Corrective Action Plans

Finding 503563 (2022-006)

Material Weakness 2022

MP

Questioned Costs Procurement, Suspension & Debarment § 200.318 § 200.326

Finding No. 2022-006 KCHC agrees and acknowledges the findings related to procurement and suspension and debarment compliance. Since the hiring of new procurement personnel in September 2024, the Finance head has been actively providing regular training to procurement and finance staff, ensuring th...

Finding No. 2022-006 KCHC agrees and acknowledges the findings related to procurement and suspension and debarment compliance. Since the hiring of new procurement personnel in September 2024, the Finance head has been actively providing regular training to procurement and finance staff, ensuring they are well-versed in federal regulations. Additionally, KCHC has implemented enhanced systems for procurement management and documentation. 1. Onboarding and Training for New Procurement Personnel: The new procurement personnel will undergo comprehensive training on KCHC's procurement policies, federal regulations (2 CFR Part 200), and the use of ProcurementExpress and DocuSign systems. This training ensures the new staff member adheres to procurement procedures, including proper documentation. 2. Ongoing Training for Procurement and Finance Staff: Regular training sessions are conducted to reinforce awareness of federal procurement regulations and KCHC’s internal policies. The focus will be on maintaining adequate documentation, ensuring open competition in procurement processes, and complying with suspension and debarment regulations. 3. Strengthening Monitoring and Internal Audits: KCHC will continue to enhance internal monitoring and audit activities. The Finance department will collaborate with procurement personnel to review all transactions, ensuring that procurement packages include price quotes, purchase orders, and contracts as required. Internal audits will be performed regularly to identify and rectify any documentation gaps. 4. Optimizing Existing Systems: The integration of ProcurementExpress with the accounting system and the use of DocuSign for approval routing will be fully utilized to ensure that all procurement steps are documented and compliant with federal standards. These systems will also ensure that records are readily available during audits. 5. Addressing Repeat Findings: To address the repeat nature of this finding, KCHC will closely monitor the implementation of corrective actions. The accountant will lead efforts to track procurement documentation compliance, providing regular reports to CFO to ensure that procurement activities align with both federal and internal requirements. Implementation Timeline: Completed as of September 30, 2024 with continued updates and monitoring. Responsible person: Arlene Deleon Guerrero, CFO

View Audit 325728 Questioned Costs: $1

Finding 503562 (2022-005)

Material Weakness 2022

Kagman Community Health Center, Inc.

MP

Questioned Costs Subrecipient Monitoring Matching / Level of Effort / Earmarking

Finding No. 2022-005 KCHC disagrees with the finding that it is in noncompliance with the applicable period of performance requirements. The sample request was received after the August 19 meeting with the CEO and board representative, during which it was noted that no further samples would be acce...

Finding No. 2022-005 KCHC disagrees with the finding that it is in noncompliance with the applicable period of performance requirements. The sample request was received after the August 19 meeting with the CEO and board representative, during which it was noted that no further samples would be accepted as the audit had extended beyond one year. The delays were due to staffing challenges both on the part of the auditor and within KCHC. In FY 2025, KCHC has started the following corrective actions ensuring that all records are systematically filed and digitized for easy retrieval, regardless of changes in staff. This new system allows for seamless access to documents and a clear audit trail: 1. DocuSign for Document Management: In FY2025, KCHC adopted DocuSign to facilitate the management of financial documents. While DocuSign does not automatically upload supporting documents to the accounting software, it provides an efficient way to manage approvals and ensure an audit trail. After approval, the assigned accountant is responsible for manually uploading the supporting documents into the accounting software to ensure they are properly recorded and retrievable for audit purposes. 2. Timely Upload and Filing of Documentation: To address the delays, KCHC has updated its procedures requiring that all financial staff upload supporting documents at the time of expenditure approval or payment. This process will ensure that no documentation is missing or delayed, and all records are maintained in compliance with federal guidelines. 3. Ongoing Monitoring and Reporting: The CFO will oversee quarterly internal audits to ensure that the enhanced recordkeeping system is functioning effectively and that all expenditures continue to comply with the period of performance requirements. Progress will be reported to the Board of Directors to ensure transparency and ongoing compliance. By taking these corrective actions, KCHC will ensure that all expenditures are supported by proper documentation, uploaded timely, and readily available for audit review, preventing any future delays or compliance issues. Implementation Timeline: Completed as of August 31, 2024 with continued updates and monitoring. Responsible person: Arlene Deleon Guerrero, CFO

View Audit 325728 Questioned Costs: $1

Finding 503561 (2022-004)

Significant Deficiency 2022

Kagman Community Health Center, Inc.

