Findings Citing § 200.214

2025-001 U.S. Department of Education, Assistance Listing #84.027/84.173 Special Education Cluster (IDEA) Program and U.S. Department of Treasury, Assistance Listing #21.027 Coronavirus State and Local Fiscal Recovery Funds (SLRF) Program for the period of July 1, 2024, through June 30, 2025 Criteria: Uniform Guidance section 2 CFR §200.317-200.327 Procurement Standards, requires purchases exceeding the micro-purchase threshold of $10,000 to follow small purchase procedures, which require obtaining price or rate quotations from an adequate number of qualified sources (§200.320) prior to entering into a contract. In addition, 2 CFR Part 180 and 2 CFR §200.214 require non-federal entities to verify if contractors are suspended or debarred (e.g., Sam.gov check or certification) and include appropriate contract clauses in applicable contracts. Condition: The School Department did not obtain price or rate quotations for two projects that exceeded the micro-purchase threshold. Additionally, the Department did not perform, or document required suspension and debarment procedures for the contractor (e.g., verification against SAM.gov, obtaining certifications, or including contract clauses). The City did not perform, or document required suspension and debarment procedures for the contractor (e.g., verification against SAM.gov, obtaining certifications, or including contract clauses) for three of the six contracts tested. Cause: School staff were not aware the projects would be funded with federal funds and did not ensure compliance with federal requirements for competitive pricing and suspension/debarment verification. City staff were not aware projects covered under the SLRF definition of “revenue replacement”, which excludes most procurement requirements, are still required to follow 2 CFR Part 180 and 2 CFR §200.214. Effect: Failure to obtain competitive quotes and verify contractor eligibility to receive Federal funds increases the risk of noncompliance, inefficient use of federal funds, and potential disallowance of costs. Known Questioned Costs: $61,891 for #84.027/84.173; $51,750 for #21.027 Likely Questioned Costs: $12,799 for #21.027 Recommendation: We recommend training staff on procurement and suspension/debarment requirements and implementing a pre-award compliance checklist. We also recommend increasing communication between grant personnel and facilities management personnel so all parties are aware which projects will be funded with federal funds.

Assistance Listing, Federal Agency, and Program Name - 21.027, U.S. Department of Treasury, COVID 19 Coronavirus State and Local Fiscal Recovery Funds Federal Award Identification Number and Year - H4HRGP33345 Pass-through Entity - State of Colorado, Department of Local Affairs, for the benefit of the Division of Housing Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303, the recipient must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the recipient or subrecipient is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should align with the guidance in “Standards for Internal Control in the Federal Government,” issued by the Comptroller General of the United States, or the “Internal Control Integrated Framework," issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - Management did not have controls in place to ensure documentation was maintained evidencing the organization's verfication that contractors are not suspended or debarred from participating in a federally funded activity. Questioned Costs - N/A If questioned costs are not determinable, description of why known questioned costs were undetermined or otherwise could not be reported - N/A Identification of How Questioned Costs Were Computed - N/A Context - While gaining an understanding of the organization's internal controls, we noted management was unable to provide documentation to support that checks for suspension and debarment occurred before the organization entered into a covered transaction. We were able to verify in our sample testing that management did not enter into contracts with individuals or organizations suspended or debarred from participating in federal programs. Cause and Effect - A lack of controls could result in material noncompliance with federal procurement standards. Recommendation - We recommend management retain documented evidence that checks for suspension and debarment have occurred before entering into a covered transaction with outside contractors. Views of Responsible Officials and Corrective Action Plan - Management concurs with the finding. We acknowledge that, for one federal program under the Coronavirus State and Local Fiscal Recovery Funds program (Assistance Listing 21.027), the required suspension and debarment verification was performed; however, the supporting documentation evidencing this verification was not retained in the contract file. This represents a documentation lapse rather than a control deficiency. Volunteers of America Colorado (VOAC) routinely performs suspension and debarment verifications for all applicable vendors, contractors, and subrecipients receiving federal funds in accordance with 2 CFR 200.214. This requirement applies to entities and individuals awarded federally funded contracts or subawards exceeding the micro purchase threshold and excludes routine commercial vendors for indirect administrative costs or purchases under $10,000. To strengthen compliance documentation and ensure consistent audit support, VOAC has implemented the following corrective actions: 1.Policy Enhancement: The procurement procedure has been updated to explicitly require saving and retaining a time stamped screenshot or PDF confirmation of each SAM.gov verification showing the verification date and results. Where applicable, contractors subject to 2 CFR 200.214 must also provide a self certification statement within the executed agreement. 2.Centralized Recordkeeping: Verification evidence will be maintained in both the individual contract file and the centralized grant management system. 3.Annual Training and Refresher: Procurement and grants management staff will participate in annual training to reinforce 2 CFR 200.214 requirements and best practices for documentation and record retention. Management believes this was an isolated documentation lapse prior to the current audit period when the contractor was selected, and that the actions taken since have resolved the issue and will ensure continued compliance.

Compliance Requirement: Procurement, Suspension and Debarment Campus:Sacramento Cluster name/program: Supplemental Nutrition Assistance Program Cluster Federal Assistance Listing Numbers: 10.561 Federal Award Identification Number: 21-3068 and 24-3069 Federal Agency: U.S. Department of Agriculture Passed through Entity: State of California Department of Social Services Award Year: July 1, 2024 – June 30, 2025 Criteria: According to 2 CFR 200.214, recipients and subrecipients are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, as well as 2 CFR part 180. The regulations in 2 CFR part 180 restrict making Federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Additionally, 2 CFR 180.300 requires non-federal entities (including state agencies administering federal programs like SNAP) to verify that contractors and subrecipients are not suspended or debarred from receiving federal funds CFR 200.303 also requires nonfederal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition and Context: During our testing of 2 procurement samples, it was noted that the program personnel did not check if the vendors were suspended or debarred from receiving federal funds before entering into a covered transaction, nor was a certification from the vendor about verification of suspension and debarment collected from the vendor. We noted the vendors were not suspended or debarred and there were no other exceptions noted in the procurement, suspension and debarment testing. Cause and Effect: The control over the verification that vendors are not suspended or debarred prior to entering into a covered transaction was not designed effectively. As such, the suspension and debarment check requirements were not implemented for all procurement methods for this program. Questioned Costs: None Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding: No Recommendations: We recommend the University implement controls to verify the suspension and debarment status of all vendors prior to entering covered transactions, as well as maintaining evidence of the suspension and debarment check in the procurement file of each vendor. Views of Responsible Officials: The University concurs with the recommendations. The University will review and enhance its procedures and internal controls to verify the suspension and debarment status of all vendors prior to entering covered transactions, as well as maintaining evidence of the suspension and debarment check in the procurement file of each vendor.

FINDING 2025-002 Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program Assistance Listings Numbers: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2024, FY2025 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion Condition and Context An effective internal control system was not in place at the School Corporation to ensure compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 15 CLOVERDALE COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Procurement Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold, which is set at $150,000 per Indiana Code. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds: micro-purchases, typically for those purchases of $10,000 or under, and small purchase procedures for those purchases above the micro-purchase threshold but below the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive price rate quotations. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. The School Corporation had not designed or implemented adequate policies or procedures to ensure that proper procurement procedures for small purchases were followed. The School Corporation did not obtain price or rate quotes from multiple vendors for its audit period expenditures with each of the three vendors tested in the small purchases category. Documentation detailing the history of procurement, including rationale to limit competition at the time of the expenditure(s) was not provided for audit. Suspension and Debarment Nonfederal entities and contractors are subject to nonprocurement debarment and suspension regulations. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or are ineligible for participation in federal assistance programs or activities. This is done by checking SAM Exclusions, collecting a certification from that entity, or adding a clause or condition to the covered transaction with that entity. The School Corporation had not designed or implemented adequate policies or procedures to ensure that applicable vendors who received federal funds over certain thresholds were not suspended or debarred from participating in federal awards programs. There were three vendors subject to suspension and debarment requirements during the audit period that were not procured through the School Corporation's affiliated Educational Services Center for cooperative purchasing. The School Corporation did not perform procedures to ensure the vendors were not suspended, debarred, or otherwise excluded from or ineligible for participation in federal assistance programs or activities for one of these three vendors. The lack of internal controls was a systemic issue throughout the audit period. Noncompliance was isolated to small purchases for procurement and one vendor noted for suspension and debarment. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." INDIANA STATE BOARD OF ACCOUNTS 16 CLOVERDALE COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.318 states in part: "(a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327. . . . (i) The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. . . ." 2 CFR 200.320 states in part: "The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and §§ 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award. . . . (a) Informal procurement methods. When the value of the procurement for property or services under a Federal award does not exceed the simplified acquisition threshold (SAT), as defined in § 200.1, or a lower threshold established by a non-Federal entity, formal procurement methods are not required. The non-Federal entity may use informal procurement methods to expedite the completion of its transactions and minimize the associated administrative burden and cost. The informal methods used for procurement of property or services at or below the SAT include: . . . (2) Small Purchases– (i) Small purchase procedures. The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity. . . ." 2 CFR 200.214 states: "Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or INDIANA STATE BOARD OF ACCOUNTS 17 CLOVERDALE COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." Cause Management had not developed nor implemented an effective system of internal controls that would have ensured compliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement. The Food Service Director indicated that some of these purchases may have been emergency situations but was unaware of the need to document the rationale at the time of the transaction if competition was limited for small purchases procurements. Effect The lack of an internal control system enabled material noncompliance to occur and remain undetected. Noncompliance with the Procurement and Suspension and Debarment compliance requirement could enable small purchases made by the School Corporation to be uncompetitive and could lead to contracting with vendors who are suspended or debarred from receiving federal grant funding. Noncompliance with the grant agreement and the compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended the School Corporation's management strengthen its system of internal controls over small purchase requirements to ensure that an adequate number of price or rate quotes are obtained before purchase. Additionally, if procurements are made in emergency or extenuating circumstances, documentation at the time of the transaction must be retained for audit to justify limiting competition. We also recommended that vendors with a single or aggregate transaction amounts of $25,000 per fiscal year are verified for suspension and debarment prior to entering into the transaction and/or contract. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Criteria or specific requirement: CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, §200.214 specifies that recipients and subrecipients are subject to the nonprocurement debarment and suspension regulations related to subawards and contracts with certain parties. The non-federal entity must have controls in place to ensure subawards and contracts are not entered into with suspended or debarred parties. Condition: Verification support did not indicate the date verification procedures were performed. As a result, we were unable to verify this was performed prior to engaging with the contractor. Questioned costs: None. Context: Suspension and debarment verification support from SAM.gov did not explicitly state the date the verification procedures were performed. Support was not available to ensure verification procedures were performed prior to the date CAPECO engaged with the contractor. Cause: During the verification process, management failed to include a date stamp for the online print out to support the date the verification procedures were performed. Effect: Suspension and debarment verification support from SAM.gov did not explicitly state the date the verification procedures were performed. Repeat finding: Not a repeat finding. Recommendation: We recommend CAPECO ensure documentation is retained to support the date the suspension and debarment verification procedures are performed. Views of responsible officials: There is no disagreement with the audit finding.

2025-001 – Suspension and Debarment (repeat comment) Finding Type: Significant deficiency in internal control over compliance Program: ALN 97.044 – Assistance to Firefighters Grant • Grant number EMW-2022-FG-01118 • Grant number EMW-2023-FG-03417 • Grant number EMW-2023-FG-02529 Criteria: As required by 2 CFR 200.214, Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Condition: The vendors used for these grants were not checked for suspension and debarment prior to execution of the contract. Cause/Effect: Although a policy has been adopted requiring a check the suspension and debarment status prior to entering into contracts, the internal control over this process was not operating as designed. Questioned Cost: None. Recommendation: We recommend that the City update procedures to ensure that a check of suspension and debarment status is obtained prior to entering into a covered transaction. View of Responsible Official: Management is in agreement with this recommendation.

