Corrective Action Plans

C.     We do not anticipate any ESSER ARP money to be issued in the near future.

Condition: Expenditures of federal funds representing <0.25% of total expenditures of federal funds for the year ended September 30, 2024 were charged to various federal programs and were not reported on the Schedule of Expenditures of Federal Awards (SEFA) for the period ended September 30, 2024. Planned Corrective Action: Management will document a formal control to ensure proper reconciliation of the SEFA to the financial statements. The control will include the following: A report in substantially the same form as the annual SEFA will be developed at least quarterly and will include a reconciliation of grants receivables activity. Meetings will be help at least quarterly to review grant activity, including the aforementioned report, and assess impacts to the financial statements. These meetings will be conducted by Treasury and Accounting staff and evidence of document review will be maintained. A centralized repository of information pertaining to federal grants activity will be maintained to ensure timely access to grant and expenditure data for relevant staff. Contact person(s) responsible for corrective action: VP, Treasury Management Controller Anticipated Completion Date: Control will be documented by March 31, 2025 and operational for the quarter ending by June 30, 2025.

2024-003 Preparation of and Internal controls over Schedule of Expenditures of Federal Awards Preparation (Material Weakness) Federal Agency: U.S Department of Education Program Name: Child Nutrition Cluster; Education Stabilization Fund Assistance Listing Number: 10.553, 10.555 and 10.559; 84.425 Award Period: June 30, 2024 Recommendation: The Board of Education and management should review the financial reporting process. Once this review is complete, the District should then perform a risk assessment to determine the best way to implement appropriate internal controls over financial reporting to ensure that the District prepares the schedule conformity with Uniform Guidance. Action Taken (Unaudited): Management plans to have the Board Clerk and the Board Treasurer complete the Schedule of Expenditures together and to ensure that the correct expenses are being reported. Contact Name – Kristy Dyche Expected Completion Date – 6/30/2025

Prince George's County Public Schools respectfully submits the following corrective action plan for the year ended June 30, 2024. Audit period: June 30, 2024 The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS—FEDERAL AWARD PROGRAMS AUDITS U.S. Department of EducationStudent Support and Academic Enrichment Program– Assistance Listing No. 84.424 We recommend that the School system review its procedures to ensure that amounts reported on the SEFA are in accordance with 2 CFR part 200.502 and 510. Explanation of disagreement with audit finding: We agree with the finding in part. As the auditors noted, Grant Number 20157201, ended on 9/30/22. There were additional FY23 invoices and payroll processed to this grant after the grant was closed out by the Grant Accountant. The corrections to remove these expenses, though they caused a net effect of zero, were recorded in fiscal year 2024. The adjustments for $27,799 were mistakenly reported on the fiscal year 2024 SEFA. These additional amounts were never reported in the MSDE AFR system, because as noted, they resulted in net zero change. Reporting in the MSDE AFR system is always done with a report from Oracle, the school system’s financial reporting system, and only actual expenses are reported. In addition, at year end, the full report is reconciled to our Grants Roll Forward Report, which allows us to ensure the correct information is reported for each grant. Action taken in response to finding: The $27,799 will be removed from the FY24 SEFA. In an ongoing effort to ensure that all grants are reported correctly and in line Grant’s Administrator will hold regular meetings (at least quarterly) with the Budget Analyst and/or Grants Accountant assigned to these grant funds. The Grants Accountant will also provide transaction and payroll detail reports to the Grants Administrator on a regular basis for review and correction when necessary. Planned completion date for corrective action plan: March 2025 Contact person(s) responsible for corrective action: Department of the Division of Student Services: Elizabeth Faison, Associate Superintendent of Student Services, Ph.D., NCC, LCPC Grant Financial Management Office: Darrell Haley, Supervising Budget Analyst Claire Taylor, Supervising Grants Accountant, CPA, CGFM, CGMS