MP

Questioned Costs Cash Management

Finding No. 2022-004 We agree and acknowledge the identified discrepancy in Finding No. 2022-004. However, we clarify that drawdowns were not higher than actual expenditures. The variance was due to timing differences between the reporting of cumulative expenditures on SF-425 reports and the figure...

Finding No. 2022-004 We agree and acknowledge the identified discrepancy in Finding No. 2022-004. However, we clarify that drawdowns were not higher than actual expenditures. The variance was due to timing differences between the reporting of cumulative expenditures on SF-425 reports and the figures in our accounting records. To address this, while the findings pertain to FY 2022, we have taken corrective actions that can be seen in FY 2025: 1. Change in Responsible Personnel: In FY 2025, we assigned a new team to manage the cash management process. This change brings greater accountability and expertise to ensure accurate alignment of federal grant drawdowns with actual recorded expenditures. 2. Enhanced Year-End Closing Procedure: In FY 2025, we introduced a robust year-end closing procedure to ensure that expenditures reported in our grant documents are aligned with actual allowable costs as per our accounting records. This process helps ensure consistency between our SF-425 reports and internal records. 3. Stricter Monitoring and Internal Controls: We have strengthened monitoring and internal controls in FY 2025 to ensure that future drawdowns strictly adhere to our reimbursement policy. This includes closer oversight of cumulative expenditures to prevent any variance between reported and actual expenditures. Implementation Timeline: These corrective actions, implemented in September 06, 2024, are designed to prevent similar issues from arising in future audits and ensure full compliance with federal grant reporting requirements. Responsible person: Arlene DeleonGuerrero, CFO

View Audit 325728 Questioned Costs: $1

Finding 503560 (2022-003)

Significant Deficiency 2022

Kagman Community Health Center, Inc.

MP

Questioned Costs Allowable Costs / Cost Principles Subrecipient Monitoring § 200.403

Finding No. 2022-003 KCHC agrees with the finding and understands the importance of maintaining robust recordkeeping and documentation procedures to comply with federal cost principles. We acknowledge the discrepancies noted in the audit findings regarding non-payroll expenditures. To address th...

Finding No. 2022-003 KCHC agrees with the finding and understands the importance of maintaining robust recordkeeping and documentation procedures to comply with federal cost principles. We acknowledge the discrepancies noted in the audit findings regarding non-payroll expenditures. To address these issues, KCHC has implemented the following actions: • Strengthening Documentation Controls: KCHC has reinforced its recordkeeping procedures, requiring that all expenditures be fully supported by accurate documentation before approval. The accounting department has implemented additional review layers to ensure that all supporting documents, including receipts and invoices, are properly matched and retained. • Enhanced Training for Staff: Staff responsible for processing and documenting expenditures have undergone training to improve awareness of federal cost principles and documentation requirements. This training will ensure that all expenditures are supported by accurate, complete, and timely documentation. • Monitoring and Oversight: KCHC has introduced regular internal audits to monitor compliance with documentation standards. These audits will help identify any potential discrepancies early and ensure timely corrective action. Implementation Timeline: KCHC began implementation of these changes in FY 2025 under the CFO. The organization remains confident that these measures will address the audit findings and improve compliance with 2 CFR section 200.403(e). KCHC is committed to maintaining the highest standards of financial management and accountability. Responsible person: Arlene DeleonGuerrero, CFO

View Audit 325728 Questioned Costs: $1

Finding 503554 (2022-001)

Material Weakness 2022

Municipality of Madison

SD

Procurement, Suspension & Debarment Internal Control / Segregation of Duties

The City of Madison will design and implement formal, written internal control policies and procedures to ensure compliance with federal compliance requirements. This will include the following: Records Retention: Assign duties to appropriate individuals and implement a document management system ...

The City of Madison will design and implement formal, written internal control policies and procedures to ensure compliance with federal compliance requirements. This will include the following: Records Retention: Assign duties to appropriate individuals and implement a document management system to ensure compliance with federal retention requirements. Procurement Policy: Develop and implement a formal, written procurement policy that adheres to federal procurement standards under the Uniform Guidance 2 CFR 200.318. Staff Training: Conduct comprehensive training for all personnel involved in the administration of federal awards to ensure familiarity and compliance with federal regulations and internal control expectations. Monitoring and Review: Implement a monitoring and review process to periodically evaluate the effectiveness of internal controls and compliance with federal regulations.

View Audit 325722

Finding 503473 (2022-002)

Significant Deficiency 2022

The Enola Group, Inc.

