Corrective Action Plans

Finding 1210990 (2024-015)

Material Weakness 2024

MS

Allowable Costs / Cost Principles Student Financial Aid Significant Deficiency

Finding 2024- 015: Allowable Costs/ Cost Principle Signifi cant Deficiency In Internal Contro l Over Compliance Criteria: Per 45 CFR 1355.57(d), a title N·E agency must allocate project costs in accordance with applicab le HHS regulations and other guidance. Per 45 CFR 75.303(a), non-Federal entitie...

Finding 2024- 015: Allowable Costs/ Cost Principle Signifi cant Deficiency In Internal Contro l Over Compliance Criteria: Per 45 CFR 1355.57(d), a title N·E agency must allocate project costs in accordance with applicab le HHS regulations and other guidance. Per 45 CFR 75.303(a), non-Federal entities expending HHS awards must establish and maintain effective internal con trols over compliance with Federal sta tes, regu lations, and the terms and conditionsof the Federal award. Condition: Our audit procedures over administrative services disclosed that MDCPS lacked proper policies and procedures over data editing or modification of the cost allocation system. Perspe ctive: Per discussion with management, it was determined that no formal policies and procedures were established for data editing or modifications. Personnel Responsible for Corrective Action : Name: Christopher Roy Title : Deputy Director to the CFO Email: Christopher.Roy@mdcps.ms.gov Phone Number: 601-359-4043 Corrective Action Plan: MDCPS Is strengthening segregation of duties within the Cap Plus system by limiting administrative privileges and ensuring supervisory approval is documented for all cost allocation changes. AntJdpated Completion Date: Permissions were corrected and completed as of March 31, 2026. Documented process and policy anticipated completed May 30, 2026.

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Finding 1210989 (2024-014)

Material Weakness 2024

State of Mississippi

MS

Allowable Costs / Cost Principles Student Financial Aid Significant Deficiency

Finding 2024 - 014: Allowable Costs/ Cost Prlnclple Significant Defldency In Internal Control Over Compliance Criteria: Per 45 CFR 1355.57(d), a title IV-E agency must allocate project costs in accordance with applicable HHS regulati ons and other guidance. Per 45 CFR 75.303(a), non-Federal entities...

Finding 2024 - 014: Allowable Costs/ Cost Prlnclple Significant Defldency In Internal Control Over Compliance Criteria: Per 45 CFR 1355.57(d), a title IV-E agency must allocate project costs in accordance with applicable HHS regulati ons and other guidance. Per 45 CFR 75.303(a), non-Federal entities expending HHS awards must establish and maintain effective internal controls over compliance with Federal states, regulations, and the terms and conditions of the Federal award. Condition: Our audit procedures over administrative services disclosed that MDCPS lacked proper controls over employee training costs expended through a specific vendor. Perspective: Below are the exceptions noted in our testing of administrat ive services for appropriate review over cost allocation . The samples were not stat ist ically valid. One hundred percent of the costs charged for employeetraining using a specific vendor (four transactions) were te.ste d, and four out of four transactions lacked appro priate review. Personnel Responsible for Corrective Action: Name: Christopher Ray Title : Depuly to 1he Chief Financial Officer Email: christoher.Roy@mdcps.ms.gov Phone Number: 601-359-4043 Corrective Action Plan: MDCPS will enforce our policy requiring approval of the grant management's team's review of appropriate detailed documentation provided by vendor payments. Antldpated Completion Date: Completed as of March 31, 2026.

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Finding 1210988 (2024-013)

Material Weakness 2024

State of Mississippi

MS

Reporting Student Financial Aid Subrecipient Monitoring

Finding 2024- 013: Terminated User Access Not Removed Timely Significant Deficiency In Internal Control Over Financial Reporting Criteria: Per 45 CFR 75.303(a), non-Federal entitles expendingHHS awards must establish and maintain effective internal controls over compliance with Federal states, regul...

