Corrective Action Plans

Finding 1218974 (2025-101)

Material Weakness 2025

Mainehealth

ME

Subrecipient Monitoring Allowable Costs / Cost Principles Reporting § 200.430

PAYROLL CONTROLS Criteria: In accordance with the documentation standards of 2 CFR section 200.430(a), costs of compensation for personal services are allowable to the extent the total compensation for individual employees is reasonable for the services rendered, conforms to the established written ...

PAYROLL CONTROLS Criteria: In accordance with the documentation standards of 2 CFR section 200.430(a), costs of compensation for personal services are allowable to the extent the total compensation for individual employees is reasonable for the services rendered, conforms to the established written policy of the recipient or subrecipient and is determined and supported as provided in 2 CFR section 200.430(g), which states that charges to federal awards for salaries and wages must be based on records that accurately reflect the work performed. Condition: Payroll testing was completed for a sample of 40 individuals for which time and expenses were charged to R&D grants. Within that selection, we noted instances where payroll controls did not function properly in regard to percentage of time allocated to a grant, proper pay code inclusion, fringe benefit calculation and timely and supervisor level review of time sheets. Context: Management was able to isolate the time allocation error to 20 employees for which the time and costs charges to the grants were in excess of actual time allocation. This resulted in $87,831.53 in excess charged to the grants. Additional control deficiencies did not result in significant improper grant expenditures. Cause: A new payroll system was implemented in fiscal 2025. Grant allocation percentages were not accurately established in the payroll system upon conversion. Effect: Time charged to grant efforts by certain individuals exceeded actual time worked. Recommendation: Review controls should be enhanced to ensure grant expenditures accurately reflect payroll costs. Corrective Actions Taken or Planned: Management identified the issue early following implementation of the new payroll system and performed a detailed review to isolate the impacted population. Corrections were made to payroll allocations for the affected employees, and reimbursement adjustments were processed as appropriate. To prevent recurrence, management has implemented the following control enhancements: - Standardized procedures for establishing and validating grant allocation percentages within the payroll system; - Enhanced supervisory review requirements for time reporting and payroll approvals; - Periodic monitoring and reconciliation of payroll charges to grant budgets; - Additional training for payroll and grant accounting personnel on system configuration and compliance requirements. Responsible Parties: VP of Accounting and Controller and VP of Audit & Compliance. Anticipated Completion Date: Completed in fiscal year 2025; ongoing monitoring procedures are in place.

View Audit 404984

Finding 1218940 (2025-003)

Material Weakness 2025

Anoka County

MN

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

Finding Number: 2025-003 Finding Title: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, and Reporting Program: 93.658 Foster Care Title IV-E, 93.778 Grants to States for Medicaid Name of Contact Person Responsible for Corrective Action: Ryan DuMond, Supervisor, Accounting Correctiv...

Finding Number: 2025-003 Finding Title: Activities Allowed or Unallowed, Allowable Costs/Cost Principles, and Reporting Program: 93.658 Foster Care Title IV-E, 93.778 Grants to States for Medicaid Name of Contact Person Responsible for Corrective Action: Ryan DuMond, Supervisor, Accounting Corrective Action Planned: Staff will conduct thorough reviews of all Quarterly Fiscal Memos and attachments issued by DHS to ensure that reporting requirements are fully understood and applied consistently. The County will also develop and document a comprehensive procedure for preparing the DHS‑2550 and DHS‑2556 reports, including detailed instructions for entering adjustments, processing reversing entries, reporting amortization, properly coding capital purchases, and handling MAXIS‑related costs. A mandatory review process will be implemented before submission of each report to verify accuracy and compliance with DHS guidance. As part of this review, staff will closely examine expense classifications to ensure that capital outlay expenditures are accurately coded and reported, and that all required amortization expenses are correctly included. These actions will help prevent misclassification and report errors in future submissions. Anticipated Completion Date: July 2026

View Audit 404983

Finding 1218937 (2025-005)

Material Weakness 2025

Worksource Montgomery, Inc.

MD

Allowable Costs / Cost Principles Subrecipient Monitoring Significant Deficiency § 200.403

Management Response: Management acknowledges Finding 2025-005 and agrees that the deficiency in accounting for expenses covered under the resource sharing agreement constitutes a material weakness in internal control over financial reporting and compliance. Misclassification of individual expense ca...

