Corrective Action Plans

Corrective Action Plan for Current Year Findings June 30, 2024 Finding 2024-001: Activities Allowed or Unallowed Research and Development Cluster Award Period: July 1, 2023 – June 30, 2024 Responsible Person: Karen Miller, Controller 609-771-2203 Jeanette Vega, Director of Grant Financial Administration 609-771-2847 Corrective Action Plan: For the fiscal year ending June 30, 2024, the College had 7 employees with a combined total of 10 payroll instances with no effort verification form certified for any of the transactions from July 1, 2023, to December 31, 2023, in the fiscal year being audited. The effort was certified after the fiscal year, as part of the year-end process which was not in line with the semi-annually time frames as historically done with guidance in our Effort Verification Operating Policy. The College recognizes the importance of ensuring that labor costs charged to federal awards are based on accurate and timely records and certifications, as required under 2 CFR 200.430(g). The timing delays occurred due to staffing vacancies and knowledge transfer of current staff as well as misalignment of staffing. Once the staffing was realigned, trained, and vacant positions filled, the time and effort certification for the fiscal year labor costs were completed. This task occurred during the months between August 2024 and November 2024 which was outside the policy time frames. The College is committed to improving its internal controls over time and effort reporting for research and development grants to ensure compliance by taking corrective action steps to improve monitoring and oversight, strengthen training and communications, and develop an action plan for corrective timing. The College implemented part of the corrective action on August 01, 2024, retroactive to July 1, 2023, and will complete the remaining items by the end of the next fiscal year. Anticipated Completion Date: June 30, 2025

Corrective Action Plan – Kansas Health Science University Identifying Number: 2024-002 Finding: Improper Controls Over Personnel Expenses Applicable Regulation: Uniform Grant Guidance (2 CFR 200.430(g)(1)(i)) states 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. Finding: A KHSU supervisor did not properly document approval for one employee’s personnel activity reports. Corrective Action Taken or Planned: Upon being notified by the auditors of this specific issue, the organization took immediate steps to address the finding. The missing documentation for the personnel activity report was located and the supervisor provided retroactive written approval. The updated Personnel Activity Report was submitted to KDADS. This corrective action resolved the specific instance during the audit. In addition, the following will be implemented: 1. Development and Implementation of a Standard Operating Plan • A SOP for reviewing and documenting approvals of personnel activity reports (PARs) will be developed. • The procedure will include detailed steps for supervisors to review, approve, and retain documentation of PARs. 2. Training for Supervisors • All supervisors responsible for approving PARs will have one-on-one training on the new SOP by the Chief Financial Officer, emphasizing the importance of proper documentation to comply with internal controls and audit standards. • Training sessions will be scheduled. 3. Implementation of Monitoring Controls • A secondary review process will be introduced to ensure compliance with the new procedures, including review by the Principal Investigator. • The Grants Management Office or an equivalent oversight body will conduct periodic audits of PAR documentation to verify proper approvals. Contact Person: Matt Ankenbrandt, Chief Financial Officer mankenbrandt@kansashsc.org Anticipated Completion Date: 2/15/25

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.