2024-004 Preparation of and Internal controls over Schedule of Expenditures of Federal Awards Preparation (Material Weakness) Federal Agency: U.S Department of Education Program Name: Education Stabilization Fund Assistance Listing Number: 84.425 Award Period: June 30, 2024 Recommendation: The Board of Education and management should review the financial reporting process. Once this review is complete, the District should then perform a risk assessment to determine the best way to implement appropriate internal controls over financial reporting to ensure that the District prepares the schedule conformity with Uniform Guidance. Action Taken (Unaudited): Management plans to work with a third-party consulting fitm to address issues an improve protocols. Contact Name – Dr. Jessica Dain Expected Completion Date – 06/30/2025

Finding 2024-004: Schedule of Expenditures of Federal Awards (SEFA) – Material Weakness Condition: While performing our audit procedures, we noted that CAFB included the a $5 million grant from Fairfax County on their SEFA even though CAFB is considered a beneficiary related to this grant. Views of Responsible Officials and Planned Corrective Actions: As stated in the report, the Organization respectfully disagrees with both the substance and the severity of the finding. In RSM’s proposal to the Organization, the firm indicates that it offers proactive advice to its clients: “Specialists RSM has a deep bench of specialists locally and nationwide available to advise CAFB and the engagement team on issues as they arise. Relevant specialists cover areas such as: unrelated business income from alternative investments, multi-state taxation, Federal single audits, and information technology. Proactive resolution of accounting issues We find that year-round communication and a proactive approach to accounting issues help clients avoid surprises at the end of the audit process. For this reason, we encourage clients to call us to discuss new transactions as they arise.” [emphasis added] We agree that the independent auditor cannot be part of the Organization’s internal controls. In this instance, the Organization conducted its own research into the nature of the beneficiary agreement and reached a conclusion that it should not be included on the SEFA. During audit planning, we discussed this position with the audit partner and manager who recommended that it should be included on the SEFA. Following the resignation of the engagement partner and manager, a new resource assigned to conclude our engagement by the firm disagreed with that position and raised this finding. Had the initial audit team remained and we excluded the grant, we assume that we would have received a finding for its exclusion. As to the severity of the finding, we disagree that the instance rises to the level of a material weakness. Although we concede the amount of the award ($5 million) is significant, its inclusion/exclusion from the SEFA did not impact the selection of major programs and was a singular decision-making instance of an unusual form of award, irrespective of the amount involved. As for corrective action, considering the infrequency of beneficiary agreement awards to non-profit organizations, it is improbable that the Organization will receive such an award again. Nevertheless, if the Organization encounters an unusual transaction or award, we will continue to perform our own research on the award/transaction and form our independent conclusion (as we did in this instance) and refrain from taking actions that might imply the independent auditor is part of the Organization’s internal control structure.Anticipated Completion Date: February 2025

Corrective Action: - The Organization will issue new letters of confirmation requests to all counties under contract that are to be sent to the audit firm and the Chief Financial Officer of the Organization, who is the responsible party. - The Organization has established policies and procedures to understand and ensure compliance with the Organization’s contractual obligations.- The Organization has implemented procedures to determine the source of funding received through various county contracts. - The Organization has implemented review procedures to ensure the Schedule is complete, accurate, and prepared in accordance with the requirements set forth within 2 CFR 200.510(a).

Corrective Action: Management will continue to stress the importance of following the detailed procedures for preparation and review of the SEFA. The SEFA checklist is updated to include a thorough review of expenditure details to ensure no prior-year expenses are reported. Responsibility for compiling the SEFA was assigned to a Senior Program Accounting Manager who is tasked with assuring the schedule and all the support reconciliation are complete and accurate. Both the Director of Program Accounting and the Executive Director of Finance/Controller will review the SEFA for completeness, accuracy, and compliance with CFR Section §200.510(b). Estimated completion date: June 30, 2025 Individual Responsible for Corrective Action Plan: Contact: Reginald Gregory Title: Executive Director/Controller Phone Number: 202-772-4300

Internal controls will be reviewed and modified as needed to ensure compliance with federal statutes, regulations and the terms and conditions of the federal award. DED will increase future communication with the Office of the State Comptroller when reporting expenditures of the SSBCI program to insure proper categorization of technical assistance expenditures.

Office of the State Comptroller will review the instructions provided to State Agencies with the Sub-Schedules and consider changes to make them clearer that State Agencies should review and include all Federal expenditures for their Agency. OSC will also review the process used for determining if any additional programs should be included on State Agency Sub-schedules.

