Findings Citing § 200.329

Nature of Finding: Compliance Finding and Material Weakness in Internal Controls over Compliance - Reporting Criteria/Condition: Federal regulations 2 CFR 200.328 - 200.329 provide that required reporting under the federal program must be completed timely and accurately. Per the federal award agreement, specific reporting requirements with established due dates were outlined. We noted during review of the different reporting requirements that none of the reports required to be filed through September 30, 2025 were filed in a timely manner. Per the federal award agreement, the following reporting requirements were applicable through September 30, 2025: • Performance reports were required to be submitted on a semi-annual basis no later than thirty calendar days after the end of each six-month reporting period. • A written request was required to be submitted to the U.S. Department of Housing and Urban Development (HUD) no later than thirty calendar days after all grant funds were drawn down and the project was completed. Cause/Context: Controls were not in place to ensure timely reporting. Five performance reports required through September 30, 2025 were submitted late. These reports were required to be completed semi-annually subsequent to the grant agreement being signed with due dates ranging from July 2023 through July 2025, but were all filed after September 30, 2025. A written request required after project completion was also filed late as it was due thirty days following the completion of the projects but was not submitted until after September 30, 2025. The lack of controls over these reporting requirements was specific to the housing division of Hope Network and Affiliates. Effect: A lack of controls could result in late or missed reporting. Recommendation: We recommend the Network establish procedures and controls to ensure financial and performance reports are filed timely and that the Network submit all outstanding reports for the federal award. We also recommend that the Network monitor the due date of any upcoming reports, including the final closeout reports. Upon completion of the final close out report, the Network should ensure that the proper allocation of expenditures are communicated to HUD timely and accurately. Views of Responsible Officials and Planned Corrective Actions: Subsequent to September 30, 2025, the Network has filed all over-due semi-annual performance reports and submitted the required written request for confirmation of final drawdown of funds and project completion. The finance department will review all grant agreements and procedures to ensure all required reporting is tracked and filed timely according to grant documents and will develop a uniform process for existing grants across all Hope Network Affiliates.

#2025-003 – Major Federal Award Finding – Reporting Nature of Finding: Compliance Finding Reporting and Significant Deficiency in Internal Controls over Compliance Criteria/Condition: Federal regulations 2 CFR 200.328 - 200.329 provide that required reporting under the federal program must be completed timely and accurately. The federal award agreement includes specific report filing due dates. We noted during testing of 12 different required reports, including both financial and performance reports, that 2 of these reports tested were not filed in a timely manner. Cause/Context: Controls were not in place to ensure timely reporting. Two performance reports tested were submitted one day late. Effect: A lack of controls could result in late or missed reporting. Recommendation: We recommend the Organization establish procedures and controls to ensure financial and performance reports are filed timely. Views of Responsible Officials and Planned Corrective Actions: The Organization’s program leadership is playing a more active role in reporting and compliance and is actively involving directors of programs in the process of reporting.

Finding #2025-001: Program Title: Substance Abuse and Mental Health Services Projects of Regional and National Significance Assistance Listing: 93.243 Contract Grant Number:5H79SP082149-04 Federal Award Years: 08/31/2024 to 8/30/2025 Federal Agency: U.S. Department of Health and Human Services Criteria: Reports submitted annually by the recipient must be due no later than 90 calendar days after the reporting period in accordance with 2 CFR 200.329 C(1) and with terms and conditions of the federal award. Condition: Based on procedures performed, we identified one annual performance report was submitted six calendar days after the 90-day deadline. Questioned Costs: None Cause: Program management misunderstood the reporting deadline and process for requesting an extension resulting in the untimely submission of the annual performance report to the federal agency. No request for an extension was submitted for the report. Effect: Noncompliance with Reporting compliance requirement of the Uniform Guidance and terms and conditions of the federal award. Repeat Finding: No Recommendation: We recommend BHSST improve procedures for identification and tracking of reporting deadlines to ensure annual reports are submitted timely in accordance with the compliance requirements of Uniform Guidance, federal regulations, and terms and conditions of federal awards.

Reporting – ACF-196R Federal Agency: U.S. Department of Health and Human Services Federal Program Title: Temporary Assistance for Needy Families (TANF) ALN: 93.558 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Number and Period: 2401TXTANF October 1, 2023 – September 30, 2024 Statistically Valid Sample: No, and not intended to be a statistically valid sample Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or specific requirement: Per 2 CFR §200.303(a), Health and Human Services Commission (HHSC) must establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that it 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). Pursuant to 45 CFR §265.3(a)(1) each State must collect on a monthly basis, and file on a quarterly basis, the data specified in the TANF Data Report and the TANF Financial Report (or, as applicable, the Territorial Financial Report). More specifically, Form ACF-196R is used by States administering the Temporary Assistance for Needy Families (TANF) program to report quarterly expenditure data and to request quarterly grant funds. The ACF-204 report (Annual Report on State Maintenance-of-Effort Programs) must be completed and submitted in accordance with the requirements at 45 CFR §265.9(c). The report includes several line items that contain critical information, including “Total State MOE Expenditures.” Input for the Total State MOE expenditures line item is provided by the Texas Education Agency (TEA), the Texas Workforce Commission (TWC), and HHSC. The MOE amounts in the ACF-204 report are to agree to the amounts in the final ACF-196R report. For the FY2024 ACF-196R report, the contributing agencies reported State MOE expenditures on various line items including but not limited to: HHSC – Line 6a (Basic Assistance (excluding Relative Foster Care Maintenance Payments and Adoption and Guardianship Subsidies) TEA – Line 11b (Pre-Kindergarten/Head Start) Condition: All key line items in the FY 2024 ACF‑204 report were tested and agreed to supporting documentation without exception. However, the Total State Maintenance of Effort (MOE) Expenditures reported in the ACF‑204 by HHSC and the Texas Education Agency (TEA) did not reconcile to the amounts reported in the ACF‑196R as shown below: Amounts reported in the ACF‑204 were accurate and supported; the variances occurred because the ACF‑196R reflected higher MOE expenditures than those reported on the ACF‑204. Questioned costs: None. Context: See “Condition.” Cause: The variance in line 11b was due to miscommunication between the relevant HHSC personnel regarding revisions to an initial submission. The variance in line 6a was due to the HHSC Federal Reporting Team incorrectly including period 1 of 2025 in the MOE calculation. The agency did not perform a complete reconciliation between the ACF‑204 and ACF‑196R prior to submission, resulting in inconsistent MOE reporting across the required reports. Effect: Inaccurate or inconsistent reporting of MOE expenditures increases the risk of noncompliance with federal reporting requirements under 2 CFR §200.302 (financial management) and 2 CFR §200.329 (performance and financial reporting). These discrepancies may impair the federal awarding agency’s ability to evaluate program performance, assess State MOE compliance, and rely on the accuracy of reported financial information. Repeat Finding: No. Recommendation: HHSC should strengthen their financial reporting controls to ensure consistency between the ACF‑204 and ACF‑196R reports. Specifically, the agency should implement a formal reconciliation process that: • Compares all MOE expenditure amounts reported on the ACF‑204 to those reported on the ACF‑196R prior to submission; • Requires documented review and approval of the reconciliation by management; and • Ensures any discrepancies are researched, resolved, and corrected before the reports are finalized. Views of responsible officials: HHSC concurs with the recommendation.

Finding Reference: 2025-002 Reporting Federal Agency: U.S. Department of Agriculture Federal Program: Water and Waste Disposal System for Rural Communities - ALN 10.760 Compliance Requirement: Reporting Criteria: The Uniform Guidance requires that non-federal entities may be required to submit performance reports at least annually but not more frequently that quarterly, except in unusual circumstances, using a form or format authorized by OMB (2 CFR section 200.329). They also may be required to submit special reports as required by the terms and conditions of the federal award. The U.S. Department of Agriculture requires the Authority to submi quarterly Income and Expense Statements. The reports are to be signed by the appropriate borrower official and submitted within 30 days of each quarter's end. Condition: The Authority has not submitted Quarterly Income and Expense Statements within 30 days of the fiscal quarter end. However, the Authority has submitted audited annual financial reports within 9 months of fiscal year end. This is a repeat report finding from the prior year (2024-003). Cause and Effect: The Authority was unacquainted with quarterly filing requirements as set forth by the U.S. Department of Agriculture per the loan agreement. Without filing quarterly Income and Expense Statements, USDA is unaware of how funding is spent throughout the year. Questioned Cost: None Recommendation: The Authority should begin to submit quarterly reports in accordance with loan agreement. Views of Responsible Officials: The Authority is now aware of the quarterly reporting requirements. The Authority has developed and implemented procedures to ensure that all future reports will be submitted timely.

SCHEDULE OF FINDINGS AND QUESTIONED COSTS Federal Award Findings and Questioned Costs July 31, 2025 Comment #2025-002 INTERNAL CONTROLS OVER FINANCIAL STATEMENT PREPARATION, GRANT CLOSE-OUT, AND COMPLIANCE WITH RELATED PROVISIONS OF GRANTS AND CONTRACTS SHOULD BE IMPROVED GENERAL (Repeat) Condition: As part of our auditing procedures, we assisted in the preparation of the financial statements, related disclosures, and the schedule of expenditures of federal awards of the Agency. The preparation of these financial statements in accordance with generally accepted accounting principles (GAAP) and Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, is the responsibility of the grantee. The authoritative and regulatory standards states in summary that management should authorize, process, reconcile and close-out each grant and contract in a timely manner to ensure proper accounting and reporting of such activity in accordance with the specific professional standards and regulatory requirements. The close-out process is designed to reduce the risk of errors, fraud, material misstatement of financial and compliance reporting and recognition of expenditures (or revenue) in the proper period. While there has been improvements, we noted that the current system of internal controls over financial statements and compliance is not designed to ensure that the objectives are achieved. Further, the capacity and experience of the current staff does not allow for adequate analysis of grants and contracts, proper allocations of shared costs and support services provided, grantor receivables, deferred revenue, and other close-out procedures accurately and in a timely manner. This resulted in adjustments necessary to present the financial statements and disclosures of the Agency as of July 31, 2025. We also noted significant weaknesses in internal controls over payroll and recording various journal entries related to payroll transactions and fringe benefits. Therefore, the risk exists that grant receivables and/or cash from the various programs are not recorded properly during the reporting period (interim and annually). This condition also makes it difficult to prepare accurate external reports required by the various funding sources in a timely manner (i.e. SF-425, DHS’s reports for LIHEAP, etc.). The systemic cause appears to be the change in the accounting staff and continuing education and training in grant accounting. Policies and procedures are not up-dated and followed consistently throughout the year. Context: Review of internal control structure of the organization in accordance with Government Auditing Standards. Criteria: Controls should be in place to ensure that financial statements are prepared in accordance with GAAP. The auditee shall prepare financial statements that reflect its financial position, results of operations or changes in net assets, and, where appropriate, cash flows for the fiscal year audited. The auditee shall also prepare a schedule of expenditures of Federal awards for the period covered by the auditee's financial statements. [2 CFR §200.510(a) and (b)] Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §200.328 Financial reporting and §200.329. (Continued) Effect: Monitoring and reporting program performance [2 CFR §200.302(b)(2)]. Management may not be able to obtain complete and accurate financial statements on an interim or fiscal year basis to be used for internal or external reporting purposes. Cause: Turnover of key staff, change in the accounting system, limited personnel with knowledge and/or the ability to assist and provide needed information to aid in financial statement preparation. Recommendation: The degree to which the preparation of the financial statements and related disclosures are prepared by the independent auditor is a control deficiency as determined by the knowledge, skills and experience of those in the organization who are charged with the responsibility of its financial reporting. The Agency's chief financial officer (CFO) should require the grant accountant and a general ledger accountant to receive annual training by professionals in the field of grant accounting and reporting. The payroll clerk should receive proper training in processing journal entries for all areas of payroll. All accounting staff should have the adequate skills, knowledge and experience to oversee and/or perform the necessary accounting functions each month. Policies and procedures should be updated to adequately address the challenges and dynamics of the community action agency. We believe that the CFO with the supporting staff and general ledger accountant should have the overall responsibility of properly reconciling and closing out the accounting system and grant activity each month in an efficient and timely manner so as to eliminate the risk of significant errors occurring. Budget-to-actual schedules should be an integral part of the grant accountant’s basic responsibilities. Program directors should be involved in the closing process. We further recommend that training be provided to all staff engaged in the financial reporting, allocations and reconciliation functions to ensure that a complete and accurate financial statements close-out process is achieved each month and annually. Accounting policies and procedures must be updated and implemented. Views of Responsible Officials and Planned Corrective Actions: Management is in the process of assessing the organizational structure and capacity to provide adequate financial reporting. With Board review and approval of the Agency’s financial funding sources, the Agency will require additional specialize training for fiscal staff and improve in the segregation of duties to ensure adequate internal controls are fully implemented. The CFO will have the overall responsibility of properly reconciling and closing out the accounting system and grant activity each month in an efficient and timely manner to eliminate the risk of significant errors occurring. Budget-to-actual schedules will be an integral part of the grant accountant analyst’s basic responsibilities. The fiscal policies and procedures will be updated with the enhancements implemented within the fiscal department. Staff will be trained on revised policies and procedures and Uniform Guidance regulations. The CFO will take lead in financial reporting to ensure that all reporting meet GAAP and GAS requirements and to provide informative reports for Board and Management. All enhancements will be implemented by June 30, 2026.

Finding 2025-001: Reporting - Significant Deficiency Name of Federal Agency: U.S. Department of Health and Human Services Federal Program Name and Assistance Listing Number: CCDF Cluster, 93.575 Federal Award Identification Number and Year: 2101HICSC6, 2021 Name of Pass-through Entity: State of Hawaii Department of Human Services Criteria: According to 2 CFR 200.329, management is responsible for ensuring that all reports are submitted timely, in accordance with organizational policies and compliance requirements. Condition: During the audit we noted that the Organization had not retained documentation showing that the required reports were submitted timely. Cause: The Organization's financial management did not retain documentation indicating that the reports were submitted timely. Effect or Potential Effect: This condition may lead to non-compliance with reporting requirements. Questioned Costs: N/A Context: This issue was noted across multiple reporting instances. While management submitted complete and accurate reports, documentation confirming timely submission was not retained. Identification as a Repeat Finding: This is a repeat finding. See 2024-02. Recommendation: We recommend that the Organization implement policies, procedures, and controls to ensure that there are documented and retrievable records to indicate that reports were submitted timely. Views of Responsible Officials: Management concurs with the finding and will ensure that records are maintained to indicate timely submission of reports.