Finding 2024- 013: Terminated User Access Not Removed Timely Significant Deficiency In Internal Control Over Financial Reporting Criteria: Per 45 CFR 75.303(a), non-Federal entitles expendingHHS awards must establish and maintain effective internal controls over compliance with Federal states, regulati ons, and the terms and conditions of the Federal award. Management must mainta in effective user access controls over financia l reporting systems. This Includes promptly removing or disabling access for terminated users and periodically reviewing user access to confirm it aligns with current employment status and job responsibilities. Condition: Testing of IT general controls identifiedinstances where terminated employees' user accounts or financial application access remained active beyond the termination date. MDCPS did not disable terminated user access or remove related application rights in a timely manner. Perspective: During our review of general IT controls, the auditor received a list of terminated employees. Of the 11 employees presented, 6 maintainedaccess to MACWIS after termination.Further, during the performance of a process walkthrough,it was noted that the former chief financial officer was still active in CapPlus and SPHARS. Personnel Responsiblefor Corrective Action: Nome: Shannon Rushton (Employee Seporotlon SOP) Title : Deputy Commissionerof Human Capitol Email: Shannon.Rushton@mdcps.ms.gov Phone Number: 601-359-2696 Name: Christopher Ray (CapPlus User Termination) Title: Deputy Director to the CFO Email: Christopher.Roy@mdcps.ms.gov Phone Number: 601-359-4043 Corrective Action Plan: MDCPS has reinforcedthe EmployeeSeparation St andard Operating Procedure(2.19.2.2) to ensure all system access is removed promptly upon employee separation. Human Resources will notify system administrators immedai tely upon employeetermination, and system administrators will disable all associated application access no later than th e employee's final day of employment. Human Resources will conduct periodic user access reviews to ensure procedures are properly Imp lemented. The Finance Division will ensure the cap Plus software's access and penn1ss1ons are monitored and maintained by the agency with assistance from Interactive Voice Application (IVA). Upon a Cap Plus user's termination , they will be removed from the Cap Plu s software upon their last day of employment or the removal of th eir dutie.s by the agency. These permissions do not require IT or Human Resource control as Cap Plus i s independent of all accounting, payroll, and HR software. Antldpated Completion Date: Empl oyee Separation SOP effectiveas of July 22, 2025. CapP lus user's termination procedures effective as of March 31, 2026.

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Finding 1210987 (2024-039)

Material Weakness 2024

State of Mississippi

MS

Subrecipient Monitoring § 200.332 § 200.501 § 200.512

SUBRECIPIENT MONITORING ALN Number 93.558 Temporary Assistance for Needy Families (TANF) 93.489. 93.575. 93.596 Child Care Development Fund (CCDF) 93.568 Low Income Household Energy Assistance Program (LII-IEAP) 2024-039 Strengthen Controls over Subrecipient Monitoring to Ensure Compliance with Unif...

SUBRECIPIENT MONITORING ALN Number 93.558 Temporary Assistance for Needy Families (TANF) 93.489. 93.575. 93.596 Child Care Development Fund (CCDF) 93.568 Low Income Household Energy Assistance Program (LII-IEAP) 2024-039 Strengthen Controls over Subrecipient Monitoring to Ensure Compliance with Uniform Guidance Auditing Requirement . Federal Award No. All Current Active Grants Response : MDHS concurs that controls should be strengthened over subrecipient monitoring to ensure compliance with Uniform Guidance Auditing Requirements. Corrective Action Plan: 1. Strengthen Controls over Subrecipient Monitoring to ensure compliance with Uniform Guidance. A. The Office of Compliance. Division of Monitoring has made significant strides in strengthening controls over the subrecipient monitoring process ensuring compliance with Uniform Guidance Auditing Requirements. The Division continues to review and update the processes and procedures as necessary to ensure processes are adequate and effective. Staff are constantly notified/trained on updates to policies. procedures. and regulations to ensure continued compliance with monitoring the agency's subgrant agreements. B. Responsible Party: Laketha Gilmore. Director of Monitoring and Kameron Harris. Chief Compliance Officer C. Completion Date: The corrective action has been implemented and is ongoing.

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Finding 1210986 (2024-036)

Material Weakness 2024

State of Mississippi

MS

Matching / Level of Effort / Earmarking

EARMARKING ALN Number 93.489, 93.575. and 93.596 2024-036 Federal Award No. 2101MSCCDF Response: MDHS is required to spend 3% of CCDF funding for infant/toddler specific quality improvement activities not included as direct services for child care vouchers. MDHS did not meet the required 3% earmarke...

EARMARKING ALN Number 93.489, 93.575. and 93.596 2024-036 Federal Award No. 2101MSCCDF Response: MDHS is required to spend 3% of CCDF funding for infant/toddler specific quality improvement activities not included as direct services for child care vouchers. MDHS did not meet the required 3% earmarked spending requirement for Federal allocated 2021 CCDF money. MDHS did obligate and liquidate all but $138,239.33 of the required infant/toddler spending requirement. This deficiency was properly reported to the Federal Office of Child Care (OCC) as required on the ACF 696 report submitted December 31, 2023. Furthermore, MOHS staff was fully aware of this situation prior to the findings from the Fiscal Year 20.24 Single Audit being received. To correct this deficiency, MOHS received guidance from the OCC and the Federal Office of Grants Management (OGM) to return the portion of202l CCDF funds not spent on infant/toddler quality activities to OCC. MOHS has complied with the corrective action. Fu11hermore. MOHS has established and is following control processes in place both, within the Division of Early Childhood Care & Development (DECCD) and the MOHS Division of Budgets and Accounting to monitor all spending and meeting required earmarked spending activities. Both Divisions meet regularly to discuss spending and ensure the agency is on track to meet all federally mandated earmarked spending requirements. MDHS has not failed to meet any earmarked spending requirements since the 2021 infant/toddler earmark was not met. Corrective Action Plan: A. Completed: Return portion of unspent Infant/Toddler funding to OCC. 8. Completed: Establish internal monitoring processes for spending funding earmarked for specific activities including all infant/toddler quality improvement activities. C. Completed: DECCD and the MOHS Division of Budgets and Accounting conduct regular meetings to ensure the agency is on track with spending of all earmarked funds.