Management Response: Management acknowledges Finding 2025-005 and agrees that the deficiency in accounting for expenses covered under the resource sharing agreement constitutes a material weakness in internal control over financial reporting and compliance. Misclassification of individual expense categories by $70,223 affected the accuracy of category-level reporting and increased the risk of budget overages or noncompliance where federal awards and resource sharing agreements contain line-item spending limitations or require accurate reporting by cost category. Although the error did not necessarily affect total expenditures, incorrect classification can impair oversight, distort budget-to-actual monitoring, and reduce the reliability of information used for internal and external reporting. Management determined that the root causes included insufficiently detailed written guidance for coding transactions under the resource sharing agreement, inconsistent use of account mappings between the general ledger and agreement budget categories, and inadequate review of category-level coding before expenditures were finalized and reported. Existing procedures addressed expense processing generally, but they did not provide enough direction on how shared-service or agreement-covered costs should be classified into the proper expense categories for budget monitoring and reporting. To address this material weakness, management is implementing a corrective action plan focused on improving category-level classification and reporting for expenses covered under the resource sharing agreement. The plan includes four key actions: revising written accounting procedures to define category descriptions, coding rules, and decision standards; creating a standardized crosswalk between general ledger accounts and agreement budget categories; requiring supervisory review of category coding before final reporting; and implementing periodic budget-to-actual monitoring to identify unusual balances, potential overages, and coding trends that may indicate misclassification. Under the revised process, each expense charged under the resource sharing agreement will be recorded using the approved chart-of-accounts mapping and supported by documentation sufficient to identify the nature of the cost, the applicable budget category, and the reason the selected classification is appropriate. If a transaction involves a cost type that does not clearly align to an established category, accounting personnel will be required to elevate the transaction for review before posting or reporting. Any manual reclassification entries affecting agreement categories will require documented justification and supervisory approval. In addition, management will compare recorded expenditures to budgeted amounts by category on a recurring basis so that unusual fluctuations, coding anomalies, or category overages can be investigated and corrected before financial or grant reporting is finalized. Management will also provide targeted training to accounting, finance, and grants personnel responsible for recording or reviewing resource sharing agreement activity. Training will address the relationship between GAAP-based accounting records, agreement-specific budget categories, and federal compliance expectations for accurate, current, and complete financial reporting and comparison of expenditures to budget amounts. Management will supplement this training with periodic reviews of classification trends and exception items so that recurring coding issues can be identified and corrected through additional guidance, process changes, or retraining as needed. Management believes these corrective actions directly address the auditors’ recommendation to review current policies and procedures for compliance with GAAP and federal regulations. Responsibility for implementation will rest primarily with the Finance Director, in coordination with accounting and grants personnel involved in resource sharing agreement reporting. Management expects the enhanced coding guidance, account crosswalk, review controls, and category-level monitoring procedures to improve the accuracy of expense classification, strengthen budget oversight, and reduce the risk of misstatements or noncompliance related to resource sharing agreement expenditures in future periods. Corrective Action Plan Summary Corrective Action Responsible Staff/Role Target Completion Date Evidence of Completion Revise and adopt written accounting procedures for expenses covered under the resource sharing agreement, including category definitions, coding rules, and documentation standards for classification decisions. Finance Director; Accounting Manager June 30, 2026 Approved procedures; updated accounting manual; staff distribution records. Develop and implement a standardized crosswalk between general ledger accounts and resource sharing agreement budget categories, including guidance for common transaction types and reclassification scenarios. Accounting Manager; Finance Director July 15, 2026 Approved account crosswalk; coding reference guide; sample mapped transactions. Require documented supervisory review of category coding for resource sharing agreement transactions before final reporting, including review of manual reclasses and higher-risk expense categories. Finance Director Effective immediately Reviewer signoff on category reports; approved reclassification support; supervisory review documentation. Provide targeted training to accounting, finance, and grants personnel on category-level expense classification, use of the crosswalk, and reporting requirements under the resource sharing agreement Compliance Officer; Finance Director August 31, 2026 Training materials; attendance logs; completed acknowledgements or knowledge checks. and applicable federal regulations. Perform monthly budget-to-actual category reviews for resource sharing agreement expenditures to identify unusual balances, potential overages, and coding anomalies requiring investigation or correction. Accounting Manager; Finance Director Monthly, beginning July 31, 2026 Monthly budget-to-actual reports; exception logs; documented follow-up and corrections. Perform quarterly monitoring of a sample of resource sharing agreement transactions to verify correct category coding, consistency with the approved crosswalk, and compliance with agreement and federal reporting requirements. Compliance Officer; Finance Director Quarterly, beginning September 30, 2026 Quarterly monitoring reports; sample testing documentation; corrective action follow-up records

View Audit 404980

Finding 1218936 (2025-003)

Material Weakness 2025

Worksource Montgomery, Inc.

MD

Allowable Costs / Cost Principles Subrecipient Monitoring § 200.405

Management Response: Management acknowledges Finding 2025-003 and agrees that the control deficiency related to allocation of expenses within the WIOA Cluster constitutes a material weakness in internal control over compliance. This finding is distinct from Finding 2025-002 because it concerns the m...

Management Response: Management acknowledges Finding 2025-003 and agrees that the control deficiency related to allocation of expenses within the WIOA Cluster constitutes a material weakness in internal control over compliance. This finding is distinct from Finding 2025-002 because it concerns the methodology, approval, and monitoring of cost allocations affecting WIOA programs, including restrictions applicable to the Youth program, rather than the allowability of costs based on timing or period of performance. Although the identified costs were corrected, the deficiency increased the risk that shared or allocable costs could be assigned to restricted programs in a manner inconsistent with federal requirements if not detected and prevented in a timely manner. Management determined that the root causes were insufficiently detailed written procedures for allocating shared costs within the WIOA Cluster, lack of explicit documentation addressing the prohibition on transfers to or from the Youth program under 20 CFR 683.130, and inconsistent supervisory review of allocation entries before posting. Existing practices addressed cost charging generally, but they did not provide enough direction on how shared expenditures benefiting multiple WIOA funding streams should be allocated, documented, reviewed, and restricted when Youth funds were involved. To address this material weakness, management is implementing four control improvements. First, it will formalize written cost allocation policies and procedures for the WIOA Cluster that define approved methodologies, documentation standards, proportional benefit requirements, and restrictions applicable to the Youth program. Second, it will require documented supervisory review and approval of all allocation entries affecting WIOA programs before posting to the general ledger. Third, it will provide targeted training to finance, grants, and program management personnel on WIOA-specific allocation requirements, with particular emphasis on Youth program restrictions. Fourth, it will implement periodic monitoring to verify that allocations follow the approved methodology and remain consistent with federal requirements. Under the revised process, each allocation affecting WIOA programs will be supported by contemporaneous documentation identifying the nature of the cost, the programs benefiting from the expenditure, the basis used to distribute the cost, and the calculation of the amounts charged to each program. When a cost benefits multiple programs and proportional benefit can be reasonably determined, the allocation will be based on that proportional benefit. When proportional benefit cannot be determined precisely, the allocation will be supported by a reasonable documented method that is applied consistently. Allocation support must also include a compliance checkpoint confirming that no allocation results in an impermissible transfer to or from the Youth program. No allocation entry affecting WIOA programs will be recorded without documented preparer support and written supervisory review evidencing compliance with internal policy and applicable regulations. Management will also establish recurring monitoring controls to test allocations recorded during the year. On at least a quarterly basis, the Finance Director or designee will review a sample of WIOA allocation entries to confirm that the approved methodology was followed, supporting documentation was retained, supervisory approval was completed, and Youth program restrictions were observed. Exceptions identified through this monitoring process will be documented, investigated, and corrected promptly, with any necessary retraining or policy revisions implemented to prevent recurrence. Results of the monitoring process will be communicated to senior management as part of ongoing oversight of federal awards compliance. Management believes these corrective actions directly address the auditors’ recommendations and strengthen controls over allocation of expenses within the WIOA Cluster without duplicating the corrective actions described in Finding 2025-002. Responsibility for implementation will rest primarily with the Finance Director, in coordination with grants and program leadership. Management expects the enhanced policy framework, approval requirements, training, and monitoring activities to reduce the risk of noncompliant allocations, improve documentation of shared cost methodologies, and support sustained compliance with 2 CFR 200.405 and 20 CFR 683.130. Corrective Action Plan Summary Corrective Action Responsible Staff/Role Target Completion Date Evidence of Completion Revise and adopt written WIOA cost allocation policies and procedures that define approved allocation methodologies, documentation requirements, proportional benefit standards, and explicit restrictions applicable to the Youth program. Finance Director; Grants Manager June 30, 2026 Approved policy and procedure document; distribution to applicable staff; retained version history. Implement a standardized allocation worksheet and review checklist for all shared costs charged to WIOA programs, including a compliance checkpoint for Youth program restrictions. Accounting Manager; Finance Director July 15, 2026 Standard allocation template; completed review checklist; sample completed allocation packages. Require documented supervisory review and approval of all allocation entries affecting WIOA programs before posting to the general ledger. Finance Director Effective immediately Signed allocation entries; reviewer signoff; journal entry support retained with monthly close documentation. Provide targeted training to finance, grants, and program personnel on 2 CFR 200.405, WIOA allocation principles, and the prohibition on transfers to or Finance Director; Compliance Officer August 31, 2026 Training materials; attendance logs; completed acknowledgements or assessments. from the Youth program under 20 CFR 683.130. Perform quarterly monitoring of a sample of WIOA allocation entries to verify adherence to the approved methodology, adequacy of support, supervisory approval, and compliance with Youth program restrictions. Finance Director; Compliance Officer Quarterly, beginning September 30, 2026 Quarterly monitoring reports; exception logs; documented corrective follow-up. Evaluate the effectiveness of the revised allocation controls and update policies, training, or monitoring procedures if deficiencies or exceptions are identified. Finance Director; Executive Leadership Semi-annually during fiscal year 2027 Management review memoranda; updated procedures; remediation tracking documentation.