Strengthening Institutions Program – Department of Education Federal Financial Assistance Listing #84.031 P031A080196 Reporting Material Weakness in Internal Control over Compliance and Material Noncompliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.328 and 2 CFR 200.329 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: Section 3 of the Title III Endowment Report for the year ending June 30, 2024, was completed materially incorrect for Type of Savings Account Security line items and Total Invested line item. Cause: There was a lapse within the internal control process ensuring the report was completed materially correct. Effect: The annual report was completed materially incorrect and filed with the Department of Education. Questioned Costs: None. Context/Sampling: No sampling was utilized. The only report required to be filed in the fiscal year was tested. Repeat Finding from Prior Years: Yes. Recommendation: The University should review their current internal control process to ensure required reports are completed materially correct. Views of Responsible Officials: Management agrees with the finding.

Finding 2025-002 Lack of Internal Controls over Reporting Federal Agency: U.S. Department of Education Federal Program: Research and Development Cluster ALN: 84.351 Award Numbers: S351A210129 Award Years: 2021-2026 Type of Finding: Significant deficiency in internal control over compliance and noncompliance. Criteria: Per 2 CFR 200.329, the grant recipient must monitor their activities under Federal Awards to ensure they are compliant with all requirements and meeting performance expectations. Per the grant award, performance reports should contain current performance and financial expenditure information for the grant. Condition and context: During our testing of reporting, we noted that the total expenditures reported on the November performance report exceeded the expenditure account detail for the reporting period by about $60,000. Per the grant director, this was due to purchase order requisitions being cancelled by the business manager that were still accrued as expenditures on the November report by the grant director. Cause: The district did not have internal controls in place to avoid overstating expenditures in the grant report. Effect: Failure to accurately report expenditures could result in noncompliance with federal grant requirements and a loss of Federal grant funding. Questioned Costs: None. Repeat Finding: No. We believe this to be an isolated occurrence. Recommendation: We recommend that the District follow internal control procedures to confirm that grant expenditures are accurately reported. Management’s Response: Management concurs with the finding. See Corrective Action Plan.

Finding 2025-003 Lack of Internal Controls over Reporting Federal Agency: U.S. Department of Education Federal Program(s): Indian Education – Tribal Leaders of Tomorrow Assistance Listing Number(s):84.299A Award Number(s): S299A200024-24 Award Years: 2024 Type of Finding: Significant deficiency in internal control over compliance and noncompliance. Criteria: All recipients are required to submit an annual Grant Performance Report providing the most current performance and financial expenditure information that is sufficient to meet the reporting requirements of 2 CFR 200.328, 200.329 and 34 CFR 75.720. Yukon Flats is required to submit quarterly performance reports within 30 days after the end of each quarter. Condition and Context: The client was unable to locate the annual report that was submitted for the program. Additionally, they were unable to show that the annual report or the quarterly reports were submitted timely. Cause: Lack of internal controls related to reporting requirements and employee turnover at the District. Effect: Lack of internal controls over reporting could allow requirements to be missed that could in turn lead to a loss of funding. Repeat Finding: This is not a repeat finding. Questioned Costs: None reported. Recommendation: We recommend that management implement stronger internal controls over reporting, specifically to retaining supporting documentation of timely submission. Management Response: Management concurs with this finding. See Corrective Action Plan.

Congressional Directives, U.S Department of Health and Human Services, Federal Assistance Listing #93.493; Contract No. 90XP0658-01-00 Condition: The amount of expenditures covered by the report period were inaccurately reported to the federal granting agency. Criteria: In compliance with Title 24 CFR Subpart D Post Federal Award Requirements §200.302 Financial management (b): The financial management system must provide for (2) Accurate, current, and complete disclosure of the financial results of each Federal award program in accordance with the reporting requirements set forth in SS 200.328 and 200.329.” Cause: The error stems from a clerical oversight related to evaluating the amount of expenditures at the wrong date, as the transactions in the final month of the reporting period had not been closed out by the Organization at the time the report was prepared. Effect: The Organization failed to report the actual amount of expenditures in accordance with the program requirements, resulting in an understatement of $85,195 on the report. Failure to submit accurate funding and financial data could result in loss of future funding. Recommendation: Management should perform an internal review over inputs into federal financial reports before they’re submitted, to verify that inputs are accurate and cover the appropriate reporting period.

Finding 2025.002 - Reporting - Material Weakness Name of Federal Agency: U.S. Department of Health and Human Services Federal Program Name and Assistance Listing Number: Head Start Cluster, 93.600 Federal Award Identification Number and Year: 01CH011268-05-01 (2024), 01CH012890-01-01 (2024), 01CH011268-05-03 (2024) Name of Pass-through Entity (if applicable): N/A Criteria In accordance with §200.328 Financial Reporting and 200.329, Monitoring and Reporting Program Performance, recipients and subrecipients must submit financial and performance reports as required by the award. Under the requirements of the Federal Funding Accountability and Transparency Act (“FFATA”) that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to identify awards subject to FFATA, collect and report information on each first tier subaward or amendment of $30,000 or more in federal funds in the FFATA Subaward Reporting System. Condition A SF-425 report was not properly supported by accounting records or reviewed prior to filing. Additionally, the Federal Funding Accountability and Transparency Act ("FFATA") report for the subrecipient was not filed. Cause CLC lacks sufficiently documented policies and procedures related to the grant's reporting requirements. CLC experienced a change in personnel. Management did not maintain supporting documentation for the SF-425 report and did not have the report reviewed prior to submission. Additionally, management was unaware of the FFATA reporting requirement. Effect or Potential Effect Inadequate documentation of policies and procedures for reporting requirements and controls over the preparation and review of reports resulted in the untimely filing of required reports causing there to be noncompliance with the reporting requirement set forth by the Uniform Guidance. Lack of review and support may result in the improper reporting of activity to the granting agency. Questioned Costs None Context One of two SF-425 reports was tested. The report tested did not have supporting documentation or evidence of review. The entity was required to submit 1 FFATA report, which was not submitted. Identification as a Repeat Finding This is not a repeat finding. Recommendation We recommend that management establish and formally document comprehensive policies and procedures for the reporting process. These policies and procedures should clearly outline all required reports, filing timelines, and the method for maintaining supporting documentation. We recommend that CLC develop and implement a standardized checklist outlining all required grant compliance requirements. The checklist should clearly identify the individual responsible for preparation and the individual responsible for review. Additionally, both the preparer and reviewer should document their completion of the review to provide evidence that compliance requirements have been appropriately verified. Views of Responsible Officials Children’s Learning Centers of Fairfield County, Inc. concurs with this finding. Management will establish and formally document grant reporting policies and procedures for the Head Start Cluster, including a centralized compliance calendar, required deliverables list, and a standardized checklist for each reporting package (including SF-425 and FFATA subaward reporting, as applicable). All reports will be supported by underlying accounting records, retained in a centralized repository, and subject to documented preparer and independent reviewer sign-off prior to submission. CLC will provide staff training and cross-training to maintain continuity during personnel changes.

Congressional Directives, ALN 93.493 U.S. Department of Health and Human Services Program Year 2024 - 2025 Criteria or Specific Requirement - Reporting 2 CFR 200.329 Condition - Semi-annual performance reports submitted to the U.S. Department of Health and Human Services (HRSA) portal were not submitted timely. Cause - The University experienced uncertainty regarding the expected submission timeline for the required performance report. Effect or Potential Effect - The University submitted the performance report to HRSA after the deadline. Questioned Costs - None Context - Out of the population of two semi-annual performance reporting requirements for the fiscal year, a sample of one report was selected for testing. Our sample was not, and was not intended to be statistically valid. The performance report tested was not submitted in a timely manner. Identification as a Repeat Finding - N/A Recommendation - The University should review and update their internal controls to ensure performance reports are submitted in a timely manner.

U.S. Department of Homeland Security Direct Funding FFAL# 97.083 Staffing for Adequate Fire and Emergency Response (SAFER) Cash Management, Reporting Significant Deficiency in Internal Control Criteria: In accordance with 2 CFR 200.302, non-Federal entities must establish and maintain effective internal controls over Federal award compliance, including controls over cash management and Federal financial and performance reporting. Additionally, 2 CFR 200.327–200.329 require accurate, complete, and timely submission of performance and financial reports. Condition: The City did not have adequate internal controls to ensure the accuracy, completeness, and proper authorization of submissions to the Federal agency. Specifically: 1. Financial and performance reports submitted to the Federal agency did not undergo a secondary (independent) review prior to submission. 2. Reimbursement requests submitted to the Federal agency did not undergo a secondary (independent) review prior to submission. Cause: The City has not implemented or enforced a formalized review process that requires supervisory-level approval prior to the submission of reports or reimbursement requests. Effect: Without a secondary review, there is an increased risk that inaccurate, incomplete, or unsupported information may be submitted to the Federal agency. This could result in: • Reporting errors or omissions, • Noncompliance with Federal requirements, • Potential questioned costs, and • Increased risk of funding delays or corrective action requirements. Questioned Costs: None to report Context/Sampling: Out of a total population of three reports and reimbursement requests, three were selected for testing. Repeat Finding from Prior Years: No. Recommendation: We recommend that the City design and implement formal internal controls requiring documented secondary review and approval for all financial and performance reports, and all reimbursement requests submitted to Federal agencies. Views of Responsible Officials: Agree.

Finding 2025-004: Reporting Assistance Listing Number 84.126A Rehabilitation Services - Vocational Rehabilitation Grants to States Award Period: July 1, 2024 – June 30, 2025 Criteria: Award recipients, as dictated by the grant agreements, may be required to provide performance reporting to the awarding agency in order to maintain funding. For performance reporting, non-federal entities may be required to submit performance reports at least annually but not more frequently than quarterly using a form or format authorized by the awarding agency (2 CFR 200.329). Condition: In accordance with the grant agreements, the College was required to provide certain quarterly and annual performance reports which were not submitted timely. Cause: Staff turnover within the Finance and Office of Grants and Sponsored Research (OGSR) prevented adequate levels of detailed review and understanding of the specific due dates and information requirements for periodic performance reporting per the grant agreements. Effect: Certain performance reports were not submitted timely in accordance with the requirements of the respective grant agreements. Questioned Costs: None. Context: For the “Transition TA & Administration” and “Summer Transition Programs” grants, the College was unable to produce evidence that performance reporting occurred timely and with the requisite approvals. Repeat Finding: No. Recommendation: It is recommended that management perform a more thorough review of specific reporting requirements related to the ALN 84.126A grant agreements to ensure that the College’s requirements as they relate to performance reporting requirements are met. Views of Responsible Individuals: In response, the College is looking to implement a centralized reporting and tracking system with reminders for deadlines as well as incorporating reviews over performance reporting into month-end procedures. Oversight over reporting has been added as part of the monthly Research Administration meetings, and the College is looking to expand support staff to assist with performance monitoring. Lastly, the College is planning to expand annual training requirements for all principal investigators and support staff. Refer to the Corrective Action Plan for Current Year Findings.

2025-001 Report Submission Delay Program: 93.778 Medicaid Cluster – Medical Assistance Program, Pass-Through Award #567787 Criteria: In accordance with 2 CFR 200.329, non-Federal entities must submit performance reports at the interval required by the Federal awarding agency or pass-through entity no later than the specified due date. If a justified request is submitted by a non-Federal entity, the Federal agency may extend the due date for any performance report. Condition: During our audit, we identified one quarterly status report that was submitted to the Contracting Officer’s Representative (COR) after the stated due date. Cause: During the reporting period, the report was submitted to the COR after the stated due date due to an administrative oversight by program management. Effect: Report was not submitted to the COR in a timely manner and a request for extension of the due date was not made. Questioned Costs: None noted. Context: The report was due to the COR within 20 days of the reporting period end and was submitted one day after the stated due date. Repeat Finding: No. Recommendation: When timely submission may not be possible, Union of Pan Asian Communities should request an extension from the COR by providing a notice of the delay and rationale for the late report, and, if approved, submit the report by the extended deadline. When extensions are not granted, Union of Pan Asian Communities should submit reports by the initial stated due date. Views of Responsible Officials: Management agrees with the finding and a response is included in the corrective action plan.