Failure to Verify Contractor Suspension and Debarment Status. Condition: The City did not verify the suspension or debarment status of a contractor prior to awarding a federally funded contract during the audit period. Criteria: Federal regulations (2 CFR 200.214) require recipients of federal funds to ensure that contractors are not suspended or debarred prior to awarding a contract. Verification may be documented through a SAM.gov search, a contractor certification, or a contract clause addressing suspension and debarment. Cause: The City's current procurement procedures do not specifically outline how suspension and debarment checks should be performed or documented. Staff were unaware of the requirement. Effect: The City increased the risk of awarding federal funds to a contractor who may be suspended or debarred, which could result in noncompliance with federal regulations and potential disallowance of costs. Questioned Costs: None. Recommendation: We recommend the City update its procurement procedures to include a clear process for verifying and documenting suspension and debarment status for all federally funded contracts. Acceptable documentation includes a printed SAM.gov search, a contractor certification, or a contract clause addressing the requirement. Management Response: Management agrees with the finding. The City will revise its procurement procedures and train staff to ensure verification is completed and retained for all federally funded procurements.

2025-004 Suspension & Debarment – Special Education Cluster (IDEA) Federal Agency: U.S. Department of Education Federal Program Name: Special Education Cluster (IDEA) Assistance Listing Number: 84.027, 84.173 Pass-Through Agency: Wisconsin Department of Instruction Pass Through Numbers: 2025-133675-DPI-FLOW-341, 2025-133675-DPI-PRESCH-347 Award Period: July 1, 2024 – June 30, 2025 Type of Finding: Significant Deficiency in Internal Control over Suspension and Debarment Criteria or specific requirement: 2 CFR 200.214 requires non-Federal entities to follow suspension and debarment regulations outlined in 2 CFR part 180. When a non-Federal entity enters into a covered transactions with an entity at a lower tier, the non-Federal entity must verify that the entity, as described in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition: During our testing of procurement transactions of the program, we noted that the District did not retain documentation of verification that that vendors are not debarred, suspended or otherwise excluded. Questioned Costs: None Context: In sample of 5 vendors contracts subject to suspension and debarment, we noted that the District did not retain documentation related to suspension and debarment for all vendors that were selected for testing. Cause: The District did not retain documentation following their Federal Funds Procurement policy related to the appropriate methods of procurement. Effect: The District could contract with a vendor that has been suspended or debarred from receiving Federal funds. Repeat Finding: No Recommendation: We recommend the District evaluate current procedures and controls to ensure that policies are consistently followed and properly documented in accordance with District policies. Views of Responsible Officials: There is no disagreement with the finding.

Reference Number: 2025-019 Prior Year Finding: 2024-052 Federal Agency: National Science Foundation State Agency: Higher Education Policy Commission Federal Program: Research and Development Cluster Assistance Listing Number: 47.076 Award Number and Year: 1834586 (09/01/2018 – 08/31/2025) Compliance Requirement: Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or Specific Requirement: Compliance: 2 CFR 200.214 Suspension and Debarment restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. 2 CFR 180.300 states that an entity may determine suspension and debarment status by: (a) Checking SAM (System for Award Management) Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person Control: Per 2 CFR Section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The Higher Education Policy Commission (HEPC) did not properly verify and document the suspension and debarment status of subrecipients. Context: Nine transactions were selected for testing, including five for West Virginia University, one for Shepherd University, two for HEPC, and one for the Department of Agriculture. The following exceptions were noted: HEPC: • For 1 of 2 transactions selected for testing, HEPC performed the suspension and debarment verification after the subaward issuance date. The subaward was issued on 10/31/2023 but the suspension and debarment verification occurred on 12/4/2024. • For 1 of 2 transactions selected for testing, HEPC performed a suspension and debarment verification, but it was not dated and auditors were unable to determine if it occurred prior to issuance of the subaward. Questioned costs: None noted. The subrecipients were not suspended or disbarred. Cause: HEPC’s procedures and internal controls were not sufficient to ensure that it performed suspension and debarment verifications prior to issuance of subawards nor that documentation of the verifications was maintained and was complete. Effect: Failure to verify the suspension and debarment status of subrecipients prior to issuance of subawards could result in HEPC entering into agreements with subrecipients who are ineligible to participate in the program. Recommendation: HEPC should review and enhance its controls and procedures to ensure that it verifies the suspension and debarment status of subrecipients prior to issuance of subawards and include documentation for when the check occurred. Views of responsible officials: Management concurs with the finding and has developed a plan to correct the finding.

riteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not documented for four covered transactions. Cause: Procedures were not in place to document that the required suspension and debarment checks were performed at the time of the initial procurement but have since been implemented. Effect: The Town was at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of the four vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: Yes; Finding 2024-002 Recommendation: The Town must ensure that there is documentation that all contractors under covered transactions that are performing services for Federal awards are not suspended or debarred. Views of Responsible Officials: Management agrees with the finding.

Federal Agency: U.S. Department of the Treasury Federal Program Name: COVID-19 Coronavirus Relief Fund Assistance Listing Number: 21.019 Award Period: March 3, 2021 – December 31, 2024 Type of Finding: Significant Deficiency over Compliance and Other Matters Criteria or specific requirement: 2 CFR 200.303 requires non-federal entities to establish and maintain internal control designed to reasonably ensure compliance with federal statutes and regulations, including procedures to verify and document vendor eligibility. 2 CFR 200.214 requires verification that vendors are not suspended or debarred prior to entering into covered transactions. Condition: The City does not have a documented control to perform and retain evidence of suspension and debarment verification (e.g., SAM.gov check or vendor certification) at the time of entering into covered transactions funded by federal awards. Management indicated that vendor eligibility checks are performed as part of standard operating practice; however, documentation evidencing the timing and performance of these checks was not retained. Questioned costs: None. Context: Four of the five covered transactions selected did not have proper supporting documentation for suspension and debarment procedures. Cause: For three of the transactions tested, the City relied on cooperative purchasing agreements. Accordingly, the City did not perform or retain documentation of its own suspension and debarment verification. For the remaining transaction, documentation evidencing suspension and debarment compliance was not retained. Effect: The City did not have a documented control to perform and retain evidence of suspension and debarment verification at the time of award, as required by 2 CFR 200.303. Repeat Finding: No. Recommendation: We recommend the City obtain certifications from vendors stating their organization is not suspended, debarred, or otherwise excluded from participation in federal assistance programs or document the procedures performed to verify the vendor is not identified as suspended or debarred on SAM.gov. Views of responsible officials: There is no disagreement with the audit finding.

Suspension and Debarment Control Every Student Succeeds Act/Preschool Development Grants FFAL #93.434 Passed through from the Oklahoma Department of Human Services Suspension and Debarment Significant Deficiency in Internal Control Over Compliance Criteria: Per 2 CFR 200.214, non federal entities must not enter into covered transactions with parties that are suspended or debarred. Acceptable verification methods include: • Checking the Exclusions section of SAM.gov, • Collecting vendor certifications regarding suspension/debarment status, or • Including appropriate suspension and debarment clauses in contracts. Internal controls must ensure these verifications are performed and documented. Condition: While a control appears to be in place for suspension and debarment, the Foundation could not support a control to verify whether all vendors paid with federal funds were suspended or debarred from participating in federal programs prior to entering into those transactions. For one procurement transactions selected for testing, the Foundation did not perform or document and retain any suspension and debarment verification procedures, such as checking SAM.gov, obtaining vendor certifications, or including suspension/debarment clauses in contracts. Cause: While the Foundation has established a formal internal control process to ensure suspension and debarment checks are performed before entering into covered transactions, it appears that not applicable transactions were captured in this process. Effect: The absence of a control that captures all applicable transactions creates a possibility that suspension and debarment requirements could occur and not be prevented or detected. Although no suspended or debarred vendors were identified through auditor performed SAM.gov searches, the deficiency increases the risk of entering into prohibited transactions in future periods. Context: We tested 1 vendor with procurement transactions totaling approximately $283,800 in federal expenditures. The Foundation did not maintain evidence of suspension and debarment verification for the one vendor tested. Independent auditor verification through SAM.gov confirmed that the vendor tested was not suspended or debarred. Nonstatistical sampling was used.Repeat Finding From Prior Year: No Questioned Costs: None, no vendor was listed as suspended or debarred. Recommendation: We recommend that The Foundation establish, document, and implement formal controls to ensure suspension and debarment verifications are completed prior to awarding covered transactions. Controls may include: • Performing and retaining SAM.gov verification printouts; • Obtaining annual or per transaction vendor certification statements; or • Incorporating a suspension and debarment clause into procurement contracts. Views of Responsible Officials: We do agree with the finding on suspension and debarment control on the FY2025 audit and have modified our procedures to include all covered transactions moving forward.

Assistance Listing, Federal Agency, and Program Name 21.027 COVID 19 Coronavirus State and Local Fiscal Recovery Funds and 84.215 Innovative Approaches to Literacy Federal Award Identification Number and Year Coronavirus State and Local Fiscal Recovery Funds SLFRP1027 Innovative Approaches to Literacy S215K230129 Pass through Entity 21.027 Michigan Strategic Fund; 20 Fathoms; Lean Rocket Lab; Talent First Inc; Lansing Economic Area Partnership; Michigan Economic Development Corporation 84.215 N/A Finding Type Significant Deficiency Repeat Finding No Criteria Recipients of federal awards are required to follow their internal purchasing policies, as well as comply with purchasing standards set forth in the Uniform Guidance. Per the University policy, all grant funded purchases in excess of $25,000 should be verified using SAM.gov the supplier is not suspended or debarred and the results should be retained in the purchase requisition. As Uniform Guidance restricts making federal awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal award (CFR 200.214). Condition In accordance with the University's policy, the University was unable to provide documentation to support its consideration of the suspension and debarment for the only vendor selected within Coronavirus State and Local Fiscal Recovery Funds. In accordance with the University's policy, the University was unable to provide documentation to support its consideration of the suspension and debarment for the only vendor selected within Innovative Approaches to Literacy. Questioned Costs None If questioned costs are not determinable, description of why known questioned costs were undetermined or otherwise could not be reported N/A Identification of How Questioned Costs Were Computed N/A Context In the samples mentioned above, In accordance with University's policy the University did not maintain the appropriate documentation for the vendors to support their assessment of whether the vendors where included on Suspension or Debarment list. In either case the vendors included in the samples were not included in the Suspension and Debarment list and the University was allowed to contract with the vendor. Cause and Effect The University did not follow its policy to ensure that the documentation verifying the vendors were not suspended or debarred. Recommendation We recommend the University reviews its procedures and controls to ensure documentation of its compliance with the requirements under uniform guidance is maintained. Views of Responsible Officials and Planned Corrective Actions A new custom validation warning will be added to the requisitions business process at the buyer approval step to require the Procurement Specialist to verify SAM.gov and attach the results as required for grant funded purchases. This custom validation will ensure that each required consideration of suspension and debarment occurs and is documented in the procurement record.

