Corrective Action Plans

The City concurs with the finding and will take the following actions in response:Development’s Fiscal Team shall continue the process developed in response to the 2023 finding, with one modification: instead of a quarterly ‘true up’ process, Development shall perform a monthly ‘true up’ process. This provides the opportunity for more frequent fiscal review of work logs and quicker identification of non-compliance by programmatic staff and supervisors. If a work log is not signed by the employee and/or supervisor, fiscal staff shall notify the employee and supervisor of the issue and request it be signed as soon as possible. Only after the work log is signed by both employee and supervisor shall it be included in the monthly true up. If the employee and/or supervisor is non-responsive to the request to sign the work log, the Deputy Director of Housing Strategies shall be notified and requested to address the issue as soon as possible; Development’s fiscal team shall continue to review signature timeliness as a part of the monthly ‘true up’ process. If fiscal identifies work logs signed by either employee and/or supervisor outside of the allotted time per the Department’s work log policy, fiscal shall notify the Deputy Director of Housing Strategies and request the issue be addressed as soon as possible; and The Compliance Officer shall provide a written reminder to all applicable staff and supervisors to sign the work log in a timely manner and shall perform a periodic review of the work logs throughout the year. Work log review shall also be included in internal monitoring done by the Compliance Officer. Documentation of reviews will be retained per the Department’s record retention schedule.

Recommendation: During our review of the grant expenditures, it was noted that budgeted amounts were charged to the grant instead of the actual costs incurred. This practice was observed in multiple instances, leading to discrepancies between the reported expenditures and the actual costs. Management did not review time and effort to make after-the-fact adjustments to the amounts charged to the grant. We recommend that the Organization establish a review process to ensure that all costs charged to the grant are based on actual expenditures and are properly documented Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management has established a review process to ensure that all costs charged to the grant are based on actual expenditures and are properly documented. Name(s) of the contact person(s) responsible for corrective action: Theresa Watters Planned completion date for corrective action plan: February 21, 2025

Corrective action plan: Management is in the process of implementing a method for employees to charge their time to grants, as needed, from the payroll system. Personnel responsible for corrective action: Timothy Jodway, Interim Chief Financial Officer. Estimated corrective action completion date: May 2025

Management Response/Corrective Action Plan: The School Department completed the necessary time and effort documents for expense reimbursement that were approved by the Department of Education. The time and effort was not specific to actual time worked for those split among multiple grants or funds. Moving forward, any employee who has time split between multiple grants or Federal and non-Federal activities will be expected to complete a personnel activity report. This report will record actual time spent working on eligible activities for each fund. If the employee has a regular schedule, the employee’s schedule will suffice as their personnel activity report, as long as it follows the guidelines. The personnel activity reports will be requested each month during the reimbursement request process and will be signed by the employee and their supervisor.

Management Response/Corrective Action Plan: The School Department completed the necessary time and effort documents for expense reimbursement that were approved by the Department of Education. The time and effort was not specific to actual time worked for those split among multiple grants or funds. Moving forward, any employee who has time split between multiple grants or Federal and non-Federal activities will be expected to complete a personnel activity report. This report will record actual time spent working on eligible activities for each fund. If the employee has a regular schedule, the employee’s schedule will suffice as their personnel activity report, as long as it follows the guidelines. The personnel activity reports will be requested each month during the reimbursement request process and will be signed by the employee and their supervisor.

CORRECTIVE ACTION PLAN (Concerning Finding 2024-001) Contact Person Responsible for Corrective Action: Catrina Kemp, Business Manager Corrective Action: The Regional School Unit No. 70 will take the following actions to address finding 2024-001. Managerment will review standards and requirements annually to ensure that the district is following federal guidelines. Management will also employ a signature and date on all federal grant disbursements to ensure that all criteria and requirements are met. Allowable costs will be assesed monthly before submission for allowability. Management will implement a two step review process for contracts and payroll. Anticipated Completions Date: July 1, 2025

The District acknowledges this finding and is committed to strengthening internal controls to ensure compliance with federal time accounting requirements. The State and Federal Programs Department has received training on Time and Effort procedures, and additionally training is being provided to school sites to reinforce accurate time certification and documentation for federal fund expenditures. To address the deficiencies, the district will shift from an annual to a monthly reconciliation process, ensuring that employee salaries charged to Title I accurately reflect actual work performed. The State and Federal Programs Department will collaborate with the Budget Department to systematically track employees funded through Title I and verify that all required PARs are completed and maintained.

