Corrective Action Plans

Finding 1181560 (2025-002)

Material Weakness 2025

PA

Internal Control / Segregation of Duties Subrecipient Monitoring Period of Performance § 200.344

Finding Number: 2025-002, Grant Closeouts Condition: The University did not complete full grant closeout procedures in a timely manner for 8 out of 40 grants that were tested with a period of performance that ended in the year ended June 30, 2025. Corrective Actions: Penn State will raise awareness ...

Finding Number: 2025-002, Grant Closeouts Condition: The University did not complete full grant closeout procedures in a timely manner for 8 out of 40 grants that were tested with a period of performance that ended in the year ended June 30, 2025. Corrective Actions: Penn State will raise awareness of the late closeout issue at various committee, workgroup, and council meetings during Spring 2026, and enforce compliance with our existing policy. These meetings involve research leadership at all colleges, such as Associate Deans for Research, College Research Administration Officers, and College Strategic Financial Partners. Penn State will provide additional trainings throughout the year to educate colleges on the closeout process through the Financial Analysis and Compliance Office. Contact person responsible for corrective action: Jason Guilbeault, Assistant Vice President for Research – Post Award Contractual Compliance Anticipated Completion Date: March 31, 2026

View Audit 392770

Finding 1181556 (2025-001)

Material Weakness 2025

The Pennsylvania State University

PA

Subrecipient Monitoring Internal Control / Segregation of Duties Cash Management § 200.305

Finding Number: 2025-001, Subrecipient Payments Condition: The University did not have adequate controls in place to ensure invoices to subrecipients were paid timely within the 30-calendar-day requirement. Planned Corrective Action: Penn State created a new Subaward Administration and Compliance Of...

Finding Number: 2025-001, Subrecipient Payments Condition: The University did not have adequate controls in place to ensure invoices to subrecipients were paid timely within the 30-calendar-day requirement. Planned Corrective Action: Penn State created a new Subaward Administration and Compliance Office (SACO), which is part of the new Post Award Contractual Compliance Office. The SACO is led by its own director and provides central oversight over key subaward compliance processes, such as subrecipient payments, and provide training to campus on subrecipient processes. This function has already implemented new changes and workflows in the financial system to allow for better tracking and reporting of subaward compliance activities, and continues to refine subaward processes. The creation of this office demonstrates Penn State’s commitment to compliance for subaward activities. Contact person responsible for corrective action: Jason Guilbeault, Assistant Vice President for Research – Post Award Contractual Compliance Anticipated Completion Date: February 27, 2026

View Audit 392770

Finding 1181549 (2025-001)

Material Weakness 2025

SOUTHWESTERN COLLEGE FOUNDATION

CA

Subrecipient Monitoring Reporting

Views of Responsible Officials and Corrective Action Plan We concur. Foundation management has implemented new procedures to ensure all required reporting is performed timely and accurately. We will continue outreach to the Small Business Administration to verify and correct the invalid FAIN number.

View Audit 392752

Finding 1181547 (2025-001)

Material Weakness 2025

Brunswick Central School District

NY

Procurement, Suspension & Debarment School Nutrition Programs § 200.318

Compliance Requirement Procurement Criteria Under 2 CFR 180.995, the School District must not enter into covered transactions with parties that are suspended or debarred. For covered transactions (generally at or above the simplified acquisition threshold), the School District must verify that vendo...

Compliance Requirement Procurement Criteria Under 2 CFR 180.995, the School District must not enter into covered transactions with parties that are suspended or debarred. For covered transactions (generally at or above the simplified acquisition threshold), the School District must verify that vendors are not suspended or debarred by (1) checking SAM.gov, (2) collecting a vendor certification, or (3) adding a contractual clause that the vendor is not suspended or debarred and maintaining documentation of the verification. Additionally, under 2 CFR 200.318(h), the School District must maintain effective internal controls over procurement to ensure compliance with federal statutes, regulations, and the terms and conditions of federal awards. Condition During testing and confirmed with management at the School District, it was determined that the School District does not verify that vendors were not debarred or suspended. Cause The School District’s procurement procedures do not require or are not consistently followed to perform and retain documentation of suspension and debarment checks for covered transactions. Effect Without controls to verify and document vendor eligibility, the School District is at risk of expending federal funds with vendors that are suspended or debarred, resulting in noncompliance with federal requirements. This could lead to questioned costs, repayment obligations, and reputational risk. Recommendation The Bonadio Group recommended that the School District strengthen its internal controls over the procurement requirement regarding suspension and debarment requirement by implementing the following actions: (a) Update written procurement procedures to clearly require documented verification before entering any covered transactions. (b) Require procurement staff to document verification at the time of award and to retain the documentation in the procurement file. (c) Integrate a system of controls, where feasible, that prevents a purchase order or contract from being finalized unless proof of suspension/debarment verification has been uploaded. (d) Provide reoccurring training to procurement, finance and grant management staff regarding federal suspension and debarment requirements and proper documentation practices. (e) Implement periodic monitoring or internal reviews to ensure that the verification process is consistently followed and address any deviations promptly. View of Responsible Officials The School District will institute additional procedures to ensure that vendors are not debarred or suspended. Response We are in agreement with the recommendation and will be creating a federal funds procedural manual to address the issues above. Anticipated Completion Date This will be corrected by 6/30/26. Person Responsible Stephanie Fanning, Assistant Superintendent for Business