FINDING 2025-004 Subject: Special Education Cluster - Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Program: COVID-19 - Special Education Grants to States Assistance Listings Number: 84.027X Federal Award Number and Year (or Other Identifying Number): 22611-019-ARP Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Significant Deficiency, Other Matters Condition and Context Procurement Small purchases, procurements between $50,000 and $150,000, require three quotes to be obtained and a contract awarded. There was one disbursement tested for $52,598 for small purchase procurement, and, while the appropriate number of quotes were obtained, a contract was not awarded for the transaction as required by Indiana Code 5-22-8-3. Suspension and Debarment Prior to entering into subawards and covered transactions with the Special Education Cluster (IDEA) award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a nonprocurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the System for Award Management (SAM) Excluded Parties List System (EPLS), collecting a certification from that person or entity, or adding a clause or condition to the covered transaction with that person or entity. It was determined that the School Corporation had a process in place to verify that vendors were not suspended or debarred, but the process was not operating effectively. For the one vendor tested also related to the transaction noted above, documentation of the SAM.gov search could not be provided. INDIANA STATE BOARD OF ACCOUNTS 20 OAK HILL UNITED SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The lack of internal controls and noncompliance were isolated to the transaction and award number noted above. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states: "Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 2 CFR 200.318 states in part: "(a) The non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity's documented procurement procedures must conform to the procurement standards identified in §§ 200.317 through 200.327. . . . (i) The non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. . . ." 2 CFR 200.320 states in part: "The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and §§ 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award. (a) Informal procurement methods. When the value of the procurement for property or services under a Federal award does not exceed the simplified acquisition threshold (SAT), as defined in § 200.1, or a lower threshold established by a non-Federal entity, formal procurement methods are not required. The non-Federal entity may use informal procurement methods to expedite the completion of its transactions and minimize the associated administrative burden and cost. The informal methods used for procurement of property or services at or below the SAT include: . . . INDIANA STATE BOARD OF ACCOUNTS 21 OAK HILL UNITED SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (2) Small purchases— (i) Small purchase procedures. The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity. . . ." Indiana Code 5-22-8-3 states: "(a) This section applies only if the purchasing agent expects the purchase to be: (1) at least fifty thousand dollars ($50,000); and (2) not more than one hundred fifty thousand dollars ($150,000). (b) A purchasing agent may purchase supplies under this section by inviting quotes from at least three (3) persons known to deal in the lines or classes of supplies to be purchased. (c) The purchasing agent shall mail an invitation to quote to the persons described in subsection (b) at least seven (7) days before the time fixed for receiving quotes. (d) If the purchasing agent receives a satisfactory quote, the purchasing agent shall award a contract to the lowest responsible and responsive offeror for each line or class of supplies required. (e) The purchasing agent may reject all quotes. (f) If the purchasing agent does not receive a quote from a responsible and responsive offeror, the purchasing agent may purchase the supplies under IC 5-22-10-10." 31 CFR 19.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you do business is not excluded or disqualified. You do this by: (a) Checking the EPLS, or (b) Collecting a certification from that person if allowed by this rule, or (c) Adding a clause or condition to the covered transaction with that person." Cause The School Corporation was not aware of the Indiana Code requirement to enter into a contract for the equipment purchase. The School Corporation was aware of the requirements to check for suspension and debarment, but due to newer personnel at the School Corporation they were not able to locate the records or verify that the suspension and debarment verification was performed. INDIANA STATE BOARD OF ACCOUNTS 22 OAK HILL UNITED SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect The failure to design and implement an effective internal control system enabled noncompliance to remain undetected. Noncompliance with the provisions of federal statutes, regulations, and terms and conditions of the federal award could result in the reduction of future federal funding to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation amend its procurement policy and system of internal controls to ensure that procurement requirements meet the stricter federal and/or state requirements. Additionally, the internal control system effectiveness should be improved to ensure all contractors that are paid $25,000 or more, all or in part with federal funds, are not suspended or debarred from participating in federal programs before entering into contracts. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Assistance Listing Number: 21.027 Federal Award Identification Number: SLFRP1134 Pass-Through Agency: New Hampshire Governor’s Office for Emergency Relief and Recovery Pass-Through Number(s): Unknown Award Period: July 1, 2024 – June 30, 2025 Compliance Requirement: Suspension and Debarment Type of Finding: • Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or specific requirement: The Code of Federal Regulations (CFR) Title 2 Part 200.214 states that nonfederal entities are subject to the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition and Context: For one (1) of five (5) vendors tested, documentation was not provided to support that the City verified the vendor was not suspended or debarred from participation in federal assistant programs or activities. Questioned costs: None Cause: Procedures were not in place to document the verification that all vendors were not suspended or debarred from participation in federal programs or activities. Effect: While this did not occur in the instance identified in this finding, lack of verification of vendors’ suspension or debarment status could cause federal grant funds to be expended to vendors that are excluded from participation in federal assistance programs or activities. Repeat Finding: No. Recommendation: We recommend procedures be strengthened to ensure that documentation of verification of vendors’ suspension and debarment status is obtained prior to executing transactions. Views of responsible officials: Management agrees with the finding.

Criteria or specific requirement: 2 CFR 200.214 Suspension and Debarment restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. 2 CFR 180.300 states that an entity may determine suspension and debarment status by: (a) Checking SAM (System for Award Management) Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person 2 CFR 200.303 requires that non-federal entities receiving federal awards establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: Kansas Department of Health and Environment (Department) was unable to provide supporting documentation that it had performed suspension and debarment verification procedures before the start of procurement contracts. Questioned costs: None. Context: Sixty transactions were selected for testing which included twenty-five contracts and thirty-five subawards. For twenty-five of twenty-five contracts (100%), the Department was unable to provide documentation supporting when it had verified the contractors’ suspension and debarment status. The Department provided auditors with documentation that the contractors were not suspended or debarred, however, auditors were not able to verify that the status was documented prior to the start of the contracts. No exceptions were noted for the thirty-five subawards tested. Cause: The Department’s procedures and internal controls are not sufficient to ensure that it verifies and properly documents contractors’ suspension and debarment status prior to the execution of contracts. Effect: Failure to perform suspension and debarment verification procedures before the procurement of good or services could result in the payment of federal funds to contractors that are ineligible to participate in federal assistance programs. Repeat Finding: Yes, Finding 2024 - 007 Recommendation: We recommend that the Department enhances its procedures and internal controls to ensure that it verifies and maintains documentation of its contractors’ suspension and debarment status prior to the execution of all contracts. Verification can be performed by either checking SAM exclusions and maintaining documentation when the verification occurred, collecting a signed certification from the contractor prior to contract execution, or adding a clause or condition to the contract. We further recommend that documentation is readily available for audit. Views of responsible officials: There is no disagreement with the audit finding.

FINDING 2025-004 Subject: Child Nutrition Cluster - Procurement and Suspension and Debarment Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program Assistance Listings Numbers: 10.553, 10.555 Federal Award Numbers and Years (or Other Identifying Numbers): FY2024, FY2025 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Significant Deficiency, Other Matters Condition and Context Suspension & Debarment Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods or services awarded under a nonprocurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. Verification is to be done by checking the Excluded Parties List System (EPLS), collecting a certification from that person, or adding a clause or condition to the covered transaction with that person. INDIANA STATE BOARD OF ACCOUNTS 19 NORTHWESTERN SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The School Corporation had not properly implemented a system of internal controls, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. During the audit period, covered transactions in the amount of $63,597 were entered into with one vendor. The School Corporation had not checked the EPLS to verify the vendor was neither suspended nor debarred. The lack of internal controls and noncompliance were systemic throughout the audit period. Procurement During both the 2023-2024 and the 2024-2025 fiscal years, the School Corporation made payments to one vendor tested for micro-purchases for E-Funds via wire transactions that were automatically debited from their account without review prior to payment. Additionally, these transactions were not included within the Allowance of Claims reports presented to and approved by the School Board. The lack of internal controls is isolated to these specific E-Fund transactions with this vendor. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 180.300 states: "When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by: (a) Checking SAM Exclusions; or (b) Collecting a certification from that person; or (c) Adding a clause or condition to the covered transaction with that person." 2 CFR 200.214 states: "Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." INDIANA STATE BOARD OF ACCOUNTS 20 NORTHWESTERN SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause Management had not implemented a system of internal controls that would have ensured compliance with the Procurement and Suspension and Debarment compliance requirement. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the School Corporation's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without designing and implementing an effective internal control system, material noncompliance was able to go undetected. Noncompliance with the grant agreement and the Procurement and Suspension and Debarment compliance requirement could result in the loss of federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls, including policies and procedures that would provide segregation of duties to ensure appropriate reviews, approvals, and oversight are taking place. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

2025-006 U.S. Department of Treasury, Assistance Listing #21.027, Coronavirus State and Local Fiscal Recovery Funds (SLRF) Program for the period of July 1, 2024, through June 30, 2025 Criteria: In accordance with 2 CFR part 180 and 2 CFR §200.214, non-federal entities are prohibited from entering into contracts or making subawards to parties that are suspended or debarred from participation in federal programs. Entities must verify vendor eligibility through the System of Awards Management (SAM.gov), obtain a vendor certification documenting compliance, or add a clause or condition in the contract for that vendor. Condition: Of the five vendors tested, three did not have documented evidence the City performed the required suspension and debarment verification. Cause: The City uses SLRF funds to fill budget gaps caused by the pandemic’s economic fallout. The City did not procure all contracts with the expectation they would be paid for with federal funds. Therefore, suspension and debarment procedures were not verified in all cases. Effect: Without proper verification, there is an increased risk that federal funds could be expended on vendors who are suspended or debarred, which may result in noncompliance with federal regulations and potential repayment of funds. Recommendation: We recommend the City review their existing contracts to ensure documentation of suspension and debarment compliance has been obtained for all vendors paid with SLRF grants. Questioned Costs: None.

Finding 2025-006 - Procurement and Suspension and Debarment Federal Program: COVID-19 – Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number (ALN): 21.027 Federal Agency: U.S. Department of the Treasury Pass-Through Grantor: Wyoming Office of State Lands and Investments (OSLI) Grant Year: 2021 Federal Program: Clean Water State Revolving Fund Assistance Listing Number (ALN): 66.458 Federal Agency: U.S. Environmental Protection Agency Pass-Through Grantor: Wyoming Office of State Lands and Investments (OSLI) Grant Year: 2024 Criteria Government-wide requirements for nonprocurement suspension and debarment are contained in 2 CFR Part 180 and 2 CFR 200.214. Non-Federal entities are prohibited from contracting with or making subawards to parties that are suspended or debarred. Prior to entering into covered transactions expected to equal or exceed $25,000, the non-Federal entity must verify that the vendor is not suspended or debarred. Verification may be accomplished by checking the System for Award Management (SAM.gov) or through other acceptable methods as outlined in federal regulations. Condition The City did not perform or document verification procedures to ensure that contractors used in the program were not suspended or debarred prior to entering into covered transactions. Independently we reviewed that the contractors were not suspended or debarred. Cause: The City does not have a control system in place to ensure that the required suspension and debarment is verified and documented. Effect or Potential Effect Failure to verify that contractors were not suspended or debarred resulted in noncompliance with federal procurement requirements. As a result, there is an increased risk that federal funds could be paid to ineligible contractors. If contractors used in the program had been suspended or debarred, the City could be required to repay the granting agency for the related expenditures. Questioned Costs None Context For the COVID-19 – Coronavirus State and Local Fiscal Recovery Funds grant, of the 16 covered transactions tested, the City did not maintain formal documentation for any of the 16 transactions to demonstrate that the vendors were not suspended or debarred. For the Clean Water State Revolving Fund grant, of the 23 covered transactions tested, the City did not maintain formal documentation for 9 transactions to demonstrate that the vendors were not suspended or debarred. Acceptable documentation may include a certification from the vendor, a suspension and debarment clause included in the contract, or evidence of a SAM.gov search performed and retained in the procurement file. Identification as a repeat finding This is not a repeat finding. Recommendation We recommend the City strengthen its procurement procedures to ensure suspension and debarment verification is performed and documented prior to entering into covered transactions funded with federal awards. Verification may be accomplished by checking System for Award Management (SAM.gov), obtaining vendor certification, or including a suspension and debarment certification in the contract. Views of Responsible Officials Management concurs with the finding. See Corrective Action Plan.

Federal program – Child Nutrition Cluster – Assistance Listing Numbers 10.553 (School Breakfast Program), 10.555 (National School Lunch Program), and 10.559 (Summer Food Service Program for Children) – U.S. Department of Agriculture Program Year 2024–2025 Criteria or specific requirement – Suspension and debarment – 2 CFR §200.214 Condition – During our audit, documentation supporting verification of the suspension and debarment status was not able to be provided for a vendor with which a new covered transaction was entered. However, the vendor is not currently registered as being suspended or debarred. Cause – District procedures are designed to verify suspension and debarment status only upon initial vendor setup and do not require verification upon execution of each new covered transaction with an existing vendor. Effect or potential effect – This condition increases the risk that covered transactions could be entered into with vendors that may become suspended or debarred after initial vendor setup, which could result in noncompliance with federal requirements if not addressed. Questioned Costs – N/A Context – Out of a population of five vendors with which a covered transaction was entered into during the period, one was selected for testing. Documentation supporting the verification of the suspension and debarment status for this vendor was not able to be provided. Our sample was not, and was not intended to be, statistically valid. Identification as a repeat finding, if applicable – N/A Recommendation – We recommend the District update its policies and procedures to require suspension and debarment verification for all covered transactions, including those involving existing vendors, either prior to contract execution or award or on an annual basis. The District should also ensure such reviews are documented and retained in accordance with federal record retention requirements. Views of responsible officials and planned corrective action – Management agrees with this finding.

