Corrective Action Plans

Solvista Health management agrees with the auditor’s finding. In conjunction with the shared services agreement, the Group will implement a system of internal controls to ensure review and approval of grantrelated expenditures. The Group regularly trains staff on allowable cost principles under Uniform Guidance.

Finding 2024-003: Unsubstantiated Expense The single audit report included the following recommendation: We recommend that management strengthen the process to identify and review funding sources of underlying expenditures, that support the amounts of the reclassification journal entries. This could include reviewing approved budgets for the federal award in scope at a necessary level of detail to determine appropriateness of allocations in a timely manner. Management Response/Status of Action Plans: Amtrak believes education and reinforcing the existing upfront controls to ensure the correct initial coding of the expenditures is correct is the best way to address this issue. When this issue was identified during the audit, the company coordinated a meeting with the department where these costs originated to reinforce the need to properly code the expenditures in the purchase order process. Leadership in that department acknowledged the miscoding and committed to proper coding going forward. The company understands that the issue of training on this control to properly code purchase orders may exist in other departments and will develop communication to reinforce education in the proper processes and controls in this area. The contact for this item is Carol Hanna, VP Controller. Amtrak anticipates that changes described above will remediate this finding in the fiscal year ending September 30, 2025

During the fiscal year under audit, NASF hosted two events at the same hotel – one charged to a nonfederal program and the other related to a federal program. Initially, all event-related cost were charged to the nonfederal program. Subsequently, $28,500 was reclassified to the Federal program. As a result, $18,387 was incorrectly charged to the Federal award. The Executive Director and Chief Financial Officer have established the following corrective action plan to be completed in May, 2025 and going forward: 1. Include individual grant Profit & Loss statements to the monthly close review process to help strengthen internal controls over expenditures and make sure all cost charged to the programs are allowable under 2 CFR 200.403. 2. Provide training to NASF staff and contractors on the requirements for allowable cost. 3. NASF has informed the funder (U.S. Forest Service) - Lynne Sholty (Supervisory Grants and Agreements Specialist) about the unallowable cost of $18,387. At time of this response, we are awaiting invoice so NASF can repay the balance in full. This corrected action has an anticipated completion day of 60 days (June 30th, 2025) by the Chief Financial Officer (Rafael Chapman) in conjunction with Executive Director (James Farrell).

This finding is related to activities on our VOCA grants. This exception was related to a process in place prior to May 2023 for allocating our outside contracted IT services Again, in May 2023 FRLS added an electronic transaction approval process via Teams, that documents approvals for all our AP, AR and other transactions initiated by our accounting staff. These are reviewed and approved by the CFO before being posted into the GL. FRLS failed to update its allocation for this prior allocation method for this legacy vendor. The CFO will undertake a review of this process to ensure that we are in compliance with allowable cost documentation requirements. We will also review and update our documentation of allocations and ensure that each month’s allocation is properly approved. This change will be made within the next 60 days.

Georgia Tech management agrees that internal audit reports demonstrated departmental deficiencies in knowledge of policies and procedures that needed to be addressed. Upon disclosure of Internal Audit’s recommendations, the departments and central offices immediately responded with additional training, proactive compliance reviews, and re-enforcement of existing policies and procedures via Institute wide communications and enhanced reviews of support. New system controls regarding spend authorizations were put in place, with Georgia Tech’s Internal Audit department continuing to test these controls through the month of February. Central and departmental units within Georgia Tech will continue to work together to further enhance guidance and training to faculty and staff and to identify and test controls in our systems that will mitigate these issues.

Percentages used for allocations will be reviewed annually across all grants/programs and updated during the budget process. These allocations will be reviewed by the CFO.

a. Name of Contact Person Responsible for Corrective Action: Candy Norvell b.Corrective Action Planned: North Tippah is transitioning to a digital time clock system. All employees will log their time through the Time Trust system. The Food Service Director ,business manager and the superintendent will review and make adjustments to the part time accounts payable employee’s salary. c.Anticipated Completion Date: 7/1/25

