Corrective Action Plans

Since the prior audit period, management has taken steps to develop and implement a time and effort reporting system that meets federal documentation standards, such as activating the electronic timekeeping system to track actual work performed and testing adoption of reporting procedures across departments and teams. Finance will continue implementing the corrective actions necessary to establish an effective and compliant time and effort reporting system, including providing training for employees and regularly monitoring for effective system utilization. These actions will strengthen internal controls and ensure personnel costs are accurately recorded and appropriately allocated. The anticipated completion date remains June 30, 2027.

Contact Person Tonya Hunskor Planned Corrective Action The Cooperative will ensure proper subrecipient monitoring is implemented. Planned Completion Date June 30, 2026.

Finding 2025-008 – Allowable Costs/Cost Principles and Matching, Level of Effort, and Earmarking Contact Person: Susan Rios, Grants Manager Current status: In-Progress Anticipated Completion Date: February 06, 2026 Condition: The University did not have effective internal controls over the timely preparation and approval of employees’ time and effort certifications. Identification of repeat finding: N/A Resolution: The Time and Effort Reporting form was updated on February 6, 2026, to more accurately reflect the semesters covered by the form submitted by the respective program. The Grants Accounting Office will obtain the completed forms within 90 days of the last day of the performance period. The forms will be completed on a biannual basis and collected from each respective program within 90 days following the end date of the most recent semester.

Finding 2025-001: U.S. Department of Health and Human Service, National Institutes for Health Research and Development Cluster, Cancer Control, Assistance Listing #93.399; Lack of Required Written Policies Corrective Action: We agree with the recommendation. We do currently require complete supporting documentation for all expenditures. Montana Cancer Consortium (MCC) has updated the Financial Process Procedure to include language related to receipt management, allowable and disallowed grant expenses, and timing of payment requests. Timeline: This was implemented on December 1, 2025. Responsible Parties: MCC Director, Principal Investigators

The District will implement controls to ensure that time and effort documentation is maintained for staff who are split funded with costs being applied to federal program.

Allowable Costs/Cost Principles Recommendation: Update and revise the cost allocation plan annually to reflect actual program usage including the board of directors approval. Implement a time and effort reporting system for all shared staff and provide training to ensure compliance with federal requirements. This should include proper review and approval of all costs, explicitly documented. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Management will establish and implement formal procedures to ensure the proper allocation of allowable costs across all grant components. These procedures will include appropriate oversight mechanisms to verify accuracy, compliance with grant requirements, and consistent application of cost-allocation methodologies. Names of the contact persons responsible for corrective action: Robert Loiseau, Finance Director and Gary Beaulieu, Executive Director

Management Response: The University agrees with this recommendation and will modify the procedures associated with the review of subsequent payroll and fringe adjustments to ensure that in addition to reversing in total that the adjustments also reverse at the index-account level. These new procedures will be implemented by February 27, 2026, and will be overseen by the Deputy Controller.

Recommendation: Management should ensure that employees are aware of the jobs they are working on as they log their time, and supervisors should include this as part of their review process. When adjustments to correct errors are necessary, management should document the reason for the correction as well as review of that correction. The accounting department should record the adjustments in the general ledger through a journal entry. Action Taken: The Finance and Human Resources departments are implementing enhancements to existing payroll allocation processes, including additional training and guidance to employees and supervisors to reinforce proper timekeeping and project coding in accordance with established policy. Management will also implement formal control requiring documented review and approval of payroll allocation adjustments. All approved adjustments will be recorded in the general ledger through journal entries prepared and reviewed in accordance with established accounting procedures. Anticipated completion date: June 30, 2026

View of Responsible Officials: We have implemented a new payroll recording feature that captures all staff time including overtime via a separate spreadsheet. The change was effective subsequent to the 2024 audit report date.

2025-002 Inadequate Documentation of Timesheet Approval for Payroll Costs Charged to the Grant - Significant deficiency in Internal Control over Compliance Name of Contact Person: Daphne Chan, Interim Head of Finance Corrective Action: Lifelong Medical Care will: - Continue to update configuration of the newly implemented payroll system to adequately support processes - Revise the payroll and timekeeping policy to clearly require electronic or manual supervisory approval for all hourly timesheets before payroll processing. - Provide refresher training to supervisors on federal grant requirements related to allowable payroll costs and the necessity of timely timesheet approval. - Implement a periodic monitoring process to review samples of timesheets each pay period to confirm that approvals are documented and retained. - Maintain approved timesheets in accordance with the Lifelong's document retention policy and federal grant requirements. Estimated Completion Date: June 30, 2026 Signed by Daphne Chan Interim Head of Finance