Auditor recommendation: The auditor recommends that the City implement a final review for potential duplicated costs prior to approving reimbursement requests, and adjust the general ledger for any such items noted. Views of Responsible Officials and Planned Correc􀀁ve Ac􀀁on: The City agrees with this finding. A reimbursement request was submi􀀂ed 3/18/24 in the amount of $634,532.45. It was later iden􀀁fied that the reimbursement request included duplicate payroll expenditures in the amount of $2,694. One of the duplicated items, totaling $1,115, was iden􀀁fied through internal review within the City of Santa Fe a􀀃er the reimbursement request was submi􀀂ed. A credit memo has been processed in the FAA’s Delphi system and the City has repaid the $1,115 amount that was duplicated. The other item, totaling $1,579, was iden􀀁fied through the external audit. The City will process an addi􀀁onal credit memo and repay the $1,579 amount promptly. The Finance Director, the Accoun􀀁ng Officer, and the Grants team are working with the Airport team to strengthen policies and procedures and ensure a full review of the general ledger for the federal program to ensure no duplicate costs are charged prior to reimbursement requests being submi􀀂ed. A secondary review by the Finance Department of all Airport requests for reimbursement is now occurring prior to submission to FAA. In addi􀀁on, we have started using employee pay advices as addi􀀁onal suppor􀀁ng documenta􀀁on for reimbursement requests. In the past excel spreadsheets were used as suppor􀀁ng documenta􀀁on, and the Finance Department review some􀀁mes happened a􀀃er the reimbursement request was submi􀀂ed. Vacancies in key posi􀀁ons resulted in a lack of robust review of reimbursement requests prior to submission. These key posi􀀁ons have now been filled. The City now has an Airport Manager with substan􀀁al experience managing municipal airports and overseeing federal funding for airports. The Accoun􀀁ng Officer, Grants Manager and Accoun􀀁ng Financial Analyst posi􀀁ons in the Finance Department have been filled, and the Grants Division is now fully staffed. More robust staffing is allowing Finance to work more closely with the Airport team. One of the primary du􀀁es of the new Accoun􀀁ng Financial Analyst in the Grants Division is to support the administra􀀁on of Airport grants. The City is in the process of contrac􀀁ng with a vendor to assist the Airport with federal compliance and provide training for Airport staff on relevant Uniform Guidance requirements. The vendor’s scope of work will include helping with developing and documen􀀁ng policies and standard opera􀀁ng procedures for requests for reimbursement. Addi􀀁onally, the Airport Department plans to create a Grant Accountant posi􀀁on which will be responsible for reconciling grant expenditures monthly and processing reimbursement requests quarterly. The Finance Department will con􀀁nue to perform a secondary review of Airport requests for reimbursement prior to submission to FAA. In CY25 the City plans to provide Uniform Guidance training for staff which will include internal controls related to ac􀀁vi􀀁es allowed and allowable costs. Responsible Official: Emily Oster, Finance Director, James Harris, Airport Manager, Matthew Bonifer, Accounting Officer, Erika Lujan, Grants Manager Timeline and Es􀀁mated Comple􀀁on Date: June 30, 2025

View of Responsible Officials: We have implemented a new payroll recording feature that captures all staff time including overtime.

Reference Number: 2024-004 Proper review of payroll charges to grant funds Corrective Action Plan: The District will review the current policies and procedures of internal controls over payroll charges related to federal awards and implement controls that will adequately monitor the activity charged to programs. Contact Person: Vicki Perez, CFO Implementation Time Frame: August 31, 2025

Information on the federal program: Subject: Education Stabilization Fund - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Federal Agency: Department of Education Federal Program: Education Stabilization Fund Assistance Listing Number: 84.425D, 84.425U, 84.425W Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U210013, S425W210015 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Finding: Material Weakness, Other Matters Context: For 1 selection, in a sample of 40 payroll transactions, the School Corporation did not have time and effort logs to support the portion of the employees’ time charged to the grant. The employees’ time was split with another federal grant; however, the School Corporation did not have support for the allocation of the time charged to the Education Stabilization Fund grant. Contact Person Responsible for Corrective Action: Andrew J Nicodemus, Business Manager Contact Phone Number: 765-362-2342 x6 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Crawfordsville Community School Corporation plans to review all internal control procedures, including the controls over Activities Allowed or Unallowed and allowable Costs/Cost Principles for the Education Stabilization Fund. After this review, we will implement a system to ensure that the proper procedures are completed and fully integrated into our internal control structure. We will implement additional training for all staff involved and will have a designated place where this support is kept. The School Corporation will also implement procedures to determine proper splits for employees who are not paid from one singular Federal Grant and completion of appropriate Time and Effort Reporting. Anticipated Completion Date: We expect this Corrective Action to be implemented as of the current date due to this grant being completed and the School Corporation is not expected to have these grant funds in the future.