Federal Agency: Department of Education Federal Program Name: Wisconsin Charter Schools Program Waiver Cohort Assistance Listing Number: 84.282 Pass-Through Agency: Wisconsin Department of Public Instruction Pass-Through Number(s): 2025-138005-DPI-WCSPWC1-360 Award Period: July 1, 2024 through June 30, 2025 Type of Finding:  Material Weakness in Internal Control over Compliance  Material Noncompliance (Modified Opinion) Criteria: 2 CFR Section 200.214 of the Uniform Guidance details suspension and debarment requirements for non-federal entities. Condition: One City Schools, Inc. did not document suspension and debarment considerations in accordance with the Uniform Guidance. Questioned costs: None Context: We sampled 5 procurement transactions, noting that none of them had documentation ensuring the vendor was not suspended or debarred. Cause: Policies and procedures were put in place, but were not being followed. Effect: This could result in noncompliance, disallowed costs, or discontinuance of federal funding. Repeat Finding: Yes (2024-003) Recommendation: We recommend that the Organization maintain effective internal controls over suspension and debarment requirements. Views of responsible officials: One City Schools, Inc. agrees with the finding and are working on implementing internal controls over suspension and debarment.

2025-001 - Procurement, Debarment and Suspension Federal Program Information: U.S. Department of the Treasury, passed through the Vermont Department of Public Safety CFDA - 21.027 - Coronavirus State and Local Fiscal Recovery Funds Criteria: The following CFRs apply to this finding: 2 CFR 200.214, 2 CFR section 200.317-200.327 Condition: During audit procedures it was identified that the Town did not check sam.gov to confirm that the contractor was not debarred or suspended from receiving federal funds nor did they request a Suspension and Debarment certification from the contractor. Cause: The Town does not have the necessary internal controls over compliance. Effect: Contracts may be awarded to contractors that are debarred or suspended from working on federally funded projects. Identification of Questioned Costs: None Identified. Context: Two contracts were reviewed out of three. This is not a statistically valid sample. Repeat Finding: This is not a repeat finding. Recommendation: It is recommended that the Town revise its procurement policy to fully incorporate all elements required by 2 CFR §200.317-200.327. Views of Responsible Officials and Corrective Action Plan: Please see the Corrective Action Plan.

Information on the federal program: Research and Development Cluster, Multiple Federal Grantors, Multiple Award Periods Criteria or specific requirement: Procurement and Suspension and Debarment In accordance with 2 CFR 200.219 and 200.220, non-Federal entities must conduct procurements in a manner providing full and open competition and maintain documentation supporting the procurement method and the basis for contractor selection. Noncompetitive (sole source) procurement is permitted only under specific circumstances and generally requires adequate written justification and applicable approvals prior to contract execution. In accordance with 2 CFR 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. "Covered transactions" include contracts for goods and services awarded under a non-procurement transaction (e.g. , grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. Condition: During our testing of procurement transactions, we noted that the Institute entered into a contract with a vendor using a noncompetitive/sole source method. However, the sole source justification was not completed and approved prior to execution of the contract and expenditures were charged to the federal grant. In addition, suspension and debarment checks were not completed for vendor. Cause: Miscommunication between departments within the Institute. Effect of Potential Effect: Failure to complete sole source documentation and suspension and debarment checks prior to award of the contract results in noncompliance with federal requirements and increases the risk that costs could be considered unallowable and federal funds could be paid to entities that are suspended or debarred. Questioned Costs: None noted. Context: We selected a sample of one vendor out of a population of four for procurement testing. This vendor was also selected for suspension and debarment testing out of a population of three vendors and subrecipients. Total expenditures charged to Federal grants under this contract was $26,850. The noncompetitive/sole source documentation and vendor suspension and debarment check were not completed and approved prior to execution of the contract and expenditures were charged to the Federal grant. It was noted after subsequent check that the subrecipient was not suspended or debarred. This sample was not intended to be, and was not, a statistically valid sample Identification as a Repeat Finding: 2023-002 Recommendation: Noncompetitive/sole source procurement documentation and suspension and debarment checks should be prepared, reviewed and approved before executing contracts and before charging costs to Federal grants. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the stated finding and has implemented a corrective action plan.

Finding Number: 2025‐001 Repeat Finding: No Program Name/Assistance Listing Title: Coronavirus State and Local Fiscal Recovery Funds Assistance Listing Number: 21.027 Federal Agency: Department of Treasury Federal Award Number: WCG2023‐‐00008 Pass‐Through Agency: Water Infrastructure Finance Authority of Arizona Questioned Costs: N/A Type of Finding: Significant Deficiency Compliance Requirement: Procurement and Suspension and Debarment Criteria Non‐federal entities other than states, including those operating federal programs as subrecipients of states, must follow the procurement standards set out at 2 CFR §§200.318 through 200.326. Subrecipients must use their own documented procurement procedures, which reflect applicable State and local laws and regulations, provided that the procurements conform to applicable federal statutes and the procurement requirements identified in 2 CFR part 200. 2 CFR §§200.214 requires that vendors are checked to ensure they are not suspended or debarred from receiving federal funds. Condition The District did not follow Federal and State regulations governing procurement. Cause The District did not have policies and procedures in place to verify a vendor was not suspended or debarred. Effect The District was not in compliance with Federal and State regulations governing procurement. Context The sample was not intended to be, and was not, a statistically valid sample. For two vendors reviewed for suspension and debarment check requirements, the District did not maintain verification that the vendor was not suspended or debarred. Upon review of the vendors, neither were suspended or debarred. Recommendation The District should implement policies and procedures over procurement, specifically suspension and debarment, to ensure goods and services are procured through vendors who are not suspended or debarred, so that federal monies exceeding the formal procurement threshold are used appropriately. Views of Responsible Officials See Corrective Action Plan.

Federal Agency: 84 – Department of Education Federal Program Title: Higher Education Institutional Aid Assistance Listing Number: 84.031 Award Period: July 1, 2024, through June 30, 2025 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: In accordance with 2 CFR §200.214, non-Federal entities must comply with the requirements of 2 CFR Part 180, which adopts the governmentwide requirements for suspension and debarment. These requirements prohibit non-Federal entities from entering into covered transactions with parties that are suspended or debarred and require verification of eligibility prior to entering into such transactions. Condition/Context: During our testing of Suspension and Debarment compliance, we selected a sample of 4 contracts under the Higher Education Institutional Aid program. We noted that for 1 of the 4 contracts tested, suspension and debarment verification was not completed prior to the contract date. Questioned Costs: $45,000 Effect: Failure to verify suspension and debarment status prior to contract execution increases the risk that the UEC could enter into covered transactions with suspended or debarred parties, resulting in noncompliance with Federal requirements. Cause: The UEC’s internal controls did not consistently ensure that suspension and debarment verification procedures were completed prior to contract execution. Repeat Finding: No. Recommendation: We recommend the UEC strengthen its procurement procedures to ensure suspension and debarment verification is consistently performed and documented prior to entering into covered transactions funded with Federal awards. Views of Responsible Officials: Management agrees with the finding and has developed a plan to correct the finding.

Program: COVID-19 - Epidemiology and Laboratory Capacity for Infectious Disease (ELC) Assistance Listing No.: 93.323 Federal Grantor: U.S. Department of Health and Human Services Passed-through: California Department of Public Health Award No.: COVID-19ELC114 Award Year: 2021 Compliance Requirement: Procurement, Suspension, and Debarment Type of Finding: Material Weakness and Instance of Noncompliance Criteria: 2 CFR section 200.303(a), Internal Controls, states that the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Title 2 CFR Section 200.214 of the Uniform Guidance states that the County must comply with 2 CFR part 180, which implements Executive Orders 12549 and 12689. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Per 2 CFR Section 180.300, when a non-Federal entity enters into a covered transaction with an entity at a lower tier, the non-Federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at https://www.sam.gov/SAM/, (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity. Condition: For three (3) out of three (3) contracts tested, we noted that there was no evidence the County verified that the contracted entities were not suspended or debarred or otherwise excluded from participating in federal programs prior to entering into the contract. Cause: The County did not have adequate internal controls in place to ensure vendor eligibility was verified and documented prior to contract execution, resulting in a lack of evidence supporting compliance with suspension and debarment requirements. Effect: As a result of this condition, the County was not able to demonstrate compliance with Uniform Guidance procurement requirements, increasing the risk that federal funds could be awarded to ineligible vendors. Questioned Costs: No questioned costs were identified as a result of our procedures. Context/Sampling: A nonstatistical sample of three (3) out of twelve (12) contracts were tested. Repeat Finding from Prior Years: No. Recommendation: We recommend the County enhance internal controls over procurement to ensure verification and documentation of vendor eligibility related to suspension and debarment are performed prior to contract execution, in accordance with Uniform Guidance requirements. Views of Responsible Officials: Management agrees. See separately issued Corrective Action Plan.