View Audit 404980

Finding 1218935 (2025-002)

Material Weakness 2025

Worksource Montgomery, Inc.

MD

Allowable Costs / Cost Principles Period of Performance Subrecipient Monitoring § 200.403 § 200.458

Finding: 2025-002 Reportable finding considered a material weakness-Expenses incurred outside of the period of performance Effect: The organization claimed and was reimbursed for unallowable costs under 2 CFR 200.458. Failure to maintain effective controls over cost allowability increases the risk o...

Finding: 2025-002 Reportable finding considered a material weakness-Expenses incurred outside of the period of performance Effect: The organization claimed and was reimbursed for unallowable costs under 2 CFR 200.458. Failure to maintain effective controls over cost allowability increases the risk of noncompliance questioned costs, and potential repayment of federal funds. Questioned costs: Known questioned costs of $403,805 were identified by reviewing each transaction prior to the date and for the month after the award began to ensure there are no likely questioned costs. Recommendation for the organization from the auditor: • Formalize and implement written policies and procedures governing identification, approval, and accounting for pre-award costs. • Require documented written approval from the federal awarding agency prior to charging any pre-award costs to federal awards. • Provide training to program and finance personnel on Uniform Guidance cost allowability requirements, including 2 CFR 200.458 and 2 CFR 200.403. • Implement supervisory review controls to ensure costs charged to federal awards are incurred within the approval period of performance or have documented prior approval. Corrective Action Plan for Pre-award costs Management acknowledges the audit finding that pre-award costs were charged to multiple federal awards for expenses incurred before the approved period of performance beginning October 1, 2024. The costs were incurred without the required written prior approval from the Maryland Department of Labor (MD DOL), the pass-through entity. As a result, unallowable costs were reimbursed and later removed from the Schedule of Expenditures of Federal Awards (SEFA). Management determined that the issue resulted from insufficient internal controls, the absence of formal written procedures for pre-award costs, and gaps in staff understanding of Uniform Guidance requirements. To address these root causes, the organization adopted a formal written policy governing the identification, approval, documentation, and accounting of pre-award costs. The policy requires written prior approval from MD DOL before any pre-award costs may be incurred or charged to a federal award and establishes documentation, retention, and accounting standards to support compliance with 2 CFR 200.458 and 2 CFR 200.403. Third, the organization also implemented a mandatory written approval workflow requiring program and grants staff to prepare and submit a formal request to MD DOL whenever pre-award costs are anticipated. No costs may be incurred until written approval is received. Approval documentation must be retained in both the official grant file and the accounting system. This workflow is now part of the grant start-up process for all federal awards. Fourth, the organization strengthened supervisory review controls to ensure that all costs charged to federal awards fall within the approved period of performance or have documented prior approval. These controls include a pre-posting cost allowability checklist, supervisory review and approval of all federal charges, and accounting system alerts that flag costs incurred outside the period of performance. Additionally, the Compliance Officer will conduct quarterly internal compliance reviews to verify adherence to federal requirements and internal policies. Finally, the organization implemented preventive measures to ensure long-term compliance. These include maintaining a centralized grant calendar with period-of-performance dates, requiring dual review of costs charged during the first 90 days of new awards, and conducting semi-annual internal audits of federal expenditures. Any discrepancies identified will be reported to senior leadership within five business days. Management is committed to ensuring full compliance with Uniform Guidance and MD DOL requirements. All corrective actions described above have been implemented or will be fully implemented by July 31, 2026. The organization believes these actions sufficiently address the audit findings and significantly strengthen internal controls over federal award management. Corrective Action Plan Summary Corrective Action Responsible Staff/Role Target Completion Date Evidence of Completion Develop and implement formal Pre-award Cost Policy Finance Director June 1, 2026 Final approved policy; distribution email; policy posted to shared drive Establish mandatory written prior approval workflow Finance Director June 30, 2026 Completed approval request template; sample approval documentation; updated grant file checklist Conduct Uniform Guidance training Compliance Officer July 31, 2026 Training materials; attendance logs; post-training assessments Implement supervisory review controls Finance Director June 30, 2026 Completed checklists; system screenshots; supervisor sign-offs Perform quarterly internal compliance reviews Compliance Officer Quarterly, ongoing Quarterly review reports; corrective action memos (if applicable) Maintain centralized grant calendar Director of Performance and Compliance June 30, 2026 Updated grant calendar; access logs or distribution email Conduct semi-annual internal audits Compliance Officer Semi-annual, ongoing Internal audit reports; follow-up documentation Dual review of early-period charges Finance Director; Grants Manager July 1, 2026 Dual-review sign-off forms; documented approvals

View Audit 404980

Finding 1218931 (2025-004)

Material Weakness 2025

Worksource Montgomery, Inc.

