Corrective Action Plans

Finding 2024-003 Allowability-Payroll: Federal Agency – U.S. Department of Housing and Urban Development Program Name – Community Development Block Grants/Entitlement Grants Federal Assistance Listing Number: 14.218 2 CFR 200.303 requires that a non-federal entity must “(a) establish and maintain effective internal control over the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States and the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).” 2 CFR 200.430 (g)(1) states, “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must : (i) Be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the recipient or subrecipient; (iii) Reasonably reflect the total activity for which the employee is compensated by the recipient or subrecipient, not exceeding 100 percent of compensated activities (for IHES, this the is the IBS); (iv) Encompass federally-assisted and all other activities compensated by the recipient or subrecipient on an integrated basis but may include the use of subsidiary records as defined in the recipients written policy; (v) comply established accounting policies and procedures of the recipient or subrecipient (See paragraph (i)(1)(ii) of this section for treatment of incidental work for IHES.); and (vi) Support the distribution of the employee’s salary or wages among specific activities or cost objectives if the employee works on more than on Federal ward; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. 2 CFR 200.403 indicates that costs must “be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity” and must be “adequately documented”. Responsible Parties: The City Auditor will work with the Mayor’s Office of Economic and Community Development to enhance the policies and procedures in place to ensure that expenditures charged to the federal awards are properly reviewed and supported.

Action to be Taken: The Organization concurs with the facts of this finding and is implementing procedures to prevent this in the future. This issue was isolated to a specific payroll, where a report did not function as intended. No issues were detected with either prior or future payrolls. However, we have implemented the additional step of checking these reports to timesheets to ensure there are no discrepancies.

The District and campus staff will work together to develop processes to capture proper and relevant time and effort activities. This will ensure documentation can be provided regarding personnel expenses to identify employee costs charged to federal programs.

Title III – Assistance Listing No. 84.364 Recommendation: We recommend that the Board reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Board should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Documentation should be readily available for audit. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The Director of Multilingual Achievement will ensure that Time and Effort Statements are completed two times each year. These documents will be completed and signed on January 6 and July 6 of each year. Name of the contact person responsible for corrective action: Sonja Bloetner, Director of Multilingual Achievement Planned completion date for corrective action plan: For immediate implementation and ongoing.

Title I – Assistance Listing No. 84.010 Recommendation: We recommend that the Board reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Board should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Documentation should be readily available for audit. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Weekly payroll runs will be cross-referenced with Title I position logs. Any discrepancies will be investigated promptly. • Unauthorized Employees: Employees not listed on Title I position logs will be removed from payroll to ensure only sponsored employees are attributed to the grant. • Missing Sponsored Employees: Sponsored employees not appearing on payroll reports will be investigated to determine the cause and appropriate corrective actions will be taken. Names of the contact persons responsible for corrective action: Michele Stansbury, Director of Title I Deanna Ashenfelter, Accounting Manager Brent Harry, Fiscal Supervisor III Planned completion date for corrective action plan: Implemented September 17, 2024

Condition: The District was not in compliance with the Uniform Guidance as it was noted that management of the District was not preparing time and effort distribution records and could not produce source documentation to support the time and effort applied to payroll expense that was charged to Title I Grants to Local Education Agencies. Cause: The District's internal controls to identify and document employees that require support for time and effort charged to Title I Grants to Local Education Agencies were not effective for the year ended June 30, 2024. Auditor Recommendation: We recommend the District review their internal controls to strengthen processes and improve procedures. We recommend the District complete all required time and effort certiflcations in a timely manner. Plan of Action: Ashland School District will identify administrative-level staff to oversee federal programs, including Title I, to ensure compliance with all relevant Uniform Guidance activities. District and building staff will review guidelines and documentation requirements for all federal programs to improve record keeping and to allow appropriate review of federal program activities. Date of lmplementation: lmmediately and ongoing.

