Corrective Action Plans

The County Auditor will ensure all federal awards are accurately presented on the SEFA in the future.

Finding Number: 2025-042 Finding Name: Inaccurate Reporting of Federal Expenditures Finding Condition(s): The Illinois Department of Human Services (IDHS) did not accurately report Federal expenditures, including amounts provided to subrecipients, under the Supplemental Nutrition Assistance (SNAP) Cluster, Supplemental Nutrition for Women, Infants, and Children (WIC) programs, Food Distribution Cluster (FDC), Vocational Rehabilitation (VR), Temporary Assistance for Needy Families (TANF), Child Care Development Funds (CCDF) Cluster, Social Services Block Grants (SSBG), Block Grants for Prevention and Treatment of Substance Abuse (SAPT), and Disability Insurance/SSI (SSDI) Cluster. Additionally, the auditors noted that the IDHS included accrual expenditures to prepare the cash-basis Schedule of Expenditures of Federal Awards (SEFA). The auditors also noted that the IDHS included interagency expenditures prepare the SEFA. Finally, the auditors noted that the IDHS’ controls over reporting federal expenditures were not designed at a sufficient level of precision to ensure complete and accurate reporting in a timely manner. Name of Contact Person(s): Sarah Eves, Deputy Chief Financial Officer – Illinois Department of Human Services Corrective Action(s): The IDHS has established additional procedures to ensure federal expenditures (including subrecipient expenditures) are accurately reported for the cash-basis expenditures. These procedures include the following: • The IDHS’ General Accounting staff met with the IDHS’ Federal Reporting staff that generate the IDHS federal expenditures and reviewed how to treat accrued expenditures, vouchers in transit, and cash or refunds in transit at the end of both the prior year and the current year. • In order to perform a more detailed review of federal expenditure data, the IDHS hired additional General Accounting staff to ensure a thorough review and reconciliation of the data can be completed under a tight deadline. • Written procedures were finalized for General Accounting staff to follow while comparing supporting documentation to the total amount of federal expenditures. The procedures address the identifying and the excluding accruals from total expenditures to ensure data is reported on a cash basis. Procedures also include how to identify and include/exclude current year and prior year vouchers in transit. • A checklist was finalized for General Accounting staff to utilize while reviewing federal expenditures (and subrecipient expenditures) contained in agency GAAP fund reports. Proposed Completion Date: June 1, 2026 – Complete

Finding Number: 2025-034 Finding Name: Inadequate Process for Monitoring Interagency Program Expenditures Finding Condition(s): The Illinois Department of Human Services (IDHS) does not have an adequate process for monitoring interagency expenditures claimed under or used to meet maintenance of effort (MOE) requirements of the WIC Special Supplemental Nutrition Program for Women, Infants, and Children (WIC), the Temporary Assistance for Needy Families (TANF) and the Child Care Development Fund Cluster (CCDF) programs. Name of Contact Person(s): Sarah Eves, Deputy Chief Financial Officer – Illinois Department of Human Services Corrective Action(s): The IDHS will establish additional monitoring procedures, including sampling interagency expenditures and reviews of support documentation to ensure expenditures related to federal grants (including those made by other agencies and those made to subrecipients) are accurately reported in accordance with federal program requirements. Specific corrective actions are listed below. • Develop procedures wherein 1) The IDHS will request Quarterly Certifications, Control Assessments, and Program Expenditure Questionnaires for those agencies receiving funds from federal awards, and 2) If a response is not received within 10 business days, the IDHS’ Chief Financial Officer (CFO) will be contacted to assist with obtaining these documents. • Develop procedures wherein 1) The IDHS will sample interagency expenditures and request that the agency provide supporting documentation for the expenses, 2) If a response is not received within 10 business days, the IDHS’ CFO will be contacted to assist with obtaining these documents, and 3) Documentation will be reviewed by the IDHS to ensure the expenditures meet federal program requirements. Proposed Completion Date: December 31, 2026