FINDING 2025-004 Subject: COVID-19 - Education Stabilization Fund - Cash Management Federal Agency: Department of Education Federal Program: COVID - 19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U200013 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Cash Management Audit Findings: Material Weakness, Other Matters Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2023-009. Condition and Context The School Corporation had not properly designed or 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 related to the Cash Management compliance requirement. Reimbursement requests for the program were prepared by one employee and reviewed by another employee; however, the supporting documentation that was provided to the reviewer did not give a clear distinction as to what expenditures were included in the reimbursement. As the documentation provided was not adequate that accompanied the reimbursement request, and the reimbursement requests, as noted below, did not agree to the ledger, the reviewer could not have ensured expenses were paid prior to requesting reimbursement. For 5 of 25 expenditures tested, the School Corporation was unable to provide supporting documentation traceable to the reimbursement request. There were 2 of those expenditures, totaling $1,715, that were for ESSER II's final reimbursement which requested the remainder of the grant award and expenses could not be traced to the documentation provided for the reimbursement amount. There were 3 of the expenditures, totaling $6,665, that were not traceable to an ESSER III reimbursement request. Therefore, as the expenditure could not be traced to a reimbursement request, it could not be determined if the School Corporation paid for the expense prior to requesting reimbursement. INDIANA STATE BOARD OF ACCOUNTS 21 SILVER CREEK SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Additionally, 1 of 25 expenditures tested, for $154, was an expense that occurred after the School Corporation requested reimbursement. The lack of internal controls and noncompliance were systemic issues throughout the audit period for ESSER II and ESSER III. 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 200.305(b) states in part: "For non-Federal entities other than states, payments methods must minimize the time elapsing between the transfer of funds from the United States Treasury or the pass-through entity and the disbursement by the non-Federal entity whether the payment is made by electronic funds transfer, or issuance or redemption of checks, warrants, or payment by other means. . . . (3) Reimbursement is the preferred method when the requirements in this paragraph (b) cannot be met, when the Federal awarding agency sets a specific condition per § 200.208, or when the non-Federal entity requests payment by reimbursement. . . ." 2 CFR 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." Cause A proper system of internal controls was not designed and implemented by management of the School Corporation, which would include segregation of key functions. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. The School Corporation had not developed any policies that would have ensured compliance or that supporting documentation would have been maintained and available for audit related to the Cash Management compliance requirement. INDIANA STATE BOARD OF ACCOUNTS 22 SILVER CREEK SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Effect The failure to retain and provide appropriate supporting documentation prevented the determination of the School Corporation's compliance with the Cash Management compliance requirement. Noncompliance with the grant agreement and the Cash Management 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 School Corporation's management establish a system of internal controls to ensure that documentation will be maintained and available for audit and comply with the grant agreement and the Cash Management compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Finding 2025-046 Compliance with Subrecipient Monitoring for Disaster Grants The Federal Emergency Management Agency (FEMA) Disaster Grants program [ALN 97.036] provides supplemental assistance to recipients to assist communities with responding to and recovering from major disasters or emergencies. The program also provides funding for hazard mitigation measures to help communities implement hazard mitigation projects that can protect them from future disasters. The Disaster Grants program is based on a partnership between FEMA, the recipient (in this case, the Department), and, as applicable, the subrecipient (local governments). FEMA is responsible for managing the Disaster Grants program, approving grants, and providing technical assistance to the state, local, tribal, and territorial governments. The Department, as a recipient of Disaster Grants program funds, is responsible for providing technical advice and assistance to eligible subrecipients, providing support for damage survey activities, ensuring that all potential applicants are aware of funding assistance available, and submitting documents necessary for grant awards. A subrecipient is defined in federal regulations [2 CFR 200.1] as an entity, usually but not limited to non-federal entities, that receives a subaward from a pass-through entity to carry out part of a federal award; but does not include an individual that is a beneficiary of such award. A subrecipient may also be a recipient of other federal awards directly from a federal awarding agency. Federal regulations [2 CFR 200.1] define a subaward as an award provided by a pass-through entity (such as the Department) to an entity (subrecipient) to carry out part of a federal grant award received by the pass-through entity. Specifically for this program, the subrecipient is expected to request assistance, as needed; identify the damaged facilities; provide information to support its funding requests; maintain accurate documentation; and perform other work, as necessary. As part of its subrecipient monitoring process, the Department should complete an annual risk assessment to determine the extent of its subrecipient monitoring activities. The risk assessment should include considerations of financial risk factors, such as financial implications of operational and compliance failures; operational risk factors, such as risks resulting from inadequate internal controls; and compliance risks, such as violations with laws, regulations, and internal policies. In addition, the Department should be using monitoring tools to track the status of whether the subrecipient underwent a Single Audit, if applicable, and whether that audit has been reviewed by Department staff and any resulting management decisions issued by those staff to the subrecipient, if applicable, that address the Department’s assessment and planned actions to address any findings or issues identified in the audit During Fiscal Year 2025, the Department passed approximately $76.0 million to 66 subrecipients for responses to various disasters covered by the Department’s Disaster Grants program. In addition, the Department reported that it approved no new subawards during Fiscal Year 2025. All funds passed through to subrecipients by the Department were related to reimbursements for prior period expenses. In total, the Department reported that it had passed through Disaster Grant funding to another 68 subrecipients in prior years who did not receive funding passed through from the Department during Fiscal Year 2025; many of these subrecipients had multiple open projects that had been completed in prior years but were awaiting final approval and close-out from FEMA. What was the purpose of our audit work and what work was performed? The purpose of the audit work was to determine whether the Department had adequate internal controls in place over, and complied with, subrecipient monitoring requirements over the Disaster Grants program during Fiscal Year 2025. Another purpose of the audit work was to determine whether the Department implemented our Fiscal Year 2024 audit recommendation to review all subrecipients’ federally-required Single Audit reports, as required. The Department agreed with the recommendation and planned to implement it by June 2025. As part of our audit work, we performed testwork to determine whether the Department obtained its subrecipients’ Single Audit reports and issued a management decision, if applicable. We also determined whether the Department performed risk assessments on the subrecipients as required by federal regulations. Finally, we performed this testing over a random sample of 9 of 68 subrecipients that received pass-through funding in the current year. How were the results of the audit work measured? We measured the results of our audit work against the following requirements: • Federal regulations [2 CFR 200.332] require the Department to evaluate each subrecipient’s risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate level of subrecipient monitoring based on the Department’s assessment of risk posed by the subrecipients. Additionally, it requires the Department to verify that every subrecipient is audited as required by 2 CFR 200, Subpart F, Audit Requirements, which sets forth the federal regulations around Single Audit threshold requirements for subrecipients. It also covers the federal regulations to consider whether the results of the subrecipient’s audits indicates conditions that necessitate adjustment to the passthrough entity’s—in this case, the Department’s—own records. Further, federal regulations [2 CFR 200.521] require the Department to issue a management decision, which is defined as the Department’s written determination of the adequacy of the subrecipient’s proposed corrective action to address any findings in the subrecipient’s Single Audit reports within 6 months of the federal audit clearinghouse’s acceptance of the audit report. • The Department’s Division of Homeland Security and Emergency Management’s (DHSEM) Subrecipient Monitoring policy states that it “…will perform an annual evaluation of Subrecipient’s risks prior to the start of each State fiscal year, analyzing active awards and assessing Subrecipients for the upcoming year to determine the financial status of each Subrecipient and which subrecipients will receive on-site monitoring which may include desk reviews.” The policy further goes on to indicate that each subrecipient will receive an overall risk score that is used to determine which subrecipients will undergo monitoring review during the fiscal year based on the quantitative and qualitative data used for the assessment inputs. • The DHSEM Subrecipient Monitoring policy also states that “DHSEM will perform reviews of single audit results for Subrecipients who have expended Federal grant funds in excess of $750,000 of which some portion is passed through DHSEM.” • Federal regulations [2 CFR 200.329] stipulate that the non-federal award recipient—in this case the Department—is responsible for oversight of the operations of its federal award-supported activities. The regulations further state that the “non-federal entity” must monitor its activities under federal awards to assure that compliance with applicable federal requirements and performance expectations is being achieved. What problems did the audit work identify? Based on our audit work, we determined that the Department did not fully implement our prior audit recommendation by its planned implementation date of June 30, 2025, and did not complete required subrecipient monitoring activities for its Disaster Grants program. Specifically, we found that the Department did update the risk assessment policies for the 2025 risk assessment and fully assessed risks for subrecipients for Fiscal Year 2025. However, there was one subrecipient that had not yet issued a finalized audit report and, therefore, the Department’s subrecipient monitoring process was pending completion. Why did these problems occur? Although the Department designated staff to obtain and review Single Audit reports for all of its subrecipients, Department staff stated that they were not able to complete their reviews of previously unreviewed Single Audit reports during Fiscal Year 2025, as letters were still being processed for execution and distribution under the updated policies. The Department also subsequently stated that some of these reviews were incomplete due to the subrecipients not yet finalizing their Single Audits with their auditors. Why do these problems matter? By failing to complete all of its reviews of subrecipients’ Single Audit reports, the Department is out of compliance with both federal requirements and with its policy to complete monitoring reviews for each subrecipient. This could result in the Department not timely identifying enforcement actions that may be needed against noncompliant subrecipients and then making revisions, as applicable, to its monitoring risk assessment for the subrecipient. See "Schedule of Findings and Questioned Costs" for table/chart. Recommendation 2025-046 The Department of Public Safety (Department) should continue to implement its subrecipient monitoring policy and ensure the Department is in compliance with federal regulations to review all subrecipients’ Single Audit reports in a timely manner. This should also include the Department completing its reviews of the subrecipients’ prior year’s Single Audit reports and issuing the management decision letters for those reports. Response Department of Public Safety Agree Implementation Date: June 2026 The Department will continue to follow the current Policy and Procedure related to the Single Audit reviews and has allocated an individual to review the Single Audits. This includes issuing a management decision letter if required, in accordance with the timeline established in federal guidance.

Finding Reference 2025-005 Federal Agency: U.S. Department of Homeland Security Pass-Through Agency: Central Office of Recovery, Reconstruction and Resiliency of Puerto Rico (COR3) Program: Disaster Grants – Public Assistance (Presidentially Declared Disaster) (ALN 97.036) Compliance Requirement: Reporting (L) Type of Finding: Significant Deficiency in Internal Controls (SD), Instance of Noncompliance (NC) This finding is similar to prior-year finding 2023-005 and 2024-005. Statement of Condition In our Reporting Test, we evaluated the Quarterly Progress Reports of a total of eleven (11) projects for two quarters of fiscal year 2024-2025. During our audit procedures, we noted that the reports did not agree with the accounting and project records. Criteria 2 CFR 200.302 (a) stated that the state’s and the other non-Federal entity’s financial management system, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. Also, 2 CFR 200.302 (b) (2) states that the financial management system of each non-Federal entity must provide accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. Cause of Condition The Municipality accounting controls and procedures fail to ensure accurate, current and complete disclosure of the financial results of federal assisted activities. Effect of Condition The expenses reported in the Quarterly Progress Reports do not agree with the accounting records. Recommendation We recommend that Program Administrators reconcile the differences between the quarterly report and the accounting records before the submission of the next submission to the pass-through entity. Questioned Cost None Prior Year Finding Yes. This finding is similar to prior-year finding 2023-005 and 2024-005. Views of Responsible Officials and Planned Corrective Action We concur with the finding. We understand that only two reports did not agree with the accounting records. We have consultants that are responsible for the preparation of these reports. Instructions were given to the consultants in order to correct the reports that do not agree with the accounting records. There was a misunderstanding with the reports, in which the pass-through entity instructed that purchase orders and expenditures incurred should be reported. As subsequently clarified, only the expenditures incurred should be reported as expended. Implementation Date: June 30, 2026 Responsible Person: Meyleen Hernández Rivera Finance Director

FINDING NUMBER 2025-004 FEDERAL AGENCY U.S. DEPARTMENT OF HOMELAND SECURITY PASS-THROUGH AGENCY CENTRAL OFFICE OF RECOVERY, RECONSTRUCTION AND RESILIENCY OF PUERTO RICO (COR3) FEDERAL EMERGENCY MANAGEMENT AGENCY (FEMA) FEDERAL PROGRAM DISASTER GRANTS – PUBLIC ASSISTANCE (PRESIDENTIALLY DECLARED DISASTERS) (ALN 97.036) REQUIREMENT REPORTING (L) TYPE OF FINDING SIGNIFICANT DEFICIENCY (SD) / NONCOMPLIANCE (NC) CONDITION In our Reporting Test, we evaluated the Quarterly Progress Reports of a total of eleven (11) projects for two quarters of fiscal year 2024-2025. During our audit procedures, we noted that the reports did not agree with the accounting and project records. CRITERIA 2 CFR 200.302 (a) states that the states’ and other non-Federal entities’ financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. Also, 2 CFR 200.302 (b) (2) states that the financial management system of each non-Federal entity must provide accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. CAUSE The Municipality’s accounting controls and procedures fail to ensure accurate, current and complete disclosure of the financial results of federal assisted activities. EFFECT The expenses reported in the Quarterly Progress Reports do not agree with the accounting records. RECOMMENDATION We recommend the Program Administrators reconcile the differences between the quarterly report and the accounting records before the submission to the pass-through entity. QUESTIONED COST None. PRIOR YEAR FINDING No. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE We concur with the auditors’ finding. The Municipality acknowledges the differences identified between the expenses reported in the Quarterly Progress Reports (QPRs) and the accounting records. To address this issue, the Municipality will implement a reconciliation process between the accounting records and the QPRs prior to their submission to the pass-through entity. Additionally, management will perform a supervisory review to ensure that the reported expenses agree with the accounting records and supporting documentation. Implementation Date: Fiscal Year 2026-2027. Responsible Person: Miguel Fonseca, Federal Programs Director

Finding Reference 2025-004 Federal Agency: U.S. Department of Homeland Security Pass-Through Agency: Central Office of Recovery, Reconstruction and Resiliency of Puerto Rico (COR3) Program: Disaster Grants – Public Assistance (Presidentially Declared Disaster) (ALN 97.036) Compliance Requirement: Reporting (L) Type of Finding: Significant Deficiency in Internal Controls (SD), Instance of Noncompliance (NC) It is not a prior-year finding. Statement of Condition In our Reporting Test, we evaluated the Quarterly Progress Reports of a total of five (5) projects for two quarters of fiscal year 2024-2025. During our audit procedures, we noted that the reports of two (2) projects did not agree with the accounting and project records. Criteria 2 CFR 200.302 (a) stated that the state’s and the other non-Federal entity’s financial management system, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. Also, 2 CFR 200.302 (b) (2) states that the financial management system of each non-Federal entity must provide accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. Cause of Condition The Municipality’s accounting controls and procedures fail to ensure accurate, current and complete disclosure of the financial results of federal assisted activities. Effect of Condition The expenses reported in the Quarterly Progress Reports do not agree with the accounting records. Recommendation We recommend that Program Administrators reconcile the differences between the quarterly report and the accounting records before the submission of the next submission to the pass-through entity. Questioned Cost None Views of Responsible Officials and Planned Corrective Action We concur with the finding. During the testing of reports, the Quarterly Progress Reports of five (5) projects, corresponding to two (2) quarters of fiscal year 2024-2025, were evaluated. It was found that in two (2) projects, the quarterly reports did not match the accounting records or the project documentation. Therefore, for the purposes of this audit, the municipal accounting controls and procedures did not ensure that the reported information was accurate, up-to-date, and fully reconciled with the financial records. In light of the above, the reports will be reconciled with the accounting records, and the discrepancies found will be identified, documented, and adjusted in the system where the error originated, as appropriate. Furthermore, from this point forward, once the Quarterly Reports (QPR) are issued, a copy must be sent to the Program Accountant, the Finance Director, and myself for validation and reconciliation prior to official filing, thus preventing situations like this to occur. This process will form part of the internal control required to ensure that the reported information is accurate, current, complete, and consistent with the accounting records, in accordance with applicable federal requirements. Implementation Date: From March 2026. Full implementation is expected in fiscal year 2026-2027. Responsible Person: Mrs. Natasha Vázquez Federal Programs Director

2025-001 Reporting (Significant Deficiency in Internal Controls over Compliance and Instance of Noncompliance) Criteria: The City is required to file quarterly SF-425, Federal Financial Reports for each award and under the requirements of 2 CFR 200.329, the City is required to submit performance reports (COPS Progress Reports) semi-annually during the life of the award for each award. Condition: Four COPS Progress Reports were not submitted timely during the year ended June 30, 2025. Context: During our audit, we tested all reports for timely filing. We tested twelve SF-425 reports and six performance reports and noted four of the performance reports were filed after the due date. Cause: The City has not implemented the proper controls to ensure all required COPS Progress reports are submitted to the federal agency timely. Effect: COPS performance reports were not submitted by their due dates. Questioned Costs: None Repeat Finding: No. Recommendation: We recommend that the City ensure that adequate controls are in place to ensure that report due dates are met. Views of Responsible Officials: Management agrees with the finding.

