Findings Citing § 200.403

2023-011 Improve Controls and Compliance with Approval of Allowable Costs Federal Program Information Federal Agency: U.S. Department of Housing and Urban Development Award Name(s): CDBG Entitlement Grants Cluster Assistance Listing Number(s): 14.218 Award Year: 2023 Compliance Requirement: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Type of Finding Internal Control over Compliance – Significant Deficiency Criteria or Specific Requirement Per Uniform Guidance (2 CFR § 200.403, 200.405), recipients of federal funds must ensure that costs charged to federal awards are allowable, properly approved, and supported by adequate documentation. Effective internal controls should be in place to verify that all expenditures, including vendor invoices, are reviewed and approved prior to payment and charging to federal grants. SECTION III – FEDERAL AWARD FINDINGS AND QUESTIONED COSTS (CONTINUED) Condition and Context During testing of 34 vendor invoices charged to the Community Development Block Grants/Entitlement Grants program, 2 invoices were identified that had not been approved prior to payment or being charged to the grant. Cause The City did not consistently enforce controls requiring the review and approval of all invoices before they were processed as federal expenditures. Effect or Potential Effect The lack of proper invoice approval increases the risk of unauthorized, erroneous, or unallowable costs being charged to the federal program. Questioned Costs No questioned costs are reported. Identification as a Repeat Finding This was not a finding in the prior year. Recommendation The City should strengthen its internal controls by requiring documented approval for all invoices prior to payment and charging to federal programs, and perform periodic reviews to ensure ongoing compliance with allowable cost procedures. Views of Responsible Official Management’s corrective action plan is included at the end of this report after the Schedule of Prior Year Findings.

Finding 2023-006 – Activities Allowed or Unallowed/Allowable Costs/Cost Principles – Material Weakness in Internal Controls over Compliance and Instance of Noncompliance Head Start ALN# 93.600 (Repeat 2022-008) U.S. Department of Health & Human Services Federal Grant/Contract Number: 10CH011215-03-03; 10CH011215-03-C3; 10CH011215-04; 10HE000901-01-C6 Grant period – 2022 & 2023 Criteria – Per 2 CFR 200.303, 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 follow 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). Per 2 CFR section 200.403 – Factors affecting allowability of costs – Except where otherwise authorized by statute, costs must meet the following general criteria in order to be allowable under Federal awards: paragraph (a) Be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles; paragraph (g) Be adequately documented. Per 2 CFR section 200.404 – Reasonable costs – 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. Per 2 CFR section 200.405 – Allocable costs –focuses on how costs are allocable, ensuring they are directly tied to the federal award or its benefits. Per 2 CFR 200.430(i), charges to Federal awards for salaries and wages must be based on records that are supported by a system of internal control that provides reasonable assurance that the charges are accurate, allowable, and properly allocated and that are incorporated into the official records of the non-Federal entity. Condition – From the population of all disbursements charged to the grant, we selected 25 program disbursements, of which 9 invoices could not be located. Cause – Turnover in staff and the passage of time since the period under audit has caused documentation to be misplaced. Effect – Inadequate or inconsistent documentation of expenses may result in erroneous or fraudulent transactions occurring, loss of funding, or disallowed costs. Questioned Costs – Known questioned costs totaling $121 were identified related to 10 invoices could not be located. In addition, likely questioned costs are estimated at $34,616, based on the projection of the error identified in the tested transactions to the applicable population. Recommendation – Documentation should be prepared, reviewed, and retained to support the expense. Management’s Response – Management has reviewed and accepted the finding. See “Corrective Action Plan”.

FINDING 2023-004 Subject: Title I Grants to Local Educational Agencies - 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): S010A200014, S010A210014, S010A220014 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Cost Principles Audit Findings: Material Weakness, Other Matters Repeat Findings This is a repeat finding from the immediately prior audit report. The prior audit finding number was 2022-003. Condition and Context Costs charged to grant funds must be adequately documented. To adequately document payroll expenses charged to the grant fund, contracts or other documentation supporting the employees' approved rates of pay are necessary. The School Corporation utilized a financial software system that has two different sides, an employee portal side and an administrator side. Employee contracts are approved by the employee, the Superintendent of Schools, and the President of the School Board within the system on the employee portal side. Once approved, the data in the employee portal side is fed into a process in the administrator side. The School Corporation could not provide contracts or approved payroll rates for 6 out of 24 employees tested. As such, we could not verify the employees were paid its correct rates for hours spent working on grant related activities. This resulted in known questioned costs of $149,870. 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: INDIANA STATE BOARD OF ACCOUNTS 24 SOUTH BEND COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal 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 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for the Federal awards that are renewed quarterly or annual, from the date of submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 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. (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 200.430(i) states in part: "Standards for documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities (for IHE, this per the IHE's definition of IBS); . . . (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." INDIANA STATE BOARD OF ACCOUNTS 25 SOUTH BEND COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause The School Corporation did not maintain or provide adequate documentation to support payroll expenses charged to the grant fund. While employee contracts are approved within the financial software system, the process lacked sufficient oversight and record retention practices to ensure that approved pay rates were accessible and verifiable. Effect Without access to approved contracts or documentation verifying payroll rates for 6 of the 24 employees tested, the School Corporation could not demonstrate that payroll costs charged to the grant were accurate and allowable. This lack of documentation resulted in known questioned costs totaling $149,870. Additionally, the absence of reliable records increases the risk of noncompliance with federal grant requirements and necessitates expanded audit procedures, which will likely lead to higher audit costs. Questioned Costs Questioned costs in the amount of $149,870 were identified as described in the Condition and Context. Recommendation The School Corporation should establish and enforce formal documentation procedures to verify payroll rates for all employees whose compensation is charged to federal grants. This includes maintaining approved contracts, salary schedules, and supporting records that clearly demonstrate the accuracy and allowability of payroll costs. A review and approval process by a second knowledgeable party should be implemented to ensure compliance prior to submission. Additionally, the School Corporation should provide necessary support and resources for staff involved in payroll and grant management to strengthen recordkeeping practices. These measures will reduce the risk of noncompliance, minimize questioned costs, and help control future audit expenses. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

