/Cost Principles — Food Distribution Cluster (TEFAP/CCC/CSFP) — Questioned Costs: 188,459 Responsible Person: Todd Frease, CFO Planned Actions & Timelines: 1. Allocation Methodology Correction (by 30 days from report issuance): We will redesign our administrative cost allocation model to remove the CCC double-counting and ensure each program’s share is based on documented, reasonable measures of benefit, consistent with 2 CFR §200.405. The revised workbook will include locked formulas and version control. 2. Secondary Review Control (effective next monthly close): We will implement a two-step review: preparer signs off on the allocation workbook, and an independent reviewer validates sources, bases, and formula ranges before posting entries or submitting claims. Evidence of review will be retained in monthly share drive by indicating approval through email. Anticipated Completion Date: Within 60 days of report issuance

FINDING 2025-003 Finding Subject: Special Education Cluster (IDEA) - Earmarking Contact Person Responsible for Corrective Action: Amy Silva Contact Phone Number and Email Address: 812-753-4230 amy.silva@sgibson.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The School Corporation has designated the Director of Special Education as the primary monitor responsible for overseeing nonpublic proportionate share expenditures. The Corporation Treasurer will provide the Director of Special Education and the Assistant Superintendent with a monthly budget-to-actual expenditure report for all active grants with nonpublic proportionate share requirements. This report will track the remaining unspent balance. The Director of Special Education will meet monthly with nonpublic school administrators to review the remaining fund balances, ensure services are being rendered, and project future expenditures. A final reconciliation will be performed within 30 days of each grant's end date to confirm all required funds were spent or a waiver was successfully obtained. Anticipated Completion Date: March 1, 2026

FINDING 2025-004 Finding Subject: Child Nutrition Cluster - Allowable Costs/Cost Principles Federal Agency: Department of Agriculture Federal Program(s): School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children Assistance Listing Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years: FY2024, FY2025 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Cost Principals Audit Finding: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Allowable Costs/Costs Principles compliance requirement. The School Corporation entered into a Fixed Price meal Contract with a food service management company (FSMC). For each meal type, a fixed price was established and billed by the FSMC based on meal counts served. The School Corporation failed to compare the invoices received from the FSMC to the School Corporations software reports to ensure the number of meals invoiced agreed to the meals served. Two invoices with the FSMC were selected for testing totaling $213,048.96. . Contact Person Responsible for Corrective Action: Erin Roach Contact Phone Number and Email Address: 765-653-3119 eroach@sputnam.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The food service director will compare the invoices received from the FSMC to the School Corporations software reports prior to submission for payment. Anticipated Completion Date: February, 2026

FINDING 2025-03 Finding Subject: Special Education Cluster (IDEA) - Earmarking Contact Person Responsible for Corrective Action: Dr. Emily Dykstra Contact Phone Number and Email Address: 812-849-4481 / dykstrae@mitchell.k12.in.us Views of Responsible Officials: “We concur with the finding.” Description of Corrective Action Plan: Mitchell Community Schools will utilize time and effort logs to track time that personnel spend working with non-public students. These logs will be turned into the Director of Special Education at the end of each school year, so that they will be available for future audits. A time and effort log template will be created by March 6, 2026 to be utilized with personnel for future IDEA grants. Anticipated Completion Date: March 6, 2026

The purpose of the Goods Receipt (GR) is to record receipt of goods or services as soon as they are delivered and verified to be in acceptable condition. A Goods receipt must be posted in SAP for all items actually received. Vendors submit invoice(s) referencing the purchase order (PO) directly to Accounts Payable after delivery, indicating that the goods or services have been provided and requesting payment. Accounts Payable then reviews the vendor invoice, purchase order, and goods receipt in SAP to perform the required three-way match (PO, GR, and vendor invoice) before processing payment. 1. The Accounts Payable team will collaborate with the Procurement Services Division to establish and implement a process that ensures the timely review and reconciliation of Goods Receipt (GR) entries. This will include the development of clear guidance / training materials for schools and offices to periodically review their GR balances. Training will be conducted via Virtual Office Hours on a quarterly basis for sites to make necessary adjustments when the goods or services received differ from the original Purchase Order (PO) or the corresponding invoice. 2. The Accounts Payable team will collaborate with the Procurement Services Division to develop supplemental documentation and guidance regarding proof of delivery for goods and services received. 3. Accounts Payable staff will receive ongoing training throughout the year on documentation and reconciliation requirements, particularly when new internal controls, procedures, and processes are created. Training will be incorporated into regular team meetings, procedural updates, and onboarding for new team members to maintain alignment and accuracy across the department. The implementation target date for the above corrective action plan is June 30, 2026. Name: Rocio Saucedo Title: Director of Accounts Payable Contact Information: Rocio.Saucedo@lausd.net

Condition: Nine (9) employee payroll expenditures were claimed at an hourly rate greater than that approved by ISBE. Corrective Action Plan: Management will review its policies and procedures and implement changes to strengthen internal control over federal reporting. In addition, budgets will be monitored and amended accordingly within the period performance of the grant. Responsible Person: Janiesa Owens, Chief School Business Official Anticipated Completion Date: June 30, 2026

Finding 2025 – 002- Allowable Costs & Period of Performance (Significant Deficiency and Noncompliance) Management’s Response: Management concurs with the above finding, and the Fiscal Service Office will implement corrective action before September 2026. Management acknowledges the process gap as indicated and noted in the above findings. To strengthen policies and procedures surrounding grant disbursements and ensure expenses are properly approved and allowable under the specific grant budget, the Fiscal Service Office along with the Human Resources Department will implement a process to properly document, review, and approve all allowable grant pay rates and salaries.