Questioned Cost $ – Finding No. 2025-001: Reporting (Significant Deficiency) Federal Agency: U.S. Department of Commerce AL Number and Title: 11.029 – Tribal Broadband Connectivity Program (“TBCP”) Award Number and Award Year: NT23TBC0290054 2025 Repeat Finding? No Condition During our audit, we tested the performance reporting for the semi-annual reporting period ended March 31, 2025, and noted that the total expenditures reported did not agree with the federal expenditures reported on SF-425, resulting in a variance. Criteria Per 2 CFR 200.329, recipients must submit accurate and complete performance reports that are consistent with financial data reported on the Federal Financial Report (SF-425). Effect The performance report did not accurately reflect the total federal expenditures for the reporting period, leading to inconsistencies between the financial and performance data submitted to the federal awarding agency. This reduces the reliability of reported information and represents a deficiency in internal control over compliance. Cause and View of Responsible Officials The discrepancy occurred because the program personnel lacked a clear understanding of the difference between cash and accrual basis accounting. As a result, the Cash on hand amount reported on the SF-425 was incorrectly included in the total expenditures on the performance report. The review control did not identify this error prior to submission. Recommendation We recommend that management provide training to staff responsible for preparing and reviewing performance and financial reports to ensure a proper understanding of cash versus accrual basis reporting. Management should also implement a reconciliation and review process to verify that the total federal expenditures reported in the performance report agree to the federal share of expenditure reported on SF-425 prior to submission.

FINDING 2025-004 Subject: Child Nutrition Cluster - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children, Fresh Fruit and Vegetable Program Assistance Listings Numbers: 10.553, 10.555, 10.559, 10.582 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2023-2024, FY 2024-2025 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation had not designed or implemented a system of internal controls, which would have included appropriate segregation of duties, that would have likely been effective in preventing, or detecting and correcting, noncompliance. The School Corporation transferred $313,369 from the School Lunch fund into the Operations fund. This transfer was labeled as an indirect cost transfer; however, indirect costs were not approved to be charged to the program. This transfer was also not approved by the School Board. The issue was identified and corrected by the current Treasurer prior to June 30, 2025. The lack of internal controls and noncompliance over allowable activities was an isolated instance. Criteria 2 CFR 200.302 states in part: "(a) Each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. . . . (b) The financial management system of each non-Federal entity must provide for the following . . . (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Federal program and Federal award identification must include, as applicable, the Assistance Listings title and number, Federal award identification number and year, name of the Federal agency, and name of the pass-through entity, if any. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . . (3) Records that identify adequately the source and application of funds for federallyfunded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. INDIANA STATE BOARD OF ACCOUNTS 23 PLYMOUTH COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (4) Effective control over, and accountability for, all funds, property, and other assets. . . ." 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 200.400 states in part: "The application of these cost principles is based on the fundamental premises that: (a) The non-Federal entity is responsible for the efficient and effective administration of the Federal award through the application of sound management practices. (b) The non-Federal entity assumes responsibility for administering Federal funds in a manner consistent with underlying agreements, program objectives, and the terms and conditions of the Federal award. (c) The non-Federal entity, in recognition of its own unique combination of staff, facilities, and experience, has the primary responsibility for employing whatever form of sound organization and management techniques may be necessary in order to assure proper and efficient administration of the Federal award. . . ." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: . . . (g) Be adequately documented. . . ." 2 CFR 200.404 states in part: "A cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost. The question of reasonableness is particularly important when the non- Federal entity is predominantly federally-funded. In determining reasonableness of a given cost, consideration must be given to: . . . (e) Whether the non-Federal entity significantly deviates from its established practices and policies regarding the incurrence of costs, which may unjustifiably increase the Federal award's cost." INDIANA STATE BOARD OF ACCOUNTS 24 PLYMOUTH COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.508 states in part: "The auditee must: . . . (d) Provide the auditor with access to personnel, accounts, books, records, supporting documentation, and any other information as needed for the auditor to perform the audit required by this part." Federal Register, Vol. 87, No. 18 states in part: "Treasury has divided the Restriction on Use section into . . . (B) other restrictions on use, which include (1) debt service and replenishing reserves, (2) settlements and judgements, and (3) general restrictions. These restrictions apply to all eligible use categories. . . ." Cause The School Corporation had not developed a system of internal controls that would have ensured that all activities and costs were in compliance with the Activities Allowed or Unallowed and the Allowable Costs/Cost Principles compliance requirements. Effect Without the proper design or implementation of the components of a system of internal controls, including policies and procedures that provide segregation of duties and additional oversight as needed, the internal control system was not capable of effectively preventing, or detecting and correcting, noncompliance as identified in the Condition and Context. Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a proper system of internal controls and develop policies and procedures to ensure all activities are allowable. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

FINDING 2025-006 Subject: Title I Grants to Local Educational Agencies - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A220014, S010A230014 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Findings: Material Weakness, Modified Opinion Condition and Context The School Corporation did not have effective internal controls in place to ensure all costs paid from Title I funds and submitted for reimbursement were for allowable activities or allowable costs. As a result, the following compliance issues were noted:  On May 26, 2023, a check for $886 was issued for which supporting documentation could not be provided. As a result, it could not be determined if the expense was for an allowable activity or an allowable cost.  On August 16, 2024, seven stipends were paid to non-Title I administrative staff from Title I grant funds. Two employees received $5,000 each and five employees received $3,000 each.  On December 20, 2024, three stipends for $918 each were paid from Title I grant funds to employees who had previously received a stipend payment on August 16, 2024. These stipends were determined to not be an allowable activity or an allowable cost. The current Treasurer identified the stipend errors. The School Corporation requested and received reimbursement from the seven employees who received these stipends. INDIANA STATE BOARD OF ACCOUNTS 27 PLYMOUTH COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Criteria 2 CFR 200.302 states in part: "(a) Each state must expend and account for the Federal award in accordance with state laws and procedures for expending and accounting for the state's own funds. In addition, the state's and the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. . . . (b) The financial management system of each non-Federal entity must provide for the following . . . (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Federal program and Federal award identification must include, as applicable, the Assistance Listings title and number, Federal award identification number and year, name of the Federal agency, and name of the pass-through entity, if any. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . . (3) Records that identify adequately the source and application of funds for federallyfunded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income and interest and be supported by source documentation. (4) Effective control over, and accountability for, all funds, property, and other assets. . . ." 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 200.400 states in part: "The application of these cost principles is based on the fundamental premises that: (a) The non-Federal entity is responsible for the efficient and effective administration of the Federal award through the application of sound management practices. INDIANA STATE BOARD OF ACCOUNTS 28 PLYMOUTH COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (b) The non-Federal entity assumes responsibility for administering Federal funds in a manner consistent with underlying agreements, program objectives, and the terms and conditions of the Federal award. (c) The non-Federal entity, in recognition of its own unique combination of staff, facilities, and experience, has the primary responsibility for employing whatever form of sound organization and management techniques may be necessary in order to assure proper and efficient administration of the Federal award. . . ." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (g) Be adequately documented. . . ." 2 CFR 200.404 states in part: "A cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost. The question of reasonableness is particularly important when the non- Federal entity is predominantly federally-funded. In determining reasonableness of a given cost, consideration must be given to: . . . (e) Whether the non-Federal entity significantly deviates from its established practices and policies regarding the incurrence of costs, which may unjustifiably increase the Federal award's cost." 2 CFR 200.508 states in part: "The auditee must: . . . (d) Provide the auditor access to personnel, accounts, books, records, supporting documentation, and any other information as needed for the auditor to perform the audit required by this part." Federal Register, Vol. 87, No. 18 states in part: "Treasury has divided the Restriction on Use section into . . . (B) other restrictions on use, which include (1) debt service and replenishing reserves, (2) settlements and judgements, and (3) general restrictions. These restrictions apply to all eligible use categories. . . ." Cause The School Corporation did not design and implement an effective internal control system to review all payroll expenditures from the Title I funds, ensuring they were for allowable activities. Effect The failure to design and implement an effective internal control system over payroll expenditures caused noncompliance with the compliance requirements as detailed in the Condition and Context. INDIANA STATE BOARD OF ACCOUNTS 29 PLYMOUTH COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Questioned Costs There were no questioned costs identified. Recommendation We recommended that management of the School Corporation establish a system of internal controls to ensure that grant award fund compliance requirements are appropriately researched prior to spending. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

FINDING 2025-005 Subject: Child Nutrition Cluster - Reporting Federal Agency: Department of Agriculture Federal Programs: School Breakfast Program, National School Lunch Program, Summer Food Service Program for Children Assistance Listings Numbers: 10.553, 10.555, 10.559 Federal Award Numbers and Years (or Other Identifying Numbers): FY 2023-2024, FY 2024-2025 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters Condition and Context Monthly Sponsor Claims for Reimbursement (Claims) were submitted to the Indiana Department of Education based upon the number of meals served for the month. The Claims were prepared by the School Corporation's Food Service Director and a food service management company (FSMC) employee. The School Corporation maintained manual meal count records. A point-of-sale system (POS) was used to summarize the manual counts. For all four Claims tested, there were differences between the Claims submitted and the School Corporation's detail meal count reports, resulting in over and under reporting and reimbursement. The Claims tested contained the following errors:  The October 2023 claim reported 27 less meals served (11 breakfast and 16 lunch) than the eligible meals per the School Corporation's detail meal count reports, which resulted in an underclaimed reimbursement totaling $100. The School Corporation also overclaimed snacks by 5, which resulted in over reimbursement of $6.  The November 2023 claim reported 2 less lunch meals served than the eligible meals per the School Corporation's detail meal count reports, which resulted in an underclaimed reimbursement totaling $9.  The June 2024 claim reported 666 more breakfast meals served than the eligible meals per the School Corporation's detail meal count reports, which resulted in an overclaimed reimbursement totaling $1,946. The claim also reported 527 less lunch meals served than the eligible meals per the School Corporation's detail meal count reports, which resulted in an underclaimed reimbursement totaling $2,704. The net of the errors was $758 underclaimed. INDIANA STATE BOARD OF ACCOUNTS 28 SCHOOL CITY OF EAST CHICAGO SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued)  The May 2025 claim reported 10 less meals served (5 breakfast and 5 lunch) than the eligible meals per the School Corporation's detail meal count reports, which resulted in an underclaimed reimbursement totaling $37. The School Corporation also overclaimed snacks by 10, which resulted in over reimbursement of $12. The lack of internal controls and noncompliance were systemic issues throughout the audit period. 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 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." Cause The School Corporation did not have effective internal control procedures in place over the Claims submitted. The Claims contained evidence of an oversight or review process in place; however, they did not prevent, or detect and correct, errors. The Claims were prepared based upon summary sheets prepared by the FSMC employees and were not verified back to the source records. Effect The lack of effective internal controls caused a total of $894 not to be claimed for reimbursement, which projected to a loss of funding of $6,272. Noncompliance with the grant agreement and the compliance requirement could result in the loss or repayment of federal funds. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish a proper system of internal controls to ensure compliance with requirements related to reporting. INDIANA STATE BOARD OF ACCOUNTS 29 SCHOOL CITY OF EAST CHICAGO SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

