Corrective Action Plans

FINDING 2022-003Contact Person Responsible for Corrective Action: Kim DeVaney/Robin PopejoyContact Phone Number: 317.758.4172Views of Responsible Official: We concur with the finding.Description of Corrective Action Plan: Those procedures and errors were discussed and adjustments have beenmade. To prevent errors the Payroll Specialist will make sure the employee timesheets that was signed off by the Directormatches with the hours they were approved to work when hired.Anticipated Completion Date: February 2023

Recommendation: We recommend that the College increase the time and effort certification process to be more timely and implement a review process over the time and effort certification process.Explanation of disagreement with audit finding: There is no disagreement with the audit finding.Action in Response to Finding: The College will implement the change to conduct the time and effort certification process semi-annually and to add an additional review by the Department Chair or Program Director, or in cases in which the PI is chair, the Dean of the Faculty.Name of the contact person responsible for corrective action: Tess Powers, Director of Faculty Research Support (719) 389-6318Planned completion date for corrective action plan: May 1, 2023

Finding 2022-003Material weakness in internal controls over compliance for allowable activities and costs and material non-compliance inthe Coronavirus State and Local Fiscal Recovery Fund program.Contact Person(s):Nicholas Lee, Chief Financial OfficerCorrective action planned:The Organization will provide additional training to employees responsible for incurring costs in accordance with 2 CFR200.403. Additional resources have been assigned to review and ensure documentation and policies are retained to supportthe distribution of charges between projects. Anticipated completion date:June 30, 2023

The District has implemented procedures for time and effort

Recommendation: The auditors recommend the University implement an internal control policy that requires employees whose compensation is charged to a federal award complete time and effort reporting to accurately reflect the work performed on each federal award and ensure supporting documentation is maintained for those who do charge time.Planned Corrective Action: Heritage University agrees with the finding. Heritage University will implement a new internal control policy that requires employees whose compensation is charged to federal awards to complete time and effort to accurately reflect the work performed on each federal award. Heritage University is using the time and effort forms to allocate the correct hours to each federal award during the payroll process period. Each time an employee must fill out the time and effort to show actual hours worked, signed by the employee and supervisor before turning it into the payroll department. Email sent out to all employees outlining the new process required by employees whose hours are charged to a federal award.Name of Responsible Party:1. Alysia Stevens, Controller2. Tom Richter, VP of Administration/CFO3. Dr. Andrew Sund, PresidentAnticipated Completion Date:? Email sent out to employees 8/15/2022.? Payroll started allocating to federal awards based on time and effort 8/31/2022 payroll.

2022-002 ? Internal Control over Payroll ExpendituresCorrective Action PlanIn response to Audit Finding 2022-002, we will correct this issue by doing the following:1. Both Accounting and HR will continue to sign off on written payroll notices,2. Each pay period when a payroll change notice is received the AccountingDepartment will make sure to verify the information entered into the system matches what is on the written on the payroll notice,3. A monthly review of the Payroll/HR system against all payroll change notices will be conducted.Person(s) Responsible: Tracy BrownTiming for Implementation: April 15thTracy Brown, Fiscal DirectorScott Gray, Executive Director

View of Responsible Officials: As part of the ongoing review of procedures, all wage changes must now be approved in writing by the CEO or her designee for all subordinate staff, and by the Board of Directors for the CEO. All wage changes will be submitted to the payroll processor before any adjustments can be made in the system. Additionally, each payroll is reviewed by a second person to ensure compliance. All supporting documentation of compensation changes will also be placed in the employee's personnel file. Policies and procedures and/or the Financial Procedures Handbook will also be updated to reflect the changes.

Policies will be placed and adopted by the agency that meet the UG code. These policies will be placed in the fiscal manual. The fiscal manual will be created by using federal guidelines and by using the DDAP fiscal manual as guidance.

JFT does have all the board minutes on file. However, because we were a small agency, salary rates were not often changed. Additionally, all salary rates and changes were always driven by the ability to obtain the funding needed. Since we were small and there was not always a lot to discuss with the board our board only met twice a year. Therefore, all salary was discussed with the board president, then taken to the board. Unfortunately, there is no formal documentation at this time. As of 2023 our board now meets quarterly. Therefore, the following policy will be included in the fiscal manual: the JFT board of directors will hold a public meeting quarterly. All matters of pay rates and salaries will be approved at the start of each grant cycle. State and county grants will be discussed prior to the July 1 start dates, all federal grants will be discussed prior to October 1. Any changes in salary must be approved by the board and documented in official board minutes. All board minutes will be placed in a locked file in the Fiscal Coordinator’s office.