MD

Allowable Costs / Cost Principles Subrecipient Monitoring § 200.303 § 200.401

Management Response: Management acknowledges Finding 2025-004 and agrees that weaknesses in the review and approval of expenses represent a material weakness in internal control over compliance. The reimbursement of personal credit card expenses and the charging of those transactions to federal awar...

Management Response: Management acknowledges Finding 2025-004 and agrees that weaknesses in the review and approval of expenses represent a material weakness in internal control over compliance. The reimbursement of personal credit card expenses and the charging of those transactions to federal awards resulted in unallowable costs and demonstrated a breakdown in the review process for employee reimbursements and supporting documentation. Although the known questioned costs total only $46, the broader risk is that additional unallowable, unsupported, or improperly coded expenses could be charged to federal awards if review controls are not strengthened. Management determined that the root causes included insufficiently detailed procedures for reviewing employee reimbursement requests, inconsistent verification of business purpose and allowability before reimbursement, and inadequate supervisory review of expense documentation before costs were posted to federal awards. Existing controls were not precise enough to identify personal or otherwise unallowable charges embedded within reimbursement activity, particularly when descriptions were incomplete or reviewers did not independently confirm that the expense was necessary, reasonable, properly documented, and allowable under Uniform Guidance. To address this material weakness, management is implementing a corrective action plan focused on strengthening pre-payment and pre-posting review of employee reimbursements and other expense transactions charged to federal awards. The plan includes four key actions: revising reimbursement and accounts payable procedures to require detailed support for every request; requiring documented secondary review by supervisory or finance personnel independent of the submitter; implementing exception-based review procedures for higher-risk transactions; and performing periodic post-payment monitoring to confirm that review procedures are operating effectively and that unallowable costs are promptly identified and corrected. Under the revised process, no employee reimbursement or expense charged to a federal award will be approved unless the request includes sufficient supporting documentation to allow the reviewer to determine that the cost is necessary, reasonable, allocable as applicable, consistently treated, and adequately documented in accordance with Uniform Guidance cost principles. Reviewers will be required to confirm the business purpose of the transaction, assess whether the type of cost is allowable under the terms of the award and applicable federal regulations, and verify that no personal items, duplicate charges, sales tax errors, or unsupported amounts are included. If documentation is incomplete or a charge appears questionable, the transaction will be held pending clarification, recoded to a non-federal source, or denied reimbursement as appropriate. Any unallowable expense identified after reimbursement will be promptly removed from the applicable federal award and reported through management’s corrective follow-up procedures. Management will also reinforce accountability through targeted training and oversight. Employees who prepare, review, approve, or process reimbursements and expense reports affecting federal awards will receive training on allowable cost principles, documentation expectations, and the importance of careful review under 2 CFR Part 200, including the requirement that costs be adequately documented and necessary and reasonable for the performance of the federal award. In addition, Finance will generate periodic exception reports highlighting reimbursement activity charged to federal awards, personal credit card reimbursements, and other transactions meeting defined risk criteria. These reports will be reviewed by management to identify trends, address control failures, and implement additional corrective measures when needed. Management believes these corrective actions directly address the auditors’ recommendations and strengthen controls over the review and approval of expenses charged to federal awards without repeating the corrective actions already established for pre-award costs, allocation methodology, or broader financial close procedures. Responsibility for implementation will rest primarily with the Finance Director, in coordination with accounts payable, grants, and program leadership. Management expects enhanced documentation standards, independent review requirements, exception-based oversight, and monitoring activities to reduce the risk of personal or otherwise unallowable expenses being reimbursed and charged to federal awards in future periods. Corrective Action Plan Summary Corrective Action Responsible Staff/Role Target Completion Date Evidence of Completion Revise and adopt written expense reimbursement and accounts payable review procedures requiring itemized receipts, documented business purpose, funding source identification, and explicit confirmation that requested costs are not personal in nature. Finance Director; Accounts Payable Supervisor June 30, 2026 Approved procedures; updated reimbursement forms; staff distribution records. Implement a standardized reimbursement review checklist requiring reviewer validation of allowability, Accounts Payable Supervisor; July 15, 2026 Completed checklist template; sample reviewed reimbursement business purpose, receipt support, coding accuracy, and identification of any personal or unsupported charges before reimbursement or posting to a federal award. Finance Director packages; approval signoff documentation. Require independent supervisory review and approval for all employee reimbursements and any expense transaction charged in whole or in part to a federal award, including personal credit card reimbursement requests. Finance Director Effective immediately Supervisor approval records; signed reimbursement packages; workflow evidence showing independent review. Provide targeted training for employees, supervisors, accounts payable, and grants personnel on allowable cost principles, documentation standards, and reviewer responsibilities for expenses affecting federal awards. Compliance Officer; Finance Director August 31, 2026 Training materials; attendance logs; completed acknowledgements or knowledge checks. Create periodic exception reports for reimbursement activity charged to federal awards, missing receipt transactions, unusual merchants, and other higher-risk expense patterns, and require documented management review of the results. Accounting Manager; Finance Director September 30, 2026 Exception report format; monthly or quarterly review logs; documented follow-up on exceptions. Perform quarterly post-payment monitoring of a sample of reimbursed expenses charged to federal awards to verify compliance with documentation, Compliance Officer; Finance Director Quarterly, beginning September 30, 2026 Quarterly monitoring reports; exception logs; evidence of recoding, recovery, or corrective follow-up. approval, and allowability requirements and to ensure prompt correction of any identified exceptions.