Views from Responsible Officials and Corrective Action Plan BCFS Health and Human Services For the Year Ended August 31, 2025 Finding Number: 2025‑001 and 2025-002Federal Program: Crime Victim Assistance – AL 16.575 (Common Thread – Texas) Pass‑Through Entity: Texas Office of the Governor Award Number: 3853406 Questioned Costs: $853,982 Responsible Person: Rosa Baez, President BCFS Health and Human Services Views of Responsible Officials: Management concurs with the finding. BCFS Health and Human Services’ (BCFS HHS) in-kind match plan includes the use of exempt personnel performing after-hours "on-call" volunteer duties, such as answering phones or undertaking responsibilities outside their standard work roles. BCFS HHS did not meet the in-kind match requirements, as the former Program Executive Director deviated from the in-kind match plan, as approved by the funder. The former Program Executive Director did so by hiring full-time personnel to perform the same duties as the on-call volunteers and including them as part of the in-kind match. In 2022, during the COVID pandemic, the funder waived match requirements; during this period, the prior Program Executive Director hired full-time overnight on-call personnel, in response to increased call volume driven by restrictions on face-to-face services due to concerns of exposure. The match waiver was discontinued with the grant awarded for October 2024 through September 2025, and BCFS HHS was required to meet their match obligations. The former Program Executive Director failed to reassign the On-Call workers resulting in a significant deviation from the approved match plan and contributed to the noncompliance of in-kind match requirements. Immediately upon the issuance of the monitoring report regarding match requirements, BCFS HHS’ President has been actively working with Office of the Governor (OOG) to rectify the match requirements per the grant. Management has recorded an accrual for the estimated adjustment and has implemented the corrective action plan outlined below. Page 2 of 3 Corrective Action Plan Upon receiving the preliminary monitoring report from the OOG, management promptly initiated an internal review with the OOG and began collaborating with OOG to address and resolve the findings identified. Effective immediately, BCFS HHS has established new protocols to ensure compliance with match requirements for the Common Thread Texas program. BCFS HHS will undertake the following corrective actions: 1. Revised In-Kind Volunteer Hotline Process A protocol has been implemented to manage the volunteer hotline for the Common Thread Program during after-hour operations. The hotline provides callers with program information, resources, referrals, and transfers calls as appropriate, including crisis response or intake services. The volunteer hotline is managed by volunteers that include exempt employees (working outside their regular duties), interns, and other approved community volunteers. Volunteers must complete training prior to being scheduled. The protocol guidelines include: •A designated volunteer timesheet. •A signed attestation certifying that hours listed are an accurate record ofvolunteer service. •Confirmation that the volunteer work is not required by their employment andis different and separate from their regular job duties. These measures provide robust supporting documentation and ensure that match activities are voluntary, allowable, and compliant. The Volunteer Hotline Protocol was reviewed and approved by the Office of the Governor (Public Safety Office and Office of Compliance and Monitoring). Target completion: Completed January 2026 2. Strengthen Match Documentation Processes Volunteer Attestation and Timesheet- Volunteers are required to sign a timesheet and an attestation affirming that the recorded hours accurately reflect their service with the Common Thread Volunteer Hotline. Additionally, if applicable, volunteers must confirm that this service is not mandated by their employment and is distinct from their regular job responsibilities. Monthly Match Meetings: These meetings will review the reported match activities against the approved match plan. Additionally, the meetings provide an opportunity to evaluate current needs and trends, and to ensure match obligations are met. Page 3 of 3 Target completion: Completed January 2026. 3. Correct and Reclassify Previously Reported Match BCFS HHS excluded the disallowed match activities and included permissible methods such as unrecovered indirect costs, reductions in billed expenditures, including personnel and training—and additional adjustments approved by OOG. All necessary changes are incorporated in the final Financial Status Report (FSR) submitted on January 29, 2026. Target completion: Completed. 4. Staff Training and Ongoing Compliance Monitoring BCFS HHS will provide Common Thread leadership training on uniform guidance match requirements, OOG-specific guidance, and the Volunteer Hotline Protocols. Weekly Audits- The BCFS HHS Director of Support Services, or designee, will conduct weekly audits to ensure protocol adherence. This will encompass a review of the hotline volunteers’ timesheets, and schedules. Results will be discussed in the monthly match meetings. Use of U.S. Bureau of Labor Statistics wage data- All volunteer and intern hours are valued using OOG‑approved labor categories. Target completion: Training will be completed by February 28, 2026; monitoring process will be implemented February 1, 2026. Sincerely, Rosa Baez, President BCFS Health and Human Services

2025-003 The District will implement procedures to ensure all expenditures are for allowable purposes prior to disbursement. 6/30/2026 Holly Skulich, Treasurer

Management engaged an external HR consultant to assist with revising the Accounting Policy Manual to formally document written policies and procedures related to compensation and fringe benefits. Draft policies have been developed and are currently under management review for accuracy and alignment with existing practices. The finalized policies will be presented for Board approval and implemented by March 18, 2026, and responsibility for ongoing monitoring and periodic review has been assigned to the Chief Financial Officer and Director of Administration to ensure continued compliance. Training will be provided to applicable staff, and compliance with the updated policies will be incorporated into management’s periodic internal reviews.