View Audit 392749

Finding 1181544 (2025-004)

Material Weakness 2025

Marble Valley Regional Transit District

VT

Procurement, Suspension & Debarment § 200.303 § 200.319 § 200.320

2025-004-Procurcmcnt Suspension and Debarment We have developed an internal form that each employee knows they must fill out when obtaining any kind of service or supply. We have educated staff on the dollar limits and thresholds required as well as any backup documentation needed to be obtained for...

2025-004-Procurcmcnt Suspension and Debarment We have developed an internal form that each employee knows they must fill out when obtaining any kind of service or supply. We have educated staff on the dollar limits and thresholds required as well as any backup documentation needed to be obtained for each purchase of goods or services. Moving forward the finance department will be responsible for running sam.gov checks to make sure all vendors that the district does business with are clear of suspension and debarment at either the start of the fiscal year or whenever procuring new services and goods throughout the year.

View Audit 392743

Finding 1181533 (2025-003)

Material Weakness 2025

Marble Valley Regional Transit District

VT

Cash Management Reporting Significant Deficiency § 200.305

2025-003-Cash Management MVRTD recognizes this material weakness. Several factors lead to the inaccurate billing noted in the audit. Firstly, it must be noted the during FY25 the MVRTD did not have a financial director on staff and the billing work was being performed by a staff accountant with no p...

2025-003-Cash Management MVRTD recognizes this material weakness. Several factors lead to the inaccurate billing noted in the audit. Firstly, it must be noted the during FY25 the MVRTD did not have a financial director on staff and the billing work was being performed by a staff accountant with no previous training in the billing of MVRTD specific grants and no written manuals or instructions were left behind to reference. Due to the fact allocations were set up to be calculated as an automatic entry inside of Passport ( our previous accounting system) and completed outside the system, there were no oversite measures that would have provided a way to prevent or identify duplicate transactions such as the overbilling that occurred. Since July 1, 2025, we have hired a full-time Finance Director and established a new accounting system. We have started using Quick Books Online (QBO), which is a much more detailed and comprehensive accounting system that allows us to be able to identify errors in the billing process and we established an entirely new cost allocation system that is outside of QBO. This ensures an internal and external check and balance system. All invoices and back-up are now being reviewed and approved by the Executive Director. Both the Finance Director and Executive Director will sign off on the invoices before submitting them to the state.

View Audit 392743

Finding 1181522 (2025-006)

Material Weakness 2025

Texas College

TX

Student Financial Aid

Finding 2025-006 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental E...

Finding 2025-006 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental Educational Opportunity Grant, FAL No. 84.007, June 30, 2025; Federal Work-Study Program, FAL No. 84.033, June 30, 2025. Condition - During review of enrollment reporting procedures, we noted that one (1) student record requested for testing was not provided, and two (2) sampled student records were not updated to reflect current enrollment status changes in NSLDS. As a result, the College could not demonstrate that enrollment reporting was complete, accurate, or timely for the students tested. Views of Responsible Officials –The College accepts the recommendation. The Institution has reviewed the finding and acknowledges that one student record was not submitted for review. The Institution has provided the NSLDS enrollment verification for that student. For the remaining two students, enrollment reporting was not updated within the required 30-day timeframe. The Institution has since updated their enrollment statuses in NSLDS and has provided updated records for review. The Institution respectfully requests that the finding be formally updated, if applicable, upon the auditor’s review and acceptance of all submitted NSLDS enrollment documentation. In response, the institution has updated its processes and procedures regarding student enrollment reporting with NSLDS, by ensuring accurate enrollments status matches the student transcript. Along with continuing to update within the 30 days established timeframe within NSLDS. Responsible Officials -The Registrar, the Financial Aid Office under the direction of the Vice President of Student Affairs, and Business Office under the direction of the Vice President for Business and Finance plans to have the finding resolved by its next fiscal year end audit (between July – October 2026). The College is aware of the need to review and mitigate compliance risks in this area and will use the described corrective action plan to reduce those risks and eliminate the potential for future audit findings.

View Audit 392737

Finding 1181518 (2025-005)

Material Weakness 2025

Texas College

TX

Student Financial Aid Reporting

Finding 2025-005 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental E...