FINDING 2023-009 Subject: COVID-19 - Education Stabilization Fund - Allowable Costs/Costs Principles Federal Agency: Department of Education Federal Program: COVID-19 - Education Stabilization Fund Assistance Listings Numbers: 84.425D, 84.425U, 84.425C, 84.425W Federal Award Numbers and Years (or Other Identifying Numbers): S425D200013, S425D210013, S425U210013, S425C200018, S425W210015 Pass-Through Entity: Indiana Department of Education Compliance Requirement: Allowable Costs/Costs Principles Audit Findings: Material Weakness, Other Matters Condition and Context The COVID-19 - Education Stabilization Fund established by the Coronavirus Aid, Relief, and Economic Security (CARES) Act, and further funded by the Coronavirus Response and Relief Supplemental Appropriations Act (CRSSA) and the American Rescue Plan (ARP) Act, was for the purpose of preventing, preparing for, or responding to the novel coronavirus. Based on information obtained during the audit, the scope of testing was expanded to include additional transactions in order to assess compliance with federal grant requirements. The expanded testing was necessary to obtain sufficient evidence regarding the allowability and documentation of grant expenditures. The following issues were noted during testing: Vendor Disbursements The School Corporation was unable to provide supporting documentation for three vendors tested: Mamas Against Violence, LTIA, and Kingdom Life. Although Memorandums of Understanding (MOUs) were initiated by the Treasurer, no evidence was provided to demonstrate that the MOUs were reviewed or approved by the School Board at the time of execution. Information provided was based on documentation generated by the School Corporation, including purchase orders, handwritten vendor claim forms, and copies of check payments. However, no itemized vendor invoices were submitted to substantiate the services provided or the payments made, nor to detail the nature of the services rendered. In addition, the School Corporation was unable to provide supporting documentation to verify student participation or substantiate any of the reported metrics associated with the MOU agreements. Payroll Records Out of ten additional payroll transactions tested, three employee pay rates could not be verified. One employee's pay rate did not agree with the salary ordinance, and the School Corporation was unable to provide documentation confirming School Board approval of the rate. The second employee's compensation could not be traced to specific work performed, as neither an hourly rate nor the number of hours worked was documented. The third employee's authorized salary was $30 per hour; however, the issued paycheck reflected $20 per hour. These issues combined resulted in known questioned costs of $38,400. Criteria 2 CFR 200.303 states in part: "The non-Federal entity must: INDIANA STATE BOARD OF ACCOUNTS 35 SOUTH BEND COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal 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 200.334 states in part: "Financial records, supporting documents, statistical records, and all other non-Federal entity records pertinent to a Federal award must be retained for a period of three years from the date of submission of the final expenditure report or, for the Federal awards that are renewed quarterly or annual, from the date of submission of the quarterly or annual financial report, respectively, as reported to the Federal awarding agency or pass-through entity in the case of a subrecipient. . . ." 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. (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 200.430(i) states in part: "Standards for documentation of Personnel Expenses (1) Charges to Federal awards for salaries and wages must be based on records that accurately reflect the work performed. These records must: (i) Be supported by a system of internal control which provides reasonable assurance that the charges are accurate, allowable, and properly allocated; (ii) Be incorporated into the official records of the non-Federal entity; (iii) Reasonably reflect the total activity for which the employee is compensated by the non-Federal entity, not exceeding 100% of compensated activities (for IHE, this per the IHE's definition of IBS); . . . (vii) Support the distribution of the employee's salary or wages among specific activities or cost objectives if the employee works on more than one Federal award; a Federal award and non-Federal award; an indirect cost activity and a direct cost activity; two or more indirect activities which are allocated using different allocation bases; or an unallowable activity and a direct or indirect cost activity. . . ." INDIANA STATE BOARD OF ACCOUNTS 36 SOUTH BEND COMMUNITY SCHOOL CORPORATION SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Cause The School Corporation demonstrated weaknesses in documentation and compliance practices. Vendor contracts and payments lacked adequate supporting records, including evidence of the School Board approval for MOUs and itemized invoices. The School Board approved pay rates, hours worked, and reconciliation of authorized salaries to amounts paid, limiting the ability to verify the accuracy and appropriateness of expenditures. Effect Without proper documentation, the allowability of grant expenditures cannot be substantiated, creating a risk that unallowable costs may be charged to the federal grant. In addition, incomplete payroll records prevent verification of compensation, heightening the risk of inaccurate payments, unsupported variances, and potential misuse of federal funds. Questioned Costs Questioned costs in the amount of $38,400 were identified as described in the Condition and Context. Recommendation To address these deficiencies, the School Corporation should strengthen documentation practices by ensuring all vendor contracts, MOUs, and invoices are properly reviewed, approved by the School Board, and retained. Payroll internal controls should be improved by reconciling authorized salary ordinances to actual pay rates, documenting hours worked, and retaining evidence of the School Board approval for all compensation. In addition, periodic monitoring and internal reviews should be implemented to verify adherence to federal grant requirements and School Corporation policies, thereby reducing the risk of noncompliance and enhancing accountability. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Finding: Internal Control Over Compliance Federal Assistance Listing Number 93.959 - Block Grants for Prevention and Treatment of Substance Abuse U.S. Department of Health and Human Services Criteria: According to 2 CFR Part 200.403 factors affecting allowability of costs - 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, (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, (c) be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity, (d) be accorded consistent treatment, (e) be determined in accordance with generally accepted accounting principles, (f) to be included as a cost or used to meet cost sharing or matching requirements of any other federally-financed program in either the current or a prior period and (g) be adequately documented. In addition, according to 2 CFR Part 200.303, 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. Condition: The Organization did not maintain documentation to support the review and approval of allowable costs and draw requests as designed by their internal control structure. Questioned Costs: N/A Context: We tested 40 payroll and nonpayroll expense for allowable costs and allowable activities applied to the grant for the year ended June 30, 2023 for transactional expenses approval process based on the Organization's internal control design. Four selections did not have approval documentation maintained. We tested 8 invoices for cash management for review and approval prior to the Organization requesting federal funds based on the Organization's internal control design. Five selections did not have review and approval documentation maintained. We tested 8 invoices for period of performance for review and approval prior to the Organization requesting federal funds based on the Organization's internal control design. Six selections did not have review and approval documentation maintained. Effect: The Organization did not maintain documentation to support that costs and reimbursement invoices had been approved in accordance with their internal control design. Cause: The entity did not have policy and procedures in place to maintain adequate supporting documentation to show internal controls were operating as designed. Identification as a Repeat Finding: 2022-003 Recommendation: We recommend that the Organization implement policies and procedures to maintain documentation of internal controls over compliance to support controls are operating as designed. Views of Responsible Officials: The Organization agrees with the finding. See separate auditee document for planned corrective action.

