Corrective Action Plans

We will maintain a schedule that details all salary and benefit expenses charged against each Federal award and ensure that these totals are reconciled back to the general ledger and the Final Expenditure Report. We take some exception with this finding, as we believe the audit sample was pulled and formatted in a cumbersome manner and did not facilitate the process of clearly identifying all of the expenditures cited, which often represented portions of benefit costs paid for personnel and reflected in total on related insurance invoices, etc. The Director of Federal Programs and the Payroll Coordinator will be charged with ensuring the accuracy of this information and the related processes moving forward.

Condition: Accrued PTO time was adjusted as of September 30, 2023, however certain employees were transferred over to the grant program that had accrued PTO as of September 30, 2022 that was not taken into account. As a result, the grant was charged PTO time for amounts that had been accrued in prior years in other programs and activities. Recommendation: Schedule should be revised to take into account the PTO time employees have prior to being transferred into the grant activities Planned Corrective Action: A new schedule has been created that will calculate only the increase in PTO cost year over year per individual and used to accrue PTO cost at year end. Contact Person: Anthony Shaver, Chief Financial Officer Anticipated Completion Date: 9/30/2024

Finding 2023-001 Finding: Significant deficiency in Internal Control over Compliance (Allowable Costs) Corrective Action Plan: CARS management has reviewed the audit findings related to unallowable severance costs, as well as the governance of the estimated and applied fringe rate across all projects. It is the opinion of the auditor that projects were overburdened by severance costs that were unallowable due to being in excess of the company’s established policy for calculating severance. However, per guidance at 2 CFR 200.431, as identified in the criteria section of the report verbiage, severance pay is allowable when required by one, or more, of the following: 1. law, 2. employment agreement, 3. established policy that constitutes an implied agreement, and/or 4. circumstances of the particular employment. It is the opinion of CARS management that claimed severance costs are allowable based on two of the four criteria: 1. Circumstances of employment, and 2. An established policy that was, in effect, an agreement with the employees. Our organization had a written severance policy at the time these costs were incurred. Although all claimed severance costs were based on CARS’ current policy, we have accepted the terms of the audit results for the sole purpose of concluding the audit process. CARS does concur that the current written accounting policy needs to be updated to more accurately reflect and summarize the procedures in place. We are continuing to update written policy verbiage to ensure its alignment with the implied policy that had developed as a result of hiring practices across California’s protected classes. As a result of this audit report, CARS will continue to monitor and assess the need for additional procedures and incorporate changes into the indirect rate reporting processes and written policy as necessary. Anticipated Completion Date: CARS will have its severance policy updated by the end of the fourth quarter of 2024. CARS has updated its procedures to review and monitor the fringe rate and ensure all costs allocated to the final projects are allocable, reasonable in amount, and allowable per policy, contract terms, and regulations to include the documentation of the fringe rate review beginning in October 2024. CARS Contact Person Responsible for Corrective Action: Kerrilyn Nakai

Finding 2023-002 Payroll and Personnel Files Significant Deficiency in Internal Control over Payroll and Personnel Files - Accurate and Completeness of Personnel Files The PRDOH agrees with the finding. However, PRDOH has implemented several corrective actions. The PRDOH established an internal control to ensure that the required documents are recorded in the files. The Director of Human Resources presented a work plan, in order to implement an effective procedure for reviewing files. A control sheet of documents required to the active records was established in which the Human Resources Officers of the regions and Hospital were requested to verify the employee’s files for the require documentation that is need it in the files. Responsible Official Lcdo. Luis Rivera Villanueva Secretario Auxiliar de Recursos Humanos 787-765-2929 ext. 4273 Mrs. Luz S. Ramos Pedroza Specialist 787-765-2929 ext. 4273 Mrs. Maribel Zayas Payroll Officer Director 787-765-2929 ext. 4209 Estimated Completion Date Implementation is expected to be completed on or before the end of October 2024.