Finding 2025-001 Internal control deficiency and noncompliance over procurement and suspension and debarment. Identification of the federal program: Assistance Listing Number 93.493: • Congressional Directives • U.S. Department of Health and Human Services • Federal award identification number – CE146487 • Federal award year – 7/1/2024 – 6/30/2025 • Pass-through entity – The Board of Regents of the University of Oklahoma Health Sciences Center • Pass-through entity identifying numbers: H79FG000747 and H79FG001034 Criteria or specific requirement (including statutory, regulatory, or other citation): Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.303, Internal controls: The non-Federal entity must (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government,” issued by the Comptroller General of the United States, or the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.318, General procurement standards: (a) the non-Federal entity must have and use documented procurement procedures, consistent with State, local, and tribal laws and regulations and the standards of this section, for the acquisition of property or services required under a Federal award or subaward. The non-Federal entity’s documented procurement procedures must conform to the procurement standards identified in 200.317 through 200.327; (b) non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders; (c) (1) the non-Federal entity must maintain written standards of conduct covering conflicts of interest and governing the actions of its employees engaged in the selection, award, and administration of contracts. Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.318, General procurement standards: (i) the non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: Rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.319, Competition: (a) All procurement transactions for the acquisition of property or services required under a Federal award must be conducted in a manner providing full and open competition consistent with the standards of this section and 200.320. Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.320, Methods of procurement to be followed: The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award: (a) (2) Small purchases – (i) Small purchase procedures. The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity; (b) Formal procurement methods. When the value of the procurement for property or services under a Federal financial assistance award exceeds the simplified acquisition threshold, or a lower threshold established by a non-Federal entity, formal procurement methods are required. Formal procurement methods require following documented procedures. Formal procurement methods also require public advertising unless a non-competitive procurement can be used in accordance with 200.319 or paragraph (c) of this section. The following formal methods of procurement are used for procurement of property or services above the simplified acquisition threshold or a value below the simplified acquisition threshold the non-Federal entity determines to be appropriate –(1) Sealed bids. A procurement method in which bids are publicly solicited and a firm fixed-price contract (lump sum or unit price) is awarded to the responsible bidder whose bid, conforming with all the material terms and conditions of the invitation for bids, is the lowest in price; (2) Proposals. A procurement method in which either a fixed price or cost-reimbursement type contract is awarded. Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.320, Methods of procurement to be followed: (c) Noncompetitive procurement. There are specific circumstances in which noncompetitive procurement can be used. Noncompetitive procurement can only be awarded if one or more of the following circumstances apply: (1) The acquisition of property or services, the aggregate dollar amount of which does not exceed the micro-purchase threshold; (2) The item is available only from a single source; (3) The public exigency or emergency for the requirement will not permit a delay resulting from publicizing a competitive solicitation; (4) The Federal awarding agency or pass-through entity expressly authorizes a noncompetitive procurement in response to a written request from the non-Federal entity; or (5) After solicitation of a number of sources, competition is determined inadequate. Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.324, Contract cost and price: (a) The non-Federal entity must perform a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold, including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but, as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. Title 2, Subtitle A, Chapter II, Part 200, Subpart C 200.214, Suspension and debarment: Non-Federal entities are subject to the non-procurement debarment and suspension regulations that restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Title 2, Subtitle A, Chapter I, Part 180, Subpart C 180.300: What must I do before I enter into a covered transaction with another person at the next lower tier? When you enter into a covered transaction with another person at the next lower tier, you must verify that the person with whom you intend to do business is not excluded or disqualified. You do this by (a) checking SAM Exclusions; (b) Collecting a certification from that person; or (c) adding a clause or condition to the covered transaction with that person. Condition: During our testing over procurement, we observed management did not have documented procurement procedures that conformed to the procurement standards identified in 2 CFR section 200.318 to 200.327 and written standards of conduct covering conflicts of interest and governing the actions of its employees engaged in the selection, award, and administration of contracts. Management did not have internal controls in place over procurements to ensure price or rate quotations were obtained from an adequate number of qualified sources, formal procurements to ensure sealed bids or proposals were obtained through public advertising, and completion of a cost or price analysis in connection with all procurement actions exceeding the simplified acquisition threshold. Management did not maintain records for procurements to document the history of procurement, including the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. In addition, during our testing over suspension and debarment, we observed management did not retain support for internal control documentation for all vendors, evidencing that the vendors were searched for suspension and debarment upon entering into a contract supported with federal funds. Cause: Management did not have internal controls in place over the compliance requirements as stated in the criteria or specific requirement section above. Effect or potential effect: Procurements were not supported by internal controls and could potentially include unreasonable prices or rates. In addition, if a search for suspension and debarment is not conducted, the entity could contract with vendors that are suspended or debarred. Questioned costs: $1,385,165 – Assistance Listing Number 93.493 Federal award identification number – CE146487 Pass-through entity identifying numbers: H79FG000747 and H79FG001034 Questioned costs were computed as all procurements selected for testing. Questioned costs for each award are as follows: • CE146487: $60,874 • H79FG000747: $119,479 • H79FG001034: $1,204,812 Questioned costs means an amount, expended or received from a Federal award, that (1) is noncompliant or suspected noncompliant with Federal statutes, regulations, or the terms and conditions of the Federal award or (2) at the time of the audit, lacked adequate documentation to support compliance. Context: During our testing over procurements, we selected five vendors for testing with total expenditures of $1,385,165 from a population of procurements totaling $1,425,361, subject to formal procurement procedures. We observed management did not have internal controls in place to ensure the compliance requirements as stated in the criteria or specific requirement section above were performed for any of the five procurements selected for testing. For suspension and debarment, we selected five vendors for testing totaling $1,385,165. Management was unable to provide documentation that internal controls were executed for any of the vendors selected for testing. Identification as a repeat finding, if applicable: No. Recommendation: Management should create documented procurement procedures that conform to the procurement standards identified in 2 CFR section 200.318 through 200.327 and written standards of conduct covering conflicts of interest and governing the actions of its employees engaged in the selection, award, and administration of contracts. Management should develop and implement internal controls over procurements to ensure price or rate quotations are obtained from an adequate number of qualified sources, formal procurements to ensure sealed bids or proposals are obtained through public advertising, and completion of a cost or price analysis in connection with all procurement actions exceeding the simplified acquisition threshold. Management should maintain records for procurements to document the history of procurement, including the rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Management should create documented suspension and debarment procedures and develop and implement internal controls to ensure vendors were searched for suspension and debarment at the time of awarding a contract supported by federal funding and retain evidence supporting such procedures. Management should review the procurements identified as questioned costs to identify if any improper payments were made to the entity. Views of responsible officials: We agree with the finding that internal controls were not sufficient to maintain compliance with federal procurement standards under Title 2, Subtitle A, Chapter II, Part 200, Subpart D, 200.318 to 200.327 for a non-federal entity. However, the funds were expended for the intended purpose of the federal award. The Company is committed to implementing internal controls to ensure procurement related to federal awards follow 2 CFR section 200.318 to 200.327. The Company will update the procurement policy to ensure it complies with the requirements of 2 CFR section 200.318 through 200.327, which includes the written standards of conduct covering conflicts of interest, governing the actions of its employees who select, award, and administer procurement contracts. This policy will include procedures to ensure proper procurement for purchases to ensure sufficient price quotations are obtained from the required number of qualified sources, proper sealed bids or proposals are obtained through public advertising, an appropriate cost or price analysis is performed for procurement actions exceeding the simplified acquisition threshold, documentation is retained, and proper oversight is exercised to demonstrate compliance with 2 CFR section 200.318 through 200.327.

Finding Number: 2025-009 State/Educational Agency(s): Arkansas Department of Education Pass-Through Entity: Not Applicable AL Number(s) and Program Title(s): 21.027 – COVID 19: Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) Federal Awarding Agency: U.S. Department of the Treasury Federal Award Number(s): SLFRP3627 Federal Award Year(s): 2021 Compliance Requirement(s) Affected: Procurement and Suspension and Debarment Type of Finding: Noncompliance and Significant Deficiency Repeat Finding: Not applicable Criteria: 2 CFR § 200.214 holds entities subject to 2 CFR Part 180, which restricts awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in federal assistance programs or activities. Condition and Context: The Agency is responsible for ensuring that entities receiving awards are registered in the System for Award Management (SAM) database and have not been suspended or debarred. Registration must occur prior to the issuance of a contract or grant agreement. ALA staff reviewed 13 unique entity identifiers to determine if the Agency was in compliance with the requirement. The Agency failed to ensure two vendors, with agreements executed between September 2024 and October 2024, were registered with SAM prior to the Agency’s issuance of subawards to them. Statistically Valid Sample: Not a statistically valid sample. Questioned Costs: None Cause: The Agency failed to adhere to documented internal control procedures and did not provide oversight to ensure vendors receiving federal funding were monitored to determine federal exclusion. Effect: Failure to develop, document, and implement procedures for internal control over compliance increases risk for issuance of contracts and grant agreements to excluded or ineligible entities. Recommendation: ALA staff recommend the Agency strengthen internal controls by developing, documenting, and establishing policies to ensure contracts and grant agreements are only issued to eligible entities. Views of Responsible Officials and Planned Corrective Action: During the audit, it was noted that for a federally funded contract exceeding $25,000, documentation was not maintained to demonstrate that the vendor was verified as not suspended or debarred through Sam.gov as required by ADE policy and federal regulation. We acknowledge that the required verification was not documented. This occurrence was an oversight in our internal contract review process and a lack of standardized checklist to ensure verification was completed and retained. Upon identification of this finding, we have taken the following corrective action: 1. Immediate corrective action: We are working with the identified vendors to register in Sam.gov. 2. Process Improvement: Documentation of Sam.gov verification will be printed/saved and added to the contract file for all contracts using federal funds over $25,000. 3. Training: Relevant staff responsible for procurement and contract management have been trained in federal suspension and debarment requirements and ADE policy. DESE is committed to full compliance with federal requirements and ADE policy. These corrective actions are designed to ensure that suspension and debarment verification is consistently performed and properly documented for all applicable federally funded contracts going forward. Anticipated Completion Date: Completed. Contact Person: Greg Rogers Chief Fiscal Officer DESE 4 Capitol Mall, Room 204-A Little Rock, AR 72201 (501) 682-4475 Greg.Rogers@ade.arkansas.gov

2025-002 U.S. Department of the Treasury Direct Award and Passed through Bristol County, Massachusetts COVID-19 – Coronavirus State and Local Fiscal Recovery Funds – ALN 21.027 Significant Deficiency in Internal Controls over Compliance and Compliance Finding Criteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not verified for nine covered transactions. Cause: Lack of appropriate oversight resulted in required suspension and debarment checks not being performed. Effect: Grant transactions are not supported adequately, and the Town is at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of the vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: No. Recommendation: The Town should implement procedures to document that all contractors under covered transactions that are performing services for the grant are not suspended or debarred. Views of Responsible Official: Management agrees with the finding.

Criteria Non-Federal entities are prohibited from entering into covered transactions with parties that are suspended, debarred, or otherwise excluded from participation in Federal assistance programs in accordance with 2 CFR Part 180, as adopted by Federal agencies. Additionally, 2 CFR 200.214 requires non-Federal entities to ensure that Federal awards are not made to parties listed as excluded in the System for Award Management (SAM). The Compliance Supplement further requires non-Federal entities to establish and maintain effective internal controls to provide reasonable assurance that vendors involved in covered transactions under Federal awards are properly screened and verified for eligibility prior to entering into such transactions. Condition The College did not have an updated suspension and debarment policy or established procedures in place to ensure that vendors utilized in federally funded R&D transactions were not suspended, debarred, or otherwise excluded from participation in Federal programs. Although management was able to locate a suspension and debarment policy, management indicated that the policy was outdated and not followed in practice. As a result, the College did not consistently perform or document verification internal control procedures to confirm vendor eligibility through SAM prior to entering into covered transactions under Federal awards during the audit period. There were no instances of noncompliance identified in our sample of 4. Cause The condition occurred because the College did not maintain effective internal controls or current procedures to ensure compliance with Federal suspension and debarment requirements. Specifically, although a policy existed, it was outdated and not implemented in practice. In addition, the College did not establish a formal process to routinely verify and document vendor eligibility for covered transactions under Federal awards. Possible Asserted Affect Failure to establish and maintain effective controls over suspension and debarment may cause the College to enter into transactions with vendors that are suspended, debarred, or otherwise excluded from participation in Federal programs. This condition may result in noncompliance with 2 CFR Part 180, 2 CFR 200.214, and the Procurement, Suspension and Debarment requirements of the OMB Compliance Supplement for the R&D Cluster, and limits the College’s ability to demonstrate compliance with Federal statutes, regulations, and the terms and conditions of Federal awards. Questioned Costs No questioned costs were identified. Statistical Sampling The sample was not intended to be, and was not a statistically valid sample. Repeat Finding The conditions found do not constitute a repeat finding from the prior year. Recommendation We recommend that the College update and formally implement its suspension and debarment policy to ensure it is current, aligns with applicable Federal regulations, and is followed in practice. Specifically, the College should establish and document procedures to require verification of vendor eligibility through the System for Award Management (SAM) prior to entering into covered transactions under Federal awards. Additionally, the College should ensure that such verification procedures are performed consistently, documented appropriately, and retained to demonstrate compliance with 2 CFR Part 180, 2 CFR 200.214, and the Procurement, Suspension and Debarment requirements of the OMB Compliance Supplement for the R&D Cluster. Management should also consider periodic monitoring or review of these procedures to ensure ongoing compliance with Federal award requirements. Views of Responsible Officials The College concurs with this finding. To mitigate the risk of entering into covered transactions with suspended or debarred vendors, the College is updating and formalizing its suspension and debarment policy, establishing procedures to require and document SAM verification prior to covered transactions under Federal awards, and implementing periodic monitoring to ensure these procedures are performed consistently. These corrective actions are being implemented in fiscal year 2026.

NONCOMPLIANCE WITH PROCUREMENT AND SUSPENSION AND DEBARMENT REQUIREMENTS, CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS, ASSISTANCE LISTING No. 21.027, Direct Allocation, AM-23-0256, AM-23-0255, YEAR ENDED JUNE 30, 2025 Criteria: Per 2 CFR 200.214, non-Federal entities are subject to the non-procurement, debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: The city did not comply with the procurement standards outlined in 2 CFR §200.318-§200.327, which require competitive procurement processes and verification that contractors are not suspended or debarred. Specifically, the city did not verify the eligibility of program recipients/participants/contractors through the System for Award Management (SAM) or equivalent documentation in order to verify that they were not suspended, debarred, or otherwise excluded from participation in the program. Cause: The city does not have procurement policies and procedures in place that allow it to comply with procurement standards outlined in the Uniform Guidance. Effect: Non-compliance with program terms and conditions. Questioned costs: None. Recommendation: Management should develop procedures that will provide reasonable assurance that procurement of goods and services are made in compliance with applicable federal regulations and other procurement requirements specific to a federal award or subaward, and that no subaward, contract, or agreement for purchase of goods or services is made with any suspended or debarred party. Views of responsible officials and planned corrective actions: The government agrees with this finding and will adhere to the attached corrective action plan.