View Audit 404980

Finding 1218928 (2025-003)

Material Weakness 2025

University of Guam

GU

Special Tests & Provisions Internal Control / Segregation of Duties

Finding NO. 2025-003 Wage Rate Requirements View of the University of Guam and Corrective Action Plan: During the first half of fiscal year 2025, the University was in the process of implementing corrective actions related to the prior-year finding. While procedures were in place to address the requ...

Finding NO. 2025-003 Wage Rate Requirements View of the University of Guam and Corrective Action Plan: During the first half of fiscal year 2025, the University was in the process of implementing corrective actions related to the prior-year finding. While procedures were in place to address the requirements, improvements to the retention of certified payroll documentation and related compliance support were still being implemented during the period under review. The University's Capital Projects team continues to monitor certified payroll submissions from the Contractor and applicable Subcontractors. Through ongoing coordination with the Contractor, the University has strengthened its oversight procedures to help ensure certified payroll documentation is obtained, reviewed, and retained in accordance with applicable requirements. The University will continue to enhance its monitoring and documentation practices as part of its ongoing corrective action efforts. Name of Contact Person: Zenon Belanger, Interim Director, Facilities Management and Services Proposed Completion date: Ongoing

View Audit 404978

Finding 1218927 (2025-002)

Material Weakness 2025

University of Guam

GU

Reporting

Finding NO. 2025-002 Reporting SF-425 View of the University of Guam and Corrective Action Plan: The University acknowledges the finding. The University notes that, for each SF-425 submission, it consults with the assigned Economic Development Administration (EDA) grant coordinator and provides supp...

Finding NO. 2025-002 Reporting SF-425 View of the University of Guam and Corrective Action Plan: The University acknowledges the finding. The University notes that, for each SF-425 submission, it consults with the assigned Economic Development Administration (EDA) grant coordinator and provides supporting documentation for the reported amounts. The amounts reported for “cash receipts” were reviewed and acknowledged by EDA and reconciled to the University’s reimbursement records. The University also consulted with EDA regarding whether revised reports were necessary. EDA informed the University that revised reports may be submitted but are not required. Accordingly, while the reporting basis selected on the form was not consistent with the basis used in preparing the supporting accounting records, the University believes the underlying amounts reported were supported, reconciled, and accepted by the federal grantor agency. To strengthen compliance going forward, the University will enhance its review procedures to ensure consistency between the reporting basis selected on the SF-425, supporting accounting records, and federal reporting instructions. Name of Contact Person: Abigail Martin, Comptroller Proposed Completion date: July 31, 2026

View Audit 404978

Finding 1218926 (2025-002)

Material Weakness 2025

Park City Communities, INC

CT

HUD Housing Programs Eligibility

2025-002 - Eligibility: Public Housing Operating Fund (FALN #14.850) Criteria HUD regulations of Annual Income (24 CFR § 5.609), Eligible Family Status (24 CFR § 5.403), Citizenship and Eligible Immigrant Status (24 CFR § 5.506) and Disclosure of Social Security Numbers (24 CFR § 5.216) require the ...

2025-002 - Eligibility: Public Housing Operating Fund (FALN #14.850) Criteria HUD regulations of Annual Income (24 CFR § 5.609), Eligible Family Status (24 CFR § 5.403), Citizenship and Eligible Immigrant Status (24 CFR § 5.506) and Disclosure of Social Security Numbers (24 CFR § 5.216) require the collection and retention of certain tenant information to document the eligibility determination for each recipient. Condition The results of our testing indicated that certain items were not completed in a timely matter as follows: • In fifteen instances, the income verification form was not found in the file or not performed timely. Questioned Costs Not determinable. Context We selected a sample of 60 files for review. Our sample was a statistically valid sample. Effect or Possible Effect The tenant income verification form was not performed timely. Cause The cause is unknown. Identification as a Repeat Finding This finding is a repeat finding (see prior year finding number: 2024-002). Recommendation We recommend that Park City continue to improve its internal processes to ensure tenant income verification is performed timely. Park City's Response A Compliance Manager has been hired to randomly review resident files to make sure all documentation is maintained. An email reminder is sent monthly to managers to insure that EIV for move-ins is done on a timely basis. Contact: Jillian Baldwin Email & Phone Number : jbaldwin@oarkcitycommunities.org (203) 337-8900

View Audit 404966

Finding 1218925 (2025-001)

Material Weakness 2025

Park City Communities, INC

CT

HUD Housing Programs Special Tests & Provisions Eligibility

2025-001 – Eligibility and Special Tests and Provisions: Housing Voucher Cluster (FALN #14.871) Criteria HUD regulations of Annual Income (24 CFR § 5.609), Eligible Family Status (24 CFR § 5.403), Citizenship and Eligible Immigrant Status (24 CFR § 5.506) and Disclosure of Social Security Numbers (2...

2025-001 – Eligibility and Special Tests and Provisions: Housing Voucher Cluster (FALN #14.871) Criteria HUD regulations of Annual Income (24 CFR § 5.609), Eligible Family Status (24 CFR § 5.403), Citizenship and Eligible Immigrant Status (24 CFR § 5.506) and Disclosure of Social Security Numbers (24 CFR § 5.216) require the collection and retention of certain tenant information to document the eligibility determination for each recipient. Condition The results of our testing indicated that certain items were unable to be located in the file, as follows: • In five instances, supporting documentation (Form HUD-52580) was not available to verify that HQS inspections were completed and passed • In five instances, social security verification was missing from the tenant file. • In six instances, income verification form was missing from the tenant file or performed timely. • In fourteen instances, signed HAP contracts were not maintained in the tenant file for review. • In one instance, income was incorrectly calculated on Form HUD-50058. Questioned Costs Not determinable. Context We selected a sample of 60 files for review. Our sample was a statistically valid sample. Effect or Possible Effect The tenant file documentation was incomplete and tenant income verification was not performed timely. Cause The cause is unknown. Identification as a Repeat Finding This finding is a repeat finding (see prior year finding number: 2024-001). Recommendation We recommend that Park City continue to improve its internal processes to ensure tenant files contain the required documentation and tenant income verification is performed timely. Park City's Response Income verification: PCC has implemented software tracking of income verification attempts. Inspections: An SOP was issued to staff to review/compare lines 5I and 5H on the 50058 to inspection result history, to confirm dates populating are accurate. HAP Contracts and Social Security Card Documentation: Implemented internal tracking review of ongoing executions are in place and monitored. HAP payments are not released until HAP contract is executed by both parties. Automated process to perform a review of electronically indexed files will be put into place to identify active units that may not display an indexed document relevant to HAP contract. A request for submission of the documents will be made. Contact: Jillian Baldwin Email & Phone Number : jbaldwin@oarkcitycommunities.org (203) 337-8900