Finding Number: 2025-016 Finding Name: Inaccurate Reporting of Federal Expenditures Finding Condition(s): The Illinois Department of Commerce and Economics Opportunity (DCEO) did not accurately report Federal expenditures under the Workforce Innovation and Opportunity Act (WIOA) Cluster program. Additionally, the auditors noted that the DCEO’s controls over reporting federal expenditures were not designed at a sufficient level of precision to ensure complete and accurate reporting in a timely manner. Name of Contact Person(s): • Lisa Clement, Audit and Resolution Manager – Illinois Department of Commerce and Economic Opportunity • Jared Ebel, Chief Accountability Officer – Illinois Department of Commerce and Economic Opportunity • Phil Keshen, Deputy Director – Illinois Department of Commerce and Economic Opportunity, Office of Fiscal Management • Julio Rodriguez, Deputy Director – Illinois Department of Commerce and Economic Opportunity, Office of Employment and Training Corrective Action(s): Upon receiving the finding from the auditors in August 2026, the DCEO, the Illinois Department of Employment Security (IDES), and the Governor’s Office of Management and Budget (GOMB) discussed the proper classification and reporting of interagency service expenditures on the Statewide Schedule of Expenditure of Federal Awards (SEFA). It was determined that the interagency expenditures noted in the finding were service payments and that the receiving agency (IDES) should report them on the SEFA. The DCEO and the IDES have ensured that the service expenditures have been properly classified and reported to the Illinois Office of Comptroller (IOC) for Fiscal Year 2026 financial reporting. GOMB will ensure the proper treatment of interagency service expenditures on the Fiscal Year 2026 SEFA. Proposed Completion Date: December 31, 2026

Finding Number: 2025-014 Finding Name: Inaccurate Reporting of Federal Expenditures Finding Condition(s): The Illinois Department of Employment Security (IDES) did not accurately report Federal expenditures under the Unemployment Insurance (UI) program. Additionally, the auditors noted that the IDES’ controls over reporting federal expenditures were not designed at a sufficient level of precision to ensure complete and accurate reporting in a timely manner. Name of Contact Person(s): Kelly McGrath, Manager of Accounting and Reporting – Illinois Department of Employment Security Corrective Action(s): The difference noted in the finding is related to the proper reporting of the recoupment and subsequent refund of funds to the Federal government related to the overpayment of benefits. The IDES believed the refunds should be included on the cash-basis Schedule of Expenditures of Federal Awards (SEFA); however, during FY25, the IDES was provided guidance that the refunds relating to prior year expenditures should not be included on the current year’s SEFA. The IDES is working with the Governor’s Office of Management and Budget (GOMB) on the proper reporting of prior year refunds on the SEFA. Proposed Completion Date: January 31, 2027

Finding Number: 2025-006 Finding Name: Inaccurate Reporting of Federal Expenditures Finding Condition(s): The Illinois Environmental Protection Agency (IEPA) did not accurately report Federal expenditures, including amounts passed-through to subrecipients, under the Clean Water State Revolving Fund (CWSRF) and Drinking Water State Revolving Fund (DWSRF) programs. Additionally, the auditors noted that the IEPA’s controls over reporting federal expenditures, including amounts passed-through to subrecipients, were not designed at a sufficient level of precision to ensure complete and accurate reporting in a timely manner. Name of Contact Person(s): Erin Hutchins, State Revolving Fund Finance Manager – Illinois Environmental Protection Agency, Fiscal Unit Corrective Action(s): The IEPA’s SRF Finance Manager will oversee increased review of the data used to compile federal expenditures, including subrecipient amounts, to ensure accrued expenditures and vouchers in transit are properly excluded from the IEPA’s cash-basis expenditure totals. Additionally, the IEPA will also ensure that the correct cash-basis expenditure totals are provided to the Governor’s Office of Management and Budget (GOMB) for reporting on the Statewide Schedule of Expenditure of Federal Awards (SEFA). Proposed Completion Date: September 4, 2026 - Complete

The current Board of County Commissioners acknowledges the finding. The Board is committed to improving the identification, tracking, and reporting of federal awards. County officials will continue working with auditors and department heads to strengthen reconciliation and review procedures and ensure federal activity is accurately reported on the Schedule of Expenditures of Federal Awards.