2024-003 Career and Technical Education – Basic Grant to States – Assistance Listing No. 84.048 Child Care and Development Block Grant – Assistance Listing No. 93.575 Recommendation: We recommend the College review policies and procedures to ensure all personnel on federal grants have documented time and effort reports as stated in federal regulations. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The College will conduct an annual review and certification of time and effort. Name(s) of the contact person(s) responsible for corrective action: Jacob Wheeler, Chief Financial Officer Planned completion date for corrective action plan: June 30, 2025

Corrective Action Plan for Title I semi-annual Certifications In response to the finding regarding the completion and signing of Title I Semi-annual Certifications, the Hannibal School District has developed the following Corrective Action Plan (CAP) to ensure full compliance with Title I regulations moving forward. The plan outlines the actions that will be taken, identifies the responsible individual(s), and specifies the anticipated completion date for corrective actions. Corrective Action Plan Details: 1. Finding: The Title I semi-annual Certifications were not completed and signed in accordance with the required timeline after the applicable period. 2. Planned Actions: o Immediate Review and Verification: The District will immediately review all Title I semi-annual Certifications for the current year to ensure they are completed, signed, and filed properly. Any missing or unsigned certifications will be identified and corrected. o Establishment of Procedures for Timely Completion and Signing: A formal procedure will be established to ensure that all Title I semi-annual Certifications are completed and signed after the applicable period ends. This includes: ■ Clear Timelines: Specific deadlines will be set to ensure all certifications are completed and signed no later than 30 business days after the end of the applicable period. ■ Automated Reminders: The District will set up automated reminders through our internal tracking system to ensure certification completion and signing is done promptly. ■ Internal Monitoring: Regular checks will be conducted by the Title I coordinator to verify that all certifications are completed and signed within the required timeframe. o Training and Staff Accountability: All relevant staff members, including Title I coordinators and administrative personnel, will undergo training on the new procedures and the importance of meeting the required deadlines. Additionally, clear roles and responsibilities will be assigned to individuals for monitoring and submitting the certifications. 3. Person(s) Responsible: o Superintendent of Schools: Oversee the implementation of this Corrective Action Plan to ensure that all procedures are followed. o Title I Coordinator: Ensure that all certifications are completed and signed on time and monitor staff adherence to the new processes. 60 o Administrative Staff: Responsible for assisting with the timely submission of required documentation. • 4. Anticipated Completion Date: The District aims to have the corrective actions fully implemented and the procedures in place by February 1st, 2025. We are committed to ensuring compliance with Title I requirements and addressing any discrepancies that may arise. The District will provide updates on progress as needed and will conduct periodic reviews to ensure ongoing compliance. If you have any questions or require additional information, please feel free to contact me directly. Sincerely, Susan Johnson Superintendent of Schools Hannibal School District #60

Upon identification of costs incurred prior to the beginning of the period of performance, the Organization identified allowable costs incurred within the period of performance and previously charged to program income in order to reallocate grant expenditures without creating other instances of noncompliance (such as cash management). Although the initial support provided to auditors contained instances of expenditures incurred prior to the beginning of the period of performance, expenditure justification has been updated to reflect corrections and all subsequent grant expenditure detail has been reviewed to ensure no recurrence in the subsequent period. The Organization has also reviewed our internal processes for cut-off procedures related to grant expenditures. We will implement additional internal controls at the end of the grant and the beginning of the grant to ensure accuracy of the salaries being posted are in the correct period of performance. We are also working with our accounting software vendor and payroll vendor to automate the allocation of grant salaries based on time and effort of each individual rather than after-the-fact allocations to grants. This will reduce the need to maintain manual spreadsheets to track staff by lining up grant expenditures with pay periods instead of monthly allocations. Further, relevant staff participated in a training focused on CHC grants management matters in December 2024 and will continue to look for learning opportunities to support and challenge compliance matters. Official Responsible for Ensuring the Corrective Action Plan: Danielle Hahn, Progressive Community Health Center Chief Financial Officer. Planned Completion Date for the Corrective Action Plan: The Organization has implemented the corrective action plan as of December 2024 and will continue to monitor throughout the year.

