Corrective Action Plans

The City will work on a formal process for tracking all federal grants.

The District will review the SEFA thoroughly to ensure that expenditures are included in the appropriate fiscal year.

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

Identifying Number: Finding 2025-001 – Schedule of Expenditures of Federal Awards (SEFA) Preparation Corrective Actions Taken or Planned: The completed SEFA and supporting reconciliation will receive a documented secondary management review and approval before submission to the external auditors. The reviewer will verify the SEFA against the general ledger and grant records, including federal versus non-federal expenditures, ALNs, program clusters, award periods, and total expenditures reported. Evidence of review and approval will be retained with the SEFA workpapers. Person(s) Responsible: Essence Montgomery, CFO and Abdul Hadi, Director of Financial Accounting Anticipated Completion Date: February 1, 2027 Management Oversight & Next Steps: Management will communicate these control requirements to accounting personnel and responsible departments and incorporate them into current accounting policies and procedures. Documentation supporting the performance of each control will be retained as part of applicable workpapers and made available for management review and future audit testing.

With the exception of prepaid travel expenses, there were no differences between COMTO’s general ledger, grant agreements, or reimbursement requests. The discrepancy noted by the auditors relates to Material Weaknesses 2025-001 and 2025-002 with appropriate actions taken.

Management agrees with the finding and will implement procedures to ensure the SEFA is prepared and reviewed internally prior to the commencement of future audits.

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 Number 2025-224: The Department overstated federal grant expenditures on the Schedule of Expenditures of Federal Awards (SEFA) closing package. Federal Program: 21.027 – Coronavirus State and Local Fiscal Recovery Fund Related to Prior Finding: N/A Agency’s view: The department agrees with the finding and asserts that it was a one-of-a-kind error in the timing of recording of one expenditure transaction. The error went undetected for a few months during the very confusing and difficult Luma transition year. When staff detected the error they believed the expenditure was still required to be reported on a SEFA and the only option available was to report it in FY 2025. Corrective Action: Staff have already completely familiarized themselves with the guidance on “New Requirement for Wire Payment Requests” issued by SCO on October 6, 2025. We are confident that our understanding of these new procedures will prevent any future occurrence. Anticipated Corrective Action Date: September 28, 2026 Responsible for Corrective Action: Steve Martin, Financial Officer Steve.Martin@idpr.idaho.gov (208) 869-4120

We recognize the problem with the SEFA schedule and feel these mistakes were resolved. Please refer to an email from Clerk Sarah Miller dated July 10, 2026. The major error ($500,000) was a result of a typo while filling out the SEFA schedule. I entered $50,701 when the figure should have been $550,701. We recognize the errors that occurred and are adjusting our process to try to ensure that they are not repeated in the future.

Finding Number: 2025-002 Condition: The Organization failed to accumulate all expenditures of federal awards into their SEFA resulting in an understatement of expenditures on their 2025 SEFA. Planned Corrective Action: Management has implemented a formal SEFA preparation checklist that includes reconciliation of total federal expenditures to the general ledger and grant records. This includes establishing a control to identify all federal awards by ALN, including pass-through funding, prior to SEFA finalization and enhanced management review procedures to include verification of completeness and accuracy. Additionally, management will coordinate with program personnel to ensure all sources of federal funding are captured. Contact Person Responsible for Corrective Action: Justin Fisher, Senior Director of Accounting Anticipated Completion Date: August 31, 2026