Criteria or Specific Requirement: 2 CFR §200.302(b)(3) and §200.403(g) require that recipients maintain records sufficient to substantiate expenditures of federal awards and ensure that costs are adequately documented. Condition: During testing of expenditures for the Crime Victim Assistance Program, we noted that supporting documentation (e.g., invoices or payroll detail) for a number of transactions was incomplete or unavailable. Context: We tested a sample of 40 expenses out of 2,913 expenses during the year. Questioned Costs: No known or likely questioned costs exceed $25,000 Effect: Although alternative audit procedures were performed to verify the reasonableness and allowability of the costs, incomplete documentation indicates a weakness in recordkeeping controls. However, the number and dollar value of affected transactions were not material to the Crime Victim Assistance Program as a whole, and no questioned costs were identified. Cause: The organization experienced turnover in financial management positions and converted accounting systems multiple times during the audit period. During these transitions, some historical documentation was not migrated to the current system or retained in accessible form. Recommendation: We recommend that Safe Harbor Crisis Center strengthen its document retention policies and ensure that all grant-related supporting documentation is archived in a centralized electronic system accessible to both management and auditors, particularly during staff transitions or system conversions. Views of Responsible Officials: Management agrees with the finding and is implementing procedures to correct his which is further discussed in the corrective action plan. Corrective Action Plan: See Corrective Action Plan prepared by Management.

Name of Federal Agency: Department of Labor Federal Program Name and Assistance Listing Number: YouthBuild Program -17.274 Federal Award Identification Number and Year: YB-38231-22-60-A-36 Criteria In accordance with the Funding Opportunity Announcement, the Company is required to provide and expend cash, in-kind or third-party resources equivalent to exactly 25 percent of the grant award amount as "matching" funds. Match can be in the form of cash, in-kind contributions and third-party contributions and must meet the requirement found at 2 CFR 200.306, 2 CFR 200.403, 2 CFR 200.434, and 2 CFR 2900.8. 2 CFR 2900.8 requires that match is recognized at the time in which the funds are expended. The matching funds are required to be reported in the quarterly financial reports submitted by the Company. The quarterly performance reports must be submitted within 45 days following the end of each Program Year quarter. Reporting quarter end dates are March 31, June 30, September 30, and December 31. Condition The Company did not record in-kind matching funds contributions and related expense of $358,500 for the year ending June 30, 2023. In addition, the Company did not report their in-kind matching funds contributions or the related expenses on the quarterly financial report to the Department of Labor. For one of the two quarterly performance reports tested, one report was submitted after the 45 day deadline. Cause Internal controls over reporting of in-kind contributions and in-kind expenses were not operating effectively. Effect This resulted in an understatement of revenue and expense of $358,500 each for the year ending June 30, 2023, which resulted in a restatement of the 2023 financial statements. In addition, the Company was not in compliance with the reporting requirements of the YouthBuild program. Questioned Costs N/A. Context A sample of 2 financial reports out of 2 financial reports required during the year ended June 30, 2023 did not report the in-kind contribution of matching funds. Additionally, a sample of one financial report out of two financial reports was not submitted timely. Identification as a Repeat Finding This finding is not a repeat finding. Recommendation We recommend that management reviews its internal controls over reporting of the ETA-9130 Financial Report to ensure complete and accurate reports. Additionally, we recommend that management strengthens its policies and procedures to ensure proper recognition and recording of revenue from inkind contributions and related expenses. Views of Responsible Officials The Crenulated will request a quarterly in-kind contribution report from DOE and will ensure the in-kind contributions are recorded in the financial statements. The Crenulated plans to hire an in-house Controller with expertise in accounting for grants and review its existing contract with the current thirdparty accounting provider.

INELIGIBLE COSTS / CRITERIA / UNIFORM GUIDANCE 2 CFR PART 200 UNIFORM ADMINSTRATIVE REQUIREMENTS, COST PRINCIPLES, AND AUDIT REQUIREMENTS FOR FEDERAL AWARDS, SUBPART E: COST PRINCIPLES SECTION 200.403(F) STATES "EXCEPT WHERE OTHERWISE AUTHORIZED BY STATUTE, COSTS MUST MEET THE FOLLOWING CRITERIA IN ORDER TO BE ALLOWABLE UNDER FEDERAL AWARDS: (F) NOT BE INCLUDED AS A COST OR USED TO MEET COST SHARING OR MATCHING REQUIREMENTS OF ANY OTHER FEDERALLY-FINANCED PROGRAM IN EITHER THE CURRENT OR PRIOR PERIOD. / CONDITION / ON MAY 11, 2022 THE CITY WAS AWARDED AN ARPA GRANT THROUGH MISSISSIPPI COUNTY, MISSOURI FOR THE DEMOLITION OF A HAZARDOUS SCHOOL STRUCTURE IN ORDER TO FACILITATE THE CONSTRUCTION OF A PUBLIC HEALTH FACILITY. COSTS OF DEMOLITION WERE SUBMITTED AND REIMBURSED BY THE MISSISSIPPI COUNTY, MISSOURI ARPA GRANT IN AUGUST AND SEPTEMBER 2022. ON DECEMBER 12, 2022, THE CITY WAS AWARDED AN ARPA GRANT THROUGH THE MISSOURI DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION (DESE) FOR THE SAME PROJECT. THE GRANT REQUIRED A 50% MATCH. THE BUDGET SUBMITTED TO DESE INDICATED THAT THE GRANT FROM MISSISSIPPI COUNTY, MISSOURI WOULD BE USED AS A MATCH. ON DECEMBER 14, 2022, THE CITY SUBMITTED INVOICES TO DESE FOR REIMBURSEMENT IN THE AMOUNT OF $94,921.26. THE INVOICES SUBMITTED HAD PREVIOUSLY BEEN REIMBURSED BY THE MISSISSIPPI COUNTY ARPA GRANT. THUS, THE CLAIM FOR REIMBURSEMENT WAS DUPLICATED, AND THE CITY WAS REIMBURSED TWICE FOR THE SAME COSTS. / CAUSE / THE CITY RECEIVED A MISCOMMUNICATION REGARDING THE ELIGIBILITY OF COSTS. ALSO, THE CITY WAS NO FULLY AWARE OF THE COST STANDARDS CONTAINED IN UNIFORM GUIDANCE. / EFFECT / THE CITY HAS DUPLICATED THE REQUEST FOR REIMBURSEMENT OF COSTS SUBMITTED TO THE DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION AND THE MISSISSIPPI COUNTY, MISSOURI IN THE AMOUNT OF $94,921.26. / QUESTIONED COSTS / THE AMOUNT OF $94,921.26 IS BEING QUESTIONED, SINCE THE COST HAS PREVIOUSLY BEEN REPORTED AS A COST OF ANOTHER PROGRAM. / PERSPECTIVE / THE FINDING IS AN ISOLATED INSTANCE, IN THAT THE QUESTIONED COSTS PERTAINED TO A SINGLE INVOICE. / PRIOR FINDING / THE CITY DID NOT HAVE A SINGLE AUDIT IN THE PRIOR YEAR, AND THEREFORE PRIOR AUDIT FINDINGS DO NOT APPLY TO THIS MATTER. / RECOMMENDATIONS / I WOULD RECOMMEND CONTACTING THE MISSOURI DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION AND MISSISSIPPI COUNTY, MISSOURI, AND ADVISE THEM OF THE QUESTIONED COSTS. I WOULD RECOMMEND FILING AMENDED REPORTS AS NEEDED. ALSO, I WOULD RECOMMEND REQUESTING THAT OTHER ELIGIBLE COSTS BE SUBSTITUTED FOR THE REIMBURSEMENT. I WOULD ALSO RECOMMEND THAT THE CITY ADMINISTRATIVE STAFF FULLY REVIEW THE ADMINISTRATIVE AND COST STANDARDS CONTAINED IN UNIFORM GUIDANCE. FURTHER, THE CITY SHOULD CONSULT WITH AN OUTSIDE PROFESSIONAL AS NEEDED. / MANAGEMENT RESPONSE / MANAGEMENT AGREES WITH THE FINDING. MANAGEMENT WILL CONTACT THE GRANTOR AGENCIES TO RESOLVE THE MATTER AS QUICKLY AS POSSIBLE. FURTHER, THE ADMINISTRATIVE STAFF WILL RECEIVE TRAINING IN REGARDS TO THE ADMINISTRATIVE AND COST STANDARDS OF THE UNIFORM GUIDANCE. ALSO, OUTSIDE PROFESSIONALS WILL BE CONSULTED AS NEEDED.