Information on the federal program: Subject: Title I Grants to Local Educational Agencies - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listing Number: 84.010A Federal Award Numbers and Years (or Other Identifying Numbers): S010A210014, S010A220014, S010A230014 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Finding: Material Weakness, Other Matters Context: For 5 selections, in a sample of 40 payroll transactions, the School Corporation did not have time and effort logs to support the portion of the employees’ time charged to the grant. The employees’ time was split with another federal grant, however, the School Corporation did not have support for the allocation of the time charged to the Title I grant. Additionally, for three selections, the School Corporation charged a higher percentage to the Title I grant than what the time and effort log percentage showed. Contact Person Responsible for Corrective Action: Andrew J Nicodemus, Business Manager Contact Phone Number: 765-362-2342 x6 Views of Responsible Official: We concur with the finding. Description of Corrective Action Plan: Crawfordsville Community School Corporation plans to review all internal control procedures, including the controls over Activities Allowed or Unallowed and allowable Costs/Cost Principles for the Title I Program. After this review, we will implement a system to ensure that the proper procedures are completed and fully integrated into our internal control structure. We will implement additional training for all staff involved and will have a designated place where this support is kept. The School Corporation will also implement procedures to determine proper splits for employees who are not paid from one singular Federal Grant and completion of appropriate Time and Effort Reporting. Anticipated Completion Date: We expect this Corrective Action to be implemented by the end of the current 6-month period in June 2025.

2024-003 Education Stabilization Funds – Assistance Listing No. 84.425 Recommendation: We recommend NWILCS ensure policies and procedures for payroll expenditures for grant programs be charged to the federal grant based on approved hours worked in the program. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. NWILCS has just brought it’s accounting operations in house as of October 1, 2024 and is working on policy and procedures to ensure that proper recording of payroll occurs. In addition, we are working with ADP to create a file to be loaded directly into our accounting system after each payroll. This will help reduce the number of possible errors. Name of the contact person responsible for corrective action: David Sevier Planned completion date for corrective action plan: May 31, 2025 am

The District Treasurer, with the assistance of the payroll department and District grant administrators, will institute a process regarding the timely and accurate filing of payroll certifications.

REFERENCE: 2024-006 – Allowable Costs/Cost Principles COVID-19 Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing No. 21.027) Federal Grantor: Department of Treasury Facility: St. Mary Medical Center – Long Beach Finding: At St. Mary Medical Center – Long Beach, controls over the required allowability criteria with regard to payroll expense were not performed and/or documented throughout the year. Corrective Action Plan: At St. Mary Medical Center – Long Beach, the leadership team implemented a timecard review process to ensure timecards are properly signed off and approved each pay period, with exceptions confirmed via email from the appropriate manager. Person Responsible: Vo Phay Sin, Controller – St. Mary Medical Center, Long Beach Completion: April 2024

REFERENCE: 2024-002 – Allowable Costs/Cost Principles Medicaid Cluster (Assistance Listing No. 93.778) Federal Grantor: Health Resources and Services Administration Facility: California Hospital and Medical Center Finding: At California Hospital and Medical Center, controls over the required allowability criteria with regard to payroll expense were not performed and/or documented throughout the year. Corrective Action Plan: Emails are sent to the supervisor on the Monday after the pay period ends reminding them to sign-off on their direct reports' timecards by the deadline. If the supervisor does not sign off by the deadline a subsequent email is sent. In the email, they are asked to attest that the timecard is approved as is or corrections will be submitted. Payroll stores the overdue timecard approval attestations in Google drive. Person Responsible: Lynn Christopher, System Director Payroll Delivery Completion: July 2024