U.S. Department of Education AL 84.010A Title I, Basic Grants to Local Education Agencies AL 84.010A Title I, Part A - Investment in Schools 2 AL 84.367A Title II: Improving Teacher Quality State Grants AL 84.424A Title IV: Student Support and Academic Enrichment Grants Type of Finding – Noncompliance and Significant Deficiency over Activities Allowed or Unallowed and Allowable Costs/Cost Principles (Payroll) Repeat Finding: No Auditee’s Corrective Action Plan: The School recognizes the importance of maintaining records and ensuring adequate internal controls over activities allowed and allowable costs/costs/principles. To strengthen internal controls in this area, in July 2024, the school introduced EdOps to work on payroll and to conduct an additional layer of review in addition to the HR Manager and the CEO. The School recognizes that its documentation and record-keeping requires improvement. Should the School resume operations, it will assess review and record-keeping processes to ensure the integrity and accuracy of payroll and related documents. Contact Person: Aaron Lentner

Audit Finding Reference: 2024-001 Management’s Response and Planned Corrective Action: The District will ensure that any further retention bonuses be formally reviewed and approved by the School Board and Superintendent. Stipends for work performed are now included in a formal Letter of Agreement and signed by the employee and administrator. Name of Contact Person and Completion Date: Name: Kathryn Ducharme Anticipated Completion Date – July 1, 2024

Management Response and Corrective Action Plan 1. Automatic payments for recurrent utility services are covered by blanket approval to ensure timely remittances. Individual utility invoices are not individually approved but are reviewed by agency location by the Operations department during their monthly finance meeting. Management has elected this method as most efficient for the volume and timeliness required. Documentation of the review during the meetings will be kept as evidence of review of these expenses. 2. Management allocates payroll for exempt salaried employees on an hourly basis to fund sources based on the 80-hour period for which they are compensated. Any hours worked in excess of 80 hours by these employees are not compensated nor charged to fund sources. Exempt salaried employees have been directed to report only compensated time on timesheets. 3. We concur with this finding. Changes in pay rates for staff who perform multiple roles will be redefined to include all possibly affected program fund sources that staff may impact. Contact person(s) responsible for the corrective action: Lisa Brabo, Chief Executive Officer, lbrabo@fsacares.org Denise Cicourel, Chief Operating Officer, denise@fsacares.org Jaime Kuczkowski, Chief Financial Officer, jaime@balancefm.com Anticipated Completion Date: Education and documentation on the above have already started and will be completed by June 30, 2025.

Invest in Kids updated its human resources system to ensure timesheets accurately reflect time allocated across various funding sources and cost objectives. Additionally, all staff attended the organization’s annual financial management and internal controls training in October 2024, that included updated policies and a focus on accurate submissions of time and effort. Policy reviews have also been completed by management.

Management’s Response/Corrective Action Plan: Management will have staff prepare monthly personnel activity reports for time worked on grants and will review and adjust budgeted payroll allocations accordingly. Monthly budget report have already been set up on the Google Drive for management and staff to access and review.

Name of Responsible Individual: Marchon Jackson, Associate Vice President for Research, Brenda Willis, Senior Executive Director of Financial Grants & Contracts, Jaquion Gholston, Assistant Vice President for Post-Award and UARC Operations Corrective Action: A new office is being developed to address the timeliness of the personnel payment request forms. In Phase I, CRAs will be assigned to high-volume research colleges to provide support for costing allocations. Phase 2 will encompass existing departmental administrators who will gradually transition into more centralized research workflows supported by CRAs. A shared services model for the remaining colleges is planned for FY26. Quarterly checklist and updates outlining cost allocation statuses will be completed with Deans and Associate Deans to determine the process needed to complete cost allocations timely. Anticipated Completion Date: July 1, 2025