Planned Corrective Action: Our payroll system provider corrected the backend setting to prevent employees from adjusting their timecards after they have been approved and locked. We reviewed and confirmed that the system is now functioning as intended to prevent similar issues in the future. We deducted the overage amount from the November 2025 invoice to reimburse the agency in full. Anticipated Completion Date 11/17/2025 & 12/31/2025. Responsible Contact Person: Katherine Page, Director of Finance

Significant Deficiency in Internal Controls over Compliance for Allowable Costs/Cost Principles Finding Summary: The Organization did not maintain documentation to support payroll timesheet approvals. Responsible Individuals: Danielle Smith, Executive Director Corrective Action Plan: Payroll procedures will be updated to incorporate this process and the Organization will maintain documentation of payroll timecard approval to support payroll amounts allocated to the federal award. Anticipated Completion Date: June 2026

Finding 2025-001 Allowable Costs/Cost Principles (Material Weakness) Condition: Compensation – personal services: For this program, there was no evidence that actual employee time was tracked, reviewed and approved, or the actual time spent was used as a basis for allocating personnel charges to the grant before payroll period ending February 28, 2025. Correction Action Planned: • Effective March 1, 2025, each location used a time sheet for tracking actual hours worked on grants. This time sheet includes all grants that the employee worked on and non-grant time. The time sheet is signed by the employee and reviewed and approved by the employee’s supervisor ensuring time spent on grant is accurately recorded. • The People & Operations Manager retains completed time sheets together with other expenditure support for grant reimbursement. The contract accountants review the actual salary expense against initial budgeted grant expense and make necessary adjustments to charges to reflect accurate salary expense for each grant. The Controller or Principal from the contract accounting firm reviews and approves grant accounting adjustments prior to completion of changes. Completion Date: March 1, 2025 Name of Contact Person Responsible for the Plan: Nuwan Samaraweera, COO

2025-001 – Direct Costs-Compensation Grantor: Centers for Disease Control and Prevention - Aids Activity and Coordinating Office (AACO), National Institute of Health Award Name: High Impact HIV Prevention and Surveillance Programs, Research and Development Assistance Listing Number: 93.940, 93.838 Assistance Listing Title: HIV Prevention Activities Health Department Based, Lung Diseases Award Year: July 1, 2024 to June 30, 2025 Award Numbers: CP4043 and CP5043 (2220536), 1OT2HL161847-01 Management’s Views and Corrective Action Plan Management acknowledges the finding related to delayed effort report certification. We recognize the importance of timely and accurate effort reporting as well as ensuring compliance with federal and institutional requirements. Children’s Hospital of Philadelphia Research Institute has implemented a new Effort Compensation Compliance system for effective July 1, 2025. This new system will enhance monitoring of timely effort certifications through automated reminders and greater transparency. With this implementation, training and reference materials will be provided to all personnel involved in effort reporting to ensure they understand the importance of timely certification and the potential impact of delays on grant compliance.

Finding 2025-011 U.S. Department of Labor AL No. 17.258, 17.259, 17.278 Workforce Innovation and Opportunity Act (WIOA) Cluster Significant Deficiency in Internal Controls and Noncompliance over Activities Allowed or Unallowed and Allowable Costs/Cost Principles (Payroll) Repeat Finding: No Auditee’s Corrective Action Plan: MOED follows the standard process and employees’ clock in/out at timeclock or enter their time; prior to pay period close, that time is reviewed and approved as required. MOED currently runs a report named "Audit TT - Workers with Time Submitted but Not Approved" two hours prior to the final payroll submission deadline to identify timesheets that have been submitted by employees but not yet approved as of the morning following the close of the payroll period. MOED HR will run the “Audit TT - Workers with Time Submitted but Not Approved” report 30 minutes prior to the payroll submission deadline and will ensure that all timesheets are reviewed and approved by supervisors prior to final payroll processing. Contact Person: David Hagans, Chief Financial Officer Jasmine Armstrong, Fiscal Operations Director Riley Grant, Chief Contracts Officer Completion Date: March 31, 2026