REFERENCE: 2024-001 – Allowable Costs/Cost Principles HIV Emergency Relief Project Grants (Assistance Listing No. 93.914) Federal Grantor: Health Resources and Services Administration Facility: St. Mary Medical Center – Long Beach Bailey-Boushay House Finding: At St. Mary Medical Center – Long Beach and Bailey-Boushay House, controls over the required allowability criteria with regard to payroll expense were not performed and/or documented throughout the year. At Bailey-Boushay House, one employee’s salary that was charged to the grant was not supported by the underlying timesheet for the respective pay period and the related expenditures should not have been charged to the grant and requested for reimbursement. Corrective Action Plan: At St. Mary Medical Center – Long Beach, the leadership team implemented a timecard review process to ensure timecards are properly signed off and approved each pay period, with exceptions confirmed via email from the appropriate manager. At Bailey-Boushay House, each Friday and Monday prior to running payroll, approval reminders are sent to all staff with the time-keeping policy attached. At least two different leaders and/or the scheduling coordinator send these reminders. Staff have been educated on the two-step approval system and it will impact their performance evaluation if there is continued non-compliance. The executive director ensures supervisory follow-up with each name that shows up in the audit report each pay period by Kronos Reports. The Finance Manager reviews the timecard allocations and populates the hours charged to the grant per the timecard on to the salary allocation spreadsheet. The salary allocation spreadsheet is utilized in completing the reimbursement request. The salary allocation spreadsheet is reviewed by the Director of Outpatient Programs as part of the reimbursement request approval process. The questioned costs will be refunded by Bailey-Boushay House to the grantor in February 2025. Person Responsible: Vo Phay Sin, Controller – St. Mary Medical Center, Long Beach Rob Hays, Executive Director – Bailey Boushay House Completion: April 2024 (control implementation) Expected Completion: February 2025 (compliance corrective action)

FINDING 2024-003 Finding Subject: Child Nutrition Cluster (School Lunch) – Allowable Cost Summary of Finding: The payroll for non-certified employees for the 2023-2024 school year has not been approved by the board, leading to a lack of verification for salaries paid from fund 800. As a result, any payroll for non-certified employees paid after August 1, 2023 from fund 800 cannot be verified. Contact Person Responsible for Corrective Action: Robin Popejoy Contact Phone Number and Email Address: 317.758.4172 – rpopejoy@sheridan.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The salary schedules will be submitted to the board for approval. Anticipated Completion Date: May – August 2025

Planned Corrective Action: The City will ensure actual costs are charged to the program as part of the annual reporting process. Anticipated Completion Date: December 30, 2024 Responsible Contact Person: Gretchen Johnson, Finance Director

Views of Responsible Officials The Organization agrees with this finding. Corrective Action Plan The Organization has strengthened its internal controls over payroll transactions in order to comply with laws, regulations, and grant agreements. Additionally, the pass-through entity has increased its documentation requirements which helps the Organization ensure that it possesses compliant payroll documentation. Further, the Organization plans to review its personnel files to ensure that adequate documentation exists to support approved rates of pay. Name(s) of Responsible Individuals Lacy Kimes, Board President Anticipated Completion Date Partially implemented; partially ongoing. Personnel file review anticipated completion February 28, 2025.

FINDING 2024-011 Name of Responsible Individual: Tyler Hosey, Senior Accountant Corrective Action: The University acknowledges that the records to substantiate the payroll costs were insufficient and lacking internal controls. Going forward the University plans to implement a strategic process to document time and effort associated with research and development cluster and it’s federal grants. All employees that work with the Challenger Learning Center will continue to have their hours worked documented in the Paycom payroll software. Payroll is processed on a biweekly basis, and therefore on biweekly basis the payroll costs from the Challenger Learning Center will be reimbursed to the University from the various Challenger Learning Center bank accounts. This will be done as a percentage of time worked for the NIH Grant, the NASA Grant, and the general Challenger Learning Center functions. Anticipated Completion Date: June 2025

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