2025-004 Per 2 CFR §200.510(b), the SEFA must include: - A list of individual federal programs by agency, including the Assistance Listing number. - The total federal awards expended for each program, including capital projects funded by federal grants. - Amounts passed through to subrecipients. - Outstanding balances for loan or loan guarantee programs. - Significant accounting policies used in preparing the SEFA. Recommendation: We recommend that management: - Implement a reconciliation process to ensure that all federal expenditures are accurately captured in the SEFA. - Provide additional training for accounting personnel on federal reporting requirements. - Review all local government awards to determine whether Federal funds are a component of the contracts. - Review SEFA data for completeness and accuracy before submission. Management’s Response: Management concurs with the recommendation. HTM recognizes that accurate SEFA preparation begins with identification of federal funding when an award is received and cannot depend solely on a year-end exercise performed after transactions have already been recorded. Management will establish a federal award identification and reconciliation process connecting contract administration, accounting records, federal award information, and the final SEFA. Corrective Action Status and Plan: Management is reviewing the FY 2025 SEFA and related award information and plans to formalize an enhanced SEFA preparation and review process by December 31, 2026. Finance/Accounting will maintain a centralized award inventory identifying the awarding agency and pass-through entity, Assistance Listing number, period of performance, federal and nonfederal funding components, amounts passed through to subrecipients, outstanding loan or loan-guarantee balances when applicable, and the accounting policies used to prepare the SEFA. At least quarterly, Accounting will reconcile the inventory and cumulative federal expenditures to the general ledger, grant billing records, award agreements, and supporting schedules; differences will be investigated, resolved, and documented. Management also plans to complete a preliminary year-to-date SEFA review before year-end. As part of the immediate FY 2025 remediation, management will document the bridge from the prior SEFA to the final revised schedule; retain support for the funding classification of County Operating and Measure H amounts; reconcile the final SEFA to the general ledger and project schedules; and ensure related amounts and disclosures in the audit report are updated consistently. The additional implementation activities are described below. • Reviewing all new grant agreements and contracts to identify funding sources and determine the appropriate federal participation percentage. • Providing targeted training to accounting personnel regarding federal reporting requirements and awards with blended funding sources. • Establishing a secondary management review of the SEFA, including reconciliation of expenditures to underlying award agreements and supporting schedules. The Mission's procedures for preparing the Schedule of Expenditures of Federal Awards (SEFA) did not adequately address contracts containing multiple funding sources. In certain instances, awards administered through local government entities contained both federal and state funding components; however, the agreements were initially classified as fully federal for SEFA reporting purposes. In addition, no formal process existed to systematically review funding agreements and document the federal funding portion of each award prior to SEFA preparation. The enhanced review and monitoring procedures will improve the accuracy and completeness of SEFA reporting, ensure that expenditures are properly classified between federal and non-federal funding sources, and reduce the risk of future reporting errors and noncompliance with Uniform Guidance requirements. Name of responsible person: Tisha Lazare, Chief Financial Officer Anticipated completion date: December 31, 2026

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

The corrective actions below are listed with the responsible party and target completion date for each. Actions will be completed by November 30, 2026. Policies and Procedures Manual updates will be presented to the CEO and Board of Directors in December 2026. • Complete the implementation of Sage Intacct accounting and financial management platform. Issue system produced financial reports. Target date: November 30, 2026. • Finalize written roles and responsibilities, including review and approval duties, within the accounting function. Target date: November 30, 2026. • Formally adopt the month-end closing workflow and checklists, starting with the September 2026 close. Target Date: October 31, 2026 • Clear the backlog of outstanding bank reconciliations, with documented preparer and reviewer sign-off. This was already achieved as of August 31, 2026. • Engage technical accounting assistance for leases, contributed facilities, and revenue recognition. Target date: November 30, 2026. • Add fixed-asset procedures to evaluate asset classifications, useful lives, lease terms, and depreciation and amortization. Target date: November 15, 2026. • Document the U.S. GAAP evaluation of lease arrangements and contributed or in-kind use of facilities. Target date: November 15, 2026. • Formalize procedures for PRDE funding advances, receivables, deferred revenue, and revenue recognition, including Cartas Constitutivas amendments. Target date: November 15, 2026. • Complete bank reconciliations starting with October’s accounting closing in Sage Intacc as part of the close, with evidence of timely review. Target date: November 2026. • Approve the updated policies and procedures manual. Target date: December 2026. • Deliver technical training to Finance Department staff on the updated procedures. Target date: November 30,2026These initiatives, additional Finance Department resources, the new accounting platform, enhanced month-end closing procedures, updated policies and procedures, and continued technical training represent meaningful steps toward addressing the conditions described in the finding. Management will continue to monitor these measures and evaluate their effectiveness as they operate over time.

Management will implement written procedures for federal grant administration applicable to all federal awards. Reimbursement requests will be limited to costs incurred and supported by documentation at the time of the request. The reimbursement request, expenditure listing, supporting documentation, and documented allowability review will be maintained together in a referenced file and will include preparer and reviewer sign-off. For advance payments, management will document the program's immediate cash requirements supporting the amount and timing of each advance and monitor the period between receipt and disbursement of federal funds. The reimbursement log reconciliation and Schedule of Expenditures of Federal Awards will be subject to documented review by an individual who was not involved in their preparation. Management will also coordinate with the USDA Forest Service regarding the $64,969 in questioned costs and follow the awarding agency's direction.