FINDING 2025-002 Finding Subject: COVID-19 - Education Stabilization Fund - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Summary of Finding: The School Corporation was unable to provide proper documentation for 5 out of the 25 claims selected for control testing. The School Corporation was unable to provide proper documentation to support the determination of the amount of the teachers total salary that was allocated to the federal award. Contact Person Responsible for Corrective Action: Melissa Raaf Contact Phone Number and Email Address: (812) 649-2591 / missy.raaf@sspencer.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: In the future the School Corporation will ensure that all proper documentation is saved in a binder or electronically. Anticipated Completion Date: Effective FY 2025/2026

FINDING 2025-002 Finding Subject: Special Education Cluster (IDEA)- Earmarking Summary of Finding: The School Corporation is a member of the Greater Lafayette Area Special Services Cooperative (Cooperative). During fiscal years 2023-2024, the Cooperative operated the special education programs and spent the federal money on behalf of all of its members. As the grant agreements were between the Indiana Department of Education (IDOE) and each member school, the School Corporation was responsible for ensuring and providing oversight of the Cooperative. However, there was inadequate oversight performed by the School Corporation in order to ensure compliance with the Matching, Level of Effort, Earmarking compliance requirement. The School Corporation did not have internal controls in place to ensure that the Cooperative complied with the earmarking requirements. The Cooperative did not have adequate procedures in place to ensure that the required level of expenditures for nonpublic school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure nonpublic school expenditures were appropriately identified and reported. The Non-Public Proportionate Share expenditures for the 22611-021-PN01, 22611-021-ARP, 22619-021-ARP, 23611-021-PN01, and 23619-021-PN01 grant awards could not be verified for the individual member schools. Total grant expenditures were posted as expended. The nonpublic proportionate share expenditures were determined by applying a percentage to the nonpublic school budgeted expenditures. As such, we were unable to identify if the minimum amount per the grant awards was expended and properly reported to the IDOE as required. The lack of internal controls and noncompliance were isolated to the 22611-021-PN01, 22611-021-ARP, 22619-021-ARP, 23611-021-PN01, and 23619-021-PN01 grant awards. Contact Person Responsible for Corrective Action: Lissa Stranahan Contact Phone Number and Email Address: (Phone) 765-771-6013 (Email) lstranahan@lsc.k12.in.us Views of Responsible Officials: We concur with the finding. The Greater Lafayette Area Special Services (GLASS)and Local Education Agency, Lafayette School Corporation, concur with the audit finding for Earmarking. GLASS did not have adequate procedures in place to ensure that the required level of expenditures for non-public school students with disabilities was met for each member school. The Cooperative did not have effective internal controls to ensure non-public school expenditures were appropriately identified and reported. The methodology used by the Cooperative to monitor non-public proportionate share expenditures was based upon a percentage for each school corporation that comprises the Cooperative rather than basing the expenditures off of the grant award for each non-public school within the geographical boundaries of the school corporations. While all proportionate share funds were expended, it was problematic in determining if the minimum amount per the grant awards was expended and properly reported prior to July 1, 2024. INDIANA STATE BOARD OF ACCOUNTS 28 Description of Corrective Action Plan: The former Director of GLASS retired June 30, 2023. Upon hire on July 1, 2023, the new director immediately implemented measures to correct the previous methodology used at GLASS. Non-public proportionate share funds are identified and reported based upon the grant award for each school corporation. The expenditures are based upon the geographical location of the non-public school and the corresponding public school corporation, not based upon the “home” school corporation of the student. This process was implemented and descriptions were included on the ledgers to identify non-public school proportionate share for grants that were initiated during the FY 2024-2025 school year. Anticipated Completion Date: The corrective action was already put into place on July 1, 2023 and implemented with FY 2024-2025. The audit finding reflects the previous grant cycle for 2022 grants and 2023 grants, which is prior to this action taken.

The District will become more thoroughly aware of applicable compliance requirements and seek guidance in writing when necessary from the appropriate granting agencies. Anticipated Completion: January 1, 2026 Responsible Party: Lynette Thrasher, lthrasher@mcusd1.net 815-472-6477

FINDING 2025-001 Finding Subject: Special Education Cluster (IDEA)-Earmarking Contact Person Responsible for Corrective Action: Chelsea Yon Contact Phone Number and Email Address: 812-354-8731 cyon@pcsc.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Treasurer of Pike County School Corporation will work with Exceptional Children’s Co-op on proportionate share expenditures. PCSC will also track those expenditures in a separate line along with revenue received for the proportionate share. Anticipated Completion Date: This method was implemented in the 2025-2026 school year and will continue with each school year as needed.

Grant Cash Management – Community Development Block Grants Condition: 2 CFR 200.403 of the Uniform Guidance mandates that only necessary, and allowable costs be drawn down off of federal grants. During the audit, we found that the Water Plant Construction project had construction invoices being drawn down from two grant sources, resulting in total draw request exceeding total expenses. Corrective Action: The City understands what happened and will work on developing and implementing procedures to ensure that all invoices are not drawn beyond the amount expended. Contact Person Responsible for Corrective Action: John Dantzer, City Manager Anticipated Completion Date: This issue will be corrected moving forward.