Finding Number: 2024-001 Planned Corrective Action: Meals on Wheels of the Monterey Peninsula (MOWMP) will address the finding by taking the steps outlined below: 1. Expenditure Allocation: Controller and/or bookkeeper will allocate expenditures based on the number of meals prepared each month and the percentage of meals prepared for each program and funding. Yearly reviews of the allocation process will be conducted to ensure accuracy and relevance. Adjustments may be made based on changes in meal demand, program requirements, funding sources, or other factors affecting meal preparation costs. 2. Payroll Reporting: On a yearly basis, Managers and/or Directors will allocate the amount of time each employe works based on tasks performed and the amount of time worked on federal award activities. This allocation will be expressed as a percentage of total work hours performed. Periodic adjustments to time allocations may be necessary to reflect changes in project priorities, staffing levels, or other factors affecting workload distribution. Person Responsible for Corrective Action Plan: Leadership Oversight – Christine Winge, Executive Director Operational Oversight – Kay Smith, Controller Anticipated Date of Completion: MOWMP will complete the Corrective Action Plan by June 1, 2024 and these new policies and procedures will be in full effect throughout fiscal year 2025 and beyond. We will continue to review effectiveness and make changes as necessary.

2024-002 Allowable Costs & Principles a. Corrective Action-PHA will work with its Fee Accountant to create a detailed, comprehensive expense allocation plan. The current allocation plan listed as an activity level control has been in place for many years.

Program: AL 20.509 – Formula Grants for Rural Areas – Allowability & Subrecipient Monitoring Corrective Action Plan: • NDOT will continue to enhance its financial review procedures to ensure that all subrecipients provide adequate supporting documentation for expenditures, including personnel charges and cost allocations. • Training sessions will continue to be conducted for subrecipients to reinforce compliance requirements related to allowable costs, proper documentation, and cost allocation methods. • Revised internal procedures will clarify expectations for travel costs, fuel charges, personnel reimbursements, and revenue reporting to prevent improper charges to the grant. • Assigning audit staff to conduct periodic sampling throughout the year enhances our ability to ensure costs are properly supported, adapt to necessary changes, and effectively communicate updates to our subrecipients. Contact: Jodi Gibson Anticipated Completion Date: NDOT appreciates the audit’s recommendations and remains committed to ensuring compliance with Federal requirements through strengthened internal controls and enhanced subrecipient oversight. This will be an ongoing and continual effort to address anticipated compliance requirements and evolving state and federal regulations.

Program: AL 17.225 – Unemployment Insurance (UI) – Admin – Allowability Corrective Action Plan: NDOL has reviewed the current cost allocation plan with the Federal authority and received conditional approval for changes beginning in state fiscal year 2025. Contact: Rea Easton Anticipated Completion Date: Completed

Program: Various, including AL 93.778 – Medical Assistance Program (Medicaid) – Allowable Costs/Cost Principles Corrective Action Plan: OCIO - To resolve the identified overcharge and reduce the Internal Service Fund Balance, OCIO conducted an 8 month no-bill period from December 2023 through June 2024. During this time OCIO customer agencies would have seen a significant reduction in charges and OCIO’s fund balance significantly decreased. In addition, a full and thorough review of all OCIO rates was conducted. This review resulted in the decrease in any mainframe related rates by 30% from the previous years (State FY2021 and FY2022). DAS Materiel – The Print Shop will have the new rates developed and effective July 1, 2025, the beginning of the new biennium. Contact: OCIO - Noah Finlan; Materiel, Print Shop, Internal Service – Ann Martinez. Anticipated Completion Date: OCIO - Corrective action has already been taken and the fund balance is currently below the allowable threshold permitted. As of September 30, 2024, the fund balance was approximately $10 million dollars. Rates have been adjusted to be more in line with actual expenditures for FY2025. Print Shop – July 1, 2025.