Finding 2025-002 – L. Reporting Identification of the federal program: Federal Agency: U.S. Department of Health and Human Services Assistance Listing No: 93.069, Public Health Emergency Preparedness Award Period: January 1, 2025 through December 31, 2025 Summary of finding: A material weakness in internal control over compliance was issues related to preparation of the Schedule of Expenditures of Federal Awards (the Schedule) for Norton Healthcare, Inc and Affiliates (the Corporation). The Corporation’s internal controls over the preparation of the Schedule were not sufficient to properly accumulate and accurately report expenditures of federal awards. Planned corrective action: To ensure accurate reporting of expenditures of federal awards on the Schedule, management will implement procedures for grants awarded by non-federal entities to determine if the Corporation is a subrecipient of federal funds including obtaining and retaining documentation of this conclusion directly from the awarding entity. Further, additional levels of review of this process as well as the compilation of the amounts reported on the Schedule will be implemented. Anticipated completion date: May 31, 2027 Responsible contact person: Jane Brooks

Corrective Action Plan for the Calendar Year Ended December 31, 2025 In response to the finding from the Federal Single Audit for the fiscal year ended December 31, 2025. Major Program: COVID-19 Coronavirus State and Local Fiscal Recovery Funds (Assistance Listing Number 21.027) (G2022-09) Finding: 2025-002- Reporting and Procurement (Material Weakness and Material Non-Compliance) Management Response: Management will continue to strengthen its processes and internal controls to ensure that report of expenditures is reviewed by Finance prior to submission and only includes expenditures incurred in the period. In addition, Management will amend its procurement policy to ensure the policy includes the required regulations as outlined in the Code of Federal Regulations in relation to Federal Awards and that all relevant documentation will be retained. Christopher Caulfield, Assistant Vice President of Finance, will effectuate the corrective action plan, which will be completed by December 31, 2026. 973-754-2016

MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE – SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS – ALL FEDERAL PROGRAMS 2025-001 Reporting Compliance Requirement – Schedule of Expenditures of Federal Awards (SEFA) Finding Summary 2 CFR § 200.510 requires that the City of Plymouth, Minnesota (the City) prepare appropriate annual financial statements, including the Schedule of Expenditures of Federal Awards (SEFA), which must include the total federal awards expended as determined in accordance with 2 CFR § 200.502. The City did not have proper controls in place to ensure completeness of the SEFA and compliance with this requirement. During our audit, we noted the City did not have sufficient controls in place to ensure the accurate preparation of the SEFA in compliance with this requirement. The City’s SEFA for fiscal 2025 was understated by $1,587,830 due to the exclusion of federal expenditures incurred during the period, requiring a restatement of the previously issued SEFA and additional major program testing. Corrective Action Plan Actions Planned – The SEFA understatement resulted from a lack of coordination between the department that obtained and administered the federal grant and with finance department staff responsible for preparing the SEFA. To strengthen the year-end reporting process, the City has implemented updated procedures requiring a grant-level reconciliation of expenditures and revenues at year-end to ensure they are recorded in the proper fiscal period before preparing the SEFA. Federal grant coordinators and finance department staff will jointly review federal expenditures for accuracy and timing. This strengthened process will help ensure complete and accurate federal expenditure reporting in the SEFA. Official Responsible – The City’s Finance Director, Andrea Rich. Planned Completion Date – December 31, 2026. Disagreement With or Explanation of Finding – The City agrees with the finding and has implemented additional procedures to strengthen controls over reporting. Plan to Monitor – The City’s Finance Director, Andrea Rich, will verify that year-end grant reconciliations are completed and reviewed prior to SEFA preparation.

Management will implement a documented year-end SEFA reconciliation and review process. The process will require reconciliation of federal expenditures to the general ledger and grant records, review by Assistance Listing number, and supervisory approval before issuance of the SEFA.