INELIGIBLE COSTS / CRITERIA / UNIFORM GUIDANCE 2 CFR PART 200 UNIFORM ADMINSTRATIVE REQUIREMENTS, COST PRINCIPLES, AND AUDIT REQUIREMENTS FOR FEDERAL AWARDS, SUBPART E: COST PRINCIPLES SECTION 200.403(F) STATES "EXCEPT WHERE OTHERWISE AUTHORIZED BY STATUTE, COSTS MUST MEET THE FOLLOWING CRITERIA IN ORDER TO BE ALLOWABLE UNDER FEDERAL AWARDS: (F) NOT BE INCLUDED AS A COST OR USED TO MEET COST SHARING OR MATCHING REQUIREMENTS OF ANY OTHER FEDERALLY-FINANCED PROGRAM IN EITHER THE CURRENT OR PRIOR PERIOD. / CONDITION / ON MAY 11, 2022 THE CITY WAS AWARDED AN ARPA GRANT THROUGH MISSISSIPPI COUNTY, MISSOURI FOR THE DEMOLITION OF A HAZARDOUS SCHOOL STRUCTURE IN ORDER TO FACILITATE THE CONSTRUCTION OF A PUBLIC HEALTH FACILITY. COSTS OF DEMOLITION WERE SUBMITTED AND REIMBURSED BY THE MISSISSIPPI COUNTY, MISSOURI ARPA GRANT IN AUGUST AND SEPTEMBER 2022. ON DECEMBER 12, 2022, THE CITY WAS AWARDED AN ARPA GRANT THROUGH THE MISSOURI DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION (DESE) FOR THE SAME PROJECT. THE GRANT REQUIRED A 50% MATCH. THE BUDGET SUBMITTED TO DESE INDICATED THAT THE GRANT FROM MISSISSIPPI COUNTY, MISSOURI WOULD BE USED AS A MATCH. ON DECEMBER 14, 2022, THE CITY SUBMITTED INVOICES TO DESE FOR REIMBURSEMENT IN THE AMOUNT OF $94,921.26. THE INVOICES SUBMITTED HAD PREVIOUSLY BEEN REIMBURSED BY THE MISSISSIPPI COUNTY ARPA GRANT. THUS, THE CLAIM FOR REIMBURSEMENT WAS DUPLICATED, AND THE CITY WAS REIMBURSED TWICE FOR THE SAME COSTS. / CAUSE / THE CITY RECEIVED A MISCOMMUNICATION REGARDING THE ELIGIBILITY OF COSTS. ALSO, THE CITY WAS NO FULLY AWARE OF THE COST STANDARDS CONTAINED IN UNIFORM GUIDANCE. / EFFECT / THE CITY HAS DUPLICATED THE REQUEST FOR REIMBURSEMENT OF COSTS SUBMITTED TO THE DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION AND THE MISSISSIPPI COUNTY, MISSOURI IN THE AMOUNT OF $94,921.26. / QUESTIONED COSTS / THE AMOUNT OF $94,921.26 IS BEING QUESTIONED, SINCE THE COST HAS PREVIOUSLY BEEN REPORTED AS A COST OF ANOTHER PROGRAM. / PERSPECTIVE / THE FINDING IS AN ISOLATED INSTANCE, IN THAT THE QUESTIONED COSTS PERTAINED TO A SINGLE INVOICE. / PRIOR FINDING / THE CITY DID NOT HAVE A SINGLE AUDIT IN THE PRIOR YEAR, AND THEREFORE PRIOR AUDIT FINDINGS DO NOT APPLY TO THIS MATTER. / RECOMMENDATIONS / I WOULD RECOMMEND CONTACTING THE MISSOURI DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION AND MISSISSIPPI COUNTY, MISSOURI, AND ADVISE THEM OF THE QUESTIONED COSTS. I WOULD RECOMMEND FILING AMENDED REPORTS AS NEEDED. ALSO, I WOULD RECOMMEND REQUESTING THAT OTHER ELIGIBLE COSTS BE SUBSTITUTED FOR THE REIMBURSEMENT. I WOULD ALSO RECOMMEND THAT THE CITY ADMINISTRATIVE STAFF FULLY REVIEW THE ADMINISTRATIVE AND COST STANDARDS CONTAINED IN UNIFORM GUIDANCE. FURTHER, THE CITY SHOULD CONSULT WITH AN OUTSIDE PROFESSIONAL AS NEEDED. / MANAGEMENT RESPONSE / MANAGEMENT AGREES WITH THE FINDING. MANAGEMENT WILL CONTACT THE GRANTOR AGENCIES TO RESOLVE THE MATTER AS QUICKLY AS POSSIBLE. FURTHER, THE ADMINISTRATIVE STAFF WILL RECEIVE TRAINING IN REGARDS TO THE ADMINISTRATIVE AND COST STANDARDS OF THE UNIFORM GUIDANCE. ALSO, OUTSIDE PROFESSIONALS WILL BE CONSULTED AS NEEDED.