Finding: 2025-001 Condition Found: During testing of payroll allocated to the federal program, 1 of the 25 employees tested had salary charges which exceeded the Executive Level II compensation cap. Upon further review of the full population, a total of 3 employees were identified whose salary charges to the federal program exceeded the cap. Individual(s) Responsible for Corrective Action: Elizabeth Clark, Director of Finance Planned Corrective Action: Upon review of the salary allocation template, we found that the individuals whose salaries exceeded the Executive Level II compensation cap were allocated to grants without the application of appropriate proration. The result was that excess amounts could have been applied to grants in error. To identify and correct these errors, we will look back 12 months at all salaries charged against any grant that is funded directly or indirectly by federal funds. If any salaries in excess of the Executive Level II compensation cap were charged, we will reverse that charge and substitute another qualifying employee salary in its place. The procedure for allocating salaries to grants will be modified to include instructions to exclude employees with salaries exceeding the cap from grant allocations. Anticipated Completion Date: February 15, 2026

Criteria or Specific Requirement: Subparts D and E of 2 CFR Part 200 require a nonfederal entity to establish written policies, procedures, and standards of conduct, including procedures to implement the cash management requirements of 2 CFR section 200.305, procedures that comply with the procurement standards of 2 CFR sections 200.318 through 200.326, and procedures for determining the allowability of costs in accordance with Subpart E of 2 CFR Part 200. Specifically, 2 CFR sections 200.430, 200.431, and 200.475 require written policies concerning compensation for personal services, fringe benefits, and travel costs, respectively. Views from Responsible Officials: Management agrees with the finding. Management has established written policies and procedures after yearend that were the policies and procedures followed during the year under audit and meets the requirements of Subparts D and E of 2 CFR Part 200. Contact Person: John Jacques Date of Completion: November 14, 2025

Contact Person David Drapeaux Corrective Action Plan This finding was resolved in FY2025 through a joint agreement between the District and NDDPI. The questioned costs of $86,171, that were discovered during a separate NDDPI monitoring process, were all returned to the state before the beginning of the 2025 audit. This issue is resolved. Completion Date 05/08/25

Payroll Administration concurs with the recommendation pertaining to the preparation, review, and approval of employee timesheets to ensure the accuracy and completeness of payroll records. Employee timesheets and payroll records are originated, reviewed, and retained at the respective work locations. Therefore, Payroll Administration does not have direct access to these site-level records. To strengthen compliance, Payroll Administration will continue to provide targeted training and guidance to time reporters and time approvers on the timely review and approval of timesheets, the required time and effort certification, as well as the reconciliation of timesheet data with SAP entries. These topics will be reinforced during the monthly Time Reporter and Time Approver Virtual Office Hours. Furthermore, Payroll Administration will continue to issue periodic communications and disseminate the Best Practices Worksheet, which outlines key payroll compliance requirements, including adherence to payroll cut-off deadlines and reconciliation of timesheets and time entry in SAP. Payroll Administration remains committed to supporting District departments and school sites in maintaining full compliance with established payroll policies and procedures. Name: Araceli Pineda Title: Director, Payroll Administration Contact Information: araceli.pineda@lausd.net

Beginning with the next semi-annual certification period, the Special Education Director will prepare a comprehensive listing of all staff whose salaries and/or benefits are charged in whole or in part to the Special Educaiton program. This listing will be reconciled to payroll records prior to certification. Once certifications are completed and signed by the Special Education Director, they will be forwarded to the Superintendent's office (or designee) for independent review and approval to verify that every applicable employee has a completed certification on file. Additionally, the District will establish calander reminders and due dates for each semi-annual period to ensure timely completion and submission of certifications. Staff involved in this process will receive refresher training on federal time and effort documentation requirements.

Corrective Action Plan: The Finance Department Grants Reporting team will train departments on the process for timesheet monitoring and documentation as outlined in the City’s grant manual. The Grants Reporting team will conduct internal reviews/visits to the applicable departments to ensure time reporting and documentation procedures are followed and documentation retained meets the requirements listed in the grants manual. Persons(s) Responsible for Implementation: Cristen Huntz, Financial Analyst, Finance Department, (816) 513-1148, Email: cristen.huntz@kcmo.org, and Robin Flaherty, Financial Manager, Finance Department, (816) 513-1202, Email: robin.flaherty@kcmo.org. Implementation Date: The anticipated implementation date is April 30, 2026.

Management’s Response – Management is currently in the process of re-evaluating existing policies and procedures within the accounting department, including those related to payroll processes. Effective immediately, payroll journals related to performance payments will be provided to the individual(s) responsible for program oversight of the program so they can be reviewed at the time payments are made. Errors or omissions, if any are identified, can then be corrected immediately. Management will continue to evaluate processes and implement improvements as opportunities to do so are identified.