NONCOMPLIANCE WITH PROCUREMENT AND SUSPENSION AND DEBARMENT REQUIREMENTS, CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS, ASSISTANCE LISTING No. 21.027, Direct Allocation, MT-ARPA-CG-23-613, RRG-22-1864A, AMC-22-0137, YEAR ENDED JUNE 30, 2025 Criteria: Per 2 CFR 200.214, non-Federal entities are subject to the non-procurement, debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition: The city did not comply with the procurement standards outlined in 2 CFR §200.318-§200.327, which require competitive procurement processes and verification that contractors are not suspended or debarred. Specifically, the city did not verify the eligibility of program recipients/participants/contractors through the System for Award Management (SAM) or equivalent documentation in order to verify that they were not suspended, debarred, or otherwise excluded from participation in the program. Cause: The city does not have procurement policies and procedures in place that allow it to comply with procurement standards outlined in the Uniform Guidance. Effect: Non-compliance with program terms and conditions. Questioned costs: None. Recommendation: Management should develop procedures that will provide reasonable assurance that procurement of goods and services are made in compliance with applicable federal regulations and other procurement requirements specific to a federal award or subaward, and that no subaward, contract, or agreement for purchase of goods or services is made with any suspended or debarred party. Views of responsible officials and planned corrective actions: The government agrees with this finding and will adhere to the attached corrective action plan.

Coronavirus State and Local Fiscal Recovery Funds Criteria: Under 2 CFR 200.214, recipients and subrecipients are subject to procurement suspension and debarment requirements, which prohibit entering into covered transactions with parties that are suspended, debarred, or otherwise excluded from participation in federal programs. These requirements apply to contracts and subawards funded with federal financial assistance. In addition, 200.318–200.327 requires non federal entities to follow procurement standards applicable to federal awards, which include maintaining adequate oversight and compliance with applicable federal requirements, including suspension and debarment provisions. Condition: During our review of procurement transactions charged to federal awards, we noted that the Town did not document verification that vendors used for information technology and phone system upgrades and for the purchase of tasers and body worn cameras were not suspended or debarred at the time the contracts or purchase orders were executed. Specifically, the Town did not perform or retain evidence of a search of the System for Award Management (SAM.gov) or obtain vendor certifications demonstrating compliance with federal suspension and debarment requirements for these procurements. we did not identify any vendors that were suspended or debarred at the time of procurement. We did not identify any vendors that were suspended or debarred at the time of procurement. Universe/ Population: Four contracts totaling $7,347,577 were subjected to compliance testing. For two of the four contracts totaling $90,955, the Town did not perform or retain evidence of a search SAM.gov or obtain vendor certifications demonstrating compliance with federal suspension and debarment requirements. Cause: The Town did not have written procurement procedures or internal controls that required suspension and debarment verification to be performed and documented prior to awarding contracts or issuing purchase orders funded with federal awards. As a result, procurement staff relied on informal practices that did not include consistent SAM.gov verification. Questioned Costs: No questioned costs were identified. Effect: Without performing and documenting suspension and debarment checks, the Entity increases the risk of awarding contracts to vendors that are ineligible to participate in federally funded transactions. This noncompliance exposes the Town to potential cost disallowance, increased federal oversight, and audit findings related to procurement and internal controls. Further, questioned costs could arise if future review determines that payments were made to ineligible vendors. Recommendation: We recommend that the Town: 1. Update its written procurement policies and procedures to require verification of vendor eligibility through SAM.gov prior to awarding any contract or issuing any purchase order funded with federal awards. 2. Require procurement staff to retain documentation of the suspension and debarment verification (e.g., dated SAM.gov search results or vendor certifications). 3. Provide training to relevant personnel on federal procurement requirements, including suspension and debarment compliance under 2 CFR Part 200. 4. Require that all contracts pertaining to federally funded transactions include language that addresses termination for cause as well as other requirements stipulated in 2 CFR Part 200. View of Responsible Official: Management concurs with the finding.

2025-001 Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Assistance Listing Number: 21.027 Federal Award Identification Number: Not available Pass-Through Agency: Massachusetts Department of Revenue Pass-Through Number(s): ARPA#2FUNDS0330 Award Period: July 1, 2024 – June 30, 2025 Compliance Requirement: Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or specific requirement: The Code of Federal Regulations (CFR) Title 2 Part 200.214 states that nonfederal entities are subject to the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition and Context: For one (1) of five (5) transactions tested, the Town had a documented verification that the vendor was not suspended or debarred. However, the verification was not dated/time-stamped. Therefore, we could not determine if the verification occurred prior to entering into transaction with the vendor. Questioned Costs: None. Cause: Procedures were not in place to document the timing of the verification that all vendors were not suspended or debarred from participation in federal programs or activities. Effect: While this did not occur in the instance identified in this finding, lack of verification (or untimely verification) of vendors’ suspension or debarment status could cause federal grant funds to be expended to vendors that are excluded from participation in federal assistance programs or activities. Repeat Finding: No Recommendation: We recommend procedures be strengthened to ensure that the timing of the verification of vendors’ suspension and debarment status is documented prior to executing transactions. Views of responsible officials and planned corrective actions: Management agrees with the finding.

SIGNIFICANT DEFICIENCY; CRITERIA: 2 CFR §200.214 (Suspension and Debarment) stipulates that non-Federal entities must not enter into contracts or subawards with parties that are suspended, debarred, or otherwise excluded from Federal programs. Recipients must verify the eligibility of contractors by utilizing SAM.gov, collecting a written certification from the contractor, or including a clause in the contract requiring the contractor to certify its status.; CONDITION: During the audit, it was noted that the Town did not perform required checks to determine whether contractors or vendors selected for federally funded projects were suspended or debarred from doing business with the Federal government. Town staff reported they were not familiar with the Federal debarment requirements and did not use the System for Award Management (SAM.gov) or any other verification method before awarding contracts under FEMA‑funded projects.; EFFECT: Failure to verify contractor eligibility results in noncompliance with 2 CFR §200.214 can lead to questioned costs for the affected FEMA‑funded projects. There is increased risk that the Town would contract with an ineligible or prohibited entities which carries potential that FEMA would deobligate or seek repayment of Federal funds if a contractor is later determined to be ineligible.; CAUSE: The Town lacked written procedures addressing suspension and debarment requirements and was unaware of the mandatory steps needed to verify contractor eligibility prior to awarding federally funded work. Staff assigned to procurement and project oversight had not received training on Uniform Guidance or FEMA procurement standards.; RECOMMENDATION: The Town should implement written procedures to ensure compliance with suspension and debarment requirements for all federally funded procurements.; VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: The Town of Spruce Pine agrees with this finding. Finance procedures will be updated to include a suspension and debarment requirements. Town staff will be trained on the updated policies and its implementation.

Finding 2025-003 – Suspension and Debarment Federal Program: Coronavirus State and Local Fiscal Recovery Funds ALN: 21.027 Compliance Requirement: Procurement, Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria Per 2 CFR §180.300 and 2 CFR §200.214, non-Federal entities are prohibited from entering into covered transactions with parties that are suspended or debarred. Covered transactions are defined in 2 CFR Part 180, Subpart B. Non-Federal entities must verify the suspension and debarment status of participants through the System for Award Management (SAM.gov) or by obtaining certification from the contractor or subrecipient. Condition During testing of procurement and contract files, the Town did not retain documentation demonstrating that contractors were verified against SAM.gov. Additionally, contracts reviewed did not include provisions requiring contractors to certify that they and their subcontractors were not suspended or debarred. Cause The Town does not have a formalized process to ensure verification of contractor eligibility through SAM.gov or inclusion of required suspension and debarment certification language in contracts. Effect Failure to verify contractor eligibility increases the risk that the Town could enter into agreements with suspended or debarred parties, resulting in noncompliance with federal requirements. Questioned Costs None. Repeat Finding No. Recommendation We recommend the Town implement procedures to verify and document contractor eligibility through SAM.gov for all applicable procurements and to include required suspension and debarment certification language in all contracts and subawards. Supporting documentation should be retained in the procurement file. Views of Responsible Officials Management agrees with the finding and will implement procedures to verify contractor eligibility through SAM.gov and retain appropriate documentation in procurement files.

govern the performance of its employees engaged in the selection, award, and administration of contracts. Cause of Condition: Policies and procedures have not been designed and implemented to ensure compliance with all federal award requirements. Effect of Condition: This condition resulted in noncompliance with federal grant requirements and could lead to a loss of federal funds to the County. Recommendation: OSAI recommends county officials and department heads gain an understanding of federal programs awarded to Creek County. Internal control procedures should be designed and implemented to ensure compliance with federal requirements. Management Response: Chairman of the Board of County Commissioners and County Clerk: It has been brought to our attention that we need an additional policy that covers conflict of interests and govern the performance of its employees engaged in the selection, award, and administration of contracts. We have taken this recommendation and are implementing the proper language, for all employees to acknowledge in our County Handbook. We will strengthen this control, and add this to the handbook and it will be updated yearly, so that all conflict can be disclosed. Creek County prides itself in moving toward complete transparency and holding each employee accountable to disclose all information needed to make a proper selection of purchases. Creek County Clerk's Office will work with the District Attorney's Office for proper language. Criteria: Compliance and Reporting Guidance, State and Local Fiscal Recovery Funds (8. Procurement, Suspension & Debarment.) Section 200.308 General Procurement Standards reads as follows: (a) Documented procurement procedures. The recipient or subrecipient must maintain and use documented procedures for procurement transactions under a Federal award or subaward, including for acquisition of property or services. These documented procurement procedures must be consistent with State, local, and tribal laws and regulations and the standards identified in §§ 200.317 through 200.327. (b) Oversight of contractors. Recipients and subrecipients must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders. See also § 200.501(h). (c) Conflicts of interest. (1) The recipient or subrecipient must maintain written standards of conduct covering conflicts of interest and governing the actions of its employees engaged in the selection, award, and administration of contracts. No employee, officer, agent, or board member with a real or apparent conflict of interest may participate in the selection, award, or administration of a contract supported by the Federal award. A conflict of interest includes when the employee, officer, agent, or board member, any member of their immediate family, their partner, or an organization that employs or is about to employ any of the parties indicated herein, has a financial or other interest in or a tangible personal benefit from an entity considered for a contract. An employee, officer, agent, and board member of the recipient or subrecipient may neither solicit nor accept gratuities, favors, or anything of monetary value from contractors. However, the recipient or subrecipient may set standards for situations where the financial interest is not substantial or a gift is an unsolicited item of nominal value. The recipient's or subrecipient's standards of conduct must also provide for disciplinary actions to be applied for violations by its employees, officers, agents, or board members. (2) If the recipient or subrecipient has a parent, affiliate, or subsidiary organization that is not a State, local government, or Indian Tribe, the recipient or subrecipient must also maintain written standards of conduct covering organizational conflicts of interest. Organizational conflicts of interest mean that because of relationships with a parent company, affiliate, or subsidiary organization, the recipient or subrecipient is unable or appears to be unable to be impartial in conducting a procurement action involving a related organization. (d) Avoidance of unnecessary or duplicative items. The recipient's or subrecipient's procedures must avoid the acquisition of unnecessary or duplicative items. Consideration should be given to consolidating or breaking out procurements to obtain a more economical purchase. When appropriate, an analysis should be made between leasing and purchasing property or equipment to determine the most economical approach. (e) Procurement arrangements using strategic sourcing. When appropriate for the procurement or use of common or shared goods and services, recipients and subrecipients are encouraged to enter into State and local intergovernmental agreements or inter-entity agreements for procurement transactions. These or similar procurement arrangements using strategic sourcing may foster greater economy and efficiency. Documented procurement actions of this type (using strategic sourcing, shared services, and other similar procurement arrangements) will meet the competition requirements of this part. (f) Use of excess and surplus Federal property. The recipient or subrecipient is encouraged to use excess and surplus Federal property instead of purchasing new equipment and property when it is feasible and reduces project costs. (g) Use of value engineering clauses. When practical, the recipient or subrecipient is encouraged to use value engineering clauses in contracts for construction projects of sufficient size to offer reasonable opportunities for cost reductions. Value engineering means analyzing each contract item or task to ensure its essential function is provided at the overall lowest cost. (h) Responsible contractors. The recipient or subrecipient must award contracts only to responsible contractors that possess the ability to perform successfully under the terms and conditions of a proposed contract. The recipient or subrecipient must consider contractor integrity, public policy compliance, proper classification of employees (see the Fair Labor Standards Act, 29 U.S.C. 201, chapter 8), past performance record, and financial and technical resources when conducting a procurement transaction. See also § 200.214. (i) Procurement records. The recipient or subrecipient must maintain records sufficient to detail the history of each procurement transaction. These records must include the rationale for the procurement method, contract type selection, contractor selection or rejection, and the basis for the contract price. (j) Time-and-materials type contracts. (1) The recipient or subrecipient may use a time-and-materials type contract only after a determination that no other contract is suitable and if the contract includes a ceiling price that the contractor exceeds at its own risk. Time-and-materials type contract means a contract whose cost to a recipient or subrecipient is the sum of: (i) The actual cost of materials; and (ii) Direct labor hours charged at fixed hourly rates that reflect wages, general and administrative expenses, and profit. (2) Because this formula generates an open-ended contract price, a time-and-materials contract provides no positive profit incentive to the contractor for cost control or labor efficiency. Therefore, each contract must set a ceiling price that the contractor exceeds at its own risk. Further, the recipient or subrecipient awarding such a contract must assert a high degree of oversight to obtain reasonable assurance that the contractor is using efficient methods and effective cost controls.