FINDING 2025-008 Subject: COVID-19 - Education Stabilization Fund - Condition of Records Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U, 84.425W Federal Award Numbers and Years (or Other Identifying Numbers): S425D210013, S425U210013, S425W210015 Pass-Through Entity: Indiana Department of Education Compliance Requirements: Activities Allowed or Unallowed; Allowable Costs/Cost Principles; Equipment and Real Property Management; Matching, Level of Effort, Earmarking; Special Tests and Provisions - Wage Rate Requirements Audit Findings: Material Weakness, Modified Opinion Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding numbers were 2023-007 and 2023-009 over the compliance requirements Equipment and Real Property Management and Special Tests and Provisions - Wage Rate Requirements, respectively. Condition and Context The School Corporation received reimbursements totaling $30,316,384 from the COVID-19 - Education Stabilization Fund (ESF) federal awards during the audit period. The reimbursements were associated with three separate federal awards, each of which was required to be accounted for in a separate fund within the School Corporation's financial management system. Expenditures were to be made in accordance with the approved grant applications and budgets, with reimbursement requests subsequently submitted to the Indiana Department of Education (IDOE). The School Corporation was responsible for maintaining detailed disbursement ledgers for each grant fund to support the amounts claimed for reimbursement. As is typical with reimbursement-based grants, the ending cash and investment balances of each grant fund were expected to reflect overdrawn balances until the subsequent reimbursements were received from the IDOE. The $30,316,384 received in ESF funds during the audit period was based on 28 reimbursement requests for expenditures incurred between June 1, 2023 through December 13, 2024. Based on our review of grant fund records and inquiry with management, we identified the following deficiencies:  The detailed disbursement ledger for the period of June 1, 2023 through December 13, 2024, excluding June 2024 for Grant #S425U210013 as no reimbursement request was submitted, reflected total expenditures of $23,051,334. This resulted in $7,265,050 in reimbursements that were not adequately supported by detailed records. INDIANA STATE BOARD OF ACCOUNTS 33 SCHOOL CITY OF EAST CHICAGO SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued)  A review of the submitted reimbursement requests indicated that $1,069,865 was reimbursed for indirect costs; however, a disbursement from the grant funds to other operating funds was not recorded within the School Corporations records.  Of the 28 reimbursement requests submitted, only 5 were supported by detailed disbursement ledgers that agreed with the dates and amounts claimed. The remaining 23 reimbursement requests could not be directly reconciled to the supporting documentation provided. Upon further inquiry with management, additional records were provided; however, these records lacked sufficient detail, such as fund number, fund name, check numbers, dates, and vendor names to be useable.  Reimbursements received were not posted to each grant fund properly. This resulted in the ARP EESER III fund receipts to be understated by $4,297,935 and the ESSER II and GEER PD funds receipts to be overstated by $4,174,376 and $123,560, respectively.  Since this is a reimbursement-based grant, the ending cash and investment balances of each grant fund should either be zero or overdrawn while awaiting reimbursement. However, as of June 30, 2025, the ESSER II and Geer PD funds reported positive cash and investment balances of $5,047,932 and $404,653, respectively. Due to the deficiencies noted above, the School Corporation was unable to provide sufficient appropriate evidence for us to determine populations, and, therefore, audit and base an opinion on the compliance requirements subject to audit that were determined to have a direct and material effect on the program. As a result, the $30,316,384 in reimbursements received during the audit period were considered questioned costs. The lack of internal controls and noncompliance were material and systemic throughout the audit period. 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 200.302 states in part: "(a) . . . the other non-Federal entity's financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. See also § 200.450. INDIANA STATE BOARD OF ACCOUNTS 34 SCHOOL CITY OF EAST CHICAGO SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (b) The financial management system of each non-Federal entity must provide for the following (see §§ 200.334, 200.335, 200.336, and 200.337): (1) Identification, in its accounts, of all Federal awards received and expended and the Federal programs under which they were received. Federal program and Federal award identification must include, as applicable, the Assistance Listings title and number, Federal award identification number and year, name of the Federal agency, and name of the pass-through entity, if any. (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements in §§ 200.328 and 200.329. . . . (3) Records that identify adequately the source and application of funds for federallyfunded activities. These records must contain information pertaining to Federal awards, authorizations, financial obligations, unobligated balances, assets, expenditures, income, and interest and be supported by source documentation. (4) Effective control over, and accountability, for all funds, property, and assets. The non- Federal entity must adequately safeguard all assets and ensure that they are used solely for authorized purposes. See § 200.303. (5) Comparison of expenditures with budget amounts for each Federal award. (6) Written procedures to implement the requirements of § 200.305. (7) Written procedures for determining the allowability of costs in accordance with subpart E of this part and the terms and conditions of the Federal award." 2 CFR 200.1 states in part: ". . . Questioned cost means a cost that is questioned by the auditor because of an audit finding: (1) Which resulted from a violation or possible violation of a statute, regulation, or the terms and conditions of a Federal award, including for funds used to match Federal funds; (2) Where the costs, at the time of the audit, are not supported by adequate documentation; or (3) Where the costs incurred appear unreasonable and do not reflect the actions a prudent person would take in the circumstances. (4) Questioned costs are not an improper payment until reviewed and confirmed to be improper as defined in OMB Circular A-123 appendix C. (See also the definition of Improper payment in this section)." 2 CFR 200.403 states in part: "Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. INDIANA STATE BOARD OF ACCOUNTS 35 SCHOOL CITY OF EAST CHICAGO SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (b) Conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. . . . (g) Be adequately documented. . . ." 2 CFR 200.313(d) states in part: ". . . (1) Property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property (including the FAIN), who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. (2) A physical inventory of the property must be taken and the results reconciled with the property records at least once every two years. (3) A control system must be developed to ensure adequate safeguards to prevent loss, damage, or theft of the property. Any loss, damage, or theft must be investigated. (4) Adequate maintenance procedures must be developed to keep the property in good condition. . . ." 29 CFR 5.5 states in part: "(a) Required contract clauses. The Agency head will cause or require the contracting officer to require the contracting officer to [sic] insert in full, or (for contracts covered by the Federal Acquisition Regulation (48 CFR chapter 1)) by reference, in any contract in excess of $2,000 which is entered into for the actual construction, alteration and/or repair, including painting and decorating, of a public building or public work, or building or work financed in whole or in part from Federal funds or in accordance with guarantees of a Federal agency or financed from funds obtained by pledge of any contract of a Federal agency to make a loan, grant or annual contribution (except where a different meaning is expressly indicated), and which is subject to the labor standards provisions of any of the laws referenced by § 5.1, the following clauses . . . (1) Minimum wages— (i) Wage rates and fringe benefits. All laborers and mechanics employed or working upon the site of the work (or otherwise working in construction or development of the project under a development statute), will be paid unconditionally and not less often than once a week, and without subsequent deduction or rebate on any account (except such payroll deductions as are permitted by regulations issued by the Secretary of Labor under the Copeland Act (29 CFR part 3)), the full amount of basic hourly wages and bona fide fringe benefits (or cash equivalents thereof) due at time of payment computed at rates not less than those contained in the wage determination of the Secretary of Labor which is attached hereto and made a part hereof, regardless of any contractual relationship which may be alleged to exist between the contractor and such laborers and mechanics. . . . (3) Records and certified payrolls— (ii) Certified payroll requirements— INDIANA STATE BOARD OF ACCOUNTS 36 SCHOOL CITY OF EAST CHICAGO SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (A) Frequency and method of submission. The contractor or subcontractor must submit weekly, for each week in which any DBA- or Related Acts-covered work is performed, certified payrolls to the [write in name of appropriate Federal agency] if the agency is a party to the contract, but if the agency is not such a party, the contractor will submit the certified payrolls to the applicant, sponsor, owner, or other entity, as the case may be, that maintains such records, for transmission to the [write in name of agency]. . . ." 2 CFR 200 Appendix II to Part 200 states in part: "In addition to other provisions required by the Federal agency or non-Federal entity; all contracts made by the non-Federal entity under the Federal award must contain provisions covering the following, as applicable. . . . (D) Davis-Bacon Act, as amended (40 U.S.C. 3141-3148). When required by Federal program legislation, all prime construction contracts in excess of $2,000 awarded by non- Federal entities must include a provision for compliance with the Davis-Bacon Act (40 U.S.C. 3141-3144, and 3146-3148) as supplemented by Department of Labor regulations (29 CFR Part 5, 'Labor Standards Provisions Applicable to Contracts Covering Federally Financed and Assisted Construction'). In accordance with the statute, contractors must be required to pay wages to laborers and mechanics at a rate not less than the prevailing wages specified in a wage determination made by the Secretary of Labor. In addition, contractors must be required to pay wages not less than once a week. . . ." Cause The School Corporation experienced turnover in key personnel over the federal program, which contributed to the lack of appropriate supporting records. A proper system of internal controls was not designed to ensure continuity of policies, procedures, and records when personnel transitions occurred. Effect Noncompliance with the grant agreement and the compliance requirements could result in the repayment of federal funds. Questioned Costs We identified $30,316,384 in known questioned costs as noted in the Condition and Context. Recommendation We recommended that the School Corporation's management develop policies and procedures to ensure continuity of school records during a personnel change and that all reimbursement requests are properly supported by detail records. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

FINDING 2025-002 Subject: TRIO Cluster - Reporting Federal Agency: US Department of Education Federal Programs: TRIO Student Support Services, TRIO Talent Search, TRIO Upward Bound Assistance Listings Numbers: 84.042A, 84.044, 84.047 Federal Award Numbers and Years (or Other Identifying Numbers): P042A200749, P042A200690, P042A201220, P042A201222, P044A220683, P047A221086, P047A221077 Compliance Requirement: Reporting Audit Findings: Material Weakness, Other Matters This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2024-003. Condition and Context An effective internal control system was not in place at the College to ensure compliance with requirements related to the Reporting compliance requirement. The following errors on the fiscal year 2024 Annual Performance Report (APR) were noted:  For TRIO Student Support Services at the Indianapolis Campus, key line items were tested for 24 students. For 1 student, field 31 "Undergraduate Degree/Certificate Completed at Grantee Institution" was inaccurately reported.  For TRIO Student Support Services at the Northwest (Lake) Campus, key line items were tested for 22 students. o For 1 student, field 15 "Eligibility" was inaccurately reported. o For 2 students, field 18 "Date of First Project Service" was inaccurately reported. o For 1 student, field 19 "College Grade Level (entry into project)" was inaccurately reported. o For 7 students, field 23 "Enrollment Status (at end of academic year)" was inaccurately reported. o For 1 student, field 24 "Academic Standing" was inaccurately reported. o For 3 students, field 31 "Undergraduate Degree/Certificate Completed at Grantee Institution" was inaccurately reported.  For TRIO Student Support Services at the Richmond Campus, key line items were tested for 25 students. o For 2 students, field 17 "First Enrollment Date (at grantee institution)" was inaccurately reported. INDIANA STATE BOARD OF ACCOUNTS 20 IVY TECH COMMUNITY COLLEGE OF INDIANA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) o For 1 student, field 22 "Participant Status (during academic year)" was inaccurately reported. o For 8 students, field 23 "Enrollment Status (at end of academic year)" was inaccurately reported. o For 1 student, field 27 "College Grade Level (at end of academic year)" was inaccurately reported.  For TRIO Talent Search at the Northwest (Lake) Campus, key line items were tested for 40 students. o For 10 students, the College could not provide supporting documentation for item A1 "Persisted in school for the next academic year at the next grade level or graduated high school." o For 2 students, the College inaccurately reported that the students persisted in the next academic year at the next grade level; however, the students did not advance to the next grade level.  For TRIO Upward Bound at the Indianapolis Campus, key line items were tested for 10 students. For 1 student, field 17 "Reading Language Arts or Math Proficiency Not Achieved" was inaccurately reported.  For TRIO Upward Bound at the Muncie Campus, key line items were tested for 9 students. o For 3 students, field 16 "Eligibility" was inaccurately reported. o For 1 student, field 17 "Reading Language Arts or Math Proficiency Not Achieved" was inaccurately reported. o For 1 student, field 19 "Pre-Algebra or Algebra Course Not Successfully Completed by Beginning of 10th Grade" was inaccurately reported. The lack of effective internal controls and noncompliance was a systemic issue at four of the five campuses that were reported on the TRIO Cluster program during the audit period. 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 21 IVY TECH COMMUNITY COLLEGE OF INDIANA SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) 2 CFR 200.329(c)(1) states in part: "The recipient or subrecipient must submit performance reports as required by the Federal award. . . ." 34 CFR 646.32(c) states in part: "Recordkeeping. A grantee must maintain participant records that show– (1) The basis for the grantee's determination that each participant is eligible to participate in the project under § 646.3; (2) The grantee's basis for determining the academic need for each participant; (3) The services that are provided to each participant; (4) The performance and progress of each participant by cohort for the duration of the participant's attendance at the grantee's institution . . ." Cause The College's management had not developed an effective system of internal controls that would have ensured compliance with the Reporting compliance requirement. The College had not developed policies and procedures to verify that the TRIO Cluster reporting agreed with supporting records. Effect Without the proper implementation of an effectively designed system of internal controls, the College cannot ensure reporting for the TRIO Cluster is accurate and in agreement with supporting records. Noncompliance with the reporting requirement could have resulted in the loss of federal funds to the College. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the College's management strengthen the internal controls related to the compliance requirement listed above. We also recommended strengthening its policies and procedures to ensure reporting for the TRIO Cluster programs agree with supporting records of the College. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Finding Reference 2025-006 Federal Agency: U.S. Department of Health and Human Services Federal Program Title and ALN: Child Care and Development Block Grant (CCDF Cluster) (ALN 93.575) Compliance Requirement: Reporting – Financial Reporting (L) (MW) Type of finding: Material Weakness in Internal Control (MW), Instance of Noncompliance (NC) Statement of Condition During our audit procedures, we noted that the Program did not maintain an adequate set of accounting records that present the financial position and results of its operations of the program. In addition, required financial reports were not submitted within the established reporting deadlines. CriteriaTitle 2 U.S. Code of Federal Regulations (CFR) 200.328 and 200.329 require subrecipients to submit accurate, complete, and timely performance and financial reports in accordance with the terms and conditions of the Federal award. Additionally, 2 CFR 200.303 requires non-Federal entities to establish and maintain effective internal control over Federal programs to provide reasonable assurance that Federal awards are managed in compliance with Federal statutes, regulations, and the terms and conditions of the award. Additionally, the subaward agreement and reporting guidelines issued by the pass-through entity (ACUDEN) also establish specific reporting deadlines and require that reported financial information be supported by the subrecipient’s accounting records. Cause of Condition The program staff faced performance challenges due to a lack of staff which caused the accounting records to be delayed. Effect of Condition As a result of the inadequate maintenance of accounting records and untimely preparation of financial reports, the Municipality failed to submit the required report within the 30 calendar days required by the regulation, which leads to the noncompliance of the reporting requirement. Recommendation We recommend that management strengthen internal controls over financial reporting by: • Ensuring accounting records are maintained current and reconciled on a monthly basis; • Establishing formal written reporting procedures with clear timelines; • Assigning personnel responsible for report preparation and review; and • Implementing supervisory review procedures to verify that reports agree with underlying accounting records prior to submission. Questioned Costs None Prior-Year Finding This is a new finding. View of Responsible Official and Planned Corrective Action Plan The Municipality agrees with the finding and stated that it will implement corrective actions to improve compliance with reporting requirements. Management plans to formalize reporting procedures, assign responsible personnel, and require reconciliations between reported amounts and accounting records prior to submission of reports to ACUDEN, along with enhanced supervisory review. Implementation Date: July 1, 2026 Responsible Person: Mr. Luis A. Velez Rivera, Finance Director