Program: AL 93.778 - Medical Assistance Program; AL 93.959 - Block Grants for Prevention and Treatment of Substance Abuse; AL 93.767 - Children’s Health Insurance Program; AL 93.575 – Child Care and Development Block Grant; AL 10.561 – State Administrative Matching Grants for the Supplemental Nutrition Assistance Program – Allowable Costs/Cost Principles Corrective Action Plan: The entire payroll process is being reviewed and changes will be made. Contact: Heather Arnold Anticipated Completion Date: 12/30/2025

Program: AL 93.558 – Temporary Assistance for Needy Families; AL 93.563 – Child Support Services; AL 93.566 – Refugee and Entrant Assistance; AL 93.568 – Low Income Home Energy Assistance (LIHEAP); AL 93.575 – Child Care and Development Block Grant; AL 93.658 – Foster Care Title IV-E; AL 93.659 – Adoption Assistance; AL 93.667 – Social Services Block Grant; AL 93.767 – Children’s Health Insurance Program; AL 93.778 – Medical Assistance Program; AL 10.561 – State Administrative Matching Grants for the Supplemental Nutrition Assistance Program – Allowable Costs/Cost Principles Corrective Action Plan: Time and Effort: Agency has submitted retroactive PACAP amendment (complete). For the IST Fiscal Projects Admin cost center, a time study will no longer be utilized, and the hours will be treated as General IST Administration without direct grant allocations. RMTS Allocations: Agency has clarified with staff what the “Non-DHHS Activities” selection pertains to (complete). Labor Hours Statistics: This was the first audit cycle of the new Cost Allocation system. DHHS will create a checklist of items for the new system that will be reviewed prior to completion of the quarterly cost allocation compilation. This checklist will address specific issues presented during this audit cycle. Recipient Counts: This was the first audit cycle of the new Cost Allocation system. DHHS will create a checklist of items for the new system that will be reviewed prior to completion of the quarterly cost allocation compilation. This checklist will address specific issues presented during this audit cycle. Contact: Patrick Werner Anticipated Completion Date: 6/30/2025

Program: AL 93.558 – Temporary Assistance for Needy Families; AL 93.566 – Refugee and Entrant Assistance; AL 93.568 – Low Income Home Energy Assistance (LIHEAP); AL 93.575 – Child Care and Development Block Grant; AL 93.658 – Foster Care Title IV-E; AL 93.659 – Adoption Assistance; AL 93.667 – Social Services Block Grant; AL 93.778 – Medical Assistance Program; AL 10.561 – State Administrative Matching Grants for the Supplemental Nutrition Assistance Program – Allowable Costs/Cost Principles Corrective Action Plan: This was the first audit cycle of the new Cost Allocation system. DHHS will create a checklist of items for the new system that will be reviewed prior to completion of the quarterly cost allocation compilation. This checklist will address specific issues presented during this audit cycle. Contact: Patrick Werner Anticipated Completion Date: 6/30/2025

State Treasurer’s Office Response/Corrective Action Plan: The Office of State Treasurer does agree with finding that our grant award template did not make subrecipients aware of all required grant award information for the Mineral Leasing Act as required. The Office of State Treasurer will review and update its grant award templates to ensure that subrecipients are made aware of all required grant award information. Contact Person: Nicole Krivoruchka, Director of Finance Anticipated Completion Date: December 31, 2025

1. All offices will ensure timely and effective communication. The WIC Finance staff will meet with Budget Office (BO) Analysts monthly to review SAP forms, expenditure adjustments, Grant Status Reports and other fiscal items for accuracy and action. Program, budget and comptroller staff will meet at least quarterly to review expenditures, processes and needed actions for federal grants. BO and program office staff have agreed to the following verbally: Program staff will submit a final federal report three months after the end of the grant period. Program staff will monitor all active federal grant internal orders paying careful attention to expenditures that post after the close of federal grant budget period. If there is a late expenditure, program staff will revise the final report and submit it to the DOH BO for review using the BO workflow. The DOH BO will also monitor all active internal order numbers and alert the program office of any unusual transactions. The DOH BO will inform the program office of unusual transactions and add them to regular meeting agendas for further discussion and planning. DOH will create a bulletin to outline federal grant management policies and procedures and disseminate to all DOH program offices. 2. BO staff that made the error were notified and counseled on ways to minimize errors. BO shall update the workflow and expenditure adjustment instructions in coordination with the program office. 3. The credit was largely due to overcharges of costs for a Software License Agreement that was not allowed to be charged to the grant. The IT staff that initiated the overcharge and directed the program office to make the adjustment has been counseled on policy and procedures for charging expenditures to a federal source. All fiscal transactions for IT expenditures are reviewed by program staff as well as BO staff via the BO workflow. Policies and procedures specific to IT expenditures charged to a federal fund will be reviewed and updated to ensure information and instructions are robust and clear. Updated policies and procedures will be disseminated to all DOH staff with a responsibility in the process. Anticipated Completion Date: 05/31/2025 Contact Names: Steven Marsden, Audit Resolution Manager; Andrea Race, Chief Financial Officer