2025-003 Suspension and Disbarment Condition: The Organization did not research vendors of covered transactions for potential suspension or debarment. Criteria: Per Code of Federal Regulations 2 CFR 200.214, the Organization is prohibited from entering into contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in Federal awards. Cause: The Organization did not have a procedure in place to research vendors for suspension and debarment. Effect: Although the audit did not identify any instances of noncompliance, the Organization did not research vendors for potential suspension and debarment and could have engaged with a vendor that was suspended or debarred. Recommendation: RBT recommends that the Organization establish policies and procedures requiring that the Organization verify and document vendors' suspension and debarment status prior to entering into contracts with the vendors. Management's Response: See corrective action plan.

Finding Reference Number: 2025-002 Reportable finding considered a significant deficiency - Inadequate Controls over Procurement documentation retention Program name and CFDA: Supportive Services for Veteran Families (SSVF) 64.033 Coronavirus State and Local Fiscal Recovery Funds (CSLFRF) 21.027 Federal award identification number: SSVF – 23-CA-437 CSLFRF – UNKNOWN Federal award year: SSVF – 10/1/2022-9/30/2025 CSLFRF – 8/1/2024-6/30/2025 Federal awarding agency: SSVF – Department of Veterans Affairs CSLFRF – Department of the Treasury Name of pass-through entity: SSVF – None CSLFRF – Alameda County Criteria Federal procurement requirements under 2 CFR 200.318–200.320 outline expectations for maintaining documentation to show procurement activity aligns with written procedures and promotes full and open competition. Additionally, 2 CFR 180.300, incorporated by 2 CFR 200.214, requires organizations to verify that vendors are not suspended or debarred before entering into an agreement. This verification can be completed by checking SAM.gov or obtaining a vendor certification. Statement of Condition Organization has written procurement procedures and consistently performs cost analyses for rental assistance-related procurements. Audit testing also confirmed that none of the vendors involved were suspended or debarred. However, the Organization was not able to provide documentation showing that suspension/debarment checks were performed before onboarding these vendors. While the procedures appear to be followed in practice, the documentation step was not retained. Cause It appears that documentation was not transitioned between staff members when the individual who initially performed these procedures left the organization. Effect or Potential Effect Without documentation of these checks, the Organization cannot fully demonstrate compliance with federal procurement and suspension/debarment requirements. Although no ineligible vendors were used, the missing documentation increases the risk that future procurements could be questioned or require additional follow-up. Questioned Costs None Recommendation We recommend the Organization take a few steps to strengthen this process going forward:  Incorporate a simple, consistent step for keeping documentation of SAM.gov checks or vendor certifications in each procurement file.  Communicate this requirement to the staff performing vendor onboarding so expectations are clear.  Periodically review procurement files to make sure documentation is being consistently retained. These adjustments should help ensure the strong practices already in place are fully supported by required documentation. Reportable Views of Responsible Officials See corrective action plan.

Identification of the Federal Program: Assistance Listing Number: 16.922 Assistance Listing Title: Equitable Sharing Program Federal Agency: U.S. Department of the Justice Federal Award Identification Number: N/A Criteria or Specific Requirement (Including Statutory, Regulatory, or Other Citation): Prior to entering into subawards and contracts with award funds, recipients must ensure that contractors and subcontractors are not suspended, debarred, or otherwise excluded from participation in federally funded programs pursuant to 2 CFR Part 180 and 2 CFR §200.214. Condition: During the audit, we noticed that the City did not perform suspension and debarment checks on the contractors that they hired with Asset Forfeiture monies. Cause: The City does not have formal policies and procedures in place to ensure the suspension and debarment review process over vendors that provides goods or services to the City’s programs was conducted prior to entering into a contract. Effect or Potential Effect: Without verifying whether vendors are suspended or debarred from working on federally-funded projects prior to the contract being awarded, the City could be contracting with vendors that are prohibited from working on federally funded projects and incurring potentially disallowed costs. Questioned Costs: None noted. Context: See condition above for the context of the finding. Identification as a Repeat Finding, If Applicable: No. Recommendation: We recommended the City develop policies and procedures to incorporate the suspension and debarment verification prior to awarding contracts. Views of Responsible Officials: Management concurs with the finding and agrees to implement necessary corrective procedures.

2025-001 U.S. Department of the Treasury COVID-19 – Coronavirus State and Local Fiscal Recovery Funds - ALN 21.027 Material Weakness in Internal Controls Over Compliance Criteria: Per 2 CFR section 200.214, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. Condition: Suspension and debarment compliance was not verified for nine covered transactions. Cause: Lack of appropriate oversight resulted in required suspension and debarment checks not being performed. Effect: Town is at risk of awarding contracts to vendors not eligible to participate in federal awards programs. It was determined that none of these vendors were suspended or debarred from federal awards. Questioned Costs: None Repeat Finding from Prior Year: No. Recommendation: The Town should implement procedures to document that all contractors under covered transactions that are performing services for the grant are not suspended or debarred. Views of Responsible Official: Management agrees with the finding.

Federal Agency: U.S. Department of Treasury Federal Program Name: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Assistance Listing Number: 21.027 Federal Award Identification Number: Not available Pass-Through Agency: Massachusetts Department of Revenue Pass-Through Number(s): Unknown Award Period: July 1, 2024 – June 30, 2025 Compliance Requirement: Suspension and Debarment Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or specific requirement: The Code of Federal Regulations (CFR) Title 2 Part 200.214 states that nonfederal entities are subject to the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. Condition and Context: For each of the five (5) transactions tested, the Town did not have a documented verification that the vendor was not suspended or debarred. Questioned Costs: None. Cause: Procedures were not in place to document the verification that vendors were not suspended or debarred from participation in federal programs or activities. Effect: Lack of verification (or untimely verification) of vendors’ suspension or debarment status could cause federal grant funds to be expended to vendors that are excluded from participation in federal assistance programs or activities. Repeat Finding: No Recommendation: We recommend procedures be implemented to ensure that the verification of vendors’ suspension and debarment status is documented prior to executing transactions. Views of responsible officials and planned corrective actions: Management agrees with the finding.

2025-004 Department of the Treasury Assistance Listing #21.027 Coronavirus State and Local Fiscal Recovery Funds for the period July 1, 2024, to June 30, 2025 Criteria: Recipients of the Coronavirus State and Local Fiscal Recovery Funds (ARPA) grant are required to follow the Uniform Guidance section § 200.214 Suspension and Debarment. Under that section, grant recipients are restricted from entering into contracts with certain parties that are debarred, suspended, or otherwise excluded from receiving or participating in federal awards. The Uniform Guidance also requires grant recipients to develop internal controls to ensure compliance with the grant requirements. Condition: The Town had two significant contracts under the ARPA grant that would have required documentation or certification of suspension and debarment from the vendors, but no documentation was obtained. In addition, the Town did not have procedures in place to ensure compliance with suspension and debarment requirements. Cause: The Town did not document a search of Sam.gov to ensure the vendors were not suspended nor debarred. As an alternative, the Town also did not receive certification from the vendors or any other documentation regarding their suspension and debarment status. Effect: The Town runs the risk that the Town will contract with a vendor that is suspended or debarred. Known Questioned Costs: None Likely Questioned Costs: None Recommendations: The Town should have procedures in place to ensure it does not enter into a contract with a vendor that is suspended or debarred. In addition, any documentation of suspension and debarment status should be retained with the grant documentation.

2025-001 – Procurement, Suspension and Debarment Federal Program Information: Department of Education - Child Nutrition Cluster: CFDA - 10.553/10.555/10.559//10.582 Criteria: The following CFR(s) apply to this finding: 2 CFR 200.318 General procurement Standards and 2 CFR 200.214 Suspension and Debarment Condition: During audit procedures, it was identified that the Supervisory Union did not have internal controls in place to ensure that all appropriate procurement standards and procedures were followed. Cause: Unknown Effect: The Supervisory Union may not be consistently following all appropriate procurement standards and procedures. There were instances where the suspension and debarment verification were not performed. Identification of Questioned Costs: None identified. Context: Of the 8 procurement purchases tested, 6 were not verified for suspension or debarment in SAM.gov. Repeat Finding: This is a repeat finding of 2024-002. Recommendation: It is recommended that the Supervisory Union implements controls to ensure that it follows all appropriate procurement standards and procedures. We also recommend that the Supervisory Union review its procurement policy to ensure that it is updated and complete.

2025-001 U.S. Department of Education, Assistance Listing #84.027/84.173 Special Education Cluster (IDEA) Program and U.S. Department of Treasury, Assistance Listing #21.027 Coronavirus State and Local Fiscal Recovery Funds (SLRF) Program for the period of July 1, 2024, through June 30, 2025 Criteria: Uniform Guidance section 2 CFR §200.317-200.327 Procurement Standards, requires purchases exceeding the micro-purchase threshold of $10,000 to follow small purchase procedures, which require obtaining price or rate quotations from an adequate number of qualified sources (§200.320) prior to entering into a contract. In addition, 2 CFR Part 180 and 2 CFR §200.214 require non-federal entities to verify if contractors are suspended or debarred (e.g., Sam.gov check or certification) and include appropriate contract clauses in applicable contracts. Condition: The School Department did not obtain price or rate quotations for two projects that exceeded the micro-purchase threshold. Additionally, the Department did not perform, or document required suspension and debarment procedures for the contractor (e.g., verification against SAM.gov, obtaining certifications, or including contract clauses). The City did not perform, or document required suspension and debarment procedures for the contractor (e.g., verification against SAM.gov, obtaining certifications, or including contract clauses) for three of the six contracts tested. Cause: School staff were not aware the projects would be funded with federal funds and did not ensure compliance with federal requirements for competitive pricing and suspension/debarment verification. City staff were not aware projects covered under the SLRF definition of “revenue replacement”, which excludes most procurement requirements, are still required to follow 2 CFR Part 180 and 2 CFR §200.214. Effect: Failure to obtain competitive quotes and verify contractor eligibility to receive Federal funds increases the risk of noncompliance, inefficient use of federal funds, and potential disallowance of costs. Known Questioned Costs: $61,891 for #84.027/84.173; $51,750 for #21.027 Likely Questioned Costs: $12,799 for #21.027 Recommendation: We recommend training staff on procurement and suspension/debarment requirements and implementing a pre-award compliance checklist. We also recommend increasing communication between grant personnel and facilities management personnel so all parties are aware which projects will be funded with federal funds.