Finding 2025-005 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental Educational Opportunity Grant, FAL No. 84.007, June 30, 2025; Federal Work-Study Program, FAL No. 84.033, June 30, 2025. Condition - Testing of student withdrawals revealed that for three (3) students, Title IV funds identified as unearned through the Return of Title IV (R2T4) process were not returned to the U.S. Department of Education within the required timeframe. The returns were made between 209 and 349 days after the College’s date of determination (DOD), which is well beyond the 45-day requirement established by federal regulations. Views of Responsible Officials – The College accepts the recommendation. The Institution has reviewed the finding and acknowledges that one student record was not submitted for review. The Institution has provided the NSLDS enrollment verification for that student. For the remaining two students, enrollment reporting was not updated within the required 30-day timeframe. The Institution has since updated their enrollment statuses in NSLDS and has provided updated records for review. The Institution respectfully requests that the finding be formally updated, if applicable, upon the auditor’s review and acceptance of all submitted NSLDS enrollment documentation. In response, the institution has updated its processes and procedures regarding student enrollment reporting with NSLDS, by ensuring accurate enrollments status matches the student transcript. Along with continuing to update within the 30 days established timeframe within NSLDS. Responsible Officials -The Registrar, the Financial Aid Office under the direction of the Vice President of Student Affairs, and Business Office under the direction of the Vice President for Business and Finance plan to have the finding resolved by its next fiscal year end audit (between July – October 2026). The College is aware of the need to review and mitigate compliance risks in this area and will use the described corrective action plan to reduce those risks and eliminate the potential for future audit findings.

View Audit 392737

Finding 1181514 (2025-004)

Material Weakness 2025

Texas College

TX

Student Financial Aid Internal Control / Segregation of Duties

Finding 2025-004- U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental Ed...

Finding 2025-004- U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental Educational Opportunity Grant, FAL No. 84.007, June 30, 2025; Federal Work-Study Program, FAL No. 84.033, June 30, 2025. Failure to Provide Student-Level Documentation to Support FISAP Reporting (significant deficiency) Condition - The College did not provide the requested student-level records (ISIRs) to substantiate the number of eligible applicants reported on the FISAP submitted to the U.S. Department of Education. As a result, we were unable to verify the accuracy and completeness of the eligible applicant data reported for the applicable award year. Views of Responsible Officials - The College accepts the recommendation. The institution acknowledges that this request was initially overlooked during the audit review. The requested sample testing of ISIRs has now been completed, and a total of 34 ISIR records have been provided and uploaded to the shared file for the auditor’s review. The institution respectfully requests a formal update to this finding (if applicable), once all submitted ISIR documents have been reviewed and deemed acceptable by the auditor Responsible Officials - The Financial Aid Office under the direction of the Vice President of Student Affairs plans (to have the finding resolved by its next fiscal year end audit (between July – October 2026). The College is aware of the need to review and mitigate compliance risks in this area and will use the described corrective action plan to reduce those risks and eliminate the potential for future audit findings.

View Audit 392737

Finding 1181510 (2025-003)

Material Weakness 2025

Texas College

TX

Student Financial Aid Internal Control / Segregation of Duties

Finding 2025-003 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental E...

Finding 2025-003 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental Educational Opportunity Grant, FAL No. 84.007, June 30, 2025; Federal Work-Study Program, FAL No. 84.033, June 30, 2025. Condition – During testing of student account activity, we identified that nine (9) out of sixty (60) sampled students had Title IV -created credit balances that remained on their accounts for more than 14 days without being released to the student or parent. Views of Responsible Officials - The College accepts the recommendation. The institution has reviewed the audit finding and acknowledges that student refunds were not consistently issued within the required 14-day timeframe due to students’ incomplete admissions requirements. The institution recognizes this as a compliance deficiency and has implemented revised processes and internal controls to ensure timely and compliant issuance of student refunds going forward. Effective immediately, the Registrar’s Office provides a weekly roster of students with incomplete admission requirements to the Financial Aid Office and the Business Office prior to the release of federal student aid. These offices meet weekly to review the roster, ensure timely communication, and document all actions taken. This control ensures that federal student aid is not disbursed when admissions requirements have not been met and prevents the creation of improper student credit balances. Under the revised refund process, the Business Office staff identify student credit balances and prepare refund requests. These requests are reviewed by the Registrar’s Office to reconfirm when admission requirements have been met and by the Financial Aid Office to confirm that federal student aid has been properly originated and disbursed through the Common Origination and Disbursement (COD) system. If it is determined that a student’s admissions requirements are incomplete and a refund has been created, the Business Office notifies the Financial Aid Office to cancel all applicable federal student aid and return the funds to the U.S. Department of Education through COD. When a student’s admissions requirements have been met, then the Business Office completes the refund process by transmitting the approved refund file to the institution’s third-party refund vendor and submitting funds for release to students. These revised procedures strengthen oversight, improve interdepartmental coordination, and ensure compliance with federal refund timelines. College administrators for each department (Vice President for Student Affairs and Vice President for Business and Finance) will be responsible for informing staff of changes in campus operations that may have an impact on their ability to process refunds. Responsible Officials - The Registrar, the Financial Aid Office under the direction of the Vice President of Student Affairs, and Business Office under the direction of the Vice President for Business and Finance plan to have the finding resolved by its next fiscal year end audit (between July – October 2026). The College is aware of the need to review and mitigate compliance risks in this area and will use the described corrective action plan to reduce those risks and eliminate the potential for future audit findings.