Funds will not be drawn down until an invoice or proper pay request is received, and purchase order or contract are in hand, and payment is made promptly within no more than three business days. The Schedule of Expenditures of Federal Awards will be reviewed by Management that all funding received and reported has be fully expensed by the Authority prior to submission on the Hinkle system for audit.

ECA agrees with this finding and has created a policy for identification and verification of funding sources for all contracts. This will ensure that all contracts are screened for federal funding regardless of what is listed in the contract/award/agreement. ECA will review its existing contracts to confirm all funding sources.

Finding #2025-006 - Federal Grants Management (Schedule of Expenditures of Federal Awards) Corrective Action Planned: Management will tie the preparation of the Schedule of Expenditures of Federal Awards back to the contract tracker used to monitor each grant's period of performance and expenditure activity, ensuring the SEFA is built directly from, and reconciled to, that tracker before submission to the auditor. Anticipated Completion Date: Beginning with the Schedule of Expenditures of Federal Awards for the year ended December 31, 2026. Responsible Party: Finance Manager, with oversight by the President.

Program Federal Financial Assistance Listing Number.: 21.027 / 14.239 Federal Grantor: U.S. Department of the Treasury / U.S. Department of Housing and Urban Development Award Number and Year: Affects all grant awards included under assistance listing 14.239 and 21.027 on the Schedule of Expenditures of Federal Awards. Compliance Requirement: Other – Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) §200.510(b) - Schedule of Expenditures of Federal awards Management’s Response: We concur. Views of Responsible Officials and Corrective Action: The finance staff and program manager did not fully understand the distinctions between subrecipient and beneficiary, resulting in inaccurate reporting of these amounts. The City Manager and relevant department managers met to address this issue and recommend that staff undergo appropriate training. The training schedule will be discussed further, taking into consideration availability, location, and budget constraints. This was corrected in the Single Audit Report which will be filed with the Federal Government. Name of Responsible Person: Finance Leadership and Grant Program Managers Projected Implementation Date: August 1, 2026

A designated Finance staff member with knowledge of the Uniform Guidance requirements will be responsible for overseeing SEFA preparation for each fiscal year-end. A grant-by-grant SEFA reconciliation will be completed prior to yearend close, with particular attention to period-end cutoff. The SEFA will be independently reviewed by the Finance Director and compared to grant expenditure reports before the audit commences. Management will engage its external accountants earlier in the year-end close process.

Corrective Action Plan FINDING - 2025-001 - Federal Award Program Name: 93.958 Senior Services Criteria: Federal awards are required to be reported on the Schedule of Expenditures of Federal Awards (SEFA) when expenditures are incurred (2CFR Part 200). Condition: The Organization had a federal award received in a prior year that was not originally included on the SEFA. Cause of Condition: The Organization did not have adequate procedures in place to identify all federal awards and ensure they were properly reflected on the SEFA. Potential Effect of Condition: The Organization’s federal award expenditures not being included in the audited SEFA. Views of Responsible Officials: Management has acknowledged the finding and added the award expenditures to the SEFA. Corrective Action: The Controller will implement formal federal grant management policies and procedures to ensure all federal awards are properly identified, tracked, and reported on the SEFA in accordance with 2 CFR Section 200.502. Key actions include: - Developing and implementing a written federal grant and loan management policy, subject to Board approval. - Establishing and maintaining a centralized electronic repository of all federal grant and loan documentation, including key award details necessary for SEFA reporting. - Providing training to accounting and program staff responsible for identifying and tracking federal awards. - Performing quarterly reviews of the federal awards repository to ensure completeness and accuracy of information used in SEFA preparation. - The Controller will perform quarterly reviews, and the CFO will review and approve the completeness of the federal awards listing. Procedures will be implemented immediately and in place for the next SEFA reporting cycle.

DJFS will begin to use project numbers to allow for an additional check of all amounts reported. DJFS is also going to provide federal grant information to the Auditor’s office as soon as they complete their final report in order to give the Auditor’s office adequate time to review the information with MUNIS and will afford the Auditor’s office more time to compile the SEFA and have a secondary review to avoid any computational or clerical errors.