FINDING 2025-003 Subject: Special Education Cluster (IDEA) - Procurement and Suspension and Debarment Federal Agency: Department of Education Federal Program: Special Education Grants to States Assistance Listings Number: 84.027 Federal Award Numbers and Years (or Other identifying Numbers): 22611-133-PN01, 23611-133-PN01, 24611-133-PN01 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Procurement and Suspension and Debarment Audit Findings: Material Weakness, Modified Opinion INDIANA STATE BOARD OF ACCOUNTS 19 LEWIS CASS SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Condition and Context The internal control system in place at the School Corporation was not effective in ensuring compliance with requirements related to the grant agreement and the Procurement and Suspension and Debarment compliance requirement. Procurement - Small Purchases Federal regulations allow for informal procurement methods when the value of the procurement for property or services does not exceed the simplified acquisition threshold, which is set at $250,000 unless a lower, more restrictive threshold is set by a nonfederal entity. As Indiana Code has set a more restrictive threshold of $150,000, the informal procurement method is permitted when the value of the procurement does not exceed $150,000. This informal process allows for methods other than the formal bid process. The informal process is divided between two methods based on thresholds: micro-purchases, typically for those purchases $10,000 or under, and small purchase procedures for those purchases above the micro-purchase threshold but below the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive price rate quotations. If small purchase procedures are used, then price or rate quotations must be obtained from an adequate number of qualified sources. A total of two vendors were determined to require small purchase procedures, totaling $123,078. For the two vendors tested, the School Corporation did not obtain price or rate quotations. Additionally, documentation detailing the history of procurement, which must include the reason for the procurement method used, was absent for those two vendors. Suspension and Debarment Prior to entering into subawards and covered transactions with federal award funds, recipients are required to verify that such contractors and subrecipients are not suspended, debarred, or otherwise excluded. "Covered transactions" include, but are not limited to, contracts for goods and services awarded under a nonprocurement transaction (i.e., grant agreement) that are expected to equal or exceed $25,000. The verification is to be done by checking the System for Award Management (SAM) Excluded Parties List System (EPLS), collecting a certification from that person or entity, or adding a clause or condition to the covered transaction with that person or entity. A population of two covered transactions for goods or services totaling $123,078, both of which equaled or exceeded the $25,000 threshold paid from the special education funds during the audit period, were identified and selected for testing. For both transactions, the School Corporation did not verify that the vendor was not suspended, debarred, or otherwise excluded from or eligible for participation in federal assistance programs or activities prior to issuing payment. The lack of effective internal controls and noncompliance were systemic issues throughout the audit period. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: INDIANA STATE BOARD OF ACCOUNTS 20 LEWIS CASS SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal awards in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in 'Standards for Internal Control in the Federal Government' issued by the Comptroller General of the United States or the 'Internal Control Integrated Framework', issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). . . ." 2 CFR 200.214 states: "Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities." 2 CFR 200.320 states in part: "The non-Federal entity must have and use documented procurement procedures, consistent with the standards of this section and §§ 200.317, 200.318, and 200.319 for any of the following methods of procurement used for the acquisition of property or services required under a Federal award or sub-award. (a) Informal procurement methods. When the value of the procurement for property or services under a Federal award does not exceed the simplified acquisition threshold (SAT), as defined in § 200.1, or a lower threshold established by a non-Federal entity, formal procurement methods are not required. The non-Federal entity may use informal procurement methods to expedite the completion of its transactions and minimize the associated administrative burden and cost. The informal methods used for procurement of property or services at or below the SAT include: . . . (2) Small purchases— (i) Small purchase procedures. The acquisition of property or services, the aggregate dollar amount of which is higher than the micro-purchase threshold but does not exceed the simplified acquisition threshold. If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources as determined appropriate by the non-Federal entity. . . ." Cause The School Corporation did not have adequate internal controls to ensure compliance with procurement and suspension and debarment requirements. Effect The lack of an effective internal control system enabled material noncompliance to occur and remain undetected. Noncompliance with the Procurement and Suspension and Debarment compliance requirement could enable small purchases made by the School Corporation to be uncompetitive and could lead to contracting with vendors who are suspended or debarred from receiving federal grant funding. INDIANA STATE BOARD OF ACCOUNTS 21 LEWIS CASS SCHOOLS SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Noncompliance with the grant agreement and the compliance requirement could result in the loss of future federal funds to the School Corporation. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the management of the School Corporation develop policies and procedures to ensure there are appropriate procurement procedures for goods and services and contractors and subrecipients, as appropriate, are verified to not be suspended, debarred, or otherwise excluded prior to entering into any contracts or subawards. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Federal agency: U.S. Department of Treasury Federal program title: Coronavirus State and Local Fiscal Recovery Funds (SLFRF) Assistance Listing Number: 21.027 Federal Award Identification Number: Unknown Pass-Through Agency: Massachusetts Department of Revenue Pass-Through Number(s): GAE DOR 22ARPALOCPASSTHRU001 Award Period: July 1, 2024 – June 30, 2025 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Compliance Requirement: Suspension and Debarment Criteria or Specific Requirement: The Code of Federal Regulations (CFR) Title 2 Part 200.214 states that nonfederal entities are subject to the nonprocurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. These regulations restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in federal assistance programs or activities. Condition and Context: For one of one vendors tested, documentation was not provided to support that the Town verified the vendor was not suspended or debarred from participation in federal assistance programs or activities. Questioned Costs: None Cause: Procedures were not in place to document the verification that all vendors were not suspended or debarred from participation in federal programs or activities. Effect: While this did not occur in the instance identified in this finding, lack of verification of vendors’ suspension or debarment status could cause federal grant funds to be expended to vendors that are excluded from participation in federal assistance programs or activities. Repeat Finding: No Recommendation: We recommend the Town enhance procedures and controls to ensure that the verification of vendors’ suspension and debarment status is obtained and documented prior to executing transactions. This verification can be performed by checking the System for Award Management (SAM.gov), obtaining a written certification from the vendor, or including a contract clause stating that the vendor is not suspended or debarred. Views of Responsible Officials: Management agrees with the finding.

2025-001 - Procurement, Debarment and Suspension Federal Program Information: U.S. Department of the Treasury, passed through the Vermont Department of Public Safety CFDA - 21.027 - Coronavirus State and Local Fiscal Recovery Funds Criteria: The following CFRs apply to this finding: 2 CFR 200.214, 2 CFR section 200.317-200.327 Condition: During audit procedures it was identified that the Town did not check sam.gov to confirm that the contractor was not debarred or suspended from receiving federal funds nor did they request a Suspension and Debarment certification from the contractor. Cause: The Town does not have the necessary internal controls over compliance. Effect: Contracts may be awarded to contractors that are debarred or suspended from working on federally funded projects. Identification of Questioned Costs: None Identified. Context: Two contracts were reviewed out of three. This is not a statistically valid sample. Repeat Finding: This is not a repeat finding. Recommendation: It is recommended that the Town revise its procurement policy to fully incorporate all elements required by 2 CFR §200.317-200.327. Views of Responsible Officials and Corrective Action Plan: Please see the Corrective Action Plan.

LACK OF PROCEDURES TO ENSURE PROPER SUSPENSION AND DEBARMENT REQUIREMENTS Program: AL 21.027 – COVID-19 – Coronavirus State and Local Fiscal Recovery Funds – Suspension & Debarment Grant: SLFRP0923, March 3, 2021, through December 31, 2024 Federal Grantor: U.S. Department of the Treasury Criteria: Title 2 of the U.S. Code of Federal Regulations (CFR) § 200.303 (January 1, 2023) states the following, in relevant part: The non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The U.S. Department of the Treasury adopted the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards in 2 CFR § 1000.10 (January 1, 2023), which states the following: Except for the deviations set forth elsewhere in this Part, the Department of the Treasury adopts the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, set forth at 2 CFR part 200. 2 CFR § 200.214 (January 1, 2023) states the following: Non-Federal entities are subject to the non-procurement debarment and suspension regulations implementing Executive Orders 12549 and 12689, 2 CFR part 180. The regulations in 2 CFR part 180 restrict awards, subawards, and contracts with certain parties that are debarred, suspended, or otherwise excluded from or ineligible for participation in Federal assistance programs or activities. 2 CFR § 180.300 (January 1, 2023) requires non-Federal entities to verify that an entity is not excluded or disqualified prior to entering into a covered transaction by: “(a) Checking SAM Exclusions; or (b) Collecting a certification from that . . . [entity]; or (c) Adding a clause or condition to the covered transaction with that . . . [entity].” A good internal control plan requires the County to have proper procedures in place to verify that contractors paid with Federal funds are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities. Condition: The County did not have controls in place to ensure that suspension and debarment requirements were followed and adequately documented. We noted the County used Coronavirus State and Local Fiscal Recovery Funds to pay nine vendors over $25,000 each, totaling $1,387,268, during the fiscal year ended June 30, 2025. The County failed to ensure that these vendors were not excluded or disqualified prior to entering into these covered transactions. Context: The County did not have a system in place to ensure proper application of the federal guidelines for the federal disbursements. Effect: Without adequate procedures to ensure contractors are not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, there is an increased risk for the misuse of Federal funds and noncompliance with Federal regulations, leading to possible Federal sanctions. Cause: Lack of procedures and knowledge regarding suspension and debarment requirements. Questioned Costs: None Repeat Finding: Yes Recommendation: We recommend the County implement procedures to ensure, prior to entering into a covered transaction, that a contractor is not suspended, debarred, or otherwise excluded from or ineligible for participation in Federal programs or activities, and those procedures are adequately documented. View of Officials: The County will implement procedures to ensure when a contractor is paid with federal funds, sam.gov will be utilized to verify the entity has not been suspended or debarred and such procedure will be adequately documented.

2025-001 – Suspension and Debarment Cluster: Research and Development Grantor: Social Security Administration, National Science Foundation Award Name: Center for Retirement Research at Boston College and Affiliated Institutions: Retirement and Disability Research Consortium, Building a Youth-Led Learning Community through Automating Hydroponic Systems, Empowering Youth in STEM and Technological Careers through AI-Enhanced Sustainable and Community-Focused Urban Gardening Award Number: 6 RDR23000010, 2048994, 2241766 Award Year: FY2025 Assistance Listing Numbers: 96.007, 47.076, 47.076 Assistance Listing Titles: Social Security Research and Demonstration; STEM Education (formerly Education and Human Resources) Pass-Through Entities: None - Direct Criteria: Per 2 CFR 200.214, when entering into a covered transaction with an entity, the auditee must have established procedures to verify that the entity is not suspended, debarred or otherwise excluded from participating in the transaction. Condition: For 1 of 25 new vendors sampled, the vendor was not included in the ongoing suspension and debarment monitoring process, which is performed via a third-party servicer. Upon further discussion with the University, it was determined that the selected vendor was part of one day where a total of an additional 24 new vendors were also excluded from the ongoing process. Of the 25 total vendors, 3 of these vendors incurred expenditures related to federal awards totaling approximately $7,000 during the fiscal year. Cause: There was a system failure on one specific day between the University and the third-party servicer that prevented the suspension and debarment checks from being performed on new vendors. After the system failure, University personnel did not confirm that new vendors that were intended to be added on the date in question, were in fact added to the system. Effect: New vendors were not checked for suspension and debarment prior to the University entering into a transaction with the affected vendors. Questioned Costs: None noted. Repeat Finding: No. Recommendation: PwC recommends cross training of individuals responsible for the daily system interactions with the third-party servicer to ensure any system issues are promptly resolved and new vendors are checked for suspension and debarment prior to the University entering into a transaction with them. Management’s Views and Corrective Action Plan: Management’s response is included in Management's Views and Corrective Action Plan included at the end of this report after the Schedule of Status of Prior Audit Findings.