Management understands and agrees with the finding. The Cooperative recognizes that expenditures reported to Hancock County for the fiscal year ended December 31, 2025, inadvertently included federal award expenditures related to the prior fiscal year, resulting in an improper cut-off. To address this, management has implemented and documented procedures to ensure that only expenditures incurred within the current fiscal year are included in amounts reported to Hancock County. These procedures include a cutoff checklist completed by the preparer prior to each submission, which documents the date range verified for each expenditure line and confirms that all amounts fall within the current grant period. Submission of expense reports to Hancock County will be held until the checklist is fully completed and signed off. These controls will be applied to any future federal grants to prevent recurrence.

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.

Finding 2025-001: Material Weakness, Inaccurate Schedule of Expenditures of Federal Awards (SEFA) Person(s) Responsible: Tiffany Hermes, Finance Director Anticipated Completion Date: 12/31/2026 Corrective Action Plan: The Finance Department has implemented quarterly meetings with other departments that maintain grants to discuss and reconcile all grants. This includes Department Heads as well as their admin to enhance conversations to ensure we are tracking any new obligated grants as well as maintaining the current grants.

Management Response Management concurs with this finding, in part. CARS acknowledges that its SEFA preparation process did not include a formally documented procedure for evaluating and documenting subrecipient-versus-contractor determinations or a documented supervisory review control over the preparation of the SEFA. However, during the period under audit, management did review agreements at the time of award and considered the nature of each relationship in determining the appropriate classification based on its understanding of the subrecipient criteria established under Uniform Guidance, 2 CFR § 200.331. Accordingly, while CARS acknowledges that its evaluation and review processes were not formally documented, management believes it is important to distinguish the absence of formal documentation and controls from an absence of management review or consideration of the appropriate classification. CARS’ classification approach had also been discussed with the auditors during the annual Single Audits conducted for Years 1 through 4 of the current federal award. No exceptions related to the classification of these entities were identified during those prior audits. CARS recognizes, however, that responsibility for determining the appropriate classification of subrecipients and contractors and for ensuring accurate SEFA reporting rests with management. Based on additional training regarding subaward management under 2 CFR Part 200, together with the matters identified and discussed during the current audit, CARS agrees that establishing a formal written policy and documented review process will strengthen its internal controls and help ensure consistent application of the Uniform Guidance requirements. Upon identification of the classification issue during the current audit, CARS evaluated the affected entities and revised the SEFA prior to issuance of the audit report to properly reflect amounts provided to subrecipients. The revision did not change total federal expenditures reported on the SEFA. Corrective Action CARS will develop and implement written procedures for subrecipient-versus-contractor determinations and will establish formal SEFA preparation and review procedures, including documented supervisory review prior to issuance. Responsible Party: Ranelle Bensch, Director of Finance & Compliance Target Implementation Date: January 2027

Views of Responsible Officials and Planned Corrective Actions Management agrees with the finding and recognizes the importance of preparing a complete and accurate Schedule of Expenditures of Federal Awards (SEFA) prior to the commencement of the annual audit in accordance with the requirements of 2 CFR §200.510(b). The finding resulted from the absence of a formalized process to consistently identify and document federal funding components within contracts funded through multiple revenue sources, including changes reflected in new and renewed County contracts. As a result, certain federal funding components were not identified during the initial preparation of the SEFA, requiring revisions during the audit. In response, management has implemented and will continue to enhance procedures to strengthen the preparation and review of the SEFA throughout the fiscal year. These corrective actions include: • Establishing formal procedures requiring the identification and documentation of Assistance Listing Numbers (ALNs) for all new contracts and contract renewals. • Tracking applicable federal funding and corresponding ALNs within the accounting system to support the accurate preparation and review of the SEFA. • Requiring the Controller to review all new and renewed contracts monthly to identify changes affecting federal funding and ensure the SEFA is updated accordingly. • Obtaining and maintaining timely ALN confirmations and supporting documentation for all applicable federal awards. • Preparing and reconciling the completed SEFA to supporting accounting records, finding documentation, and applicible federal and pass-through contracts prior to submission to the independent auditors.

The County Clerk has implemented a program to ensure knowledge and awareness of all federal monies being expended. The County Treasurer will set up accounts within our financial software to account for all transactions.