We acknowledge BDO’s recommendation to ensure consistent approval and retention of timesheets by both employees and supervisors for each pay period requested for reimbursement. However, VOAWW asserts that we have established controls in place to obtain and retain timesheet approvals, and the two instances of missing approvals identified in the audit were due to human error rather than a lack of controls. To prevent such occurrences in the future and reinforce our existing procedures, we will continue implementing and strengthening the following controls: • Proactive Timesheet Approval Monitoring – Reports are regularly run to identify missing timesheet approvals before payroll is processed. Employees and supervisors with outstanding approvals receive reminders to ensure further action as needed, including notifying program directors about missing timesheet submissions or approvals resulting in out-of-compliance with federal awards and Uniform Guidance. • Real-Time Payroll Processing Checks – During payroll processing, additional reminders are sent to employees and supervisors who have not yet approved their timesheets, further reducing the likelihood of omissions. • Additional Approval Outside the System – In response to BDO’s recommendation, we will require managers to email Payroll at the end of every pay period affirming that they have reviewed and approved all timecards. This additional layer of approval ensures that even if a manager forgets to approve a timesheet in the system, there is still documented confirmation of their review. • Post-Payroll Compensating Control Implemented in FY24 – To mitigate any risk of over/undercharging grants due to miscoded time from unapproved timesheets, a compensating control was introduced in FY24. This process requires Program Management to review and approve a post-payroll report identifying any discrepancies in time allocations, ensuring that all time charged to grants is accurate and properly approved. • Documentation and Continuous Improvement – VOAWW provided attestations to BDO where available and acknowledges that the compensating control was not fully implemented during FY23 but was in place for most of FY24. Moving forward, we will ensure that this control is consistently applied across all programs. By maintaining and strengthening these controls, including the additional email approval process, we are confident in our ability to ensure proper timesheet approvals while mitigating any risk of inaccurate grant charging. Responsible Individual: Claire Danielson, Controller Estimated time of completion: June 2025

We acknowledge the auditors’ recommendation regarding the need for a more arm’s-length approach in determining rent charges between entities. To address this finding, we are making adjustments to our rent allocation methodology to enhance transparency and ensure compliance with best practices. As part of our corrective action plan, we will implement the following measures: • Transition to an Actual Expense Allocation Methodology – VOAWW will modify the rent allocation process to allocate actual expenses incurred, ensuring that charges between entities reflect true costs. This approach eliminates the need for a year-end true-up process while maintaining fairness and accuracy. • Implementation of a True-Up Process for FY25 – While transitioning to the new methodology, we will conduct a true-up process for FY25 to reconcile any discrepancies and ensure that rent allocations align with actual expenses. These actions will help strengthen our internal controls and ensure that inter-entity rent allocations are handled in a compliant and equitable manner. Responsible Individual: Claire Danielson, Controller Estimated time of completion: June 2025

UPS-AIDS has always used the budget allocations for wages and salaries in the past until this year that it becomes an issue. The finding was not corrected because management did not have sufficient time to prepare for the subsequent year after the previous year was submitted in a very short period of time. Nevertheless, we have agreed to comply as they have requested. However, we have agreed to comply with 2 CFR 200.430. Ive Pierre, Chief Financial Officer, will implement a time study by June 30, 2025.