Starting in 2023 all employees of the Organization will complete formal time sheets. These sheets will be signed by the Administrative Coordinator and by the Fiscal Coordinator and then entered into the system each pay period to rectify this finding.

The Organization will implement control procedures that maintain proper segregation of duties. Allocation of payroll expenditures to federal programs are to be prepared by the Staff Accountant and will require the formal approval from an individual in leadership (COO, Controller) prior to being recorded. The prepared file and documentation of the review and approval will be retained in a share drive for future access.

Criteria: Recipients of federal awards must follow the costs principles set out at 2 CFR section 200.430 to substantiate compensation and other purchases charged to a federal program. “Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: …(iii) reasonable reflect the total activity for which the employee is compensated by the non‐Federal entity” 2 CFR section 200.430(i). The Organization’s processes did not maintain sufficient documentation of the approval of the activity of each employee or the purchase of goods/services. Audit Recommendation: We recommend the Organization ensure it 1) maintains records of each employee’s activity and 2) monitors compliance with the job‐costing system implemented. Auditee Response: The Organization believes the paychecks and purchases identified were approved prior to payment. We will ensure that documentation is downloaded each pay period to ensure such documentation is not lost when a change in servicer is made. Corrective Action Plan: UICSL has implemented a new payroll system Paycom to help account for these Labor Allocation and Grant Codes. Employees are automated to each program and there is a designated reporting function allowing us to review what is assigned. UICSL also now has Directors for each division so there is clearly defined approvers and supervisors for each purchase and transaction. Person Responsible: Matt Poss, Director of Finance Operations Timeline: UICSL transitioned to Paycom in back‐half of 2023 and Leadership was designated and assigned for 2023.

Federal Award Findings and Questioned Costs Finding 2022‐002: Inaccurate Staff Timesheet Support Corrective Action: At monthly staff meetings, we will review current contracts, including terminating contracts and new contracts that are beginning. We will inform and train staff regarding the proper recordkeeping of their time allocation on their timesheets. We will also inform and train managers on more thorough oversight of staff time allocation to contracts as part of the timesheet approval process. Name of Contact Person: Heather Hays, Associate Director Proposed Completion Date: Immediately

Item: 2022-004 Assistance Listing Number: 93.940 Programs: HIV Prevention Activities – Health Department Based Federal Agency: U.S. Department of Health and Human Services Pass-Through Agency: Arizona Department of Health Services Centers for Disease Control and Prevention Compliance Requirement: Allowable Activities and Costs Criteria or Specific Requirement: The entity’s system of internal controls did detect, or document the rationale for, instances in which the amounts charged to a federal program did not agree to the underlying supporting documentation maintained by the Organization. Condition: The entity’s system of internal controls did detect, or document the rationale for, instances in which the amounts charged to a federal program did not agree to the underlying supporting documentation maintained by the Organization. Name of Contact Person: Rosalie Johnson, Chief Financial Officer Phone Number: (602) 595-8109 Anticipated Completion Date: January 1, 2023 Views of Responsible Officials and Corrective Actions: Management agrees with the finding. Billings are reviewed by supervisors, including a review of the underlying supporting documentation, prior to submission of the billing. Additional training and record retention practices will be added and/or enhanced to ensure there is evidence of supervisory review of the underlying supporting documentation. Such review and record retention processes will include documentation of noted discrepancies and rationale for such discrepancies if not corrected.

Item: 2022-003 Assistance Listing Number: 93.940 Programs: HIV Prevention Activities – Health Department Based Federal Agency: U.S. Department of Health and Human Services Pass-Through Agency: Arizona Department of Health Services Centers for Disease Control and Prevention Compliance Requirement: Allowable Activities and Costs Criteria or Specific Requirement: In accordance with 2 CFR § 200.430 – Compensation – charges to federal programs for salaries and wages should be supported by a system of internal controls which provides reasonable assurance the amounts charged are accurate, allowable and properly allocated. Condition: The entity’s system of internal controls did not retain contemporaneous documentation of supervisory review over payroll allocations charged to the federal programs. Name of Contact Person: Rosalie Johnson, Chief Financial Officer Phone Number: (602) 595-8109 Anticipated Completion Date: January 1, 2023 Views of Responsible Officials and Corrective Actions: Management agrees with the finding. Payroll allocations are monitored on a routine basis to ensure they are reasonable and accurate. Additional training and record retention practices will be added and/or enhanced to ensure there is evidence of supervisory review.