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Finding 1210980 (2024-037)

Material Weakness 2024

State of Mississippi

MS

Reporting Internal Control / Segregation of Duties Procurement, Suspension & Debarment

ALN Number 2024 -037 93.558 Temporary Assistance for Needy Families (TANF) 93.568 Low-Income Home Energy Assistance Program (LIHEAP) Strengthen Controls to Ensure Compliance with Federal Funding Accountability and Transparency Act (FFATA) Reporting Requirements. Federal Award No. All Current Active ...

ALN Number 2024 -037 93.558 Temporary Assistance for Needy Families (TANF) 93.568 Low-Income Home Energy Assistance Program (LIHEAP) Strengthen Controls to Ensure Compliance with Federal Funding Accountability and Transparency Act (FFATA) Reporting Requirements. Federal Award No. All Current Active Grants Response: MOHS does not concur with this finding. MOHS has implemented and adhered to standardized operating procedures (SOPs) over the past year to ensure timely and periodic reporting under the Federal Funding Accountability and Transparency Act (FFATA). In March 2025. the federal government retired the Federal Subaward Reporting System (FSRS), which MDHS used to submit new and modified awards. The successor platform, SAM.gov. launched with migrated award data that reflects only the most recent award amount. Historical submission details-including the timestamps that demonstrated timely filings-were not retained in the migrated records. Because the majority of MDHS's FFATA submissions typically occur in November and January. the migrated data does not display the original submission dates associated with those reports. Following the retirement of FSRS, MDHS no longer has access to the legacy system and therefore cannot produce the historical report previously used to verify timely submission. Additionally, the compliance supplement does not address the FFATA reporting processes within SAM.gov. Notwithstanding these system changes, MOHS continues to prepare and submit FFATA reports in accordance with its established SOPs and within the required timeframes. Corrective Action Plan: MOHS will make efforts to create practical. auditable processes to ensure timely and accurate FFATA reporting and solid proof of timeliness and completeness, in the new system.

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Finding 1210976 (2024-038)

Material Weakness 2024

State of Mississippi

MS

Subrecipient Monitoring Internal Control / Segregation of Duties Significant Deficiency

SUBRECIPIENT MONITORING ALN Number 93.558 Temporary Assistance for Needy Families (TANF) 2024-038 Strengthen Controls over On-Site Monitoring for the Temporary Assistance for Needy Families (TANF) Program. Federal Award No. All Current Active Grants Response: MDHS concurs that controls should be str...

SUBRECIPIENT MONITORING ALN Number 93.558 Temporary Assistance for Needy Families (TANF) 2024-038 Strengthen Controls over On-Site Monitoring for the Temporary Assistance for Needy Families (TANF) Program. Federal Award No. All Current Active Grants Response: MDHS concurs that controls should be strengthened over On-Site monitoring for the TANF program. Corrective Action Plan: 1. Strengthen Controls over On-Site Monitoring for the TANF Program A. The Office of Compliance. Division of Monitoring has made significant strides in strengthening controls over the subrecipient monitoring process. The Division continues to review and update the processes and procedures as necessary to ensure processes are adequate and effective. Staff are constantly notified/trained on updates to policies. procedures. and regulations to ensure continued compliance with monitoring the agency's subgrant agreements. B. Responsible Party: Laketha Gilmore. Director of Monitoring and Kameron Harris, Chief Compliance Officer C. Completion Date: The corrective action has been implemented and is ongoing.

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Finding 1210974 (2024-035)

Material Weakness 2024

State of Mississippi

MS

Eligibility Material Weakness

ELIGIBILTY ALN Number 93.558 Temporary Assistance for Needy Families (TANF) 202 -035 Strengthen Controls to Ensure Compliance With Eligibility Requirements of the Temporary Assistance for Needy Families (TANF) Program . Federal Award No. All Current Active Grants Response: MDHS has implemented a mul...