View Audit 392737

Finding 1181506 (2025-002)

Material Weakness 2025

Texas College

TX

Student Financial Aid Internal Control / Segregation of Duties

Finding 2025-002 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental E...

Finding 2025-002 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental Educational Opportunity Grant, FAL No. 84.007, June 30, 2025; Federal Work-Study Program, FAL No. 84.033, June 30, 2025. Condition - Based on documentation provided for the 2024–2025 award year, the College disbursed Title IV funds to a student whose ISIR contained Comment Code 325, indicating that the student’s unaccompanied homeless youth status required resolution prior to awarding and disbursing aid. The College did not provide documentation from an authorized entity, nor evidence of a documented Financial Aid Administrator case-by-case determination, to support the student’s independent status. As a result, the student’s dependency status remained unresolved at the time Title IV funds were disbursed. Views of Responsible Officials – The College accepts the recommendation Although a recommendation was noted, the Financial Aid Management System (FAMS) was not programmed as expected for the 2024– 2025 FAFSA application year. The issue was anticipated to be addressed by the third-party vendor through system updates; however, because of the programming oversight, no system flag was generated to request self-supporting documentation or validation of a student’s homelessness or risk of homelessness. In addition, the Department of Education’s FAFSA application did not generate a comment code requiring further action on the student’s record. The Institution has since worked with its third-party vendor to correct the programming oversight to ensure that required documentation is requested for students who indicate homelessness or risk of homelessness. Additionally, at the direction of the FAMS vendor, the Financial Aid Office implemented an internal edit to ensure a system flag alerts staff when documentation is required to resolve such cases. With these corrections, the conditions that caused the error have been addressed. Responsible Officials -The Financial Aid Office under the direction of the Vice President of Student Affairs plans to have the finding resolved by its next fiscal year end audit (between July – October 2026).To ensure ongoing compliance, the Financial Aid Office will monitor student records for appropriate flags and required documentation. The College is aware of the need to review and mitigate compliance risks in this area and will use the described corrective action plan to reduce those risks and eliminate the potential for future audit findings.

View Audit 392737

Finding 1181502 (2025-001)

Material Weakness 2025

Texas College

TX

Student Financial Aid Reporting

Finding 2025-001 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental E...

Finding 2025-001 - U.S. Department of Education (USDE, Title IV Student Financial Aid Programs (significant deficiency): Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2025; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2025; Federal Supplemental Educational Opportunity Grant, FAL No. 84.007, June 30, 2025; Federal Work-Study Program, FAL No. 84.033, June 30, 2025. Condition– It was noted that the College did not perform the required reconciliations between: a. The Student Financial Aid (SFA) Office records, b. The Business Office/General Ledger (SEFA), and c. The Common Origination and Disbursement (COD) System. In additional, unreconciled figures from the College’s internal records were used in preparing and submitting the Fiscal Operations Report and Application to Participate (FISAP) submitted to the U.S. Department of Education for the most recent award year. As a result, the College could not demonstrate that Title IV activity reported to ED was accurate or fully supported. Subsequent to the identification of this exception, management provided additional documentation intended to support reconciliation activities; however, the documentation did not demonstrate that reconciliations were performed timely or as part of established internal control procedures during the period under audit. Views of Responsible Officials - The College accepts the recommendation. Beginning with future monthly Title IV reconciliations, the Institution will complete all required reconciliations no later than five (5) days after the COD reconciliation reports are made available. The Financial Aid Office will provide the reports to the Business Office for reconciliation. Following reconciliation by the Business Office, the reports will be returned to the Financial Aid Office when resolution of discrepancies is required. Once discrepancies are resolved, the Financial Aid Office will submit the updated reports back to the Business Office, and the resolution will be documented. If no resolution is required, the reports will be retained for the applicable month. All monthly reconciliations will be maintained and made available for review during the yearend audit by the Business Office Responsible Officials- The Financial Aid Office under the direction of the Vice President of Student Affairs plans to have the finding resolved by its next fiscal year end audit (between July – October 2026). The College is aware of the need to review and mitigate compliance risks in this area and will use the described corrective action plan to reduce those risks and eliminate the potential for future audit findings.

View Audit 392737

Finding 1181498 (2025-002)

Material Weakness 2025

North Harrison Community School Corporation

IN

Procurement, Suspension & Debarment Subrecipient Monitoring § 200.1 § 200.303 § 200.317 § 200.318 § 200.319

Date: February 9, 2026 FINDING 2025-002 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Paula Powers, Food Service Coordinator Contact Phone Number and Email Address: 812-347-3905 ppowers@nhcs.k12.in.us Views or Re...