View Audit 404966

Finding 1218923 (2025-002)

Material Weakness 2025

Danville School District

AR

Procurement, Suspension & Debarment § 200.320

The District will gather two qualified vendors for purchases of $10,000 to $25,000. The District will have Board approval for purchases exceeding $25,700. In addition, the Food Service Director will exercise care to order items on the bid list, but will not be limited to only items on the bid list a...

The District will gather two qualified vendors for purchases of $10,000 to $25,000. The District will have Board approval for purchases exceeding $25,700. In addition, the Food Service Director will exercise care to order items on the bid list, but will not be limited to only items on the bid list as new items become available.

View Audit 404952

Finding 1218920 (2025-001)

Material Weakness 2025

Danville School District

AR

Allowable Costs / Cost Principles School Nutrition Programs Internal Control / Segregation of Duties

The District will implement proper control over program expenditures. Expenditures for other programs will be paid directly from those program funds, if possible.

View Audit 404952

Finding 1218917 (2025-001)

Material Weakness 2025

THE LIGHTHOUSE FOR THE BLIND IN NEW ORLEANS, INCORPORATED

LA

Procurement, Suspension & Debarment § 200.318 § 200.327

Going forward, Lighthouse Louisiana will ensure that its procurement policy reflects its commitment to purchases made in a manner that promotes full and open competition, supports price reasonableness, and maintains appropriate documentation based on the applicable procurement threshold. Management ...

Going forward, Lighthouse Louisiana will ensure that its procurement policy reflects its commitment to purchases made in a manner that promotes full and open competition, supports price reasonableness, and maintains appropriate documentation based on the applicable procurement threshold. Management confirms that the Organization will apply a $10,000 micro-purchase threshold, require price or rate quotations from an adequate number of qualified sources for small purchases between $10,000 and $250,000, and require a formal competitive process for procurements exceeding $250,000, unless a properly documented exception applies. Lighthouse Louisiana did not actively retain all SAM.gov search results in vendor files for each vendor included in the procurement testing; however, if a SAM.gov verification was performed but not retained in the file, management will document the issue, perform and retain an updated verification, and strengthen internal controls to require retention of SAM.gov evidence before agreement execution or renewal. As part of its corrective action, Lighthouse Louisiana will enhance its procurement file review process to ensure that each grant-funded procurement contains, as applicable, the procurement method determination, supporting quotes or price comparisons, price reasonableness analysis, vendor selection rationale, required approvals, contract or agreement, and SAM.gov verification. Management will also reinforce staff training on procurement documentation requirements and will implement a standardized procurement checklist for grant-funded purchases. The Chief Financial Officer, Chief Operations Officer, and Project Director will be responsible for ensuring that any requested documentation is gathered and submitted to the auditors and that procurement file improvements are implemented prospectively.

View Audit 404950

Finding 1218916 (2025-003)

Material Weakness 2025

Russell Rural Water District No. 3

KS

Procurement, Suspension & Debarment

SIGNIFICANT DEFICIENCY 2025-003 Water and Waste Disposal Systems for Rural Communities – Procurement, Suspension and Debarment Condition During inquiry of District management, it was determined that the District did not have the required written policies in place to be followed. Recommendation We re...

SIGNIFICANT DEFICIENCY 2025-003 Water and Waste Disposal Systems for Rural Communities – Procurement, Suspension and Debarment Condition During inquiry of District management, it was determined that the District did not have the required written policies in place to be followed. Recommendation We recommend that the District’s written policies be updated to properly reflect all requirements. Comments on the Finding Management is aware of the oversight and has begun the process of creating a written policy.

View Audit 404949

Finding 1218915 (2025-003)

Material Weakness 2025

The Salvation Army Golden State Division

CA

Material Weakness School Nutrition Programs Equipment & Real Property Management

The Division is in the process of designing and implementing a precise control to ensure that the inventory reports are reviewed prior to being submitted to the grantor and that the backup documentation is maintained. Anticipated Completion Date: 9/30/2026 Responsible Contact Person: Michael Zielins...

The Division is in the process of designing and implementing a precise control to ensure that the inventory reports are reviewed prior to being submitted to the grantor and that the backup documentation is maintained. Anticipated Completion Date: 9/30/2026 Responsible Contact Person: Michael Zielinski, Major, Divisional Commander.

View Audit 404948

Finding 1218896 (2025-002)

Material Weakness 2025

The Salvation Army Golden State Division

CA

Eligibility Subrecipient Monitoring Material Weakness

The Division is in the process of designing and implementing a precise control to ensure that participants self-certify that they meet the grant eligibility requirements and that such evidence is maintained. Anticipated Completion Date: 9/30/2026 Responsible Contact Person: Michael Zielinski, Major,...

The Division is in the process of designing and implementing a precise control to ensure that participants self-certify that they meet the grant eligibility requirements and that such evidence is maintained. Anticipated Completion Date: 9/30/2026 Responsible Contact Person: Michael Zielinski, Major, Divisional Commander.

View Audit 404948

Finding 1218877 (2025-001)

Material Weakness 2025

The Salvation Army Golden State Division

CA

Allowable Costs / Cost Principles Subrecipient Monitoring Material Weakness § 200.502

The Division is in the process of designing and implementing a precise control to ensure that the amount of food distributed is properly reviewed and that the Division maintains such evidence. Anticipated Completion Date: 9/30/2026 Responsible Contact Person: Michael Zielinski, Major, Divisional Com...