Federal Agency: U.S. Department of Health and Human Services Federal Program Name: COVID-19 Vaccines Community-Based Education & Outreach (IVAX) Assistance Listing Number: 93.268 Pass-Through Entity: Illinois Primary Health Care Association Pass-Through Number: N/A Award Periods: July 1, 2022 – March 31, 2023 Type of Finding: Immaterial Noncompliance and Significant deficiency in internal control over compliance Criteria: A non-Federal entity that does not have a current negotiated indirect cost rate, may elect to charge a de minimis rate of 10% of modified total direct costs (MTDC) which may be used indefinitely. No documentation is required to justify the 10% de minimis indirect cost rate. As described in § 200.403, costs must be consistently charged as either indirect or direct costs, but may not be double charged or inconsistently charged as both. If chosen, this methodology once elected must be used consistently for all Federal awards until such time as a non-Federal entity chooses to negotiate for a rate, which the non-Federal entity may apply to do at any time. Condition: Legacy incorrectly calculated the reimbursement of in-direct costs when using the de minimis rate of 10%. Questioned Costs: $3,404. Context: Three (3) of three (3) in-direct cost transactions selected for testing. Cause: Unknown. Effect: Calculating indirect costs incorrectly could result in unallowable costs being charged to the grant. Repeat Finding: No. Recommendation: We recommend that a member of management review the monthly calculation of indirect costs to ensure it is calculated correctly. Views of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services Federal Program Name: COVID-19 Vaccines Community-Based Education & Outreach (IVAX) Assistance Listing Number: 93.268 Pass-Through Entity: Illinois Primary Health Care Association Pass-Through Number: N/A Award Periods: July 1, 2022 – March 31, 2023 Type of Finding: Immaterial Noncompliance and Significant deficiency in internal control over compliance Criteria: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award's period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). A period of performance may contain one or more budget periods. Condition: Costs outside of the period of performance were charged to the grant. Questioned Costs: $4,279 Context: Four (4) of seven (7) transactions tested. Cause: Unknown Effect: Legacy may allocate unallowable costs to the federal grant. Repeat Finding: Yes. Prior Year Finding: 2022-004. Recommendation: We recommend that only costs incurred during the period of performance be charged to the grant. For payroll in which periods extend over multiple budget periods, we recommend prorating the amount charged to the grant by days worked within the grant period. Views of Responsible Officials: There is no disagreement with the audit finding.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 66.458, Environmental Protection Agency. Capitalization Grants for Clean Water State Revolving Funds Federal Award Identification Number and Year: 5749-01, Loan Period 06/18/2022-11/15/2024 Pass-through Entity: Michigan Department of Environment, Great Lakes, and Energy Finance Division - Water Infrastructure Financing Section Type: Material weakness in internal control and material noncompliance with laws and regulations Repeat Finding: No Criteria: As a precondition to receive federal awards, prospective recipients must have effective internal controls over the federal award. As described in 2 CFR, Part 200.303, nonfederal entities must have certain written policies and procedures surrounding the management of their federal awards. Such policies should include procedures for collecting payments of federal funds per 2 CRF 200.305, cash management (i.e., minimizing the time between draws and actual disbursing of federal awards) per 2 CFR 200.302(b)(6), allowable cost per 2 CFR 200.403, and conflict of interest per 2 CFR 200.318. Per 2 CFR 200.319 (d), the non-Federal entity must have written procedures for procurement transactions. Condition: The Township did not have written procedures for cash management, allowable cost or conflict of interest. In addition, the Township procurement policy did not include all necessary items specified in the Uniform Guidance. Identification of How Likely Questioned Costs Were Computed: N/A Known Questioned Costs: None Context: N/A Cause/Effect: The Township was not aware that they were required to have written policies and procedures for the items noted above and was using the grant agreement requirements for guidelines. The Township's controls were not adequate to ensure it followed the federal requirement over these processes. Recommendation: We recommend the Township adopt written policies and procedures over cash management, allowable costs, and conflicts of interest. In addition, we recommend that management review and modify the procedure policy to include all the necessary items outline in the Uniform Guidance. View of responsible officials and planned corrective action plan: See attached corrective action plan.