Date: February 9, 2026 FINDING 2025-002 Finding Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Contact Person Responsible for Corrective Action: Paula Powers, Food Service Coordinator Contact Phone Number and Email Address: 812-347-3905 ppowers@nhcs.k12.in.us Views or Responsible Official: We concur with the findings. Description of Corrective Active Plan: The Food Service Coordinator will verify Sam.gov to confirm a contractor is not suspended or disbarred before awarding a contract every 12 months. For small purchases, quotes will be obtained and retained with the claims for that payment. Anticipated Completion Date: March 2026

View Audit 392733

Finding 1181494 (2025-001)

Material Weakness 2025

North Harrison Community School Corporation

IN

School Nutrition Programs Internal Control / Segregation of Duties Eligibility § 200.303

Date: February 9, 2026 FINDING 2025-001 Finding Subject: Child Nutrition Cluster-Eligibility Contact Person Responsible for Corrective Action: Paula Powers, Food Service Coordinator Contact Phone Number and Email Address: 812-347-3905 ppowers@nhcs.k12.in.us Views or Responsible Official: We concur w...

Date: February 9, 2026 FINDING 2025-001 Finding Subject: Child Nutrition Cluster-Eligibility Contact Person Responsible for Corrective Action: Paula Powers, Food Service Coordinator Contact Phone Number and Email Address: 812-347-3905 ppowers@nhcs.k12.in.us Views or Responsible Official: We concur with the findings. Description of Corrective Action Plan: With future processing of Direct Certification downloads, the Food Authority will generate and IT department will input Direct Certification to software System (Harmony). A second person will review the approval process to ensure Direct Certification input was downloaded correctly. After reviewing, second person will sign the Direct Certification download list in order to maintain proper checks and balances. Anticipated Completion Date: August 2026

View Audit 392733

Finding 1181490 (2025-001)

Material Weakness 2025

Centennial Homes, Inc.

MD

Internal Control / Segregation of Duties Reporting

A. Comments on Finding and Recommendations Management agrees with the audit finding related to the untimely replacement reserve deposit. The missed deposit resulted from a transfer omission during the conversion to new accounting software. Upon identification of the issue, management remitted the re...

A. Comments on Finding and Recommendations Management agrees with the audit finding related to the untimely replacement reserve deposit. The missed deposit resulted from a transfer omission during the conversion to new accounting software. Upon identification of the issue, management remitted the required deposit in full prior to issuance of the audited financial statements. B. Actions Taken or Planned To address the matter and prevent similar exceptions in the future, management has taken the following corrective actions: 1. Reviewed the reserve deposit requirements and confirmed the required transfer amount and timing. 2. Updated the recurring transfer configuration within the new accounting software. 3. Implemented a monthly verification control to confirm that required replacement reserve deposits are processed timely and accurately. 4. Assigned management oversight responsibility for review of monthly reserve funding activity. C. Status of Corrective Action on Prior Findings No prior findings noted. Responsible Party: Managing Agent Planned Completion Date: Corrective action was completed prior to issuance of the audited financial statements, with ongoing monthly monitoring thereafter.

View Audit 392726

Finding 1181489 (2025-001)

Material Weakness 2025

Montgomery Housing, Inc.

MD

Internal Control / Segregation of Duties Reporting

A. Comments on Finding and Recommendations Management agrees with the audit finding related to the untimely replacement reserve deposit. The missed deposit resulted from a transfer omission during the conversion to new accounting software. Upon identification of the issue, management remitted the re...

A. Comments on Finding and Recommendations Management agrees with the audit finding related to the untimely replacement reserve deposit. The missed deposit resulted from a transfer omission during the conversion to new accounting software. Upon identification of the issue, management remitted the required deposit in full prior to issuance of the audited financial statements. B. Actions Taken or Planned To address the matter and prevent similar exceptions in the future, management has taken the following corrective actions: 1. Reviewed the reserve deposit requirements and confirmed the required transfer amount and timing. 2. Updated the recurring transfer configuration within the new accounting software. 3. Implemented a monthly verification control to confirm that required replacement reserve deposits are processed timely and accurately. 4. Assigned management oversight responsibility for review of monthly reserve funding activity. C. Status of Corrective Action on Prior Findings No prior findings noted. Responsible Party: Managing Agent Planned Completion Date: Corrective action was completed prior to issuance of the audited financial statements, with ongoing monthly monitoring thereafter.

View Audit 392725

Finding 1181488 (2025-001)

Material Weakness 2025

Next Step Housing, Inc.

MD

Internal Control / Segregation of Duties Reporting

A. Comments on Finding and Recommendations Management agrees with the audit finding related to the untimely replacement reserve deposit. The missed deposit resulted from a transfer omission during the conversion to new accounting software. Upon identification of the issue, management remitted the re...