The Agency updated procedures for developing the SEFA in accordance with 2 CFR 200.502 which states, “The determination of when a federal award is expended must be based on when the activity related to the Federal award occurs.”The Agency is required to comply with 2 CFR 200.403 which indicates that allowable costs must be determined in accordance with accounting principles generally accepted in the United States of America (GAAP). The Agency updated procedures for developing the SEFA in accordance with both 2 CFR 200.502 and 2 CFR 200.403 to include the following process improvement: The agency has modified its current process to ensure the direct and indirect costs charged to the federal programs include only the costs incurred during the current fiscal year.

The Agency updated procedures for developing the SEFA in accordance with 2 C.F.R. 200.510 (b) to include the following process improvements: The agency has modified its current process in determining the value of federal awards expended for the various federal loans in Federal, which will include all Federal loans within their affordability period in the compliance period. The compliance period requirements under the guidance §200.502 (b) are any new loans made or received during the audit period that are still within their affordability period. Add an additional process step regarding the requirements for the SEFA to be presented accurately when an expenditure is reclassified to another general ledger account across all programs to ensure the SEFA presentation accounts for the correct expenditures during the audit period. The agency has modified its current process to ensure the direct and indirect costs charged to the federal programs include only the costs incurred during the current fiscal year.

Condition: The schedule of expenditures of federal awards (SEFA) contained inaccuracies and incomplete information that was identified during the audit. Planned Corrective Action: The School District will develop a SEFA checklist to help ensure all federal expenditures are properly reported. Additional processes will be put in place by management to review the SEFA in advance of the annual audit to effectively meet audit report timelines and help ensure completeness, validity, and accuracy of the final SEFA reporting. Contact person responsible for corrective action: Patricia Carion/Piper Bognar Anticipated Completion Date: 07/31/2025

Finding 2024-004 U.S. Department of Treasury Federal Award Year Ending June 30, 2024 COVID-19: Coronavirus State and Local Fiscal Recovery Funds Lack of internal controls over the preparation of the Schedule of Expenditures for Federal Awards Finding: The Schedule of Expenditures for Federal Awards for the year ended June 30, 2024, was initially overstated by $529,900 due to an improper subrecipient verses beneficiary determination for the COVID-19 coronavirus state and local fiscal recovery funds. Corrective Actions Taken or Planned: When reviewing revised grants, particularly pass-through grants, look for any new language in the updated review that could affect the classification of the grant as a federal award and update any relevant schedules accordingly. Look into other alternatives for additional reviews on grants. Contact person responsible for corrective action: Heather Brouse, CFO, and Melissa King, Accountant

A review and training of the award set up process is being conducted to ensure all team members in Office of Sponsored Programs (OSP) follow the correct procedures for moving an advance fund number into a fully executed award. Implementation of a new electronic research administration system, Novelution, is currently underway. Internal controls will be incorporated into this system to track advance awards and their conversion into fully executed awards. This control will improve tracking and communication via systems to avoid the duplication of fund numbers for the same award. On a quarterly basis, Research Accounting Services (RAS) will send reports of advance funds to OSP to follow up on the status. RAS is also incorporating additional reviews during the SEFA preparation process. They will review advance funds to check with OSP to see if the fully executed agreements have been received from the sponsor and if any updates are needed. Novelution will also be a more robust system that will provide full grants management for agreements in order to provide more transparency across central units that will minimize these types of errors from occurring in the future. This is expected to be completed prior to the close of FY2025.

RECOMMENDATION: Marshall Jones recommends that the School establish a process to track the expenditures of federal awards during the year, including awards for which purchases are made on the School’s behalf by the passthrough grantor. This will better enable the School to timely prepare a complete and accurate SEFA. RESPONSE: DeKalb Preparatory Academy intends to hire a Chief Financial Officer (CFO) to oversee financial operations. The CFO will be responsible for ensuring accurate tracking and management of all revenues and expenditures, including those from state, local, and federal sources.