INELIGIBLE COSTS / CRITERIA / UNIFORM GUIDANCE 2 CFR PART 200 UNIFORM ADMINSTRATIVE REQUIREMENTS, COST PRINCIPLES, AND AUDIT REQUIREMENTS FOR FEDERAL AWARDS, SUBPART E: COST PRINCIPLES SECTION 200.403(F) STATES "EXCEPT WHERE OTHERWISE AUTHORIZED BY STATUTE, COSTS MUST MEET THE FOLLOWING CRITERIA IN ORDER TO BE ALLOWABLE UNDER FEDERAL AWARDS: (F) NOT BE INCLUDED AS A COST OR USED TO MEET COST SHARING OR MATCHING REQUIREMENTS OF ANY OTHER FEDERALLY-FINANCED PROGRAM IN EITHER THE CURRENT OR PRIOR PERIOD. / CONDITION / ON MAY 11, 2022 THE CITY WAS AWARDED AN ARPA GRANT THROUGH MISSISSIPPI COUNTY, MISSOURI FOR THE DEMOLITION OF A HAZARDOUS SCHOOL STRUCTURE IN ORDER TO FACILITATE THE CONSTRUCTION OF A PUBLIC HEALTH FACILITY. COSTS OF DEMOLITION WERE SUBMITTED AND REIMBURSED BY THE MISSISSIPPI COUNTY, MISSOURI ARPA GRANT IN AUGUST AND SEPTEMBER 2022. ON DECEMBER 12, 2022, THE CITY WAS AWARDED AN ARPA GRANT THROUGH THE MISSOURI DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION (DESE) FOR THE SAME PROJECT. THE GRANT REQUIRED A 50% MATCH. THE BUDGET SUBMITTED TO DESE INDICATED THAT THE GRANT FROM MISSISSIPPI COUNTY, MISSOURI WOULD BE USED AS A MATCH. ON DECEMBER 14, 2022, THE CITY SUBMITTED INVOICES TO DESE FOR REIMBURSEMENT IN THE AMOUNT OF $94,921.26. THE INVOICES SUBMITTED HAD PREVIOUSLY BEEN REIMBURSED BY THE MISSISSIPPI COUNTY ARPA GRANT. THUS, THE CLAIM FOR REIMBURSEMENT WAS DUPLICATED, AND THE CITY WAS REIMBURSED TWICE FOR THE SAME COSTS. / CAUSE / THE CITY RECEIVED A MISCOMMUNICATION REGARDING THE ELIGIBILITY OF COSTS. ALSO, THE CITY WAS NO FULLY AWARE OF THE COST STANDARDS CONTAINED IN UNIFORM GUIDANCE. / EFFECT / THE CITY HAS DUPLICATED THE REQUEST FOR REIMBURSEMENT OF COSTS SUBMITTED TO THE DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION AND THE MISSISSIPPI COUNTY, MISSOURI IN THE AMOUNT OF $94,921.26. / QUESTIONED COSTS / THE AMOUNT OF $94,921.26 IS BEING QUESTIONED, SINCE THE COST HAS PREVIOUSLY BEEN REPORTED AS A COST OF ANOTHER PROGRAM. / PERSPECTIVE / THE FINDING IS AN ISOLATED INSTANCE, IN THAT THE QUESTIONED COSTS PERTAINED TO A SINGLE INVOICE. / PRIOR FINDING / THE CITY DID NOT HAVE A SINGLE AUDIT IN THE PRIOR YEAR, AND THEREFORE PRIOR AUDIT FINDINGS DO NOT APPLY TO THIS MATTER. / RECOMMENDATIONS / I WOULD RECOMMEND CONTACTING THE MISSOURI DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION AND MISSISSIPPI COUNTY, MISSOURI, AND ADVISE THEM OF THE QUESTIONED COSTS. I WOULD RECOMMEND FILING AMENDED REPORTS AS NEEDED. ALSO, I WOULD RECOMMEND REQUESTING THAT OTHER ELIGIBLE COSTS BE SUBSTITUTED FOR THE REIMBURSEMENT. I WOULD ALSO RECOMMEND THAT THE CITY ADMINISTRATIVE STAFF FULLY REVIEW THE ADMINISTRATIVE AND COST STANDARDS CONTAINED IN UNIFORM GUIDANCE. FURTHER, THE CITY SHOULD CONSULT WITH AN OUTSIDE PROFESSIONAL AS NEEDED. / MANAGEMENT RESPONSE / MANAGEMENT AGREES WITH THE FINDING. MANAGEMENT WILL CONTACT THE GRANTOR AGENCIES TO RESOLVE THE MATTER AS QUICKLY AS POSSIBLE. FURTHER, THE ADMINISTRATIVE STAFF WILL RECEIVE TRAINING IN REGARDS TO THE ADMINISTRATIVE AND COST STANDARDS OF THE UNIFORM GUIDANCE. ALSO, OUTSIDE PROFESSIONALS WILL BE CONSULTED AS NEEDED.

INELIGIBLE COSTS / CRITERIA / UNIFORM GUIDANCE 2 CFR PART 200 UNIFORM ADMINSTRATIVE REQUIREMENTS, COST PRINCIPLES, AND AUDIT REQUIREMENTS FOR FEDERAL AWARDS, SUBPART E: COST PRINCIPLES SECTION 200.403(F) STATES "EXCEPT WHERE OTHERWISE AUTHORIZED BY STATUTE, COSTS MUST MEET THE FOLLOWING CRITERIA IN ORDER TO BE ALLOWABLE UNDER FEDERAL AWARDS: (F) NOT BE INCLUDED AS A COST OR USED TO MEET COST SHARING OR MATCHING REQUIREMENTS OF ANY OTHER FEDERALLY-FINANCED PROGRAM IN EITHER THE CURRENT OR PRIOR PERIOD. / CONDITION / ON MAY 11, 2022 THE CITY WAS AWARDED AN ARPA GRANT THROUGH MISSISSIPPI COUNTY, MISSOURI FOR THE DEMOLITION OF A HAZARDOUS SCHOOL STRUCTURE IN ORDER TO FACILITATE THE CONSTRUCTION OF A PUBLIC HEALTH FACILITY. COSTS OF DEMOLITION WERE SUBMITTED AND REIMBURSED BY THE MISSISSIPPI COUNTY, MISSOURI ARPA GRANT IN AUGUST AND SEPTEMBER 2022. ON DECEMBER 12, 2022, THE CITY WAS AWARDED AN ARPA GRANT THROUGH THE MISSOURI DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION (DESE) FOR THE SAME PROJECT. THE GRANT REQUIRED A 50% MATCH. THE BUDGET SUBMITTED TO DESE INDICATED THAT THE GRANT FROM MISSISSIPPI COUNTY, MISSOURI WOULD BE USED AS A MATCH. ON DECEMBER 14, 2022, THE CITY SUBMITTED INVOICES TO DESE FOR REIMBURSEMENT IN THE AMOUNT OF $94,921.26. THE INVOICES SUBMITTED HAD PREVIOUSLY BEEN REIMBURSED BY THE MISSISSIPPI COUNTY ARPA GRANT. THUS, THE CLAIM FOR REIMBURSEMENT WAS DUPLICATED, AND THE CITY WAS REIMBURSED TWICE FOR THE SAME COSTS. / CAUSE / THE CITY RECEIVED A MISCOMMUNICATION REGARDING THE ELIGIBILITY OF COSTS. ALSO, THE CITY WAS NO FULLY AWARE OF THE COST STANDARDS CONTAINED IN UNIFORM GUIDANCE. / EFFECT / THE CITY HAS DUPLICATED THE REQUEST FOR REIMBURSEMENT OF COSTS SUBMITTED TO THE DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION AND THE MISSISSIPPI COUNTY, MISSOURI IN THE AMOUNT OF $94,921.26. / QUESTIONED COSTS / THE AMOUNT OF $94,921.26 IS BEING QUESTIONED, SINCE THE COST HAS PREVIOUSLY BEEN REPORTED AS A COST OF ANOTHER PROGRAM. / PERSPECTIVE / THE FINDING IS AN ISOLATED INSTANCE, IN THAT THE QUESTIONED COSTS PERTAINED TO A SINGLE INVOICE. / PRIOR FINDING / THE CITY DID NOT HAVE A SINGLE AUDIT IN THE PRIOR YEAR, AND THEREFORE PRIOR AUDIT FINDINGS DO NOT APPLY TO THIS MATTER. / RECOMMENDATIONS / I WOULD RECOMMEND CONTACTING THE MISSOURI DEPARTMENT OF ELEMENTARY AND SECONDARY EDUCATION AND MISSISSIPPI COUNTY, MISSOURI, AND ADVISE THEM OF THE QUESTIONED COSTS. I WOULD RECOMMEND FILING AMENDED REPORTS AS NEEDED. ALSO, I WOULD RECOMMEND REQUESTING THAT OTHER ELIGIBLE COSTS BE SUBSTITUTED FOR THE REIMBURSEMENT. I WOULD ALSO RECOMMEND THAT THE CITY ADMINISTRATIVE STAFF FULLY REVIEW THE ADMINISTRATIVE AND COST STANDARDS CONTAINED IN UNIFORM GUIDANCE. FURTHER, THE CITY SHOULD CONSULT WITH AN OUTSIDE PROFESSIONAL AS NEEDED. / MANAGEMENT RESPONSE / MANAGEMENT AGREES WITH THE FINDING. MANAGEMENT WILL CONTACT THE GRANTOR AGENCIES TO RESOLVE THE MATTER AS QUICKLY AS POSSIBLE. FURTHER, THE ADMINISTRATIVE STAFF WILL RECEIVE TRAINING IN REGARDS TO THE ADMINISTRATIVE AND COST STANDARDS OF THE UNIFORM GUIDANCE. ALSO, OUTSIDE PROFESSIONALS WILL BE CONSULTED AS NEEDED.