NC

Reporting Allowable Costs / Cost Principles

Name of Contact Person: Terri Brown, Director of Finance Corrective Action: Due to the extreme turnover within the Finance Director position in FY 21-22, there were more than normal accounting errors that were corrected by journal entries in the FY21 audit. The Executive Director addressed the turno...

Name of Contact Person: Terri Brown, Director of Finance Corrective Action: Due to the extreme turnover within the Finance Director position in FY 21-22, there were more than normal accounting errors that were corrected by journal entries in the FY21 audit. The Executive Director addressed the turnover by hiring a Finance Director with extensive non-profit finance and operation experience. In addition, training was provided on the accounting software. The Finance Director role has been occupied by one individual for multiple years. A Bookkeeping position was also created and filled which now allows for more separation of duties. A system of checks and balances have been established between the Bookkeeper, Administrative Assistant, Finance Director and Executive Director. This system includes the enhancement of protocols such as cash receipts, disbursements process and journal vouchers, monthly one on one in depth review of financials with Program Directors and Finance Director, and monthly Finance Director and Executive Director meetings. In addition, the Executive Director, Finance Director and Bookkeeper are now using the secured server to file digital copies of most financial documents. The Finance Director has monthly finance meetings with each Program Director to review their monthly actuals against budget. In addition, the accounting system is now remote which allows for access based on role for the Bookkeeper and Executive Director. The organization has created a third position, Accounts Receivable Coordinator to process all AR related duties. Proposed Completion Date: Immediately.

View Audit 325591

Finding 503469 (2022-002)

Significant Deficiency 2022

The Enola Group, Inc.

NC

Reporting Allowable Costs / Cost Principles

Name of Contact Person: Terri Brown, Director of Finance Corrective Action: Due to the extreme turnover within the Finance Director position in FY 21-22, there were more than normal accounting errors that were corrected by journal entries in the FY21 audit. The Executive Director addressed the turno...

Name of Contact Person: Terri Brown, Director of Finance Corrective Action: Due to the extreme turnover within the Finance Director position in FY 21-22, there were more than normal accounting errors that were corrected by journal entries in the FY21 audit. The Executive Director addressed the turnover by hiring a Finance Director with extensive non-profit finance and operation experience. In addition, training was provided on the accounting software. The Finance Director role has been occupied by one individual for multiple years. A Bookkeeping position was also created and filled which now allows for more separation of duties. A system of checks and balances have been established between the Bookkeeper, Administrative Assistant, Finance Director and Executive Director. This system includes the enhancement of protocols such as cash receipts, disbursements process and journal vouchers, monthly one on one in depth review of financials with Program Directors and Finance Director, and monthly Finance Director and Executive Director meetings. In addition, the Executive Director, Finance Director and Bookkeeper are now using the secured server to file digital copies of most financial documents. The Finance Director has monthly finance meetings with each Program Director to review their monthly actuals against budget. In addition, the accounting system is now remote which allows for access based on role for the Bookkeeper and Executive Director. The organization has created a third position, Accounts Receivable Coordinator to process all AR related duties. Proposed Completion Date: Immediately.

View Audit 325587

Finding 503452 (2022-009)

Significant Deficiency 2022

West Side Community Health Services INC

MN

Procurement, Suspension & Debarment § 200.214

Health Centers Cluster – Assistance Listing No. 93.2242/93.527 Recommendation: We recommend the Organization follow existing policy, but ensure procedures are in place to retain sufficient documentation to support review of vendors against federal exclusion list. Explanation of disagreement with aud...

Health Centers Cluster – Assistance Listing No. 93.2242/93.527 Recommendation: We recommend the Organization follow existing policy, but ensure procedures are in place to retain sufficient documentation to support review of vendors against federal exclusion list. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management will review procedures to ensure proper check of vendors is performed against federal exclusion list, and that documentation is maintained to support that review. Name(s) of the contact person(s) responsible for corrective action: Duke Fokuo Planned completion date for corrective action plan: December 2024

View Audit 325563

Finding 503451 (2022-008)

Significant Deficiency 2022

West Side Community Health Services INC

MN

Procurement, Suspension & Debarment

Health Centers Cluster – Assistance Listing No. 93.2242/93.527 Recommendation: We recommend the Organization follow existing policy, but ensure procedures are in place to retain sufficient documentation to support whichever procurement method was utilized in procuring vendors. Explanation of disagre...