ELIGIBILTY ALN Number 93.558 Temporary Assistance for Needy Families (TANF) 202 -035 Strengthen Controls to Ensure Compliance With Eligibility Requirements of the Temporary Assistance for Needy Families (TANF) Program . Federal Award No. All Current Active Grants Response: MDHS has implemented a multi-tiered approach to address the audit findings from the Fiscal Year 2024 Single Audit. These efforts focus on strengthening eligibility controls and enhancing internal oversight. MDHS is required to adhere to specific eligibility and verification standards for the TANF program. including mandatory immunization checks, age limit monitoring. and proper authorization of work stipends. During the Fiscal Year 2024 Single Audit 16 instances were identified where these controls were not fully met. resulting in questioned costs of $2,592. MDHS has already taken steps to address the identified overpayments and documentation gaps. To correct these deficiencies, MDHS is strengthening its internal control processes within the Division of Economic Assistance and Eligibility (DEAE) to ensure that immunization records are verified within the required thirty (30) day window· and benefit adjustments for children reaching age eighteen (18) are processed promptly. Furthermore. MDHS is implementing case reviews to ensure all payments are approved by authorized personnel and that work stipends are supported by completed applications and accurate attendance records. MDHS has committed to ongoing staff training to prevent the recurrence of these eligibility and authorization errors. Corrective Action Plan: I. Child's current immunization status was not verified within thirty (30) days. A. DEAE provides policy guidelines via a weekly "Did You Know" email to all staff. Information regarding the immunization requirement will be included in this series by June I. 2026. Statewide TANF and TWP training will begin on June 1. 2026 B. Responsible Parties: Shauna Aguilar. Deputy Director- Economic Programs, Marilyn Williams, Deputy Division Director- Field Operations. Marshea Cooper, Deputy Division Director- State Operations C. Anticipated Completion Date: August I. 2026 2. TANF benefits were not reduced promptly once a dependent child reached 18 years old. resulting in overpayment. A. There is a report generated monthly that identifies children in households that will reach their 18th birthday one month prior to their 18th birthday. In addition, DEAE conducted training in February and March 2026 with regional directors. county directors. and supervisors that included information on using the above-mentioned report to prevent overpayment due to dependent children turning 18 B. Responsible Parties: Shauna Aguilar. Deputy Director- Economic Programs. Marilyn Williams. Deputy Division Director- Field Operations. Marshea Cooper. Deputy Division Director- State Operations C. Anticipated Completion Date: This corrective action has been implemented and completed. 3. TANF benefit payment \Vas approved by an unknown authorizer. A. This finding is due to a system issue that has been resolved. MIS identified that the system did not hold the names of employees who left the agency and replaced the name with “unknown authorizer” Cases now hold the authorizer’s name going forward from the fix. B. Responsible Parties: Shauna Aguilar. Deputy Director- Economic Programs. Marilyn Williams. Deputy Division Director- Field Operations. Marshea Cooper. Deputy Division Director- State Operations C. Anticipated Completion Date: This corrective action has been implemented and completed. 4. Transportation work stipend was overpaid based on the recipient's scheduled hours. A. DWD revie\vs cases monthly to identify errors. Statewide TANF and TWP training will begin on June 1. 2026 . B. Responsible Parties: Shauna Aguilar, Deputy Director- Economic Programs. Marilyn Williams. Deputy Division Director- Field Operations. Marshea Cooper. Deputy Division Director- State Operations C. Anticipated Completion Date: In progress and ongoing 5. Transitional work stipends were paid to recipients without completed applications on file. A. Statewide TANF and TWP training will begin on June 1·. 2026 . B. Responsible Parties: Shauna Aguilar. Deputy Director- Economic Programs. Marilyn Williams. Deputy Division Director- Field Operat ions. Marshea Cooper. Deputy Division Director- State Operations C. Anticipated Completion Date: August I. 2026 6. Transitional work stipend amounts paid to recipients were incorrect based on attendance records. A. The TANF Policy team will begin reviewing transition cases on May I. 2026. B. Responsible Parties: Shauna Aguilar. Deputy Director- Economic Programs. Marilyn Williams, Deputy Division Director- Field Operations. Marshea Cooper. Deputy Division Director- State Operations C. Anticipated Completion Date: Implementation May I. 2026 and ongoing process

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Finding 1210973 (2024-034)

Material Weakness 2024

State of Mississippi

MS

Procurement, Suspension & Debarment Reporting Internal Control / Segregation of Duties § 200.303

The Department should review and enhance controls and procedures to ensure that financial and programmatic/progress reports are reviewed and approved prior to submission. Copies of all reports should be retained and be readily available for audit. Response: The Department concurs with the finding an...