Finding No. 2025-001 Significant Deficiency in Internal Control over Compliance, Other Matters Condition The Organization had revisions to the SEFA and management’s review and approval process did not detect the following errors that were identified during the audit procedures performed: - An incorrect de minimis indirect cost rate was used and charged to a federal award. - Approximately $65,000 of federal expenditures were omitted from the initial SEFA. - Subrecipient costs from the prior year were charged to the current year due to incomplete accruals in the prior year. As a result, the SEFA was not complete or accurate prior to submission for audit. Planned Corrective Action: Management concurs with the findings and related recommendations. While the Organization completed its federal award activity in May 2025 and does not currently anticipate additional federal award activity, it recognizes the importance of compliance with grant reporting requirements, including the accurate preparation of the Schedule of Expenditures of Federal Awards (SEFA). In response to this finding, the Organization has taken the following corrective actions: Indirect Cost Rate: Updated our grant setup checklist to ensure the correct de minimis indirect cost rate is applied. The Organization has initiated and is currently processing the repayment of the overcharged indirect costs to the primary awardee. SEFA Completeness & Year-End Cutoff: Implemented a formal year-end SEFA reconciliation procedure. This includes a secondary review by the Director, Accounting to cross-reference general ledger federal expenditures against grant award agreements and to verify that all subrecipient accruals are recorded in the proper fiscal period. These improvements in our review and approval functions are designed to prevent future reporting omissions and ensure timely, accurate SEFA preparation should the Organization be subject to Single Audit requirements in the future. Anticipated Completion Date: July 31, 2026 Name of Contact Person: Melinda O’Leary, Chief Financial Officer & Vice President If the Cognizant or Oversight Agency for Audit has questions regarding this plan, please call Melinda O’Leary, Chief Financial Officer & Vice President at 571-483-1324.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS – ALL FEDERAL PROGRAMS 2025-002 Reporting Compliance Requirement – Schedule of Expenditures of Federal Awards (SEFA) Finding Summary 2 CFR § 200.510 requires that the City prepare appropriate annual financial statements, including the Schedule of Expenditures of Federal Awards (SEFA), which must include the total federal awards expended as determined in accordance with 2 CFR § 200.502. The City did not have proper controls in place to ensure completeness of the SEFA and compliance with this requirement. During our audit, we noted the City did not have sufficient controls in place to ensure the accurate preparation of the SEFA in compliance with this requirement. The City’s SEFA for fiscal 2025 was overstated by $147,700 in federal expenditures due to the inclusion of costs that were incurred in the previous fiscal year. Corrective Action Plan Actions Planned – The SEFA overstatement resulted from including prior-year expenditures in the 2025 reporting period. The City did not prepare a SEFA in the previous fiscal year because federal expenditures did not meet the Single Audit threshold; this contributed to the oversight in tracking the timing of eligible expenditures. To strengthen the year-end reporting process, the City has implemented updated procedures requiring a grant-level reconciliation of expenditures and revenues at year-end to ensure they are recorded in the proper fiscal period before preparing the SEFA. Federal grant coordinators and Finance Department staff will jointly review federal expenditures for accuracy and timing. This strengthened process will help ensure complete and accurate federal expenditure reporting in the SEFA. Official Responsible – Kim Sommerland, Finance Director. Planned Completion Date – June 30, 2026. Disagreement With or Explanation of Finding – The City agrees with the finding and has implemented additional procedures to strengthen controls over reporting. Plan to Monitor – The Finance Director will verify that year-end grant reconciliations are completed and reviewed prior to SEFA preparation.