Action Taken: The Organization is now aware that utilization of budget estimates is not allowed for charging payroll and will utilize proper accounting treatment going forward.

Finding Reference Number: SA2022-004 Documenting Payroll Costs Charged to Grant Assistance Listing Numbers: 20.507 Assistance Listing Title: COVID-19 – Federal Transit Cluster - Formula Grants (Urbanized Area Formula Program) Name of Federal Agency: Department of Transportation Federal Award Identification Number: CA-2019-111-01, CA-2020-141-00 • Fiscal Year of Initial Finding: 2022 • Name(s) of the contact person: Isaac Moreno, Finance Director • Corrective Action Plan: The City of Turlock will immediately begin to perform time studies of those individuals whose time is charged to grants and use the results of the time study to determine the allocation percentage, in order to address this finding. • Anticipated Completion Date: 6/30/2024

Audit Finding Reference: 2022-001 Improve Time and Effort Documentation Planned Corrective Action: We understand the importance and requirement regarding this finding. Semi-Annual certification of all staff funded fully out of grants will be completed. Monthly Time and Effort certifications will be completed for all staff funded out of multiple accounts, grant or local. Stipend and Payment for additional work forms will be completed for all staff supporting grant funded activities outside of contractual time. These forms will be re­ viewed and maintained by Grant administrators. The district will use forms created and recommended for use by Massachusetts Department of Elementary and Secondary Education. Sample forms are attached. Name of Contact Person and Completion Date: Laureen Cipolla, Accountability and Student Achievement, laureen.cipolla@leominsterschools.org 978-537-7700 x l345 Anticipated date of completion - 6/30/23

The District will review the Uniform Guidance requirements and ensure all expenditure adjustments are well supported with information to help ensure the federal monies are used on program activities as prescribed in the grant agreements.

Finding 2022-002 Internal Controls over Allowable Costs The auditors recommend the following: 3. Management implement procedures to ensure all expenditures are properly reviewed and approved, and supporting documentation maintained in accordance with federal regulations. Context SDA was unable to produce backup for several invoice payments and evidence of one Time & Effort Certification for allocation to specific grants. Staffing Corrective Action SDA continues to have an outside accounting firm conduct a semi-annual review of financial statements and invoice documentation in advance of the official audit process. The addition of internal staff provides audit support needed to validate that the new systems, procedures and processes implemented by SDA to correct the 2022 audit findings. Process Corrective Action In 2023, SDA introduced training for managers on the requirement of Time & Effort Certification submission for all staff and contractors who are working on grant-funded projects. The updated process requires Mangers to approve a signed Time & Effort Certification with any invoice approval. The Director of Finance and Administration will rigorously enforce the SDA policy that all invoices, receipts, and Time and Effort Certifications must be submitted to receive payment for any work completed. Systems Corrective Action In mid-2023, SDA implemented a centralized and password protected e-filing system to hold all important records for all programs and every area of the business including finance, human resources, and administration. To further ensure that all payments made by the organization have appropriate invoice backup, Bill.com, an invoice and payables tracking system, was implemented fully in 2023 with an approval chain that houses evidence of all transactions.