2024-018. USU Extension Extra Services Compensation Program Non-Compliance with Uniform Guidance State Agency: Utah State University Research & Development Federal Agency: Various 1) Potential Financial Impact USU retained Huron Higher Education Consulting to conduct a Uniform Guidance compliance review of compensation costs charged to federal sponsors. Huron Consulting routinely works with Carnegie R1 institutions to review research compliance issues. Huron conducted a detailed review of an extensive data set for ESC payments made to USU employees, focusing on employees who had salary charged to federal grants or designated as a grant cost share. This review identified limited instances (1) when salaries directly charged to sponsored projects included extra service compensation in the institutional base salary and (2) when extra service compensation was charged to federal sponsors. Overall, the review found that the vast majority of USU ESC payments (referred to as secondary payments in the internal audit) were not charged to federal sponsored awards. Out of a total population of $5.8 million ESC payments reviewed, the unallowed compensation costs related to ESC is approximately $140,000. USU is in the process of addressing the unallowable compensation costs by removing unallowable charges on open awards and refunding unallowable charges on closed awards. 2) Policies and required documentation for ESC. ESC Policies: USU is reviewing its policies associated with ESC and institutional base salary (IBS) (both currently defined in USU Policy 376: Extra Service Compensation). A working group has been established that includes the Provost’s Office, the President’s Office, the Office of Research and Human Resources to develop updated procedures for requesting ESC. Once in place, a new Extra Service Compensation website will be rolled out that will provide guidance on the policy, acceptable uses of extra-service Compensation, and training materials. In conjunction with the website development, a communication plan to inform stakeholders, especially approving department heads and administrators, will be developed. Institutional Base Salary Policy and Procedures: USU will create and implement an Institutional Base Salary policy that aligns with federal requirements and industry best practices and specifically defines salary components and the associated pay codes that are included and excluded from an employee’s institutional base salary. USU will also update its time and effort certification system with correct institutional base salary mapping. 3) Internal controls for sponsored program compensation USU will implement the following improvements in its internal controls: Revised ESC Form. USU has revised its ESC Form to include documentation / calculation demonstrating payment is commensurate with institutional base salary. Revised ESC Application and Approval Process: USU has already updated the internal ESC review process to include appropriate controls to ensure that all ESC requests are reviewed for Uniform Guidance and USU policy requirements. In this regard, all ESC requests at USU are now reviewed by the Office of Sponsored Programs in the context of all funding sources associated with the applicant (including cost share indexes). This change directly addresses prior routing based on the source of funding which resulted in the Office of Research/Sponsored Programs being bypassed for state-funded ESC requests. Certification language has been inserted at appropriate approval levels to ensure that employees are not receiving ESC related to their primary position/workload. Improved Definitions of Primary Work Statement: USU has initiated a collaborative effort between Human Resources, the Provost’s Office, and the Office of Research to clearly define the primary work assignment for faculty via the role statement or annual work plans to clarify the full workload associated with the IBS. Increased Compliance Monitoring: After-the-fact monthly review of ESC payments is being collaboratively performed between the Office of Research and Provost’s Office. Additionally, USU has reorganized its operations to house post-award research administrators within the Office of Research and added an additional supervisory position to manage post award compliance and management. USU will charge central-post award research administrators with monitoring salary charges to sponsored awards and cost share accounts as a secondary internal control. Research Incentive Programs: The Office of Research will establish permissible conditions and components for research incentive programs and any and all proposed programs will be reviewed and approved by the Office of Research before implementation. 4) Adequate training to university personnel regarding sponsored programs compensation compliance. Uniform Guidance training for faculty and staff: USU is building and incorporating new training modules for those managing federal awards which will include guidance on allowable compensation costs and determining institutional base salary. ESC Training: USU has developed a new required annual training for anyone requesting or approving ESC from all types of funding sources at USU (delivered via USU’s Learn Blue system). This training addresses requirements for ESC and employees’ role and responsibilities for compliance requirements. Additional training regarding time and effort certification will be developed. Pay Code Training: USU will provide additional training and education for departmental and payroll staff responsible for coding and processing salary across the institution. Responsible Person: Lisa M. Berreau Vice President for Research Utah State University 435-797-3509 Anticipated completion date of corrective action plan: Actively in progress and full completion by Jan. 1, 2026.

Federal Agency Name: Corporation for National and Community Service Pass-Through Entity: State of Washington – Service Washington, State of California – California Volunteers, State of Kentucky – KY Cabinet of Health and & Family Services Assistance Listing Number: 94.006 Program Name: AmeriCorps State and National Finding Summary: Title 2 U.S. Code of Federal Regulations (CFR) Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.430 provides that records must be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated. Amounts for certain personnel costs were not reimbursed at the correct pay rate for certain employees. Responsible Individuals: Reid Cox, CFO Corrective Action Plan: Acknowledged. While current year differences were immaterial and resulted in a slight underbilling, we have implemented a secondary review process of all calculations of hourly payrates to ensure consistency in the payrate calculation. Anticipated Completion Date: Ongoing

The District is aware of the importance of maintaining documentation that demonstrates expenditures charged to a program are allocable and allowable. The District will review existing procedures related to the review of temporary workers to ensure that documentation is available to demonstrate charges to programs comply with federal guidelines and regulations. The District also recognizes the importance of timely approval of time and effort in compliance with federal regulations. While the District does perform regular reconciliations of expenses to ensure allowability, the District will review and update procedures, as necessary, to continue to improve and document timely supervisory approvals after each bi-weekly payroll is processed in relation to finding 2024-01 in the District’s Report on Internal Controls and Compliance.