A. Comments on Finding and Recommendations Management agrees with the audit finding related to the untimely replacement reserve deposit. The missed deposit resulted from a transfer omission during the conversion to new accounting software. Upon identification of the issue, management remitted the required deposit in full prior to issuance of the audited financial statements. B. Actions Taken or Planned To address the matter and prevent similar exceptions in the future, management has taken the following corrective actions: 1. Reviewed the reserve deposit requirements and confirmed the required transfer amount and timing. 2. Updated the recurring transfer configuration within the new accounting software. 3. Implemented a monthly verification control to confirm that required replacement reserve deposits are processed timely and accurately. 4. Assigned management oversight responsibility for review of monthly reserve funding activity. C. Status of Corrective Action on Prior Findings No prior findings noted. Responsible Party: Managing Agent Planned Completion Date: Corrective action was completed prior to issuance of the audited financial statements, with ongoing monthly monitoring thereafter.

View Audit 392724

Finding 1181439 (2025-002)

Material Weakness 2025

Carteret County, North Carolina

NC

Eligibility Internal Control / Segregation of Duties

Training with all Medicaid Income Maintenance Caseworkers was conducted on January 28 and 29, 2026, to address the deficiencies noted above. All seasoned Medicaid workers have a minimum of two cases reviewed through a second-party process each month. Any errors found are addressed with the caseworke...

Training with all Medicaid Income Maintenance Caseworkers was conducted on January 28 and 29, 2026, to address the deficiencies noted above. All seasoned Medicaid workers have a minimum of two cases reviewed through a second-party process each month. Any errors found are addressed with the caseworkers individually and are used for training during monthly unit meetings held with all of our Medicaid caseworkers. Currently, Carteret County has 9 unseasoned workers who are being 100% second partied.

View Audit 392701

Finding 1181438 (2025-007)

Material Weakness 2025

Independent School District No. 286

MN

Equipment & Real Property Management § 200.313

MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE AND MATERIAL NONCOMPLIANCE – U.S. DEPARTMENT OF EDUCATION – PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, COVID-19 – EDUCATION STABILIZATION FUND – FEDERAL ALN 84.425 2025-007 Material Weakness in Internal Control Over Compliance and Material...

MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE AND MATERIAL NONCOMPLIANCE – U.S. DEPARTMENT OF EDUCATION – PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, COVID-19 – EDUCATION STABILIZATION FUND – FEDERAL ALN 84.425 2025-007 Material Weakness in Internal Control Over Compliance and Material Noncompliance With Equipment and Real Property Management Requirements Finding Summary 2 CFR § 200.313 requires the District to designate fixed assets purchased under federal programs and to maintain related property records, including a description of the property, a serial number or other unique identification number, the source of funding for the property (including the federal ALN), who holds title, the acquisition date, cost of the property, percentage of federal participation in the project costs for the federal award under which the property was acquired, the location, use, and condition of the property, and any ultimate disposition data, including the date of disposal and sale price of the property. A physical inventory of the property must be taken and the results reconciled with the property records at least every two years. During our audit, we noted that the District did not have sufficient controls in place within the COVID-19 – Education Stabilization Fund federal program to specifically identify federally funded fixed assets and maintain the required records as noted above to assure compliance with federal equipment and real property management requirements. The District does not have a process or procedure in place for a physical inventory of property acquired with federal funds. Fixed assets purchased with federal awards have not been maintained in accordance with federal equipment and real property management requirements. Corrective Action Plan Actions Planned – The District plans to review its internal control procedures to ensure future compliance with the federal compliance requirements specific to equipment and real property management requirements for the COVID-19 – Education Stabilization Fund federal program. Official Responsible – Kathleen Heider, Finance Director. Planned Completion Date – June 30, 2026. Disagreement With or Explanation of Finding – The District is in agreement with this finding. Plan to Monitor – Kathleen Heider, Finance Director, will ensure that federally funded fixed assets are distinguishable within the District’s finance system. The District also intends to review its control procedures relating to equipment and real property management requirements to ensure compliance for future federal awards expenditures.

View Audit 392698

Finding 1181437 (2025-006)

Material Weakness 2025

Independent School District No. 286

MN

Procurement, Suspension & Debarment § 200.318

MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE AND MATERIAL NONCOMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER – FEDERAL ALN 10.553, 10.555, AND 10.559 2025-006 Internal Control Over Compliance and Material Noncompliance W...