The Division is in the process of designing and implementing a precise control to ensure that the amount of food distributed is properly reviewed and that the Division maintains such evidence. Anticipated Completion Date: 9/30/2026 Responsible Contact Person: Michael Zielinski, Major, Divisional Commander.

View Audit 404948

Finding 1218858 (2025-002)

Material Weakness 2025

Auburn University

AL

Subrecipient Monitoring § 200.332 § 200.501

MANAGEMENT VIEWS AND CORRECTIVE ACTION PLAN REPORT ON FEDERAL AWARDS IN ACCORDANCE WITH THE OMB UNIFORM GUIDANCE SEPTEMBER 30, 2025 Finding 2025-002 Subrecipient Monitoring- Lack of evidence of subrecipient Uniform Guidance report reviews Cluster: Research and Development Sponsoring Agency: Various ...

MANAGEMENT VIEWS AND CORRECTIVE ACTION PLAN REPORT ON FEDERAL AWARDS IN ACCORDANCE WITH THE OMB UNIFORM GUIDANCE SEPTEMBER 30, 2025 Finding 2025-002 Subrecipient Monitoring- Lack of evidence of subrecipient Uniform Guidance report reviews Cluster: Research and Development Sponsoring Agency: Various agencies Award Names: Southeast Region Cybersecurity Collaboration Center (SERC3), Establish, manage, and maintain a public-private partnership (PPP) additive manufacturing (AM) consortium for the Rapid Manufacturing Propulsion Technology (RAMPT), Developing effective adaptation strategies to enhance the resilience of farmers under changing climate, Towards a sustainable bioeconomy: Biotransformation of paper mill sludge for value-added chirally pure (R)-1,3-butanediol production, A systems approach to perennial forage management using plant growth-promoting rhizobacteria Award Numbers: 212514, 208409, 200987, 205258, and 205264 Assistance Listing Title: Cybersecurity, Energy Security & Emergency Response (CESER), Science, Integrative Activities, and Agriculture and Food Research Initiative (AFRI) Assistance Listing Number: 81.008, 43.RD, 47.083, and 10.310, Award Year: 2024 - 2025 Pass-through entity: UT-Batelle LLC, RPM Innovations, Inc., New Mexico State University, Regents of University of the University of California, and University of Tennessee Management notes 2025-002 is a repeat finding of 2024-002, but given the timing of the finding last year, our 2024 CAP was anticipated to be completed as of October 1, 2025. To ensure Auburn University is in compliance with 2CFR 200.332(f), Auburn University has implemented the following corrective action plan: Since the audit period, the University has completed a comprehensive review of its subrecipient monitoring framework and has been working to distribute workload more effectively with the goal of building consistency in subrecipient monitoring procedures. This includes efforts to clarify ownership of monitoring tasks, implementing a more centralized and standardized approach to documentation, and balancing the day-to-day operational duties across the subaward team to allow for appropriate focus on Uniform Guidance compliance. Brief internal training sessions or check-ins will be conducted to reinforce expectations and ensure that all staff are aligned with the updated documentation practices. Current procedures were revised to address risk assessments and annual monitoring. These improvements are designed to ensure consistency, accountability, and compliance with Uniform Guidance expectations moving forward. We will document when all reviews of sub-recipients’ financial statements/Uniform Guidance reports occur and who completes the reviews. These reviews will be entity-specific and conducted annually. The corrective actions noted herein have been implemented as of October 1, 2025. Contact: Tony Ventimiglia Asst. VP Research Administration Office of the Senior VP for Research & Economic Development Amy Douglas Associate VP Financial Services/Controller Completed Date: October 1, 2025

View Audit 404945

Finding 1218854 (2025-001)

Material Weakness 2025

Auburn University

AL

Procurement, Suspension & Debarment Allowable Costs / Cost Principles § 200.324

MANAGEMENT VIEWS AND CORRECTIVE ACTION PLAN REPORT ON FEDERAL AWARDS IN ACCORDANCE WITH THE OMB UNIFORM GUIDANCE SEPTEMBER 30, 2025 Finding 2025-001 Procurement- Lack of Cost or Price Analysis Cluster: Research and Development, and also applies to Expanded Food and Nutrition Education Programs, whic...

MANAGEMENT VIEWS AND CORRECTIVE ACTION PLAN REPORT ON FEDERAL AWARDS IN ACCORDANCE WITH THE OMB UNIFORM GUIDANCE SEPTEMBER 30, 2025 Finding 2025-001 Procurement- Lack of Cost or Price Analysis Cluster: Research and Development, and also applies to Expanded Food and Nutrition Education Programs, which is not a cluster Sponsoring Agency: National Aeronautics and Space Administration and Department of Agriculture Award Names: NASA 90NSSC24K0999 and NI22eFNEPXXXG004-0003 Award Numbers: 208905 and 385076 Assistance Listing Title: Mission Support and Expanded Food and Nutrition Education Program Assistance Listing Number: 43.009 and 10.514 Award Year: 2024 – 2025 Management notes 2025-001 is a repeat finding of 2024-001, but given the timing of the finding last year, our 2024 CAP was anticipated to be completed as of October 1, 2025. To ensure Auburn University is in compliance with 2CFR 200.324, Auburn University has implemented the following corrective action plan: In addition to our current policies that required three quotes for purchases between $15,000-$75,000 and a formal competitive bid for purchases greater than $75,000, Auburn University revised our policies to require a cost or price analysis for items greater than $250,000, documenting that the purchase is reasonable. For items greater than $250,000, we will include a certification on the Professional Services Contracts and the Sole Source request forms indicating an analysis of cost or price has occurred and that the purchase is reasonable. As part of the cost or price analysis, we will utilize available data points. In addition to our analysis, we will ensure that our reviews have been appropriately documented and included in our files. Prior to the implementation date noted below, we will review any purchases greater than $250,000 in fiscal year 2026 and ensure proper cost or price analysis is completed and documented. The corrective actions noted herein have been implemented as of October 1, 2025. Contact: Missty Kennedy Chief Procurement Officer and Executive Director Procurement and Payment Services Amy Douglas Associate VP Financial Services/Controller Completed Date: October 1, 2025

View Audit 404945

Finding 1218852 (2025-005)

Material Weakness 2025

Proteus, Inc.