2024-002 INTERNAL CONTROL OVER COMPLIANCE WITH ACTIVITIES ALLOWED OR UNALLOWED AND ALLOWABLE COSTS/COST PRINCIPLES – PAYROLL ACTIVITIES Procedures have been established requiring supervisors to review and approve time charged to Federal projects as a part of the internal control process and ongoing monitoring of federal awards. The current internal control policies and procedures will be strengthened and enforced to ensure employees are preparing and certifying, and supervisors and/or program managers are approving hours charged to all federal projects monthly. Individual(s) Responsible for Corrective Action Plan: John Chomiak Chief Financial & Administration Officer, NMSC 312-610-5615 Anticipated Completion Date: June 30, 2025

The District will enhance internal controls to provide reasonable assurance that all personnel expenses charged to federal awards are accurately documented and approved. This will involve implementing a systematic internal review process for time and effort reporting. The process will include regular checks and approvals by supervisory personnel to ensure that all charges are properly allocated and compliant with established accounting policies. Additionally, the District will integrate these reviews into the official records of the District, ensuring that all activities compensated by the District are accurately reflected. To support this, the District will provide training for staff on the updated procedures and the importance of maintaining accurate records for personnel expenses charged to federal awards. Furthermore, the District will conduct periodic internal audits to monitor compliance with the updated procedures and identify any areas for improvement These audits will help ensure that all documentation of personnel expenses meets the standards required by federal regulations. The actions to remedy this finding are currently in effect as of December 11, 2024.

To ensure that employees are using the correct timesheet, the Office Manager now reviews the timesheets each pay period for grant allocation, formatting and hours prior to executing payroll.

2024-101: Significant Deficiency in Internal Controls Over Compliance and Noncompliance Required to be Reported in Accordance with 2 CFR §200.516(c): Payroll Recommendation: To help ensure employees receive accurate compensation, the School should implement internal control procedures that include thorough verification of payroll data against authorized pay rates before payroll is processed. Action Taken: 1. Pay rate change requests will be accumulated and organized by effective date. 2. For each payroll, all (100%) of the pay rate change requests that became effective during the pay period will be compared to the pay rates for the impacted employee that appear in the preliminary payroll reports. For example, for a pay period from 10/16/2024 to 10/30/2024, all pay rate change requests with effective dates between 10/16/2024 and 10/30/2024 will be compared to the pay rates for the impacted employees in the preliminary payroll reports. 3. If any discrepancies between the pay rate change requests and the pay rates in the preliminary payroll reports are identified, the pay rate will be corrected in the payroll system, the preliminary payroll reports will be reproduced, and steps 1 and 2 will be repeated. 4. If no discrepancies between the pay rate change requests and the pay rates in the preliminary payroll reports are identified, the payroll will proceed as usual. 5. For pay rate change requests with retroactive effective dates, the date of receipt of the change request will be documented, pay rate changes will be implemented immediately, and retroactive pay will be paid in the next payroll. The retroactive change requests will be verified as described in steps 1 and 2. Anticipated Completion Date: 12/31/2024 Contact Person: Keith Chilton

Annually, the Director of Curriculum and Technology in capacity of accountability coordinator shall review all school site SPSAs prior to their final adoption by the governing board of the district and facilitate communication between school site principals and the business office to ensure congruence of the planned budget documents for the District and the SPSA documents for each school site. Should discrepancies be found, the Director shall facilitate with the site principals and the business office the needed corrections to bring the documents into agreement. Director shall also conduct as-needed training with site principals about SPSA components and their appropriate completion

Management's Response and Corrective Actions: The Director of Finance completed salary and wage approval agreement records for the ESSER funds expended for fiscal year ending June 30, 2024 during audit fieldwork. Management has assigned the Director of Finance with the task of completing the required reports in a timely manner. The Superintendent will provide oversight of this requirement. Person Responsible for Corrective Action: Danielle Banasiak, Director of Finance, and Amiee Erfourth, Superintendent

Higher Education Institutional Aid-Assistance Listing No. 84.031S Recommendation: We recommend the University review policies and procedures to ensure all personnel on federal grants documented time and effort reports as stated in federal regulations. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Time and effort reports will be reviewed and submitted monthly. Name(s) of the contact person(s) responsible for corrective action: Elizabeth McMurphy Planned completion date for corrective action plan: January 31, 2025