The Department should review and enhance controls and procedures to ensure that financial and programmatic/progress reports are reviewed and approved prior to submission. Copies of all reports should be retained and be readily available for audit. Response: The Department concurs with the finding and the need to enhance and strengthen controls and procedures to ensure programmatic/progress reports are reviewed and approved prior to submission and retain copies for audit. Prior to the conclusion of the audit, the Department formed a Grants Management Division and initiated the development of an internal grants management module for the agency. Corrective Action: The Department formed a Grants Management Division within the agency in 2025 responsible for the financial reporting of its federal grants. The Division prepares, submits, and retains copies of the financial reports and supporting documentation. Prior to submission, the prepared financial reports are approved by the responsible program. Programmatic/progress reports are the responsibility program. The program will track programmatic/progress reports to ensure all are reviewed and approved prior to submission and retained for audit purposes. Name of contact person responsible for the corrective action: Lucreta Tribune (Grants Management Division) and Theresa Kittle (Program-Epidemiology) Anticipated date for completion of corrective action: December 31, 2026

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Finding 1210972 (2024-033)

Material Weakness 2024

State of Mississippi

MS

Procurement, Suspension & Debarment § 200.214 § 200.303 § 200.317

The Department should review and enhance its procedures to ensure that it follows its procurement policy and federal suspension and debarment regulations for all applicable goods and services purchased for the program. Response: The Department concurs with the finding and the need to strengthen cont...

The Department should review and enhance its procedures to ensure that it follows its procurement policy and federal suspension and debarment regulations for all applicable goods and services purchased for the program. Response: The Department concurs with the finding and the need to strengthen controls to ensure the procurement policy and federal suspension and debarment regulations for all applicable goods and services purchased are followed. Prior to the conclusion of the audit, the agency went live with its new procurement system, OpenGov in March 2025. OpenGov ensures that services are procured following policy and regulations. Corrective Action: The Department will ensure procurement rules and regulations are followed by enforcing the use of OpenGov throughout the agency. Name of the contact person responsible for the corrective action: Dorthy Young Anticipated date for completion of corrective action: July 1, 2026

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Finding 1210971 (2024-032)

Material Weakness 2024

State of Mississippi

MS

Allowable Costs / Cost Principles § 200.303 § 200.430

The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department of Health should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Do...

The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department of Health should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Documentation should be readily available for audit. Response: The Department concurs with the finding and the need for a proper method of time recording for accurate time and effort reporting. Prior to the conclusion of the audit, the agency created an internal review group to assess the need for an efficient time keeping system to be utilized throughout the agency to allow for uniformity and accuracy. Corrective Action: The Department will continue to move forward with the implementation of the new time keeping system which allows for proper time and leave collection for documentation and allocation of employee time. In the system, the employee time will be recorded and approved by supervisory personnel for accuracy prior to submission payroll processing. The system will allow documentation to be assessed when needed. Name of contact person responsible for the corrective action: Lucreta Tribune Anticipated date for completion of corrective action: July 1, 2026

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Finding 1210967 (2024-031)

Material Weakness 2024

State of Mississippi

MS

Allowable Costs / Cost Principles § 200.303 § 200.430

The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department of Health should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Do...

The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department of Health should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Documentation should be readily available for audit. Response: The Department concurs with the finding and the need for a proper method of time recording for accurate time and effort reporting. Prior to the conclusion of the audit, the agency created an internal review group to assess the need for an efficient time keeping system to be utilized throughout the agency to allow for uniformity and accuracy. Corrective Action: The Department will continue to move forward with the implementation of the new acquired time keeping system which allows for proper time and leave collection for documentation and allocation of employee time. In the system, the employee time will be recorded and approved by supervisory personnel for accuracy prior to submission payroll processing. The system will allow documentation to be assessed when needed. Name of contact person for the corrective action: Lucreta Tribune Anticipated date for completion of corrective action: July 1, 2026.

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Finding 1210964 (2024-009)

Material Weakness 2024

State of Mississippi

MS

Reporting Procurement, Suspension & Debarment Subrecipient Monitoring § 200.303

Assistance Listing No. 17.258, 17.259, 17.278 and Workforce Innovation and Opportunity Act Cluster Type of Compliance Requirement: Reporting - FFATA Response: There is no disagreement with the audit finding. Corrective Action Plan: MDES agrees that the FSRS system generated reports provided to CLA d...