Responsible Person: Tim Bergsma, CFO - West Michigan Partnership for Children (WMPC). Management View: Management agrees with the finding and is in the process of implementing the recommendation. Corrective Action: WMPC will create a Compensation Adjustement Policy. This policy will reference the compensation policy, connect to the budget approval process, and identify clear directions regarding the approval process for compensation adjustments. Anticipated Completion Date: August 15, 2024

Item 2023‐002 Written policies, procedures, and standards of conduct Recommendation: Grantees should have written policies, procedures, and standards of conduct as required by 2 CFR 200, Subparts D & E of the Uniform Guidance. 2 CFR 200, Subparts D & E requires the non‐Federal entity to establish and maintain written policies, procedures, and standards of conduct including internal controls over the Federal awards that provides reasonable assurance that the non‐Federal entity is managing the Federal statutes, regulations, and the terms and conditions of the Federal award. Specific requirements relate to the following: § 200.302 Financial management  § 200.305 Payment  § 200.319 Competition  § 200.320 Methods of procurement to be followed  § 200.430 Compensation—personal services  § 200.431 Compensation—fringe benefits We recommend that the City implement the required written policies and procedures. Action Taken: Management, namely Jan Boutwell, City Clerk, agrees with the finding and will implement the necessary written policies to comply with the UG. Management anticipates completion by September 30, 2024.

Federal Aid Policies Finding 2023-002 Auditor Description of Condition and Effect: The Authority’s management has completely turned over and been restructured. However, the Authority’s policies for federal aid approved in 2021 have not been revised to update for the current management structure. The policies have also not been updated for changes in the 2 CFR 200 that have occurred. As a result, the Authority is noncompliant with 2 CFR 200. Auditor Recommendation: We direct the Authority review and update all federal aid policies and implement procedures to ensure that they are being reviewed at least once a year for changes in the Authority’s management structure or changes that occur in the 2 CFR 200. Corrective Action Plan: The Authority will update their federal policies to comply with 2 CFR 200 and will review all policies on an annual basis going forward. Responsible Official: Contact person is Rufus Adams, Executive Director,275 East Wall Street, P.O. Box 837, Benton Harbor, Michigan 49023. Telephone (269) 927-2268. Due Date: September 30, 2024

• Finding 2023-002 – In June 2024, Management provided re-education to grant personnel preparing and reviewing calculations to ensure an adequate understanding of the key calculation elements are identified and validated for the grant year. o Responsible Party: Peggy Wisher

Person Responsible: Chief Operating Officer, Deirdre Bagley, will coordinate with the finance team Implementation Date: By August 30, 2024 Management’s response: In response to the recommendation that the Organization apply salaries on each of its Federal awards, based on actual time spent on each award per employee, as supported by timesheets and other records, we concur with the recommendation and are in the process of creating a single, succinct schedule so that the auditors can easily test and reconcile the salary amounts to the supporting payroll and other records.

Person Responsible: Chief Operating Officer, Deirdre Bagley, will coordinate with the finance team Implementation Date: By August 30, 2024 Management’s response: In response to the recommendation that the Organization apply salaries on each of its Federal awards, based on actual time spent on each award per employee, as supported by timesheets and other records, we concur with the recommendation and are in the process of creating a single, succinct schedule so that the auditors can easily test and reconcile the salary amounts to the supporting details.

The County is continuing to draft and establish written procedures for county-wide and department specific use when determining the allowability of personnel costs related to federal awards. A primary function of this policy will be to provide guidance to county staff to ensure personnel costs are recognized in accordance with cost principles, statues, regulations, and terms and conditions of federal awards.

As noted in our prior year response, the University continued to have cost transfers in fiscal year 2023 as it reconciled its grants. To limit cost transfers in the future, the following steps have been taken by the University: • The Controller’s Office along with the Office of the Vice President of Research configured our accounting system with an automated control that prevents general (non-payroll) expenditures from being charged to the grant after the period of performance end date, one root cause of cost transfers. • For payroll expenditures, post-award specialists updated grant labor costing allocations in our accounting system to contain an end date that coincides with the period of performance end date. This change in Workday restricts labor costs from being charged after the period of performance. The University’s post-award specialist review grant labor costing allocations on a periodic basis. • With collaboration between the payroll department, the Controller’s Office and post-award specialists, before each payroll is processed within the accounting system, grants that have ended are identified and the payroll expenditures are removed from the feed and not charged to the grant. • On-going training on data certification by post-award grant managers has improved grant-expenditure compliance and data accuracy. In addition, the Controller’s Office implemented a process in which post-award grant managers are now reviewing grant level budget versus actual reporting on a periodic basis to identify errors timely (i.e. before the 90 day threshold). Additionally, the University’s Workday team is exploring additional functionality within our Workday grants management module to build in additional expense approvals, specifically for labor, before those expenses are charged to the grant to reduce future cost transfers. As part of the University’s corrective action plan, during fiscal year 2023 the sponsored programs accounting team recalculated fringe and indirect costs on all federal grants to ensure the correct expense was recorded to each grant. During this reconciliation process cumulative award to date errors were identified and corrected. The sponsored program accounting team continues to reconcile fringe and indirect costs on cost transfers at the grant level on a periodic basis to ensure accuracy. Tara Thomason, Controller and Assistance Vice President, is responsible for addressing the above items by June 2024.