Health Centers Cluster – Assistance Listing No. 93.2242/93.527 Recommendation: We recommend the Organization follow existing policy, but ensure procedures are in place to retain sufficient documentation to support whichever procurement method was utilized in procuring vendors. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management will review procedures to ensure proper procurement methodology is utilized under the Organization's policy, and that sufficient documentation is retained to support procurement method. Name(s) of the contact person(s) responsible for corrective action: Duke Fokuo Planned completion date for corrective action plan: December 2024

View Audit 325563

Finding 503450 (2022-007)

Significant Deficiency 2022

West Side Community Health Services INC

MN

Questioned Costs Allowable Costs / Cost Principles Cash Management § 200.303

Health Centers Cluster – Assistance Listing No. 93.2242/93.527 Recommendation: We recommend management implement a review process to check individual's compensation charged to federal grants against annual federal limitations prior to drawdown of funds. Explanation of disagreement with audit finding...

Health Centers Cluster – Assistance Listing No. 93.2242/93.527 Recommendation: We recommend management implement a review process to check individual's compensation charged to federal grants against annual federal limitations prior to drawdown of funds. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management will implement review processes to identify individuals over federal wage limitations moving forward before being charged to federal grants. Name(s) of the contact person(s) responsible for corrective action: Duke Fokuo Planned completion date for corrective action plan: December 2024

View Audit 325563 Questioned Costs: $1

Finding 503449 (2022-006)

Significant Deficiency 2022

West Side Community Health Services INC

MN

Reporting Internal Control / Segregation of Duties Significant Deficiency § 200.303

Health Centers Cluster, Provider Relief Fund – Assistance Listing No. 93.2242/93.527, 93.498 Recommendation: We recommend implementing a formal policy and procedure where there is a review of all required reporting by an individual that did not prepare the report. Documentation should be retained to...

Health Centers Cluster, Provider Relief Fund – Assistance Listing No. 93.2242/93.527, 93.498 Recommendation: We recommend implementing a formal policy and procedure where there is a review of all required reporting by an individual that did not prepare the report. Documentation should be retained to support the review/approval occurrence. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management will implement a formal review process for reporting and retain documentation of review. Name(s) of the contact person(s) responsible for corrective action: Duke Fokuo Planned completion date for corrective action plan: December 2024

View Audit 325563

Finding 503448 (2022-005)

Significant Deficiency 2022

West Side Community Health Services INC

MN

Cash Management Reporting Significant Deficiency § 200.303

Health Centers Cluster – Assistance Listing No. 93.2242/93.527 Recommendation: We recommend reviewing reconciliation procedures between detailed grant expenditures and summary schedules used in reporting/draw down requests to ensure sufficient detail to support draw downs. Also recommend a detailed ...

Health Centers Cluster – Assistance Listing No. 93.2242/93.527 Recommendation: We recommend reviewing reconciliation procedures between detailed grant expenditures and summary schedules used in reporting/draw down requests to ensure sufficient detail to support draw downs. Also recommend a detailed review and approval process for federal grant eligible expenditures and draw downs, to identify issues prior to draw down or reporting in the future. Documentation should be retained to support review/approval occurrence. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management will review and improve reconciliation and review process around eligible expenditures for federal grants, and drawdowns of federal funds. Name(s) of the contact person(s) responsible for corrective action: Duke Fokuo Planned completion date for corrective action plan: December 2024

View Audit 325563

Finding 503399 (2022-003)

Material Weakness 2022

Human Resource Development Institute

IL

Reporting

The Organization will implement the following corrective actions for the fiscal year ending June 30, 2022 to remediate the finding and address the cause of the finding. The Organization will implement the following corrective actions for fiscal year 2023 to remediate the finding and address the caus...

The Organization will implement the following corrective actions for the fiscal year ending June 30, 2022 to remediate the finding and address the cause of the finding. The Organization will implement the following corrective actions for fiscal year 2023 to remediate the finding and address the cause of the finding. The Organization has hired staff with higher technical accounting skills than the previous staff. The following staff have been hired full-time or will be hired soon: Payroll and Benefits Specialist, Grant Accountant, Senior Staff Accountant, Accounts Payables and Receivables Specialist, and a Purchasing Specialist. • The Chief Financial Officer (CFO) will be responsible for the implementation of the corrective action plan, and will oversee all related finance activities. • The Organization will document accounting policies and procedures to reflect the new month-end processes and provide training to staff on current and future policies. • The Organization has implemented procedures for staff accountants to prepare balance sheet reconciliations monthly with a monthly review performed by the CFO. All balance sheet accounts are reconciled to external data for verification on a monthly basis. All revenue accounts will be reconciled to external data for verification on a monthly basis. • The Organization has implemented a new accounting system – Sage Intacct. Additionally, we have implemented a grants project tracking module to better help with grants and contracts reporting and compliance. • The Organization has implemented a month-end checklist for all monthly entries to be completed by assigned finance personnel. We are ensuring that all staff are trained adequately to handle any assigned task. All monthly entries are required to be reviewed and approved by the CFO prior to posting to the general ledger within our new accounting software. All appropriate backup documentation will be saved and stored within the accounting software. • All grant related year-end audit procedures have been transitioned to the Grant Accountant who has experience with financial audits and compliance and reporting for City, State, and Federal grants. • The Organization will ensure that Finance personnel receive a minimum of twenty-five (25) hours of training annually of relevant accounting topics including updates to generally accepted accounting principles, generally accepted government accounting principles, nonprofit and governmental financial reporting, and other related accounting trainings. • The Organization will ensure that any personnel involved in financial reporting have the technical expertise to help with the preparation, review, and analysis of the financial statements and supplementary information.