CDCU’s CFO, Sarah Beaumont, will implement federal grant and loan management policies and procedures and provide training to staff responsible for completing the Schedule of Expenditure of Federal Awards (SEFA) to ensure all federal grants and loans are included in the SEFA (pursuant to Section 200.502(b) of 2 CFR Part 200). The CFO, Sarah Beaumont, will draft the federal grant and loan management policy and procedures which will be reviewed and approved by the Board of Directors. CDCU’s Finance Manager, Traci Norton, will create and maintain a repository (electronic file) of relevant federal grant and loan information that contains key information relating to each federal program to assist in preparing the SEFA (pursuant to Section 200.502(b) of 2 CFR Part 200). The Finance Manager, Traci Norton, will update federal grant and loan information in the electronic repository. Repository will be reviewed quarterly by the CFO, Sarah Beaumont, and reviewed and approved by the CEO, Todd Reeder.

CDCU’s CFO, Sarah Beaumont, will implement federal grant and loan management policies and procedures and provide training to staff responsible for completing the Schedule of Expenditure of Federal Awards (SEFA) to ensure all federal grants and loans are included in the SEFA (pursuant to Section 200.502(b) of 2 CFR Part 200). The CFO, Sarah Beaumont, will draft the federal grant and loan management policy and procedures which will be reviewed and approved by the Board of Directors. CDCU’s Finance Manager, Traci Norton, will create and maintain a repository (electronic file) of relevant federal grant and loan information that contains key information relating to each federal program to assist in preparing the SEFA (pursuant to Section 200.502(b) of 2 CFR Part 200). The Finance Manager, Traci Norton, will update federal grant and loan information in the electronic repository. Repository will be reviewed quarterly by the CFO, Sarah Beaumont, and reviewed and approved by the CEO, Todd Reeder.

Response: Management agrees with the finding and will reevaluate internal processes and procedures. This error highlights the need for better oversight and timely communication between our organization and its subrecipients to ensure accurate reporting. The root cause of this issue was insufficient monitoring and communication between the subrecipient and our grants management team. To address this, we are implementing several corrective actions. These include establishing a stricter communication schedule with subrecipients to ensure timely submission of invoices and expense reports and strengthening our internal monitoring procedures by tracking submission deadlines more closely. Additionally, we will improve guidance and capacity-building efforts for subrecipients to ensure they understand reporting requirements, and we will conduct quarterly reviews of subrecipient expenses to proactively identify and mitigate reporting delays. Contact person responsible for corrective action: Lynne Duong, Post Award & Compliance Manager Anticipated completion date: December 31, 2024

Carl Biber Chief Financial Officer 317 Western Boulevard Jacksonville, North Carolina 28546 Anticipated Completion Date: June 30, 2025 Annually, the Authority will perform additional verifications of the completeness of the Schedule of Expenditures of Federal awards by confirming directly with the mortgagee the balance as of year-end and activity for the year then ended.

2CFR 200.510(b) requires organizations to prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee’s financial statements, which must include the total of federal awards as determined in accordance with 2 CFR 200.502. The original SEFA prepared by the School District was not complete and accurate. The School District will implement a procedure to ensure that accounting records are closed timely, internal accounts are reconciled, and appropriate workpapers are prepared to support SEFA balances. The School District will implement these procedures for the 2025 fiscal year end.

Corrective Action Plan: Management agrees with the Auditor’s recommendations. The City has discussed this finding with our former auditors. Accounting staff and City grant personnel will work with third parties working with grants for the City to more frequently receive information and update the City's records accordingly. Person(s) Responsible (Name, title): Donald Harris, City Treasurer and Shelly Munks, City Clerk Timing for Implementation: Ongoing

Finding Reference Number: 2023-003 Description of Finding: The Schedule of Expenditures of Federal Awards (SEFA) was not reconciled and complete prior to the beginning of the audit. Statement of Concurrence or Nonconcurrence: The identified issue pertaining to the incomplete SEFA is accurate and clearly defined. Corrective Action: • The Authority has since contracted with a consultant to assist staff with project and budget management of the same project the grant was funding. • Reporting requirements will be completed by the consultant or finance department going forward rather than the engineering manager. • Monthly meetings are held with staff from both accounting, engineering, and the grantor to discuss grant expenditures, invoice submittals and reimbursements, and project updates. • Director of Finance has looked into grant management certification courses in order to further educate staff on grant tracking and reporting requirements.