Assistance Listing No. 17.258, 17.259, 17.278 and Workforce Innovation and Opportunity Act Cluster Type of Compliance Requirement: Reporting - FFATA Response: There is no disagreement with the audit finding. Corrective Action Plan: MDES agrees that the FSRS system generated reports provided to CLA did not indicate the date of submission and therefore CLA was unable to determine if the reports were submitted timely. MDES will strengthen controls to ensure that future system generated reports have a confirmed submission date documented. Name(s) of the contact person(s) responsible for corrective actions: Contact person(s) responsible: Tyler Berch Contact Phone number: 601-321-6214

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Finding 1210963 (2024-010)

Material Weakness 2024

State of Mississippi

MS

Eligibility Significant Deficiency Matching / Level of Effort / Earmarking § 200.303

Assistance Listing No. 17.258, 17.259, 17.278 and Workforce Innovation and Opportunity Act Cluster Type of Compliance Requirement: Eligibility Response: There is no disagreement with the audit finding. Corrective Action Plan: MDES agrees with the finding and will strengthen controls around WIOA elig...

Assistance Listing No. 17.258, 17.259, 17.278 and Workforce Innovation and Opportunity Act Cluster Type of Compliance Requirement: Eligibility Response: There is no disagreement with the audit finding. Corrective Action Plan: MDES agrees with the finding and will strengthen controls around WIOA eligibility to ensure documentation is complete and in order. Name(s) of the contact person(s) responsible for corrective actions: Contact person(s) responsible: Robert Bock Contact Phone number: 601-321-6478

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Finding 1210958 (2024-008)

Material Weakness 2024

State of Mississippi

MS

Reporting Matching / Level of Effort / Earmarking Procurement, Suspension & Debarment § 200.303

Compliance Finding on FFATAReporting Reference No. 2024-008 Dear Auditor White: Pursuant to the policies and procedures governing audits of state agencies, I am hereby submitting our response to a finding made during the recent audit of the Mississippi Development Authority ("MDA") concerning the re...

Compliance Finding on FFATAReporting Reference No. 2024-008 Dear Auditor White: Pursuant to the policies and procedures governing audits of state agencies, I am hereby submitting our response to a finding made during the recent audit of the Mississippi Development Authority ("MDA") concerning the reporting requirements under the "Federal Funding Accountability and Transparency Act" ("FFATA"). Specifically, the following determination was made: AUDIT FINDING: FFATA reporting During Fiscal year 2024, subawards were obligated on February 20, 2024, should have been reported to FSRS by April 30, 2024. MDA could not provide support that required FFATA reporting was completed by April 30, 2024 per SAM.gov, ten of the ten subawards selected for testing were not reported to FSRS until 7/31/2024. 2024-008: We recommend that MDA develop internal controls and procedures to ensure that all required subawards are reported to SAM.gov in accordance with FFATA reporting requirements. Response: During the period in question, the General Services Administration ("GSA") began the process of converting the Federal Subaward Reporting System ("FSRS") into the System for Award Management ("SAM.gov"). As of March 8, 2025, FSRS was formally retired by GSA; POST OFFICE BOX 849 • JACKSON, MISSISSIPPI 39205-0849 TELEPHONE (601) 359-3449 • FAX (601) 359-2832 • www.mississippi.org therefore, it was no longer available to determine the status of any information which once resided within it. It should be noted that, per GSA, all "data entered and saved into FSRS.gov by the deadline will be moved to SAM.gov and will be available beginning March 8, 2025." The auditors first brought the deficiency to MDA's attention on May 25, 2025. By this time, FSRS was inaccessible to detennine what reporting had been made prior to the conversion. MDA produced a printout showing that the required information was entered into the FSRS system for the grants, complying with FFATA. Furthermore, MDA presented a note published by GSA on April 25, 2025, which stated under the heading "Subaward and Subcontract Search" that it had " resolved an issue where there were missing reports from the Subaward and Subcontract search results." This note clearly establishes that there were data/reports lost in the conversion process. Upon lea rning of the deficie ncy, MDA reported the same to GSA; however, no response addressing the issue has been received. Con-ective Action Plan: Because no specific policy or procedure exists addressing FFATA repo rting, MDA is developing a specific policy and procedure to ensure all requirements of the law are met. This policy will adopt the deadline for filing the required information in SAM.gov by the end of the month following the month in which MDA makes a subgra nt greater than or equal to $30,000. Furthe rmore, MDA will screen capture all reports, with proper documentation of the date of submitta l, and place this documentation into the grant file and the electronic file system, as well as maintain a separate FFATA reporting file for each fiscal year. This policy and procedure will be finalized within the next thirty (30) days. Charles L. Bea rman, the director of the Community Incentives Division of MDA, is responsible for this con-ective action. If you should have any question s conce rning this matter, please contact me. I want to thank you and your team for your service to our state and for your cooperation in this regard

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Finding 1210957 (2024-030)

Material Weakness 2024

State of Mississippi

MS

Procurement, Suspension & Debarment § 200.214 § 200.303 § 200.317

The Department should review and enhance its procedures to ensure that it follows its procurement policy and federal suspension and debarment regulations for all applicable goods and services purchased for the program. Response: The Department concurs with the finding and the need to strengthen cont...