MATERIAL WEAKNESS IN INTERNAL CONTROL OVER COMPLIANCE AND MATERIAL NONCOMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER – FEDERAL ALN 10.553, 10.555, AND 10.559 2025-006 Internal Control Over Compliance and Material Noncompliance With Federal Procurement, Suspension, and Debarment Requirements Finding Summary 2 CFR § 180 and 2 CFR § 200.318-327 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including procurement, suspension, and debarment requirements applicable to the child nutrition cluster federal program. During our audit, we noted the District did not have sufficient controls in place resulting in material noncompliance within its child nutrition cluster federal program to ensure compliance with federal procurement requirements related to methods of procurement and to assure that it was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Corrective Action Plan Actions Planned – The District is in the process of reviewing and updating its policies and procedures relating to procurement, suspension, and debarment for its federal programs to ensure compliance with the Uniform Guidance in the future. The review of procedures will also include steps to assure that district personnel are following the requirements of the Uniform Guidance related to methods of procurement and maintaining appropriate documentation. Official Responsible – Kathleen Heider, Finance Director. Planned Completion Date – June 30, 2026. Disagreement With or Explanation of Finding – The District is in agreement with this finding. Plan to Monitor – Kathleen Heider, Finance Director, will assure appropriate internal controls and procedures are updated and in place to ensure compliance with procurement, suspension, and debarment requirements.

View Audit 392698

Finding 1181434 (2025-003)

Material Weakness 2025

North Adams Community Schools

IN

Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles § 200.208 § 200.303 § 200.403

FINDING 2025-003 Finding Subject: Special Education Cluster (IDEA) - Earmarking Contact Person Responsible for Corrective Action: Beth Quinn Contact Phone Number and Email Address: 260-728-3306 quinnb@nadams.k12.in.us Contact Person Responsible for Corrective Action: Abi West, Director of Special Ed...

FINDING 2025-003 Finding Subject: Special Education Cluster (IDEA) - Earmarking Contact Person Responsible for Corrective Action: Beth Quinn Contact Phone Number and Email Address: 260-728-3306 quinnb@nadams.k12.in.us Contact Person Responsible for Corrective Action: Abi West, Director of Special Education Contact Phone Number and Email Address: 260-824-5880 awest@awssc.k12.in.us Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: The Cooperative maintains a tracking spreadsheet to monitor hours worked by staff providing services to non-public students. Staff member will record K-12 and preschool hours separately on their Time and Effort Log. The Cooperative will then document these hours, distinguishing between Part B funds and Preschool funds. For kindergarten-aged students, the Speech-Language Pathologist will collaborate with the Student Record Administrative Assistant to identify students eligible under Section 5a (619 funding). Specifically, these are kindergarten students who are not yet six years old as of December 1. Such students are funded through both the 611 and 619 grants. Time and effort for preschool students, including 5a students, will be prioritized to the 619 grant until its allocated funds are fully expended. Once the 619 funds are exhausted, effort will be shifted to the 611 grant accordingly. Proportionate share reports will be based on actual expenditures within the six-month period, as reflected in our tracking spreadsheet. This process will be corrected for FY 2023 (611 and 610) and FY 2024 (611 and 910) to ensure compliance and prevent recurrence of similar findings in the next audit cycle. Anticipated Completion Date: September 1, 2025

View Audit 392695

Finding 1181431 (2025-003)

Material Weakness 2025

Northeastern Wayne School Corporation

IN

Matching / Level of Effort / Earmarking Special Tests & Provisions Subrecipient Monitoring § 200.303

Subject: Education Stabilization Fund (ESF) Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425U Federal Award Numbers and Years (Or Other Identifying Numbers): S425U210013 Pass-Through Entity: Indiana Department of Educa...

Subject: Education Stabilization Fund (ESF) Federal Agency: Department of Education Federal Program: COVID-19 – Education Stabilization Fund Assistance Listing Number: 84.425U Federal Award Numbers and Years (Or Other Identifying Numbers): S425U210013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Special Tests and Provisions – Wage Rate Requirements Audit Findings: Material Weakness Condition : An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Special Tests and Provisions – Wage Rate Requirements compliance requirements. Context : The School Corporation did not have an internal controls/procedure in place to ensure compliance with the Davis-Bacon requirement. For one vendor selected for testing, in a sample of two, the School Corporation did not include the wage-rate requirements in the written contract with the vendor to communicate the federal wage rate requirements. The School Corporation did subsequently obtain the weekly wage reports from the vendor. The vendor tested had total costs of $102,800, which includes material and labor, to install a portion of a new roofing to the Junior/Senior High School Building. The finding is isolated to the ESSER III grant (84.425U). Views of Responsible Official : We concur with the finding. Description of Corrective Action Plan : Management will ensure contracts planned to be paid and provided for by Federal funds include necessary Davis-Bacon Wage Rate clauses/language. During the bid advertisement process, we will make sure to include if the job is Davis-Bacon and will include the wage requirements in the advertisement. Management will require a contract to show the Davis-Bacon Wage Rate clauses/language if Federal funds are being used. Responsible Party and Timeline for Completion : Immediately Corrected

View Audit 392694

Finding 1181428 (2025-002)

Material Weakness 2025

Northeastern Wayne School Corporation

IN

School Nutrition Programs Internal Control / Segregation of Duties § 200.303

Subject: Child Nutrition Cluster (CNC) – Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (Or Other Identifying Numbers): FY23-FY24, FY24-FY25...