Section III – Major Federal Award Program Findings and Questioned Costs Finding Reference 2025-005 Federal Agency: U.S. Department of Homeland Security Pass-through Agency: P.R. Central Office for Recovery, Reconstruction and Resiliency (COR3) Program: Disaster Grants - Public Assistance (Presidentially Declared Disasters (Assistance Listing No. 97.036) Compliance Requirement: Reporting (L) Type of Finding: Significant Deficiency in Internal Controls (SD), Instance of Noncompliance (NC) Statement of Condition In our Reporting Test, we evaluated the Quarterly Progress Reports of a total of seven (7) projects for two quarters of fiscal year 2024-2025. During our audit procedures, we identified that the reports did not agree with the accounting records. During our audit procedures, we identified that the reports noted that the reports did not agree with the accounting records. Criteria 2 CFR 200.302 (a) states that the states’ and other non-Federal entities’ financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. Also, 2 CFR 200.302 (b) (2) states that the financial management system of each non-Federal entity must provide accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. Cause of Condition The Municipality’s accounting controls and procedures fail to ensure accurate, current and complete disclosure of the financial results of federal assisted activities. Effect of Condition The expenses reported in the Quarterly Progress Reports do not agree with the accounting records. Recommendation We recommend the Program Administrators reconcile the differences between the quarterly report and the accounting records before the following submissions to the pass-through entity. Questioned Cost None. Prior Year Finding No. Views of Responsible Officials and Planned Corrective Action We concur with the finding. Adopted Measures • Expense Synchronization: A protocol will be implemented requiring contracted consultants to record and report incurred expenses only when a validated disbursement voucher is available, thereby ensuring the integrity of the financial flow. • Reconciliation: The office will conduct a detailed comparison between the draft quarterly report and the general ledger to identify and correct any discrepancies prior to final submission. • Compliance Timeline: An internal deadline will be established for the submission of the report, ensuring attainment of the minimum percentage required under the Quality Activities category through accurate financial data. Expected Outcome To ensure that all financial information submitted is complete, accurate, and fully aligned with the Municipality’s accounting records, thereby eliminating the risk of audit findings. Implementation Date: March 2026. Responsible persons: • Person responsible for the implementation: Mr. Carlos Flores, Federal Program’s Subdirector • Person responsible for the supervision: Mrs. Yolanda Maldonado, Federal Program’s Director

2025-001 Submission of Required Performance Reports Federal Agency: Department of Housing and Urban Development Program Game: Community Project Funding Assistance Listing Number: 14.251 Economic Development Initiative Federal Award Identification Number: B-23-CP-CA-0083 B-23-CP-CA-0106 Questioned Costs: $0 Criteria: Under 2 CFR §200.329 (Monitoring and reporting program performance) and the terms and conditions of the federal award agreement, recipients are required to submit periodic performance reports to the federal awarding agency that compare actual accomplishments with the objectives of the federal program. These reports must be submitted according to the schedule established in the grant agreement. Condition: During testing of compliance with federal award requirements, we noted that the auditee did not submit the required performance reports on a semi-annual basis. The reports were due no later than 30 days after the end of each 6 month reporting period beginning the first January or June after the date the grant agreement is signed. The grant agreement was signed in July 2024. Cause: The auditee did not have adequate internal controls in place to ensure that required federal performance reporting deadlines were tracked and reports were prepared and submitted timely. Effect: Failure to submit required performance reports may limit the federal awarding agency’s ability to monitor program performance and determine whether federal funds are being used in accordance with program objectives. Recommendation: We recommend that the auditee implement procedures to ensure compliance with federal performance reporting requirements. Such procedures should include assigning clear responsibility for report preparation and submission, maintaining a reporting calendar for all federal award requirements, and implementing supervisory review to confirm that required reports are submitted timely. Management’s Plan for Corrective Action: Management agrees with the finding and plans to implement procedures to ensure timely submission of required performance reports. We will ensure that the grant administrator develops processes for a reporting calendar, preparing required reports, and documenting submission. Management expects these procedures to be implemented beginning in the next reporting cycle. Management has subsequently completed and submitted all of the required performance reports to remedy the identified deficiency.

Section III – Major Federal Award Program Findings and Questioned Costs Finding Reference 2025-003 Federal Agency: U.S. Department of Homeland Security Pass-through Agency: Central Office of Recovery, Reconstruction and Resiliency of Puerto Rico (COR3) Federal Emergency Management Agency (FEMA) Program: Disaster Grants – Public Assistance (Presidentially Declared Disaster) (ALN 97.036) Compliance Requirement: Reporting (L) Type of Finding: Significant Deficiency in Internal Controls (SD), Instance of Noncompliance (NC) Statement of Condition: In our Reporting Test, we evaluated the Quarterly Progress Reports of a total of four (4) projects for two quarters of fiscal year 2024-2025. During our audit procedures, we noted that the reports did not agree with the accounting and project records. Criteria: 2 CFR 200.302 (a) states that the states’ and other non-Federal entities’ financial management systems, including records documenting compliance with Federal statutes, regulations, and the terms and conditions of the Federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the Federal statutes, regulations, and the terms and conditions of the Federal award. Also, 2 CFR 200.302 (b) (2) states that the financial management system of each non-Federal entity must provide accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. Cause of Condition: The Municipality’s accounting controls and procedures fail to ensure accurate, current and complete disclosure of the financial results of federal assisted activities. Effect of Condition: The expenses reported in the Quarterly Progress Reports do not agree with the accounting records. Recommendation: We recommend the Program Administrators reconcile the differences between the quarterly report and the accounting records before the submission to the pass-through entity. Questioned Costs: None. Prior Year Findings: Yes. This finding is similar to prior-year finding 2024-003 and 2023-003. Views of Responsible Officials and Planned Corrective Actions: We concur with the findings. During the past year, the Corrective Action Plan (PAC) has been implemented and expense reconciliation efforts have been ongoing. Currently, we are in the process of collecting all supporting documentation related to work performed for projects funded by FEMA. It is expected that the reconciliation of expenses will be completed over the next few quarters, and that expense reporting will continue during the quarters in which payments are made. Implementation Date: Fiscal Year 2025-2026. Responsible Person: José A. Torres Otero Program Accountant

Finding No: 2025-003– Internal control deficiencies over accounting and identification of federal funds received from the Federal Emergency Management Agency (FEMA) that should be included on SEFA Federal Programs ALN 97.036, Disaster Grants - Public Assistance (Presidentially Declared Disasters) Name of Federal Agency U.S. Department of Homeland Security (Pass-through program from The Central Office of Recovery, Reconstruction and Resiliency) Category Internal Control; Compliance. Compliance Requirement Activities Allowed/Unallowed, Allowable Costs/Cost Principles, Period of Performance, Project Accounting. Criteria 2 CFR Part 200 Subpart D Subsection 200.302 states the following: The recipient's and subrecipient's financial management system must provide for the following: 1. Identification of all Federal awards received and expended and the Federal programs under which they were received. Federal program and Federal award identification must include, as applicable, the Assistance Listings title and number, Federal award identification number, year the Federal award was issued, and name of the Federal agency or pass-through entity. 2. Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements in §§ 200.328 and 200.329. When a federal agency or pass-through entity requires reporting on an accrual basis from a recipient or subrecipient that maintains its records other than on an accrual basis, the recipient or subrecipient must not be required to establish an accrual accounting system. This recipient or subrecipient may develop accrual data for its reports based on an analysis of the documentation on hand. 3. Maintaining records that sufficiently identify the amount, source, and expenditure of Federal funds for Federal awards. These records must contain information necessary to identify Federal awards, authorizations, financial obligations, unobligated balances, as well as assets, expenditures, income, and interest. All records must be supported by source documentation. 4. Effective control over and accountability for all funds, property, and assets. The recipient or subrecipient must safeguard all assets and ensure they are used solely for authorized purposes. See § 200.303. 5. Comparison of expenditures with budget amounts for each Federal award. 6. Written procedures to implement the requirements of § 200.305. 7. Written procedures for determining the allowability of costs in accordance with subpart E and the terms and conditions of the Federal award. Condition During our procedures concerning the Administration’s funds received from FEMA we noticed that the reimbursement funds received from FEMA were not recognized as income during the year ended June 30, 2025. Cause The Administration recognized the reimbursement as an accrual and not as income during the year ended June 30, 2025. They have recognized only the amount that they disbursed during the year at their discretion. This accounting is correct when the funds received are capital advances. Effect This can result in amounts not to be included in the Schedule of Expenditures and Federal Awards in the correct period and understate SEFA. Also, the Administration could be subject to penalties or sanctions from the Federal Grantor. Context The Administration identified $6,543 as federal expenditures from prior years capital advances of FEMA awards but did not identify as expended the amount of $11,063 from advances. In addition, the Administration received reimbursements of $1,413,451 in the fiscal year, however management did not identify this amount as federal expenditures until the audit procedures was performed. Identification of repeat finding None. Questioned costs None, as adjustments were made during the audit to correct the misstatement. Recommendation We recommend validating, with the staff in charge of Engineering, the type of funds received from FEMA, if they are reimbursements or capital advances. When the funds received are reimbursements they should be recognized as income in the year received. If the funds are capital advances they should be recognized as unearned revenue and as income in the year in which they are disbursed. Views of responsible officials and planned corrective actions We agreed with the auditors’ finding and recommendation. See further details regarding this matter within the Corrective Action Plan.

FINDING 2025-004 Subject: Title I Grants to Local Educational Agencies - Special Tests and Provisions - Participation of Private School Children Federal Agency: Department of Education Federal Program: Title I Grants to Local Educational Agencies Assistance Listings Number: 84.010 Federal Award Numbers and Years (or Other Identifying Numbers): S010A220014, S010A230014, S010A240014 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Special Test and Provisions - Participation of Private School Children Audit Findings: Material Weakness, Other Matters Condition and Context The School Corporation did not provide supporting documentation for the amounts disbursed for Participation of Private School Children. No time sheets or logs were provided to support the hours paid to employees for working with the private school children. 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: (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 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . INDIANA STATE BOARD OF ACCOUNTS 22 METROPOLITAN SCHOOL DISTRICT OF SOUTHWEST ALLEN COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." Cause The School Corporation had not developed a system of internal controls that would have ensured that records were maintained and made available for audit related to the Special Tests and Provisions - Participation of Private School Children compliance requirement. Effect The lack of appropriate documentation prevented the determination of the School Corporation's compliance with the Special Tests and Provisions - Participation of Private School Children compliance requirement. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the School Corporation's management establish internal controls to ensure compliance and comply with the Special Test and Provisions - Participation of Private School Children compliance requirement. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Finding No. 2025-072 Federal Awarding Agency: United States Department of Agriculture (USDA) Impact: Significant Deficiency AL Number and Title: 10.859 Assistance to High Energy Cost Rural Communities Federal Award Number: AK0031-E84 Applicable Compliance Requirement: Allowable Costs/Cost Principles, Special Tests and Provisions Condition: Alaska Energy Authority (AEA) did not have controls in place for review of progress reports for this program. During our testing of reports, we noted that two of the five reports sampled did not have evidence of a formal review before submission. Context: We tested a sample of five reports and found two exceptions as noted in the condition. This is a condition identified per review of AEA’s compliance with specified requirements not using a statistically valid sample. Cause: AEA did not have controls in place to ensure that progress reports were reviewed by personnel independent of the preparers prior to submission to the federal agency. Criteria: 2 CFR 200.303, Internal Controls, requires that non-federal entities receiving federal awards establish and maintain internal control designed to reasonably ensure compliance with federal statues, regulations, and the terms and conditions of the federal award. Effect: Reports may contain inaccuracies, be incomplete, or fail to comply with the requirements outlined in 2 CFR 200.329 and the federal award. Questioned Costs: None Recommendation: AEA should establish procedures requiring all reports be reviewed and approved by personnel independent of the preparer prior to submission to federal agencies. Views of Responsible Officials: Management agrees with this finding.

Finding 2025-001: Reporting - Significant Deficiency Name of Federal Agency: U.S. Department of the Treasury Federal Program Name and Assistance Listing Number: COVID-19 - Coronavirus State and Local Fiscal Recovery Funds, 21.027 Federal Award Identification Numbers and Years: 194586 (2024), 196178 (2024) Name of Pass-through Entity: California Community Foundation Criteria: According to 2 CFR 200.329, management is responsible for ensuring that all reports are submitted timely, in accordance with organizational policies and compliance requirements. Condition: During the audit we noted that the Organization had not retained documentation showing that the required reports were submitted timely for subawards 194586 and 196178. Cause: The Organization's financial management did not retain documentation indicating that the reports were submitted timely. Effect or Potential Effect: This condition may lead to non-compliance with reporting requirements. Questioned Costs: N/A Context: This issue was noted across multiple reporting instances. While management submitted complete and accurate reports, documentation confirming timely submission was not retained. Identification as a Repeat Finding: This is a repeat finding. See 2024-003. Recommendation: We recommend that the Organization implement policies, procedures, and controls to ensure that there are documented and retrievable records to indicate that reports were submitted timely. Views of Responsible Officials: Management concurs with the finding and will ensure that records are maintained to indicate timely submission of reports.