The Department should review and enhance its procedures to ensure that it follows its procurement policy and federal suspension and debarment regulations for all applicable goods and services purchased for the program. Response: The Department concurs with the finding and the need to strengthen controls to ensure the procurement policy and federal suspension and debarment regulations for all applicable goods and services purchased are followed. Prior to the conclusion of the audit, the agency went live with its new procurement system, OpenGov in March 2025. OpenGov ensures that services are procured following policy and regulations. Corrective Action: The Department will ensure procurement rules and regulations are followed by enforcing the use of OpenGov throughout the agency. Name of contact person responsible for the corrective action: Dorthy Young Anticipated date for completion of corrective action: July 1, 2026

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Finding 1210956 (2024-029)

Material Weakness 2024

State of Mississippi

MS

Allowable Costs / Cost Principles Subrecipient Monitoring Eligibility § 200.303

The Department should review and enhance its procedures and internal controls to ensure that it charges expenditures to the program that are incurred within an award’s allowable period of performance. Response: The Department concurs with the finding and the need to enhance procedures and strengthen...

The Department should review and enhance its procedures and internal controls to ensure that it charges expenditures to the program that are incurred within an award’s allowable period of performance. Response: The Department concurs with the finding and the need to enhance procedures and strengthen controls over processing expenditures to ensure compliance with the awards’ period of performance. Corrective Action: The program will enhance procedures and strengthen controls to ensure expenditures presented for payment are allowable and within the awards’ period of performance. Program leadership will develop and document an internal expenditure review process to ensure a complete review of presented expenditures for payment is completed prior to submission to the agency’s Accounts Payable Department for processing. Name of contact person responsible for the corrective action: Jameshyia Ballard Anticipated date for completion of corrective action: September 30, 2026

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Finding 1210955 (2024-028)

Material Weakness 2024

State of Mississippi

MS

Eligibility School Nutrition Programs Significant Deficiency § 200.303

The Department should review and update its procedures and controls to ensure that only eligible participants receive benefits under the program. Eligibility documentation should be maintained and readily available for audit. Response: The Department concurs with the finding and the need to strength...

The Department should review and update its procedures and controls to ensure that only eligible participants receive benefits under the program. Eligibility documentation should be maintained and readily available for audit. Response: The Department concurs with the finding and the need to strengthen controls over eligibility processing to ensure required documentation is obtained and maintained for each participant to support program eligibility. Corrective Action: The program will develop an internal tracking and retention system to maintain eligibility documentation for participants to ensure accessibility when needed. Documentation will be maintained in accordance with program requirements. Name of contact person responsible for the corrective action: Jameshyia Ballard Anticipated date for completion of corrective action: September 30, 2026

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Finding 1210954 (2024-027)

Material Weakness 2024

State of Mississippi

MS

Allowable Costs / Cost Principles § 200.303 § 200.430

The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department of Health should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Do...

The Department should reevaluate its current process, implement proper controls, and perform additional training over time and effort reporting. The Department of Health should not seek federal reimbursement unless it can substantiate that the time and effort was dedicated to the federal program. Documentation should be readily available for audit. Response: The Department concurs with the finding and the need for an effective method of time recording for accurate time and effort reporting. Prior to the conclusion of the audit, the agency created an internal review group to assess the need for an efficient time keeping system to be utilized throughout the agency to allow for uniformity and accuracy. Corrective Action: The Department will continue to move forward with the implementation of the new time keeping system which allows for proper time and leave collection for documentation and allocation of employee time. In the system, the employee time will be recorded and approved by supervisory personnel for accuracy prior to submission payroll processing. The system will allow documentation to be assessed when needed. Name of contact person responsible for the corrective action: Lucreta Tribune

View Audit 400294

Finding 1210889 (2024-001)

Material Weakness 2024

Greater Lawrence Technical School

MA

Reporting

Audit Finding Reference: 2024-001 Planned Corrective Action: Management acknowledges the finding regarding the untimely submission of the School’s annual filing with the Federal Audit Clearinghouse (FAC) for the fiscal year ended June 30, 2024. The delay was primarily due to the timing of the comple...