Subject: Child Nutrition Cluster (CNC) – Internal Controls Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (Or Other Identifying Numbers): FY23-FY24, FY24-FY25 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Eligibility Audit Findings: Material Weakness Condition : An effective internal control system was not in place at the School Corporation in order to ensure compliance with requirements related to the grant agreement and the Eligibility compliance requirements. Context : During testing of internal controls over eligibility requirements, we noted there is no formal, documented review of the eligibility income guidelines entered into the food service software to ensure that system parameters were in agreement with USDA guidelines on an annual basis. For the 2023-2024 school year, the income eligibility guidelines were not updated timely by the School Corporation. During compliance testing of eligibility, we noted 3 instances isolated to 2023-2024, in a sample of 60 students, in which the eligibility status was incorrectly determined. In two instances, the eligibility status was changed from Reduced to Free upon updating the eligibility income guidelines. In one stance, the status changed from Pay to Reduced. The lack of internal controls over the review of the eligibility income guidelines impacted both years under audit. The noncompliance with eligibility determinations was isolated to fiscal year 2024. Views of Responsible Official : We concur with the finding. Description of Corrective Action Plan : The Student Management Specialist will print the thresholds and enter the eligibility income guidelines into the food service management software, Harmony. The Superintendent will verify that the data has been entered correctly. Responsible Party and Timeline for Completion : This has already been implemented.

View Audit 392694

Finding 1181424 (2025-001)

Material Weakness 2025

Northeastern Wayne School Corporation

IN

Allowable Costs / Cost Principles School Nutrition Programs Matching / Level of Effort / Earmarking § 200.303 § 200.403

Information on the federal program : Subject: Child Nutrition Cluster (CNC) Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (Or Other Identifying Numbers): FY2...

Information on the federal program : Subject: Child Nutrition Cluster (CNC) Federal Agency: Department of Agriculture Federal Program: School Breakfast Program, National School Lunch Program Assistance Listing Number: 10.553, 10.555 Federal Award Numbers and Years (Or Other Identifying Numbers): FY23-FY24, FY24-FY25 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Activities Allowed and Unallowed, Allowable Costs Audit Findings: Material Weakness, Other Matters Condition : The School Corporation did not have adequate internal controls in place to ensure that the School Corporation complied with the allowable cost requirements. Context : During our testing of the School Corporation’s compliance with the allowable cost requirements for the Child Nutrition Cluster (CNC), we tested 40 vendor disbursement transactions and 40 payroll disbursement transactions and identified the following exceptions: 1. For one vendor disbursement, the School Corporation incorrectly recorded the disbursement for $820 to Fund 800 (School Lunch Fund) that should have been recorded to Fund 300 (Operations Fund), resulting in an unallowable cost being charged to the food service fund. 2. For one payroll disbursement, the School Corporation inaccurately entered the number of hours worked by a cafeteria employee for one pay period, resulting in an overpayment to the employee by $5,568. The employee notified the School Corporation of the overpayment and remitted the overpayment back to the School Corporation. These errors were attributable to deficiencies in the internal controls over the review and approval of vendor and payroll expenditures. Views of Responsible Official : We concur with the finding. Description of Corrective Action Plan : Management will enhance controls and review processes surrounding vendor and payroll expenditures charged to the Child Nutrition. The Food Service Director will be receiving periodic reports to review expenditures charged to the CNC to monitor charged costs. The payroll exceptions report is now checked by the Executive Assistant and Payroll. Responsible Party and Timeline for Completion : Immediately corrected

View Audit 392694

Finding 1181420 (2025-001)

Material Weakness 2025

Vermont Program for Quality in Health Care

VT

Significant Deficiency Internal Control / Segregation of Duties § 200.303 § 200.508

The Organization acknowledges and concurs with the auditor’s finding as discussed within the Schedule of Findings and Questioned Costs for the year-ended June 30, 2025. The Organization has taken steps in the year ending June 30, 2025 to strengthen internal control by engaging appropriate personnel ...

The Organization acknowledges and concurs with the auditor’s finding as discussed within the Schedule of Findings and Questioned Costs for the year-ended June 30, 2025. The Organization has taken steps in the year ending June 30, 2025 to strengthen internal control by engaging appropriate personnel along with an outside bookkeeping firm to ensure consistency and continuity of practices. In addition, during the year ending June 30, 2025, the Organization has implemented a new electronic timesheet with embedded management review and approval and automated vendor invoice approval process.During the FY25 Audit, it was found that samples of the approval of time sheets from our electronic system were found without the requisite approvals (checkmarks). We believe that this is the result of lack of awareness on our part (Employees and Supervisors) that time sheets must be saved after clicking the approval check box to ensure that the approval is recorded.VPQHC has implemented a corrective action plan that requires an Approval Status Report after each pay period to ensure that all-time sheets are approved by both the employee and supervisor. VPQHC will will conduct training for new employees during their on-boarding on how to enter time using the Asure Time & Attendance System along with periodic refresher training for employees as necessary.

View Audit 392685

Corrective Action Plans

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