2024-004 Higher Educational Institutional Aid – Assistance Listing No. 84.031X Recommendation: We recommend the College review policies and procedures to ensure all personnel on federal grants documented time and effort reports as stated in federal regulations. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: A standard template will be used for all grants for time and effort reporting and a standard procedure for approvals will be enforced to show proper approvals from supervisors. Name(s) of the contact person(s) responsible for corrective action: Dr. Dustin Grover, VP of Academic Affairs; Amy Ishmael, VP of Student Affairs; Brando Glick, VP of Fiscal Affairs Planned completion date for corrective action plan: 12/31/24

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

Corrective Steps Taken –The School District will direct personnel to oversee the compliance of the Career and Technical Education grants and verify employees are completing the “Time and Effort” reporting as required by the grant and the School Districts policy of same – annual certification for all employees paid through federal grants.

2024-004 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) – 93.323 Activities Allowed or Unallowed and Allowable Costs and Cost Principles Condition Three employees were paid an additional amount using program funding in order to reflect the administrative burden associated with running the program for three years. For two of the employees, no personnel activity reports or other time records could be provided to support those costs. For the third employee, a monthly log of hours worked on grant activities was provided. However, it only showed the total hours for that month and did not break them out by date of occurrence. Additionally, no supervisor review or other control over that log occurred. Lastly, the employees’ contracts were not amended and approved by the Board to reflect these additional amounts. Recommendation Employees with grant administration responsibilities should undergo training to better their understanding of the compliance requirements that accompany Federal programs. Additionally, controls should be implemented to ensure that all required records are prepared, as well as to ensure that the Board approves all wage rates. Comments on the Finding Staff are aware of the oversight and will strive to improve the process. Action Taken Staff involved in grant administration will review training available from the Kansas State Department of Education regarding federal programs. Additionally, a year-end review of gross wages will be implemented to ensure that paid amounts match the approved contracts.

The District will work with the Assistant Superintendent of Curriculum and Instruction and the payroll supervisor to ensure that pars are matching what is being charged in the payroll system. A form will be created to ensure that they align and both parties will sign off on it quarterly.

The District will implement a system of internal controls to ensure that all certifications are completed by employees working in the federal award programs and in a timely manner. Additionally, the District will ensure that the time being charged to the grant agrees to actual time spent working in the grant for each employee. Anticipated completion Date: Currently in process with final expected date of October 31, 2024.

Going forward, we must be sure to follow the rules in OGAPP Manual 100.3, Personnel Costs, which states that even though cost of overtime/bonuses are chargeable to federal grants, they are only allowable to the extent that the costs comply with certain guidelines. For bonuses, they are limited to 3% of an employee's gross wages (not including fringes) or $1,500, whichever is less. The Ohio Department of Health (ODH) program administrator must approve all bonuses and enter a comment in GMIS in the project comments section.

Corrective Action Planned: In July 2023, the Organization implemented ADP Work Force Now to systematically capture hours worked, the supervisor’s approval and audit trail to reflect the work performed. Budget and Grants in conjunction with the program and Human Resources will implement a hindsight review of employee working hours with a certification by the employee and supervisor. Name(s) of Contact Person(s) Responsible for Corrective Action: Betsey Knapp, Director of Budgets and Contracts; Alvin Sinckler, Chief Financial Officer Anticipated Completion Date: November 15, 2025.

Description: Management’s schedule of Expenditures of Federal Awards was incomplete, resulting in lack of identification of the need for a Single Audit and the delay in its completion. The State funder indicated that no Federal Single Audit was required. Management had not implemented a formal process for preparation of the SEFA. Recommendation: Management should prepare a master tracking schedule for government grants which includes the source of funding and audit and reporting requirements. The schedule should be prepared by someone with knowledge of the grant agreements and reviewed by a leader in the accounting department to ensure completeness. Responsible Contact: Laura McQuay, Vice President & Chief Financial Officer Corrective Action Planned: Management has implemented a master tracking schedule for government grants that includes the source of funding and audit and reporting requirements. This tracker is a joint effort between finance and grants management teams. Anticipated Completion Date: December 31, 2025