Finding Reference: 2025-006 Federal Agency: U.S. Department of Health and Human Services Federal Program Title and ALN: Child Care and Development Block Grant (CCDF Cluster) (ALN 93.575) Compliance Requirement: Reporting – Financial Reporting (L) (MW) Type of finding: Significant Deficiency in Internal Control (SD), Instance of Noncompliance (NC) Statement of Condition: During our audit procedures, we noted that during fiscal year 2024-2025, the Program did not submit the required accumulated expenditure reports within the 15-day reporting deadlines established. In addition, the final financial reports required under the award were not submitted within the 90-day deadline. Criteria Title 2 Code of Federal Regulations (CFR) Sections 200.328 and 200.329 require subrecipients to submit accurate, complete, and timely financial and performance reports in accordance with the terms and conditions of the Federal award. In addition, the subaward agreement and reporting guidelines issued by ACUDEN establish specific deadlines for the submission of required financial reports, including final reports. Cause of Condition: The condition resulted, in part, from resource constraints experienced by the Program during the fiscal year, which affected the timely preparation and submission of required financial reports to ACUDEN. Effect of Condition: The untimely submission of accumulated expenditure reports and final financial reports may impair the pass-through entity's ability to effectively monitor program activities and financial performance on a timely basis and resulted in noncompliance with the reporting requirements established under the award. Recommendation: We recommend that Program management strengthen its procedures for monitoring reporting requirements and deadlines to ensure that all required financial reports, including final reports, are submitted timely in accordance with the terms and conditions of the award. Questioned Costs: None Prior-Year Finding: This is a new finding. View of Responsible Official and Planned Corrective Action Plan: Management established corrective measures immediately upon identifying the deficiency related to the untimely submission of the required reports. The Municipality implemented formal procedures to monitor reporting deadlines and ensure the timely submission of reports required by ACUDEN. Management will continue monitoring compliance with these corrective measures to ensure the timely submission of reports in future periods. Implementation Date: July 1, 2026 Responsible Person Mrs. Mayra Ortiz Arroyo, Finance and Budget Director

Finding 2025-013 – Noncompliance with Reporting Over Major Federal Program - Coronavirus State and Local Fiscal Recovery Funds (Repeat Finding – 2023-013, 2024-013) PASS-THROUGH GRANTOR: Direct Grant FEDERAL AGENCY: U.S. Department of Treasury ASSISTANCE LISTING: 21.027 FEDERAL PROGRAM NAME: Coronavirus State and Local Fiscal Recovery Funds FEDERAL AWARD YEAR: 2021 CONTROL CATEGORY: Reporting QUESTIONED COSTS: $-0- Condition: During the test of 100% of expenditures for the Coronavirus State and Local Fiscal Recovery Funds, totaling $5,176,520, thirty (32) expenditures totaling $2,780,668, were not accurately reported in the proper period on the quarterly reports, and two expenditures to subrecipients totaling $121,362, were improperly classified as “Revenue Replacement” expense instead of using the “Infrastructure” expense category as required by the Reporting compliance requirement. Cause of Condition: Policies and procedures have not been designed and implemented to ensure federal expenditures are made in accordance with federal compliance requirements. Effect of Condition: This condition resulted in noncompliance with grant requirements. Recommendation: OSAI recommends the County design and implement a system of internal controls to ensure the accuracy and completeness of reports and to ensure compliance with federal requirements. Management Response: Chairman of the Board of County Commissioners: The Board of County Commissioners will take measures to ensure future compliance with all requirements of federal grants. Criteria: Accountability and stewardship should be overall goals in management’s accounting of federal funds. Internal controls should be designed to monitor compliance with laws and regulations pertaining to grant contracts. Title 2 CFR § 200.303(a) Internal Controls reads (a) reads as follows: 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 Controls Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Compliance and Reporting Guidance, State and Local Fiscal Recovery Funds (10. Reporting.) reads as follows: All recipients of federal funds must complete financial, performance, and compliance reporting as required and outlined in Part 2 of this guidance. Expenditures may be reported on a cash or accrual basis, as long as the methodology is disclosed and consistently applied. Reporting must be consistent with the definition of expenditures pursuant to 2 CFR 200.1. Your organization should appropriately maintain accounting records for compiling and reporting accurate, compliant financial data, in accordance with appropriate accounting standards and principles. In addition, where appropriate, your organization needs to establish controls to ensure completion and timely submission of all mandatory performance and/or compliance reporting. Further, 2 CFR § 200.329 Monitoring and Reporting Program Performance (c)(1) reads as follows The non-Federal entity must submit performance reports at the interval required by the Federal awarding agency or pass-through entity to best inform improvements in program outcomes and productivity. Intervals must be no less frequent than annually nor more frequent than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes. Reports submitted annually by the non-Federal entity and/or pass-through entity must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. Alternatively, the Federal awarding agency or pass-through entity may require annual reports before the anniversary dates of multiple year Federal awards. The final performance report submitted by the non-Federal entity and/or pass-through entity must be due no later than 120 calendar days after the period of performance end date. A subrecipient must submit to the pass-through entity, no later than 90 calendar days after the period of performance end date, all final performance reports as required by the terms and conditions of the Federal award. See also § 200.344. If a justified request is submitted by a non-Federal entity, the Federal agency may extend the due date for any performance report.

Finding 2025-014 – Noncompliance with Reporting Over Major Federal Program – Coronavirus State and Local Fiscal Recovery Funds (Repeat Finding – 2022-014, 2023-014, 2024-014) PASS-THROUGH GRANTOR: Direct Grant FEDERAL AGENCY: U.S. Department of Treasury ASSISTANCE LISTING: 21.027 FEDERAL PROGRAM NAME: Coronavirus State and Local Fiscal Recovery Funds FEDERAL AWARD YEAR: 2021 CONTROL CATEGORY: Reporting QUESTIONED COSTS: $0 Condition: During the test of sixty-five (65) expenditures for the Coronavirus State and Local Fiscal Recovery Funds, totaling $4,254,839, seventeen (17) expenditures, totaling $1,280,024, were not accurately reported in the proper period on the quarterly reports as required by the program. Cause of Condition: Policies and procedures have not been designed and implemented to ensure federal expenditures are properly reported in accordance with federal compliance requirements. Effect of Condition: This condition resulted in noncompliance with grant requirements. Recommendation: OSAI recommends the County design and implement a system of internal controls to ensure the accuracy and completeness of reports and to ensure compliance with federal requirements. Management Response: Chairman of the Board of County Commissioners: The Board of County Commissioners have hired a grant administrator to assist with the reporting process. We will ensure that the reports are accurate and reported in the proper period. Criteria: GAO Standards – Section 2 – Establishing an Effective Internal Control System – OV2.23 states in part: Objectives of an Entity – Compliance Objectives Management conducts activities in accordance with applicable laws and regulations. As part of specifying compliance objectives, the entity determines which laws and regulations apply to the entity. Management is expected to set objectives that incorporate these requirements. Title 2 CFR § 200.303(a) Internal Controls reads (a) reads as follows: 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). Additionally, Compliance and Reporting Guidance, State and Local Fiscal Recovery Funds (10. Reporting.) reads as follows: 10. Reporting. All recipients of federal funds must complete financial, performance, and compliance reporting as required and outlined in Part 2 of this guidance. Expenditures may be reported on a cash or accrual basis, as long as the methodology is disclosed and consistently applied. Reporting must be consistent with the definition of expenditures pursuant to 2 CFR 200.1. Your organization should appropriately maintain accounting records for compiling and reporting accurate, compliant financial data, in accordance with appropriate accounting standards and principles. In addition, where appropriate, your organization needs to establish controls to ensure completion and timely submission of all mandatory performance and/or compliance reporting. See Part 2 of this guidance for a full overview of recipient reporting responsibilities. Further, 2 CFR § 200.329 Monitoring and Reporting Program Performance (c)(1) reads as follows: The non-Federal entity must submit performance reports at the interval required by the Federal awarding agency or pass-through entity to best inform improvements in program outcomes and productivity. Intervals must be no less frequent than annually nor more frequent than quarterly except in unusual circumstances, for example where more frequent reporting is necessary for the effective monitoring of the Federal award or could significantly affect program outcomes. Reports submitted annually by the non-Federal entity and/or pass-through entity must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. Alternatively, the Federal awarding agency or pass-through entity may require annual reports before the anniversary dates of multiple year Federal awards. The final performance report submitted by the non-Federal entity and/or pass-through entity must be due no later than 120 calendar days after the period of performance end date. A subrecipient must submit to the pass-through entity, no later than 90 calendar days after the period of performance end date, all final performance reports as required by the terms and conditions of the Federal award. See also § 200.344. If a justified request is submitted by a non-Federal entity, the Federal agency may extend the due date for any performance report.

Health Center Program Cluster – Assistance Listing Nos. 93.224 and 93.527 U.S Department of Health and Human Services Award No. 5 H80CS00681-23-07, June 1, 2024 – May 31, 2025 Award No. 6 H80CS00681-24-04, June 1, 2025 – May 31, 2026 Criteria or Specific Requirement – Reporting – 2 CFR 200.329 Condition – The Organization is required to prepare and submit an annual Uniform Data System (UDS) for each calendar year for the Health Center Program Cluster. This report is to be prepared using accurate financial information. Cause – The Organization was unable to provide supporting documentation that agreed to the line items tested on the report. Effect or potential effect– Potential errors were made on the annual UDS report. Questioned Costs – None Context – The Organization’s annual UDS report was selected for testing. Of the ten inputs tested, four exceptions were noted related to the annual UDS report. Identification as a repeat finding, if applicable – Not a repeat finding. Recommendation – The Organization should revise polices and procedures over federal reporting to ensure reports are prepared using accurate information and supporting documentation for federal grant reports should be maintained. Views of Responsible Officials and Planned Corrective Actions – Management Response - Management concurs with the auditor's finding. The Organization acknowledges that a mistake was made on Table 9E-Other Revenue, where grant income, from the Early Childhood Development (ECD) grant, was listed in the incorrect location. The ECD grant should have been listed under Federal Grants: UHI Grant Revenue. Additionally, the Organization's UDS preparer, completed a transposition error when entering a salary amount in Table 8A. Corrective Action Planned - Management has engaged with an independent 3rd party accounting firm to review current processes, assist with strengthening internal controls and month-end/year-end closing procedures, and provide assistance in completing the Organization's annual UDS report. Completion Date - Completed 1/1/2026 Responsible Contact Person - Margret Guy, Director of Revenue; Julie Brilley, CEO

Coronavirus State and Local Fiscal Recovery Funds Assistance Listing No. 21.027 U.S. Department of Treasury Missouri Primary Care Association Criteria or specific requirement – Reporting (2 CFR 200.329) Condition – The Organization’s internal controls over compliance were not able to ensure progress reporting required to be submitted to the pass-through entity was completed timely. Cause – The Organization does not have internal controls over compliance in place to ensure all grant reporting requirements are satisfied timely. Effect or potential effect – The Organization did not submit the required quarterly and annual performance reports in a timely manner. Questioned costs – None Context – The Organization is required to submit quarterly status reports and an annual performance report to the pass-through entity in a timely manner. Identification as a repeat finding, if applicable – Not a repeat finding Recommendation – The Organization should consider implementing a grant reporting calendar for all grants with reporting requirements.

CFDA Number: 93.224 Federal Program or Cluster: Health Center Program Cluster Grantor Agency: U.S. Department of Health and Human Services Federal Award Identification: H8FCS41177 Compliance Requirements: Reporting Type of Finding: Noncompliance/Material Weakness in Internal Control over Compliance Quiestioned Costs: None Criteria: 2 CFR Part 200, Section 200.302 Financial management requires that the Organization's financial management system must provide for the following: 1) Identification of all Federal awards received and expended and the Federal programs under which they were received..; and 2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements in Sections 200.328 and 200.329. Section 200.328 Financial reporting states that the required financial reporting consists of the Federal Financial Report (SF-425). Condition: The SF-425 Federal Financial Report filed by the Organization for the H8FCS41177 Federal award reported that cash disbursements of $2,675,250, the total amount of the Federal award, had been made. However, $1,248,456 of those cash disbursements were determined during our audit to not be allowable due to not being obligated and/or liquidated by the period of performance deadlines. The cash disbursements reported on the SF-425 were not readily determinable from the Organization's general ledger accounts. Cause: Organization personnel were not aware of the period of performance with respect to this federal award. The Organization's previous CEO retired approximately May 31, 2024. Per inquiry of the Organizaton's CFO, their understanding was that the deadline to obligate for this federal award was December 31, 2024, and the deadline to expend or liquidate was December 31, 2026. The Organizaton's chart of accounts and general ledger do not include separate and distinct accounts or classes to which federal award expenditures are recorded. Effect or Potential Effect: The SF-425 Federal Financial Report filed by the Organization included cash disbursements of $1,248,456 that were not chargeable to the Federal award because they were not obligated before the period of performance end date and/or the payment was not made before the deadline to liquidate obligations. Context: We requested detail of expenditures for the Federal award and were provided with manual spreadsheets lacking all the transactional details needed. Information from the general ledger did not agree with cash disbursements reported on the SF-425. The general ledger information indicated $1,185,164 of the Federal award had not yet been disbursed at the time the SF-425 was filed. Repeat Finding: No Recommendation: We recommend that the Organization provide grants management training to all its financial staff and management covering the Uniform Guidance/OMB Guidance for Federal Financial Assistance. We also recommend that the Organization develop and implement policies and procedures for financial and performance report preparation to ensure information is supported by proper documentation and agrees with the general ledger. These policies and procedures should also include a requirement that all reports are reviewed by a member of management who is not involved in the preparation of the reports. Views of Responsible Officials: We agree with the finding. We have never received proper training. See Corrective Action Plan for Reference 2025-007.

Criteria: Per CFR 200.329(c)(1) The recipient or subrecipient must submit performance reports as required by the Federal award. Intervals must be no less frequent than annually nor more frequent than quarterly except if specific conditions are applied. Reports submitted annually by the recipient or subrecipient must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. Alternatively, the Federal agency or pass-through entity may require annual reports before the anniversary dates of multiple-year Federal awards.” Per the executed grant agreements, the grants require a quarterly report to be submitted within 30 days of the conclusion of each quarter and an annual report within 60 days at the conclusion of each calendar year. Condition: During our testing of the Organization’s compliance with the reporting requirements, we noted no quarterly or annual reports were submitted to Hamilton County. Only Final Reports were submitted once Hamilton County reached out. Cause: Controls were not in place to ensure required reports were submitted due to a lack of understanding the reporting requirements within the grant agreement. Effect: The untimely submission of the reports prevents the pass-through entity from effectively monitoring the progress of the funded project and making informed decisions. Additionally, consistent failure to meet reporting requirements could negatively impact the Organization’s ability for future federal awards. Questioned Costs: None Context: This is not a systemic problem. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization establish procedures for the preparation, review and timely submission of all reporting requirements. This can include implementing a system to track reporting deadlines and timely submission as well as designating individuals with the responsibilities of preparation, review, and submission of reports. Additionally, we recommend the Organization designate someone to review the grant documents for all compliance requirements to ensure nothing is missed. Management Response: The Advancement and Finance teams will create an updated Grants Management process. The Grants Management process will be documented and clearly define roles for Advancement and Finance staff. Additionally, a flowchart will be created to define what type of grant has been awarded (conditional vs. unconditional). The process will ensure all awarded grants are reviewed for all performance, outcomes, invoicing, and reporting requirements. The process will define who sets up calendar reminders for grant milestones (i.e., reporting) and how Program staff will be selected to receive these calendar reminders.