Federal Agency: U.S. Department of Health and Human Services Federal Program Name: COVID-19 Vaccines Community-Based Education & Outreach (IVAX) Assistance Listing Number: 93.268 Pass-Through Entity: Illinois Primary Health Care Association Pass-Through Number: N/A Award Periods: July 1, 2022 – March 31, 2023 Type of Finding: Immaterial Noncompliance and Significant deficiency in internal control over compliance Criteria: A non-Federal entity that does not have a current negotiated indirect cost rate, may elect to charge a de minimis rate of 10% of modified total direct costs (MTDC) which may be used indefinitely. No documentation is required to justify the 10% de minimis indirect cost rate. As described in § 200.403, costs must be consistently charged as either indirect or direct costs, but may not be double charged or inconsistently charged as both. If chosen, this methodology once elected must be used consistently for all Federal awards until such time as a non-Federal entity chooses to negotiate for a rate, which the non-Federal entity may apply to do at any time. Condition: Legacy incorrectly calculated the reimbursement of in-direct costs when using the de minimis rate of 10%. Questioned Costs: $3,404. Context: Three (3) of three (3) in-direct cost transactions selected for testing. Cause: Unknown. Effect: Calculating indirect costs incorrectly could result in unallowable costs being charged to the grant. Repeat Finding: No. Recommendation: We recommend that a member of management review the monthly calculation of indirect costs to ensure it is calculated correctly. Views of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: U.S. Department of Health and Human Services Federal Program Name: COVID-19 Vaccines Community-Based Education & Outreach (IVAX) Assistance Listing Number: 93.268 Pass-Through Entity: Illinois Primary Health Care Association Pass-Through Number: N/A Award Periods: July 1, 2022 – March 31, 2023 Type of Finding: Immaterial Noncompliance and Significant deficiency in internal control over compliance Criteria: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award's period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). A period of performance may contain one or more budget periods. Condition: Costs outside of the period of performance were charged to the grant. Questioned Costs: $4,279 Context: Four (4) of seven (7) transactions tested. Cause: Unknown Effect: Legacy may allocate unallowable costs to the federal grant. Repeat Finding: Yes. Prior Year Finding: 2022-004. Recommendation: We recommend that only costs incurred during the period of performance be charged to the grant. For payroll in which periods extend over multiple budget periods, we recommend prorating the amount charged to the grant by days worked within the grant period. Views of Responsible Officials: There is no disagreement with the audit finding.

Assistance Listing Number, Federal Agency, and Program Name: Assistance Listing Number 66.458, Environmental Protection Agency. Capitalization Grants for Clean Water State Revolving Funds Federal Award Identification Number and Year: 5749-01, Loan Period 06/18/2022-11/15/2024 Pass-through Entity: Michigan Department of Environment, Great Lakes, and Energy Finance Division - Water Infrastructure Financing Section Type: Material weakness in internal control and material noncompliance with laws and regulations Repeat Finding: No Criteria: As a precondition to receive federal awards, prospective recipients must have effective internal controls over the federal award. As described in 2 CFR, Part 200.303, nonfederal entities must have certain written policies and procedures surrounding the management of their federal awards. Such policies should include procedures for collecting payments of federal funds per 2 CRF 200.305, cash management (i.e., minimizing the time between draws and actual disbursing of federal awards) per 2 CFR 200.302(b)(6), allowable cost per 2 CFR 200.403, and conflict of interest per 2 CFR 200.318. Per 2 CFR 200.319 (d), the non-Federal entity must have written procedures for procurement transactions. Condition: The Township did not have written procedures for cash management, allowable cost or conflict of interest. In addition, the Township procurement policy did not include all necessary items specified in the Uniform Guidance. Identification of How Likely Questioned Costs Were Computed: N/A Known Questioned Costs: None Context: N/A Cause/Effect: The Township was not aware that they were required to have written policies and procedures for the items noted above and was using the grant agreement requirements for guidelines. The Township's controls were not adequate to ensure it followed the federal requirement over these processes. Recommendation: We recommend the Township adopt written policies and procedures over cash management, allowable costs, and conflicts of interest. In addition, we recommend that management review and modify the procedure policy to include all the necessary items outline in the Uniform Guidance. View of responsible officials and planned corrective action plan: See attached corrective action plan.