2023-004 - Written Policies Required by the Uniform Grant Guidance U.S. Environmental Protection Agency – Clean Water State Revolving Fund (ALN 66.458); Passed through the Michigan Department of Energy, Great Lakes, and Environment; All project numbers Auditor Description of Condition and Effect. Although the City has processes in place to cover these areas, there are no formal written policies covering payments, procurement, allowability of costs, compensation, and travel costs in accordance with the Uniform Guidance. As a result of this condition, the City was exposed to increased risk that grant requirements under 2 CFR 200 would not be followed. Auditor Recommendation. We recommend that the City develop and implement the required policies as soon as practical. Corrective Action. A written policy was developed and implemented in February 2024 that meets the requirements under Federal guidance. Responsible Person: Bobbi Schoon, Director of Finance and Administration

Program: AL 20.509 – Formula Grants for Rural Areas – Allowability & Subrecipient Monitoring Corrective Action Plan: NDOT recently updated the Invoicing Reimbursement Acceptable Documentation Requirement Guidelines. These guidelines offer comprehensive instruction, best practices, and a clearer definition of allowable expenses for subrecipients. The updated guide was distributed to subrecipients in February 2024. Over the next six months, NDOT plans to conduct additional training sessions through opportunities such as the monthly Transit Manager meetings, on-site visits, or webinars with subrecipients. The objective is to ensure a thorough understanding of required documentation and the identification of eligible federal reimbursement expenses. To assist with transit subrecipient monitoring, NDOT management has designated an internal auditor within the Transit Section. The auditor’s focus will be assessing reimbursement documentation, reviewing time studies, evaluating cost allocation plans, developing risk assessment, and helping to intensify monitoring efforts over all subrecipients. NDOT is also in the process of improving and updating the invoice review process to provide consistency for reviewing and approving invoices to enhance accuracy within the Transit Section. Additionally, NDOT has established a dedicated unit “Financial Oversight” within the Transit Section solely focusing on Subrecipient reimbursements. The four staff members in this unit will report directly to Financial Aid Administrator III, this oversight will enhance the quality checks and consistency among subrecipient reimbursements. The Financial Oversight unit will continue to evaluate and refine the operations to ensure federal regulation and required documentation is in place prior to any subrecipient reimbursement. Contact: Jodi Gibson Anticipated Completion Date: On-going

Finding 2023-002 Contact Person: Lily Rakness Parra, County Clerk Corrective Action Planned: Washakie County agrees with the finding of 2023-002. Washakie County is currently working on implementing a more thorough tracking procedure in order to document all of the significant processes for our federal awards. Also, in order to further track funds disbursed, a sams.gov account has been set up and is currently utilized in order to determine if an entity is eligible for disbursement of federal funds. An amendment to implement sams.gov utilization will be produced in order to add it to our current Procurement Policy.

The Staff Accountant, Kyle Winton, will ensure that the PSERS reimbursements are properly deducted from federal grant allocations by reconciling with the quarterly Act 29 Reimbursement report that identifies federally funded staff through the CSIU payroll module. The appropriate aide ratio from the Act 29 Employer Salary Report will be used to calculate the correct retirement amount based on the employees’ work history.

Recommendation: Additional training should be provided to individuals responsible for the development of written policies and procedures in accordance with the Uniform Guidance. Action Taken: One City Schools is in the process of identifying a required training program for all staff members involved in the submission, review and/or approval of the schedule of expenditures of federal awards. This includes One City’s Executive Chef, Executive Director of K-8, COO and VP of Government Relations (who oversees compliance). Designated staff will take advantage of all DPI-provided training seminars and resources available, and we will track attendance of relevant staff members. This process will be in place by June, 2024.