Corrective Action Plan 2024-006 – Unallowable Expenditures National School Lunch Program (Significant Deficiency) Federal Program Information: Funding Agency: U.S. Department of Agriculture Title: National School Lunch Program FAL Number: 10.555 & 10.553 Passthrough: N/A Award Year: 2024 Responsible Official’s Plan: Due to the timing of the finding, the District is performing a permanent cash transfer in March to be compliant with the National School Lunch Program. Additionally, the specific corrective action plan provides details for how we have ensured the unallowable expenses for the National School Lunch Program will not occur again. Specific corrective action plan for finding: This was the result of an error in changing an employee's position from one department to another. Moving forward, the Human Resources Department will notify Payroll of any changes in position and will require TWO SIGNATURES prior to making any changes in pay coding. The two signatures are from the Director of Human Resources and the Director of Finance. Timeline for completion of corrective action plan: The permanent cash transfer process has begun and will be completed by March 31, 2025. The form to ensure two signatures are captured prior to making changes in pay coding is already created and being utilized. Employee positions responsible for meeting the timeline: Director of Finance – Cooper Jones Director of Human Resources – Lisa Salazar

2024-002 No indirect cost allocation methodology Criteria: According to CFR Part 200.405(d), if a cost benefits two or more projects or activities in proportions that can be determined without undue effort or cost, the cost must be allocated to the projects based on the proportional benefit. However, when these proportions cannot be determined because of the interrelationship of the work involved, then, notwithstanding paragraph (c), the costs may be allocated or transferred to benefited projects on any reasonable documented basis. Client Response: The agency will use FTE as an allocation method for such expenses calculated as such: (FTE hours for program/Total FTE hours x Total Expense of Line Item). Proposed Implementation Date – December 1, 2024 Name of Contact Person – John Edwards, Sr. Email:jledwards@umadaop.org Phone: 419-255-4444

Finding - Activities Allowed or Unallowed & Allowable Costs/Cost Principles: Payroll, Assistance Listing Number 93.243; June 30, 2024, award year; U.S. Department of Health and Human Services Criteria or Specific Requirement In accordance with 2 CFR 200.405, A cost is allocable to a Federal award if the cost is assignable to that Federal award with the relative benefits received. These costs must be incurred specifically for the Federal award. Condition Found Of the Seventeen payroll charges selected for testing, the allocation of payroll charged to the Federal grant did not align with the percentage of time incurred specifically for the Federal grant in four instances. Views of Responsible Officials and Planned Corrective Actions It was determined that the allocation percentage assigned in our payroll system did not match the calculated payroll expensed to the grant. Corrective measures: 1) contacted our payroll administrator and determined the cause to be that an allocation percentage was applied to the employee and the employee was also assigning their time via their time sheet effectively calculating twice, first on the total payroll and again on the allocated amount. The employee was instructed not to enter the allocation since it is already done in the payroll system. 2) A monthly review and calculation will be performed by program management and accounting to verify cost allocations are correct. Responsible Official: Korin Ihloff, CFO Expected Completion Date: The issue was addressed immediately.

Response: Management agrees with the finding and acknowledges that a significant deficiency was identified related to unallowable payroll costs. This issue occurred due to a timing delay in processing an Employment Transaction Report (ETR). The payroll transfer, originally intended to be effective in April 2024, was not processed until September 2024 of the following fiscal year. As a result, one grant was overcharged, while another grant was undercharged, leading to a misallocation of funds. To prevent similar issues, we will conduct monthly payroll reviews to ensure correct allocation of expenses and provide comprehensive staff training to reinforce the importance of timely and accurate payroll processing. Regular internal reviews and follow-ups will be conducted to monitor the effectiveness of these corrective actions, ensuring any further training or system improvements are implemented as needed. Contact person responsible for corrective action: Lynne Duong, Post Award & Compliance Manager Anticipated completion date: December 31, 2024