2023-009- Reporting Federal Agency: U.S. Department of the Treasury Federal Program Name: American Rescue Plan Act / Coronavirus State Fiscal Recovery Fund (ARPA) Assistance Listing Number: 23.027 Federal Award Identification Number and Year: Various Pass-Through Agency: Pennsylvania Department of Health and Human Services Pass-Through Number(s): Not Available Award Period: 1/1/2023 – 12/31/23 Type of Finding: Significant Deficiency in Internal Control Over Compliance Condition: Policies and controls in place regarding the completeness of the SEFA were not properly functioning. Within the supporting listing of expenses relating to ARPA expenditures, multiple transactions were identified as 2022 fiscal year expenditures that were included in the 2023 expenditure total. The County revised the 2023 SEFA to exclude the 2022 expenditures. Recommendation: We recommend management should review the process of recording federal expenditures to determine expenditures are being included in the appropriate fiscal year. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned and taken in response to finding: The reason for the finding’s recurrence is in part a result of the timing of when the finding was issued. For example, the 2022 Single Audit was issued in August 2024. At this point, the 2023 fiscal year was already complete. Additionally, the implementation of corrective actions are in progress, including providing training, oversight and guidance to departments administering the grants, but these efforts take time to complete and/or are ongoing. A Deputy Controller of Grant Accounting was hired in February 2023, and a Manager-Grant Accounting was hired in July 2024, after working in this capacity as a temporary staff member since mid-2023. The County approved an additional full-time grant accounting position in May 2025 and will begin recruiting for this position in June 2025. These positions are responsible for establishing accounting policies based on best practices for grant-related activities, developing and providing training and resources to grant- funded departments, reviewing grant-related accounting in the Infor system, preparation of the annual SEFA, and assisting in the facilitation and preparation of documents needed for the Single Audit. The work performed by these positions had been vacant since the departure of Internal Audit Staff who helped General Accounting prior to the 2021 audit as well as the SEFA. Several changes have been made since the grant accounting team was created including the following: The grant accounting team is developing streamlined and standardized SEFA templates for each department for SEFA preparation. The expenditures reported on each SEFA are being compared to the financial information in the GL where possible to ensure all appropriate expenditures are included. Additionally, we are incorporating tracking of lifetime grant expenditures into the SEFA process to ensure no expenditures are missed due to cut off or timing issues. In 2023, the grant accounting team created a Montgomery County Grant Repository. This repository is used to store all grant agreements awarded to the County. Departments submit grant information to the repository upon notification of grant award. The grant accounting team reviews the Grant Repository when preparing the SEFA to ensure no grant programs are inadvertently left off of the SEFA. Additionally, the availability of the Grant Repository enables members of the accounting, finance and grant departments to quickly access grant award information when needed for audits, reporting, or other requirements. The grant accounting team is continuing to review and update the County’s Grant Accounting policies and is working closely with departments to understand their utilization of Infor to account for grant- related activities. As these policies are formalized, we will continue to provide training and resources; in late 2023, the County hired an outside trainer to provide an in-depth training on the accrual method of accounting, grant accruals, and the treatment of grant revenue. The Grant Accountant provided training in April 2024 to explain and outline the SEFA and Single Audit processes. Grant-funded departments received a two-day training on utilization of the Grant Management components of Infor in February 2024. We are also providing guidance and education to departments on the differences in timing of various grant fiscal years and how these impact the financial audit, SEFA and Single Audit. For example, departments must understand how to report expenditures and receipts in the correct period regardless of the fiscal year associated to the contract (State: July-June; Federal: October-September; County: January-December) and understand how these amounts reconcile to the amounts reported to the funding agencies. The accounting department continues to work with departments to emphasize the importance of submitting financial documentation timely and reviewing what is in the General Ledger promptly at the end of each month. The Finance department is performing quarterly reviews with departments to go over financial status, including grant financials. Departments are continuing to utilize Project Codes and other components of Infor’s Grant Management System to ensure the proper accounting of grant-related expenses, receipts, and revenues in the GL. Name(s) of the contact person(s) responsible for corrective action: Thomas Landauer and Fonta Reilly Planned completion date for corrective action plan: September 2025