Management Response #2022-006: Due to turnover of several key financial executives and personnel, the Corporation did not maintain evidence of fringe benefit cost objectives calculations. Corrective Action Plan: Due to the staff turnover and shortage in 2020-2021, this process was not consistently maintained or documented. The following action items have been or will be taken: • In 2022, finance team delineated and expanded positions whose primary responsibility is to monitor and manage all grant activities. • The grants finance department will also create actual to budget reports in accordance with HRSA guidelines for fringe costs. • The report will be reconciled monthly based on fringe costs allowed by the grant as it relates to the employee class such as part time or providers that may have additional benefits. Adjustments will be recorded in the GL (General Ledger) accordingly. Responsible Party: Tamara Barnes, CFO

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.

FINDINGS - FEDERAL AWARD PROGRAMS AUDIT SIGNFICANT DEFICIENCY/COMPLIANCE 2022-01 Procurement Policies and Procedures Recommendation: Quotes should be obtained whenever possible when purchases are expected to be between $10,000 and $250,000. If purchases are to equal or exceed $250,000, the proper bidding procedures should be followed. Bidding procedures, quotes, and efforts to give preference to minority or women-owned businesses should be documented, including documenting if bids or quotes could not be obtained. A procurement policy should be established as soon as possible and an individual should be assigned to monitor the implementation of the policy. Action Taken: The Organization has begun the process of establishing a procurement policy and have it completed by March 16, 2023. The Organization will also go back to purchases starting July 1, 2022, that exceeded the micro purchase threshold of $10,000 and prepare the required documentation as listed in the recommendation. This will be completed by April 30, 2023. Any purchases exceeding the micro purchase threshold of $10,000 going forward will be supported by the required documentation.

DEPARTMENT OF TREASURY, CENTERS FOR DISEASE CONTROL AND PREVENTION, AND DEPARTMENT OF HEALTH AND HUMAN SERVICES 2022-003 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) ? Assistance Listing No. 21.027 Epidemiology and Laboratory Capacity for Infectious Diseases (ELC) ? Assistance Listing No. 93.323 Child Support Enforcement ? Assistance Listing No. 93.563 Recommendation: We recommend the County establish written procedures for determining the allowability of costs to include a written policy regarding the charging of personnel costs to grants. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned in response to finding: The County is currently in the process of drafting and establishing written procedures for county-wide and department specific use when determining the allowability of costs when charging personnel costs to federal awards. A primary function of this policy will be to provide guidance to county staff to ensure personnel costs are recognized in accordance with cost principles, statues, regulations, and terms and conditions of federal awards. Name(s) of the contact person(s) responsible for corrective action: Andrew Copeland Planned completion date for corrective action plan: June 30, 2024

2022-003 ? Allowable Costs/Activities Allowed or Unallowed: Fringe Benefits and Shared Costs Name of Responsible Individual(s): Pamela Aguilera, Chief Financial Officer Corrective Action: During the initial year of receiving our first direct federal grant, Safe & Sound calculated fringe benefits based on a percentage of the salaries allocated to the grant. Salaries were calculated based on time and effort. Safe & Sound has reviewed the current practices related to allocating fringe benefits and shared costs. Safe & Sound?s Finance team reviewed and verified that we have the adequate fringe benefit and shared costs to meet the costs allocated to this grant. To ensure we have the proper supporting documentation to meet the Uniform Guidance requirements in 2 CFR Sections 200.303 and 200.403, we will implement time and effort documentation for benefit and shared cost allocations on a monthly basis and will review for any necessary budget to actual adjustments. Date Completed: 8/31/2023

Finding 2022-002 Contact Person: Lily Rakness Parra, County Clerk Corrective Action Planned: Washakie County agrees with the finding of 2022-002. A Sams.gov account has been activated in order to verify that entities that are being utilized for County business are not excluded from or are ineligible for participation in Federal programs or activities. Also, the County is currently drafting a Procurement Policy for Washakie County to utilize for the use of Federal funding as well as in an everyday manor of purchasing and maintenance of county facilities in order to satisfy above finding.

Finding Summary: The Town did not have written policies, procedures, and standards of conduct relative to federal awards as required by the Uniform Guidance. Responsible Individual: Kathryn Lynch, Town Administrator Corrective Action Plan: The Town will be updating the Town?s procedures and policies to incorporate the requirements of Part 200 of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Anticipated Completion Date: June 30, 2023

Management agrees with the recommendation and has incorporated policy updates within the September 2023 updated policies and procedures to ensure compliance with required regulations. AALV will continue to update its policies to meet regulatory requirements.