Audit Finding Reference: 2024-001 Planned Corrective Action: Management acknowledges the finding regarding the untimely submission of the School’s annual filing with the Federal Audit Clearinghouse (FAC) for the fiscal year ended June 30, 2024. The delay was primarily due to the timing of the completion of prior audits, which impacted the School’s ability to meet the March 31, 2025 deadline. To address this issue and improve the timeliness of future filings, the School and School Committee will implement the following corrective actions: 1. Establishment of a Formal Timeline: Management will develop and adopt a detailed annual audit and reporting calendar that includes key milestones for audit completion and FAC submission to ensure adequate time for timely filing. 2. Monitoring and Verification: The School will establish a structured monitoring system that includes regularly scheduled status meetings (at least monthly, and more frequently as deadlines approach) involving key personnel and, when necessary, external auditors. These meetings will be used to review audit progress against established timelines, identify potential delays early, and implement corrective steps in real time. 3. Improved Coordination with Auditors: Management will work closely with external auditors to establish clear expectations for audit completion, including target dates for each major step of the audit. Name of Contact Person: Melissa Martel, Director of Finance Planned Completion Date: June 30, 2026

View Audit 400233

Finding 1210887 (2024-002)

Material Weakness 2024

Block Island Ecnmc Dev Fndtn Hsng CORP Dba E. Searles Ball Memorial

CT

Reporting

Management acknowledges the finding regarding the replacement reserve account not being funded at the minimum level required by the USDA‑RD approved budget. To address this issue, the Project will work to make a deposit to fully restore the replacement reserve to the required threshold in accordance...

Management acknowledges the finding regarding the replacement reserve account not being funded at the minimum level required by the USDA‑RD approved budget. To address this issue, the Project will work to make a deposit to fully restore the replacement reserve to the required threshold in accordance with USDA‑RD guidelines. In addition, we will continue to monitor reserve balances throughout the year and communicate with USDA‑RD if significant variances arise.

View Audit 400231

Finding 1210885 (2024-001)

Material Weakness 2024

Block Island Ecnmc Dev Fndtn Hsng CORP Dba E. Searles Ball Memorial

CT

Reporting

Management acknowledges the finding regarding the late filing of the single audits. Management will work with the Board of Directors and auditor to develop a plan to ensure future audits are completed on a more timely basis in accordance with the filing requirements.

View Audit 400231

Finding 1210883 (2024-002)

Material Weakness 2024

Trufund Financial Services, Inc.

NY

Allowable Costs / Cost Principles Internal Control / Segregation of Duties § 200.303 § 200.403

Finding No. 2024-002 Loan Originations Involving Fraudulent Documentation Federal Agency: U.S. Department of Commerce Economic Development Administration Program Titles and ALN Numbers: EDA Revolving Loan Fund Program Capital Allocation - New York Contractor Loans (a non major program) (11.307) Fede...

Finding No. 2024-002 Loan Originations Involving Fraudulent Documentation Federal Agency: U.S. Department of Commerce Economic Development Administration Program Titles and ALN Numbers: EDA Revolving Loan Fund Program Capital Allocation - New York Contractor Loans (a non major program) (11.307) Federal Grant Numbers: Award #01-79-15074 Compliance Requirements: Activities Allowed and Unallowed and Allowable Costs Contact Person: James H. Bason, President and Chief Executive Officer, TruFund Financial Services, Inc., 9 East 40th, NY 10016 Corrective Action: (1) Federal agency notification: Management has notified the U.S. Department of Commerce Economic Development Administration of this finding and the questioned cost, and will cooperate fully with any federal review or recovery process. (2) Federal corrective action plan: Management has provided EDA with a corrective action plan addressing the specific internal control deficiencies applicable to federally funded loan programs. (3) Enhanced internal controls over federally funded programs: All corrective actions implemented under Finding 2024-001 apply equally to all federally funded loan programs, including enhanced verification, segregation of duties, and suspicious activity monitoring. (4) Replenishment of EDA Revolving Loan Fund: Subsequent to year-end and prior to the issuance of this report, TruFund replenished $410,000 in non-federal, unencumbered funds to the EDA Revolving Loan Fund, in response to EDA's request to restore the fund balance. Anticipated Completion Date: April 30, 2026

View Audit 400229

Finding 1210861 (2024-003)

Material Weakness 2024

Berkeley County Public Service District

WV

Reporting Allowable Costs / Cost Principles

The District uses an outside party to oversee grant management. District management will review work performed by outside parties to ensure completeness and accuracy.

View Audit 400206

Finding 1210860 (2024-002)

Material Weakness 2024

Berkeley County Public Service District

WV

Cash Management Matching / Level of Effort / Earmarking

Management will monitor major programs and ensure that they are tested when necessary. The grant in question was tested during 2024.

View Audit 400206

Corrective Action Plans

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