Payroll and Personnel Files Significant Deficiency in Internal Control over Payroll and Personnel Files - Accurate and Completeness of Personnel Files During the month of August, the Office of Human Resources and Labor Relations was audited by the ADA. It is to this that we respond to the findings indicated in the audit, as follows: Over the past few years we have developed an internal control, using a document entitled Check sheet, which contains the list of documents required for the appointment of employees and another for the audit of files. It contains three columns for the collation of documents required by the Analysts of the Appointments and Changes Section and ends with the collation of the Division Supervisor, before being referred to the Personnel Officers of our regions. This document has been modified according to needs, changes, procedures and new regulations. It is important to mention that many of our audited personnel records pertain to employees appointed in years where the required requirements or documents were minimal, and no evidence was required or maintained in the personnel file. Related to the academic preparation contained in the personnel files, they are documents required by the Recruitment and Selection Section and these respond to the minimum requirements and alternatives of the class, according to the Agency's Classification Plan. Each class specification sets minimum requirements for the position the candidate will hold. On the other hand, when the previously known Administration of Health Services Facilities (AFASS) closed in 1999, its employees went to the Department of Health with the file they had, whose procedures and processes were not uniform to those of our Agency. The Regions and Hospitals have delegated the verification of documents, to work on appointments and other personnel transactions, such as job reclassifications, promotions and others. This delegation brings the process of standardizing and authorizing DSP-29 by the Recruitment and Selection Section, to ensure that it is complied with as established in the Classification Plan. The agency is in the process of updating these documents as long as a change in the employee's job classification is applied. These are transactions that allow us to update the employees’ record to the new class they will occupy. In the case of Doping Test results, we mention that these are found in the Medical Record of each employee. By HIPPA law, these are not filed in the personnel file. Of the aspects pointed out in the audit, the Department of Health has developed greater review and audit measures by the analysts of our agency, before the defunct Quality Control Section, who watched over and audited the personnel files of the Regions, providing control and compliance with the documents required according to the Regulations and Standards that govern the Office of Human Resources and Labor Relations. The Office of Human Resources presented a work plan to implement an effective and efficient personnel file review procedure to comply with and improve the agency's personnel processes and transactions.

Finding: 2022-005: Significant Deficiency in Internal Controls over Compliance – Allowability– Payroll Transactions Name of Contact Person: Shema Jones CFO Catholic Community Service 1803 Glacier Highway Juneau, AK 99801 Corrective Action: • All payroll journal entries will be reviewed and approved by program staff and the Controller since the Staff Accountant prepares the journal entries. • CCS will implement a process for Controller to review payroll entries after they are imported for accuracy between Paycor and the accounting system. • CCS will be looking into whether program staff should start direct charging their time. CCS will set up an after- payroll review to be done by program and finance/HR to review for any possible errors missed prior to running payroll. If errors are found, corrective entries will be made immediately. Also, we will be looking into whether an indirect rate would simply our very complicated allocation system we currently use. Additionally, program staff will review all new or adjusted allocations in Paycor. • Program staff will review all new or changed payroll allocations for employees they supervise. • Detailed allocation reports will be sent to program staff for review. • Program staff are to review preliminary and final reports monthly to check for any discrepancies. • The finance staff currently looks at reports monthly for discrepancies. Proposed Completion Date: 2/28/23

Personnel costs will be charged to the program based on actual time recorded in the organization’s case management software. Hours will be audited quarterly to ensure accuracy and completeness. The Center notes that the grantor, the State Bar of California, never requested the Center to charge payroll expenses to the program based on actual time documents, nor had they ever noted this discrepancy during their periodic audits of the program.

The School System concurs with the auditor’s findings and recommendations. As an on-going effort, the process for creating pay elements for specialized compensation will be monitored for accuracy during the creation stages. Electronic alerts generated in the oracle system will be re-employed to notify appropriate finance personnel when new elements are created by the Payroll Department to ensure the distribution accuracy of salary expenses along with applicable fringes to the appropriate grant accounts. This will prevent manual journal entry realignment postings of large data sets of salary and fringes to the primary assignment costing versus accounts created specifically for specialized pay that is approved in the respective grant application as an allowable cost.

Coronavirus State and Local Fiscal Recovery Funds _ Assistance Listing No. 21.027 Recommendation: We recommend that the Association adopt a formal policy for tracking employee time and effort supporting grant expenses. Additionally, management should summarize the actual time employees spend on grant award programs and adjust the budgeted cost allocations to reflect the actual time spent. A second person knowledgeable of grant award requirements should review the time and effort summaries for proper completion and recording. This will help ensure that internal contols over compliance are established and will help ensure that cost charged to grant award programs are supported and allowable. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Staff now complete a Time and Effort Certification form from the State of Arzona for each pay period to reflect time spent on each grant. Name(s) of the contact person(s) responsible for corrective action: Frank Caruso, Director of Finance and Operations. Planned completion date for corrective action plan: Already corrected, January 2023.