We will allocate shared costs appropriately among federal awards

Corrective Actions Taken or Planned Management concurs with the finding and has already initiated enhancements to its review process to ensure that expense reports are consistently reviewed and approved by both supervisors and finance personnel prior to being charged to federal awards. These steps are designed to further strengthen internal controls and support compliance with federal requirements. In addition, Finance staff are formalizing procedures to reconcile payroll charges on a regular basis to ensure compliance with federal requirements and to confirm that all charges to federal programs are supported by actual time and effort records. Responsible person: Jackie Ramirez, Operations & Finance Associate Director Expected Implementation date: October 31, 2025

VIEWS OF RESPONSIBLE OFFICIALS Develop and deliver a comprehensive training program for all relevant staff (finance staff, program staff interacting with subgrantees, procurement staff) on the requirements of 2 CFR 200, with a particular focus on subgrantee monitoring and procurement standards. IMPLEMENTATION DATE During Fiscal Year 2025-2026. RESPONSIBLE PERSON Doris Jiménez, Finance Director Administration for the Care and Comprehensive Development of Children (ACUDEN, by its Spanish Acronym)

2023-006 Management Response: Management respectfully disagrees with this Finding. • Under Condition, the finding states, “Time and effort is being tracked and maintained by employees, including hours charged to the specific efforts for the programs.…” This is not accurate. Employees report their time worked each day, including the amount of time they worked on different projects if applicable. Employees report this in our commercial HRIS/Payroll system, where it is maintained and where it is reviewed and approved by the employee’s manager. The employees report the time they worked and which project(s) they worked on, their managers review and approve the time and the distribution, and the data is tracked and maintained in our HRIS/Payroll system (ExponentHR). • Also under Condition, the finding states, “The specific amount of employee salaries and wages that are allocated to specific federal programs for reimbursement, and which are less than the amounts reflected in time and effort records, are determined by members of the finance staff.” It is correct that we would have to invoice sponsors for less than the total cost of an employee’s allocated time and effort if a sponsor’s budget is not sufficient to cover that full amount. This is the correct procedure to follow. Employees correctly continue documenting their hours worked on a specific project even if the budget is expended and the accounting staff can no longer bill the sponsor. If a particular grant does not have sufficient sponsor funds, then the Grants Accounting staff reduce the bill accordingly. • Also under Condition, the finding states, “The rationale for the amount actually allocated for reimbursement, if less than the amount reflected in time and effort records, is not documented”. This is incorrect. Our monthly invoices to each sponsor accumulate, with each invoice clearly showing not only that month’s expense but also the year-to-date expense and remaining balance, which forces the sponsor invoice to stop at an amount less than the total cost of employees’ time and effort when the budget is exhausted. • Also under Condition, the finding states, “Review and approval of the allocation of employee compensation to specific federal programs reimbursement requests is not maintained.” Each employee records their hours worked, and the project(s) on which they worked those hours, in our HRIS/Payroll system. The employee’s manager reviews and approves both the hours worked and the projects on which the hours were worked. This review and approval is maintained in our HRIS/Payroll system. Financial staff calculate the amount to allocate to specific federal programs based on these HRIS/Payroll system records (or other records such as clinical units produced, based on the terms of each grant). Separate accounting staff review the sponsor invoice and post the Receivable once they deem the invoice correct. • Under Cause, the finding states, “…..the Organization has not implemented a structured process for documenting the extent to which allowable [emphasis added] compensation costs will be allocated for reimbursement to specific federal programs in instances where the allowable compensation cost exceeds the amount allocated for reimbursement.” This means that we do not have a process for documenting how much of a payroll expense already deemed allowable on a particular grant will actually be invoiced there. We disagree and believe that the presence and documentation of a limited sponsor budget, along with cumulative tracking and documentation of compensation expenses against that budget, proves and documents why sometimes full compensation costs are not charged to a grant. • Under Possible Effect, the finding addresses possible effects of “the absence of documented allocation methodologies.” We don’t agree that our process could lead to improper allocation between federal programs (as the finding states) nor to misstating federal expenditures (as the finding states). When a sponsor’s budget is insufficient to cover its appropriately allocated compensation costs, those costs are paid from unrestricted, non-federal funds. As also noted in the finding, no questioned costs were identified.