Management agrees with the finding related to effort certifications. Dartmouth-Hitchcock published a new effort policy on February 11, 2025, for all research staff to emphasize the importance of Principal Investigators and Research Staff certifying their efforts on grants promptly. Management will begin implementing and enforcing the policy starting with the quarter ending March 31, 2025. Leadership Responsible: John Muhlen, System Vice President of Corporate Finance Anticipated Completion Date: March 31, 2025

2024-006 Program: Equitable Sharing Program Federal Financial Assistance Listing Number: 16.922 Federal Grantor: U.S. Department of Justice Award No. and Year: 2024 Compliance Requirements: Allowable Costs/Cost Principles Type of Finding: Significant Deficiency in Internal Control Over Compliance and Instance of Noncompliance Criteria: 2 CFR Section 200.303(a), Internal Controls, states that the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 CFR Section 200.430, Compensation – Personal Services, states that charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must be supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable and properly allocated. Condition: During our testing of the Sheriff Department’s compliance with allowable costs/cost principles requirements, we noted that thirty-three (33) of forty (40) overtime cost calculations were miscalculated. Cause: Equitable sharing funds may not be used for salaries, except under certain provisions outlined in Section V.B.3 of the Equitable Sharing Guide including overtime. The Sheriff’s Department calculates the allowable portion of personnel salaries using a separate template that contained a formula error which inaccurately calculated the total salaries costs allocated to the program. The Sheriff’s department did not have internal controls in place to ensure that the allowed salaries were being calculated correctly. However, the error was detected after the 5th out of 6 months in which these types of costs were allocated to the program. Effect: Salary costs were allocated to the program in an incorrect amount. Questioned Costs: Our testing resulted in questioned costs in the amount of $3,550. However, the total questioned costs for the total population was $23,409. Context/Sampling: A sample of forty (40) individuals were selected from a population consisting of (840) payroll transactions. Repeat Finding from Prior Years: No. Recommendation: We recommend the Sheriff’s Department establish and maintain internal controls to ensure the overtime calculations are being accurately allocated to the program. Management Response and Corrective Action: 1. Person Responsible: Tiffany Mui, Fiscal Administrator 2. Corrective Action Plan: a. Staff corrected the formula error in the Overtime (OT) calculation workpapers. Detailed workpapers, including formulas, will be reviewed by Fiscal Administrator. b. Updated desk procedures for Sheriff’s Narcotics task will include updated OT calculation change. Procedures will be reviewed and initialed by Fiscal Administrator and Sr. Fiscal Manager. 3. Anticipated Implementation date: March 2025

Condition: The documentation to support reasonable assurance for salaries and wages consisted of documentation of when employees completed a therapy session but no clear documentation of how much time when employees were on-call or completed case notes for this grant. Recommendations: We recommend The Center remind its employees complete a personnel activity report that show all of the hours employees spend on the grant not rely just hours documented in the Center system used to track therapy sessions. Management response: Management agrees with the finding and has already put a process in place for documenting time spent on grant-funded activities. Management is working with our Chief Compliance Officer to ensure that the process encompasses all necessary steps to ensure complete and accurate records of the grant-related activities by those who have the time covered by the grant funds.

Contact person(s) responsible for corrective action – Lisa Lawson, Sr. Accountant Corrective action planned – KMHS will move forward with billing benefit expenses as actual as of January 2025 contract billing. All employee and employer benefit costs will be billed out per the actual benefits enrolled and received. Anticipated completion date – 1/31/2025

2024-002 - LACK OF WRITTEN FISCAL POLICIES AND PROCEDURES As of March 27, 2025, scaleLIT has updated its fiscal policies and procedures to reflect all the federal guidelines required by the Uniform Guidance. The scaleLIT Board Treasurer has reviewed and approved the updates.

2024-001 – MATERIAL WEAKNESS IN INTERNAL CONTROLS OVER FINANCIAL REPORTING In July 2024, scaleLIT switched accounting firms. This engagement has led to a more robust monthly close-out process to ensure accurate and complete class allocations. The Director of Operations meets with the firm weekly to review accounts receivable, expense and income coding and allocations, and other activities related to billing and invoicing. The Director of Operations and Executive Director meet monthly with another accounting team member to review monthly financial reports. PART III - FEDERAL PROGRAM AUDIT FINDINGS 2024-001 – MATERIAL WEAKNESS IN INTERNAL CONTROLS OVER FINANCIAL REPORTING As stated above, scaleLIT is now working with a new accounting firm, Jitasa. Jitasa tracks all grants on separate ledgers. scaleLIT meets with Jitasa weekly to ensure that all income and expenses are correctly allocated. scaleLIT is implementing time studies for staff beginning on April 1, 2025, to become more detailed with the staff time spent on federal contracts.