Condition: The Outdoor Recreation Acquisition, Development and Planning program and the Drinking Water State Revolving Fund program expenditures on the schedule of expenditures of federal awards (SEFA) initially presented for audit were not complete and accurate. Planned Corrective Action: The Finance Department recently hired a new Grants Manager after being without this critical position for almost a year. The Grants Manager, along with the Grant Specialist and the Financial Reporting team accountants, plan to work together to improve the tracking and reconciliation of grant activity. In addition, the City implemented eCivis Euna Grants, a grant application, tracking, and reporting system, in November of 2025. The Grants Team will be working with Departments to document the grants process formally for the City and this will ensure that all grants are accounted for and tracked in the Euna grants system. This renewed capacity and new initaitives, supported by the new administrative cost recovery framework and the City's grants management platform, reflects a broader commitment to managing external funding with the same discipline applied to locally generated revenues. Contact person responsible for corrective action: Julie Cunningham, Grants Manager. Anticipated Completion date: 05/01/2027

Fergus has adopted and implemented policy: 252.0 Federal Funding Compliance to establish formal procedures and ensure ongoing compliance with applicable federal regulations, including 7 CFR 4280, Subpart A and 2 CFR 200. Anticipated completion date: August 31, 2026

MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE – SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS – ALL FEDERAL PROGRAMS 2025-001 Reporting Compliance Requirement Finding Summary 2 CFR § 200.510 requires that the City of South St. Paul, Minnesota (the City) prepare appropriate annual financial statements, including the Schedule of Expenditures of Federal Awards (SEFA), which must include the total federal awards expended as determined in accordance with 2 CFR § 200.502. During our audit, we noted the City did not have sufficient controls in place to ensure the accurate preparation of the SEFA in compliance with this requirement. The City’s SEFA for fiscal 2025 was overstated by $749,656 in federal expenditures, due to the inclusion of costs that were incurred in the previous fiscal year. Corrective Action Plan Actions Planned – The City has implemented new processes and procedures in 2026 which address this internal control finding to comply with the Uniform Guidance in the future. Finance department personnel will work with federal grant coordinators to assure that federal expenditures are accurately reported on the SEFA for all federal programs. Official Responsible – Clara Hilger, Finance Director. Planned Completion Date – June 30, 2026. Disagreement With or Explanation of Finding – The City agrees with this finding. Plan to Monitor – The City’s Finance Director, Clara Hilger, will ensure the new process and procedures implemented in this area ensure future compliance with the Uniform Guidance.

The Homeland Security and Emergency Management Agency (HSEMA) agrees with the conditions and recommendations of this finding. From PSJC’s perspective, this finding includes prior year (FY2020) approved expenditures not reported in FY2025 SF-425. We believe there was a transparency gap, as the discrepancies between the SF-425 reports and the SEFA expenditure totals should have been identified, disclosed and brought to our attention in prior audit engagements. Overall, we concur with the findings. The SEFA was adjusted in fiscal 2020 for expenditures that were not approved, however we did not capture the approved expenditures in the following years on SF425. Management will ensure that SEFA expenditure and SF 425 cash disbursements are aligned. We will perform first and second level review of the SF425 and SEFA. Management also concurs with the fact that the subrecipient passthrough on the SEFA should be non-district agencies. We will review the SEFA and report only non-district agencies as pass through to subrecipients.

The Department of Behavioral Health (DBH) Office of the Chief Financial Officer (OCFO) concurs with this finding. FFATA Reporting Compliance: In February 2026, the DBH Grants Management Office created an FFATA procedure to ensure compliance with timely FFATA reporting. As a result of this finding, the procedure has been updated to report bi-weekly rather than monthly to ensure reporting under 30 days. The GMO Director will also provide continuous training to staff outside of the GMO to ensure staffing will not become a barrier, as experienced in early 2026. As of June 1, 2026, all FFATA entries as of the May 25th purchase order (R071) report have been reported. Additionally, as we plan for the forthcoming electronic grants management system (eGMS) we’re in discussion to add a report feature that will provide needed info for FFATA entry i.e., UEI, FAIN, award amount and purchase order # to automate the process. SEFA Reporting Compliance: Prior to the submission of the SEFA, the grant expenditures will be reviewed with the Accounting Officer, The AFO, and the Grants Program Manager for a detailed review of the SEFA to confirm expenditures are correctly categorized by fund and grants, reconciles to the DIFS R019 report and reflects the amount expended for sub-recipients. Effective FY26, subrecipient totals are uniquely identified with an account number that will reflect in the R019 report as a subset of total expenditures. This report will be used to complete the SEFA going forward.