View Audit 325554

Finding 503398 (2022-002)

Material Weakness 2022

Human Resource Development Institute

IL

Questioned Costs Allowable Costs / Cost Principles Internal Control / Segregation of Duties

The Organization will implement the following corrective actions for the fiscal year ending June 30, 2022 to remediate the finding and address the cause of the finding. The Organization will implement the following corrective actions for fiscal year 2023 to remediate the finding and address the caus...

The Organization will implement the following corrective actions for the fiscal year ending June 30, 2022 to remediate the finding and address the cause of the finding. The Organization will implement the following corrective actions for fiscal year 2023 to remediate the finding and address the cause of the finding. The Organization has hired staff with higher technical accounting skills than the previous staff. The following staff have been hired full-time or will be hired soon: Payroll and Benefits Specialist, Grant Accountant, Senior Staff Accountant, Accounts Payables and Receivables Specialist, and a Purchasing Specialist. • The Chief Financial Officer (CFO) will be responsible for the implementation of the corrective action plan, and will oversee all related finance activities. • The Organization will document accounting policies and procedures to reflect the new month-end processes and provide training to staff on current and future policies. • The Organization has implemented procedures for staff accountants to prepare balance sheet reconciliations monthly with a monthly review performed by the CFO. All balance sheet accounts are reconciled to external data for verification on a monthly basis. All revenue accounts will be reconciled to external data for verification on a monthly basis. • The Organization has implemented a new accounting system – Sage Intacct. Additionally, we have implemented a grants project tracking module to better help with grants and contracts reporting and compliance. • The Organization has implemented a month-end checklist for all monthly entries to be completed by assigned finance personnel. We are ensuring that all staff are trained adequately to handle any assigned task. All monthly entries are required to be reviewed and approved by the CFO prior to posting to the general ledger within our new accounting software. All appropriate backup documentation will be saved and stored within the accounting software. • All grant related year-end audit procedures have been transitioned to the Grant Accountant who has experience with financial audits and compliance and reporting for City, State, and Federal grants. • The Organization will ensure that Finance personnel receive a minimum of twenty-five (25) hours of training annually of relevant accounting topics including updates to generally accepted accounting principles, generally accepted government accounting principles, nonprofit and governmental financial reporting, and other related accounting trainings. • The Organization will ensure that any personnel involved in financial reporting have the technical expertise to help with the preparation, review, and analysis of the financial statements and supplementary information.

View Audit 325554 Questioned Costs: $1

Finding 503358 (2022-002)

Significant Deficiency 2022

Marin City Health and Wellness Center

CA

Reporting

View of Responsible Officials and Planned Corrective Actions: MCHWC understands and agrees with the finding. Processes have been put in place to ensure the future timeliness of all required reports for Federal reporting compliance. Measures have been taken for immediate resolution, including: 1....

View of Responsible Officials and Planned Corrective Actions: MCHWC understands and agrees with the finding. Processes have been put in place to ensure the future timeliness of all required reports for Federal reporting compliance. Measures have been taken for immediate resolution, including: 1. Email alerts of upcoming due dates of all federal reporting requirements. 2. Designated tasks and due dates included in project plans that are reviewed weekly with the finance and accounting team. 3. Calendar of federal reporting requirements and due dates will be developed and distributed to leadership team, including Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, Controller, Compliance Director, and Grant Management Leadership.

View Audit 325519

Finding 503246 (2022-001)

Significant Deficiency 2022

Housing Opportunities Mean Empowerment Iii, Inc.

IL

a. Comments on the Finding and Each Recommendation:

View Audit 325300

Finding 503246 (2022-001)

Significant Deficiency 2022

Housing Opportunities Mean Empowerment Iii, Inc.

IL

Management concurs with the finding that the 2021 reporting package was not submitted within the