2023-008 – Reporting Federal Agency: U.S. Department of the Treasury Federal Program Name: Emergency Rental Assistance Program (ERAP) Assistance Listing Number: 23.023 Federal Award Identification Number and Year: Various Pass-Through Agency: Pennsylvania Department of Health and Human Services Pass-Through Number(s): Not Available Award Period: 1/1/2023 – 12/31/23 Type of Finding: Significant Deficiency in Internal Control Over Compliance Condition: Policies and controls in place regarding the completeness of the SEFA were not properly functioning. Within the supporting listing of expenses relating to ERAP expenditures, six transactions were identified as prior fiscal-year expenditures that were included in the unadjusted 2023 expenditure total. The County revised the 2023 SEFA to exclude the 2022 expenditures. Recommendation: We recommend management should review the process of recording federal expenditures to determine expenditures are being included in the appropriate fiscal year. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action planned and taken in response to finding: The reason for the finding’s recurrence is in part a result of the timing of when the finding was issued. For example, the 2022 Single Audit was issued in August 2024. At this point, the 2023 fiscal year was already complete. Additionally, the implementation of corrective actions are in progress, including providing training, oversight and guidance to departments administering the grants, but these efforts take time to complete and/or are ongoing. A Deputy Controller of Grant Accounting was hired in February 2023, and a Manager-Grant Accounting was hired in July 2024, after working in this capacity as a temporary staff member since mid-2023. The County approved an additional full-time grant accounting position in May 2025 and will begin recruiting for this position in June 2025. These positions are responsible for establishing accounting policies based on best practices for grant-related activities, developing and providing training and resources to grant- funded departments, reviewing grant-related accounting in the Infor system, preparation of the annual SEFA, and assisting in the facilitation and preparation of documents needed for the Single Audit. The work performed by these positions had been vacant since the departure of Internal Audit Staff who helped General Accounting prior to the 2021 audit as well as the SEFA. Several changes have been made since the grant accounting team was created including the following: The grant accounting team is developing streamlined and standardized SEFA templates for each department for SEFA preparation. The expenditures reported on each SEFA are being compared to the financial information in the GL where possible to ensure all appropriate expenditures are included. Additionally, we are incorporating tracking of lifetime grant expenditures into the SEFA process to ensure no expenditures are missed due to cut off or timing issues. In 2023, the grant accounting team created a Montgomery County Grant Repository. This repository is used to store all grant agreements awarded to the County. Departments submit grant information to the repository upon notification of grant award. The grant accounting team reviews the Grant Repository when preparing the SEFA to ensure no grant programs are inadvertently left off of the SEFA. Additionally, the availability of the Grant Repository enables members of the accounting, finance and grant departments to quickly access grant award information when needed for audits, reporting, or other requirements. The grant accounting team is continuing to review and update the County’s Grant Accounting policies and is working closely with departments to understand their utilization of Infor to account for grant- related activities. As these policies are formalized, we will continue to provide training and resources; in late 2023, the County hired an outside trainer to provide an in-depth training on the accrual method of accounting, grant accruals, and the treatment of grant revenue. The Grant Accountant provided training in April 2024 to explain and outline the SEFA and Single Audit processes. Grant-funded departments received a two-day training on utilization of the Grant Management components of Infor in February 2024. We are also providing guidance and education to departments on the differences in timing of various grant fiscal years and how these impact the financial audit, SEFA and Single Audit. For example, departments must understand how to report expenditures and receipts in the correct period regardless of the fiscal year associated to the contract (State: July-June; Federal: October-September; County: January-December) and understand how these amounts reconcile to the amounts reported to the funding agencies. The accounting department continues to work with departments to emphasize the importance of submitting financial documentation timely and reviewing what is in the General Ledger promptly at the end of each month. The Finance department is performing quarterly reviews with departments to go over financial status, including grant financials. Departments are continuing to utilize Project Codes and other components of Infor’s Grant Management System to ensure the proper accounting of grant-related expenses, receipts, and revenues in the GL. Name(s) of the contact person(s) responsible for corrective action: Thomas Landauer and Fonta Reilly Planned completion date for corrective action plan: September 2025