Criteria: Per CFR 200.329(c)(1) The recipient or subrecipient must submit performance reports as required by the Federal award. Intervals must be no less frequent than annually nor more frequent than quarterly except if specific conditions are applied. Reports submitted annually by the recipient or subrecipient must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. Alternatively, the Federal agency or pass-through entity may require annual reports before the anniversary dates of multiple-year Federal awards.” Per the executed grant agreements, the grants require a quarterly report to be submitted within 30 days of the conclusion of each quarter and an annual report within 60 days at the conclusion of each calendar year. Condition: During our testing of the Organization’s compliance with the reporting requirements, we noted no quarterly or annual reports were submitted to Hamilton County. Only Final Reports were submitted once Hamilton County reached out. Cause: Controls were not in place to ensure required reports were submitted due to a lack of understanding the reporting requirements within the grant agreement. Effect: The untimely submission of the reports prevents the pass-through entity from effectively monitoring the progress of the funded project and making informed decisions. Additionally, consistent failure to meet reporting requirements could negatively impact the Organization’s ability for future federal awards. Questioned Costs: None Context: This is not a systemic problem. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization establish procedures for the preparation, review and timely submission of all reporting requirements. This can include implementing a system to track reporting deadlines and timely submission as well as designating individuals with the responsibilities of preparation, review, and submission of reports. Additionally, we recommend the Organization designate someone to review the grant documents for all compliance requirements to ensure nothing is missed. Management Response: The Advancement and Finance teams will create an updated Grants Management process. The Grants Management process will be documented and clearly define roles for Advancement and Finance staff. Additionally, a flowchart will be created to define what type of grant has been awarded (conditional vs. unconditional). The process will ensure all awarded grants are reviewed for all performance, outcomes, invoicing, and reporting requirements. The process will define who sets up calendar reminders for grant milestones (i.e., reporting) and how Program staff will be selected to receive these calendar reminders.

VA Supportive Services for Veteran Families Program FFAL #64.033, 20-SD-136-23, 10/1/2022 – 3/1/2024 FFAL #64.033, 20-SD-136-24, 10/1/2023 – 12/31/2024 Reporting Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.328 and 2 CFR 200.329 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: No review and approval processes are in place over quarterly progress reports. Cause: Management did not have review procedures and processes in place over the quarterly progress reports. Effect: Without review procedures and processes in place over reporting, demonstrating the program complies with laws, regulations, and other compliance requirements is difficult. Additionally, not having an oversight process over reporting could result in a reasonable possibility reports that are inaccurate or incomplete could be submitted. Questioned Costs: None reported Context/Sampling: Included under the two award letters of the federal program, one annual financial report and one quarterly progress report was reviewed in the Organization’s fiscal year. In addition, two monthly HMIS reports were reviewed in the Organization’s fiscal year. There was a total of 18 reports filed. Repeat Finding from Prior Year: No Recommendation: We recommend management implement procedures and control processes to incorporate an independent review and approval over reporting and retain documentation to support the review was performed. Views of Responsible Officials: Management is in agreement.

VA Supportive Services for Veteran Families Program FFAL #64.033, 20-SD-136-23, 10/1/2022 – 3/1/2024 FFAL #64.033, 20-SD-136-24, 10/1/2023 – 12/31/2024 Reporting Material Weakness in Internal Control over Compliance Criteria: 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. 2 CFR 200.328 and 2 CFR 200.329 require the auditee to collect financial information and monitor its activities under federal awards to assure compliance with applicable federal requirements and performance expectations are being achieved and report these items in accordance with the program requirements. Condition: No review and approval processes are in place over quarterly progress reports. Cause: Management did not have review procedures and processes in place over the quarterly progress reports. Effect: Without review procedures and processes in place over reporting, demonstrating the program complies with laws, regulations, and other compliance requirements is difficult. Additionally, not having an oversight process over reporting could result in a reasonable possibility reports that are inaccurate or incomplete could be submitted. Questioned Costs: None reported Context/Sampling: Included under the two award letters of the federal program, one annual financial report and one quarterly progress report was reviewed in the Organization’s fiscal year. In addition, two monthly HMIS reports were reviewed in the Organization’s fiscal year. There was a total of 18 reports filed. Repeat Finding from Prior Year: No Recommendation: We recommend management implement procedures and control processes to incorporate an independent review and approval over reporting and retain documentation to support the review was performed. Views of Responsible Officials: Management is in agreement.

FINDING 2024-004 Subject: Water and Waste Disposal Systems for Rural Communities - Reporting Federal Agency: Department of Agriculture Federal Program: Water and Waste Disposal Systems for Rural Communities Assistance Listings Number: 10.760 Federal Award Number and Year (or Other Identifying Number): FY2024 Compliance Requirement: Reporting Audit Findings: Material Weakness, Modified Opinion Repeat Finding This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2023-003. Condition and Context As part of sound management of the federal award, the Town was responsible for implementing a system of internal controls that would ensure compliance with the applicable requirements. The Town had not properly designed or implemented such a system, which would include appropriate segregation of duties, that would likely be effective in preventing, or detecting and correcting, noncompliance. The Town was required to submit the following reporting to the Department of Agriculture annually: • Statement of Budget, Income, and Equity (Form RD 442-2) • Balance Sheet (Form RD 442-3) INDIANA STATE BOARD OF ACCOUNTS 21 TOWN OF PAOLI SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) The Form RD 442-2 covers financial operations relating to the Town's wastewater utility and the Form RD 442-3 presents the financial status of the wastewater utility. In both instances, a borrower may submit the financial data on other forms, provided the forms are in a similar format and signed and dated by the organization's official to certify the correctness of the information. Alternatively, an annual audit may be submitted in lieu of the forms. The Town did not submit the Form RD 442-2 during the audit period as required. The Town submitted the Form RD 442-3 reporting 2023 data in 2024 as required. However, this report is intended to be a comparative balance sheet as described in the USDA Rural Utilities Service Borrower's Guide. The Town did not include comparative data for 2022 in the report. There was also no documentation or other evidence of an oversight, review, or approval process for the report that was filed. The lack of internal controls and noncompliance were systemic issues throughout the audit period. 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 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following . . . (2) Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in §§ 200.328 and 200.329. . . ." 7 CFR 1780.47 states in part: "(a) Borrowers are required to provide RUS an annual audit or financial statements. . . . (e) Borrowers exempt from audits. All borrowers who are exempt from audits, will, within 60 days following the end of each fiscal year, furnish the RUS with annual financial statements, consisting of a verification of the organization's balance sheet and statement of income and expense by an appropriate official of the organization. Forms RD 442-2, 'Statement of Budget, Income and Equity,' and 442-3 may be used. INDIANA STATE BOARD OF ACCOUNTS 22 TOWN OF PAOLI SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (f) Management reports. These reports will furnish management with a means of evaluating prior decisions and serve as a basis for planning future operations and financial strategies. In those cases where revenues from multiple sources are pledged as security for an RUS loan, two reports will be required; one for the project being financed by RUS and one combining the entire operation of the borrower. In those cases where RUS loans are secured by general obligation bonds or assessments and the borrower combines revenues from all sources, one management report combining all such revenues is acceptable. The following management data will be submitted by the borrower to the processing office. These reports at a minimum will include a balance sheet and income and expense statement. . . . (2) Annual management reports. Prior to the beginning of each fiscal year the following will be submitted to the processing office. (If Form RD 442-2 is used as the annual management report, enter data in column three only of Schedule 1, and complete all of Schedule 2.) (i) Two copies of the management reports and proposed 'Annual Budget'. (ii) Financial information may be reported on Form RD 442-2 which includes Schedule 1, 'Statement of Budget, Income and Equity' and Schedule 2, 'Projected Cash Flow' or information in similar format. (iii) A copy of the rate schedule in effect at the time of submission. . . ." Cause The Clerk-Treasurer was only in her first year of her first term in office when these were due. As such, she was unfamiliar with the reporting requirements of the grant. Effect Without a proper system of internal controls in place that operated effectively, the Town did not file one of the two required reports, and the report that was filed was incomplete. As a result, material noncompliance occurred and remained undetected. By not reporting the comparative data, all information needed to determine the true financial status of the Town was not readily available. Questioned Costs There were no questioned costs identified. Recommendation We recommended that the Town's management establish a proper system of internal controls and develop and implement reporting policies and procedures to ensure that all required reports are filed timely, accurately, and contain all the required information. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Reporting Type of Finding - Noncompliance and material weakness in internal control over compliance Program: Coronavirus Relief Fund Assistance Listing Number: 21.019 Federal Agency: U.S. Department of Treasury Criteria - In accordance with 2 CFR 200.303 subrecipients must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the subrecipient is managing the federal award in compliance and federal statutes, regulations and the terms and conditions of the federal award. In accordance with 2 CFR 200.329 subrecipients must submit performance reports as required by the federal award. Reports submitted semiannually are due no later than 30 calendar days after the reporting period. Condition - Total expenditures reported on the semiannual reports due April 30, 2024 and October 31, 2024 did not agree to related support. The semiannual report due on October 31, 2024 was not submitted timely. Cause - The reports were prepared on a cash basis and the reports were not being monitored for timely submission. Effect - The Association submitted reports that were not on the accrual basis which caused expenditures to be reported in the incorrect period and submitted one report untimely. Questioned costs - No questioned costs. Context - The Association is required to report to the City of Topeka, Kansas semiannually. We tested both reports due during 2024. The report due April 30, 2024 covered the period October 1, 2023 through March 31, 2024 and reported cash expenditures of $19,675. Internal records of the Organization supported accrual expenditures of $29,678 during the same time period. Expenditures were under-reported by $10,003 on the report due April 30, 2024. The report due October 30, 2024 covered the period April 1, 2024 through September 30, 2024 and reported cash expenditures of $60,902. Internal records of the Organization supported accrual expenditures of $54,726 during the same time period. Expenditures were over-reported by $6,176 on the report due October 30, 2024. This same report was submitted February 25, 2025 when the due date was October 30, 2024. Identification as a repeat finding - This is a repeat finding. See 2023-002. Recommendation - We recommend that management review reporting requirements and internal procedures to ensure expenses are reported accurately, completely, and timely using an accrual basis. There should be a review of the reports prior to submission that includes a comparison to internal accrual-based records and monitoring to ensure the reports are submitted timely. Views of responsible official - Management concurs with the finding. The Organization is reviewing its reporting procedures and providing education on requirements to those involved. See the corrective action plan.

Federal Agency: U.S. Department of Health & Human Services Federal Program Name: Refugee and Entrant Assistance Voluntary Agency Programs Assistance Listing Number: 93.576 Federal Award Identification Number and Year: 2024 Pass-Through Agency: Church World Services, Inc. Pass-Through Number: CWS-2024-04-015 2024 Award Period: 10/1/2023-9/30/2024 Compliance Requirement Affected: Reporting Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria: Non-federal entities may be required to submit performance reports at least annually but not more frequently than quarterly, except in unusual circumstances, using a form or format authorized by OMB (2 CFR section 200.329). They also may be required to submit special reports as required by the terms and conditions of the federal award. Condition: For one programmatic report did not have a program manager's review and approval that could be verified. Context: A nonstatistical sample of 5 out 11 Programmatic reports were selected for testing for the Refugee and Entrant Assistance Voluntary Agency Programs program. The condition noted above was identified during our procedures over ODI's Reporting Federal compliance requirements. Effect: ODI did not retain documentation of the programmatic report approval, which could result in inaccuracies in reports remitted to the Federal grantor. Cause: ODI has a control designed to review and approve Federal Programmatic reports changes. However, documentation of approval could not be provided. Repeat Finding: The finding is not a repeat finding. Recommendation: We recommend that ODI strengthen its current policies and procedures to ensure that documentation is retained for review and approval of all Programmatic Reports, prior to submission to the grantor. Management’s Views: Management takes responsibility for the finding and believes that in future years, they will be able to implement proper controls to mitigate this finding.

Criteria: Per CFR 200.329(c)(1) The recipient or subrecipient must submit performance reports as required by the Federal award. Intervals must be no less frequent than annually nor more frequent than quarterly except if specific conditions are applied. Reports submitted annually by the recipient or subrecipient must be due no later than 90 calendar days after the reporting period. Reports submitted quarterly or semiannually must be due no later than 30 calendar days after the reporting period. Alternatively, the Federal agency or pass-through entity may require annual reports before the anniversary dates of multiple-year Federal awards.” Per the executed grant agreements, the grants require a quarterly report to be submitted within 30 days of the conclusion of each quarter and an annual report within 60 days at the conclusion of each calendar year. Condition: During our testing of the Organization’s compliance with the reporting requirements, we noted no quarterly or annual reports were submitted to Hamilton County. Only Final Reports were submitted once Hamilton County reached out. Cause: Controls were not in place to ensure required reports were submitted due to a lack of understanding the reporting requirements within the grant agreement. Effect: The untimely submission of the reports prevents the pass-through entity from effectively monitoring the progress of the funded project and making informed decisions. Additionally, consistent failure to meet reporting requirements could negatively impact the Organization’s ability for future federal awards. Questioned Costs: None Context: This is not a systemic problem. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Organization establish procedures for the preparation, review and timely submission of all reporting requirements. This can include implementing a system to track reporting deadlines and timely submission as well as designating individuals with the responsibilities of preparation, review, and submission of reports. Additionally, we recommend the Organization designate someone to review the grant documents for all compliance requirements to ensure nothing is missed. Management Response: The Advancement and Finance teams will create an updated Grants Management process. The Grants Management process will be documented and clearly define roles for Advancement and Finance staff. Additionally, a flowchart will be created to define what type of grant has been awarded (conditional vs. unconditional). The process will ensure all awarded grants are reviewed for all performance, outcomes, invoicing, and reporting requirements. The process will define who sets up calendar reminders for grant milestones (i.e., reporting) and how Program staff will be selected to receive these calendar reminders.