CA

Reporting

Proteus, Inc will implement a reconcilliation process for reconciling our two payroll systems through an automated program reducing manually time involved and data entry errors. Transitioning to a new integrated accounting system will significantly reduce errors and eliminate manual processes. We wi...

Proteus, Inc will implement a reconcilliation process for reconciling our two payroll systems through an automated program reducing manually time involved and data entry errors. Transitioning to a new integrated accounting system will significantly reduce errors and eliminate manual processes. We will also provide additional staff training to assure the accountability over timekeeping.

View Audit 404943

Finding 1218841 (2025-002)

Material Weakness 2025

Avoyelles Child Development Services, INC

LA

Internal Control / Segregation of Duties Reporting

Compliance Finding – Uniform Guidance Head Start Program Cluster #93.600 Material Noncompliance 2025-002 Federal Reporting and Grant Drawdown RECOMMENDATION: Management should implement procedures to ensure 1) all required federal reports are submitted timely, 2) federal reporting systems are adequa...

Compliance Finding – Uniform Guidance Head Start Program Cluster #93.600 Material Noncompliance 2025-002 Federal Reporting and Grant Drawdown RECOMMENDATION: Management should implement procedures to ensure 1) all required federal reports are submitted timely, 2) federal reporting systems are adequately monitored and supported, and 3) grant funds are not drawn down prior to obtaining all required federal approvals. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: Management believes that the organization maintains a comprehensive and effective system of internal controls over financial reporting, compliance, and grant administration. The findings relate to a specific control deficiency identified during the audit which were both impacted by a lack of communications from the funding agency and the 43-day Federal Government shutdown from October 1, 2025 to November 12, 2025, and do not, in management's view, reflect a systemic weakness in the overall control environment. Management acknowledges the circumstances that resulted in the findings and recognizes the opportunity to strengthen certain procedures and documentation practices. The conditions identified were limited in scope and occurred despite the existence of established policies, oversight processes, and monitoring activities designed to promote compliance with applicable federal requirements.

View Audit 404935

Finding 1218840 (2025-001)

Material Weakness 2025

Avoyelles Child Development Services, INC

LA

Reporting Internal Control / Segregation of Duties

Internal Control Over Compliance – Uniform Guidance Head Start Program Cluster #93.600 Significant Deficiency in Internal Control Over Compliance 2025-001 Federal Reporting and Grant Drawdown RECOMENDATION: Management should strengthen internal controls over federal reporting and grant administratio...

Internal Control Over Compliance – Uniform Guidance Head Start Program Cluster #93.600 Significant Deficiency in Internal Control Over Compliance 2025-001 Federal Reporting and Grant Drawdown RECOMENDATION: Management should strengthen internal controls over federal reporting and grant administration by 1) implementing procedures to ensure timely submission of all required federal reports, 2) establishing contingency procedures for system interruptions, and 3) requiring documented evidence of federal approval prior to drawing down grant funds associated with capital expenditures or other restricted activities. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTION: Management believes that the organization maintains a comprehensive and effective system of internal controls over financial reporting, compliance, and grant administration. The findings relate to a specific control deficiency identified during the audit which were both impacted by a lack of communications from the funding agency and the 43-day Federal Government shutdown from October 1, 2025 to November 12, 2025, and do not, in management's view, reflect a systemic weakness in the overall control environment. Management acknowledges the circumstances that resulted in the findings and recognizes the opportunity to strengthen certain procedures and documentation practices. The conditions identified were limited in scope and occurred despite the existence of established policies, oversight processes, and monitoring activities designed to promote compliance with applicable federal requirements.

View Audit 404935

Finding 1218839 (2025-001)

Material Weakness 2025

Housing Authority of the City of Alexander City

AL

HUD Housing Programs

– HUD Comprehensive Compliance Monitoring Review, Public Housing Program –14.850, Housing Choice Vouchers – 14.871, Resident Opportunities and Supportive Services -14.870 Family Self-Sufficiency Program – 14.896; Grant Period – year ended September 30, 2025. Corrective Action: The Authority has comp...

– HUD Comprehensive Compliance Monitoring Review, Public Housing Program –14.850, Housing Choice Vouchers – 14.871, Resident Opportunities and Supportive Services -14.870 Family Self-Sufficiency Program – 14.896; Grant Period – year ended September 30, 2025. Corrective Action: The Authority has completed all corrective actions submitted to HUD on March 24, 2025. The Authority received the official close out letter that all findings have been closed on March 12, 2026. Responsible Party: Darold Sterling, Executive Director, (256)329-2201. Anticipated Completion Date: September 30, 2026.

View Audit 404934

Finding 1218835 (2025-001)

Material Weakness 2025

The Joseph P. Addabbo Family Health Center, Inc.

NY

Procurement, Suspension & Debarment

The Center now uses Sreamline Verify, an online software, which searches each vendor before they are hired. There is also a monthly search performed for all vendors.

View Audit 404925

Finding 1218832 (2025-003)

Material Weakness 2025

Codman Square Health Center, Inc. and Affiliate

MA

Cash Management Significant Deficiency § 200.302 § 200.303 § 200.305

Item 2025.003 - Cash Management Recommendation The Organization should develop written procedures to review all drawdowns that occur in order to ensure accuracy. Repeat Finding Not a repeat finding. Action Taken The Health Center has engaged Cambire Consulting, a grant and contracts consulting firm....

Item 2025.003 - Cash Management Recommendation The Organization should develop written procedures to review all drawdowns that occur in order to ensure accuracy. Repeat Finding Not a repeat finding. Action Taken The Health Center has engaged Cambire Consulting, a grant and contracts consulting firm. A drawdown policy will be established for the July 2026 Board Meeting for approval.

View Audit 404919

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