Criteria: 2 CFR 200.403 (g) requires adequate documentation to be retained to support allowable activities/costs. Condition and Context: We selected a sample of 20 different payroll entries related to time allocated to the Housing Choice Voucher program and requested supporting documentation for costs allocated to the grant. Our sample was not statistically valid. We reviewed payroll summary reports and paycheck detail to various programs, but noted that there were no timecards available for review or approval for any selection. It was noted that the payroll administrator was reviewing and approving the timecards, rather than a direct supervisor over the Section 8 program. Additionally, management indicated that timecards and payroll reports were not universally available due to system limitations and employee turnover. Cause and Effect: As described in 2022-001 and 2022-003, the Agency has not maintained appropriate internal controls over compliance. Lack of appropriate supervisory review and approval, along with managements review of record retention resulted in the noncompliance. Recommendation: We recommend the review and approval of timecards be completed by a direct supervisor, that payroll records be regularly reviewed against timecards, and all supporting documentation for program costs be retained internally. Views of Responsible Officials and Planned Corrective Actions: The Agency agrees with the recommendation. See the Corrective Action Plan for the Agency’s response and planned completion date

Criteria: 2 CFR 200.403 (g) requires adequate documentation to be retained to support allowable activities/costs. Condition and Context: During our testing of expenditures obligated during the year, we were made aware of the fact that management had invertedly duplicated a draw of funds totaling $303,024.92. This error was not discovered until several months after the fact. Cause and Effect: As described in 2022-001 and 2022-003, the Agency has not maintained appropriate internal controls over compliance. Lack of appropriate supervisory review and approval, along with managements review of record retention resulted in the noncompliance. Recommendation: See finding 2022-001, specifically the recommendation relating to appropriate oversight in the finance department. We recommend that the finance department continue to hire and train its employees on various programmatic requirements and resources, to ensure compliance with both existing and new federal compliance requirements. Views of Responsible Officials and Planned Corrective Actions: The Agency agrees with the recommendation. See the Corrective Action Plan for the Agency’s response and planned completion date.

Criteria: 2 CFR 200.403 (g) requires adequate documentation to be retained to support allowable activities/costs. Condition and Context: We selected a sample of 12 different program related disbursement and requested supporting documentation for costs allocated to the grant. Our sample was not statistically valid. We reviewed invoice and payment detail to for each selection, but noted that there were no POs available for review or approval for any selection. Cause and Effect: As described in 2022-001 and 2022-003, the Agency has not maintained appropriate internal controls over compliance. Lack of appropriate supervisory review and approval, along with managements review of record retention resulted in the noncompliance. Recommendation: See finding 2022-001, specifically the recommendation relating to appropriate oversight in the finance department. We recommend that the finance department continue to hire and train its employees on various programmatic requirements and resources, to ensure compliance with both existing and new federal compliance requirements. Views of Responsible Officials and Planned Corrective Actions: The Agency agrees with the recommendation. See the Corrective Action Plan for the Agency’s response and planned completion date.

Criteria: 2 CFR 200.403 (g) requires adequate documentation to be retained to support allowable activities/costs. Condition and Context: We selected a sample of 20 different payroll entries related to time allocated to the Housing Choice Voucher program and requested supporting documentation for costs allocated to the grant. Our sample was not statistically valid. We reviewed payroll summary reports and paycheck detail to various programs, but noted that there were no timecards available for review or approval for any selection. It was noted that the payroll administrator was reviewing and approving the timecards, rather than a direct supervisor over the Section 8 program. Additionally, management indicated that timecards and payroll reports were not universally available due to system limitations and employee turnover. Cause and Effect: As described in 2022-001 and 2022-003, the Agency has not maintained appropriate internal controls over compliance. Lack of appropriate supervisory review and approval, along with managements review of record retention resulted in the noncompliance. Recommendation: We recommend the review and approval of timecards be completed by a direct supervisor, that payroll records be regularly reviewed against timecards, and all supporting documentation for program costs be retained internally. Views of Responsible Officials and Planned Corrective Actions: The Agency agrees with the recommendation. See the Corrective Action Plan for the Agency’s response and planned completion date

2 C.F.R. § 1000.10 gives regulatory effect to the Department of the Treasurer for 2 C.F.R. § 200.403(a), which requires that costs be necessary and reasonable for the performance of the Federal award and be allocable thereto under these principles. 2 C.F.R. § 200.403(c) documents that costs must be consistent with policies and procedures that apply uniformly to both federally-financed and other activities of the non-Federal entity. The County paid stipends to various employees under the “premium pay” provisions of the State and Local Fiscal Recovery Funds (SLFRF) grant, Assistance Listing (AL) #21.027. This included reimbursements of $57,000 to the Coshocton County Job and Family Services (CCJFS). The CCJFS originally reported the premium pay stipends against various indirect cost pools which were allocated to various Federal and State grants. The reimbursement was not coded against the same cost pools which resulted in the County charging the SLFRF grant and various other Federal grants for the same cost. This error was brought to the attention of the County and the CCJFS subsequently posted adjustments in 2023 to correct this error. The County should more closely monitor the reporting of coding and reporting of expenditures against grant resources. Departments should work together to ensure that only one Federal grant is being charged when multiple grants could cover the costs. This will help improve internal controls to ensure that expenditures are accurately reported and are paid from one Federal revenue source, reducing the risk of questioned costs arising.

Sections 2 CFR 200.308, 200.309, and 200.403(h) state that a non-Federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the Federal awarding agency or pass-through entity made the Federal award that were authorized by the Federal awarding agency or pass-through entity. Recipients of State and Local Fiscal Recovery Funds (SLFRF) may only use funds to cover costs incurred during the period beginning on March 3, 2021 and ending on December 31, 2024 per section 602(g)(1) of the Social Security Act as added by section 9901 of the American Rescue Plan Act of 2021, Pub. L. No. 117-2 and Treasury’s Interim Final Rule at 31 C.F.R. § 35.5(a). The County used SLFRF funds to reimburse expenditures that were incurred prior to March 3, 2021. The County identified replacement expenditures within the period of availability which were allowable. The County should implement the appropriate procedures to ensure that only allowable expenditures incurred within the period of performance are used for reimbursement with Federal funds.

Assistance Listing Number: 93.958 Name of Federal Program: Block Grants for Community Mental Health Services Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entities and Award Periods: Wisconsin Department of Health Services – October 1, 2021 through September 30, 2022, April 1, 2022 through September 30, 2022, October 1, 2022 through September 30, 2023, Milwaukee County Behavioral Health Division – January 1, 2022 through December 31, 2022, and Milwaukee County Department of Health Services – January 1, 2022 through December 31, 2022 Criteria or Specific Requirement: The Code of Federal Regulations Section 200 subpart E outlines the allowability of cost provisions. Specifically, 2 CFR 200.403(e) states that costs should be determined in accordance with generally accepted accounting principles. Condition: A prepayment for a 2023 training conference was recorded as an expense of the current period and reimbursed from a grant in the federal program. Cause: The recording of this transaction as an expense instead of a prepaid expense was because the transaction was not properly reviewed and approved. Effect or Potential Effect: An expense charged to the federal program could be disallowed. Context: This appears to be an isolated incident that was identified during other audit procedures. During our testing of for allowability of costs, we selected a sample of 40 expense transactions and 4 payrolls and did not identify any additional questioned costs. Repeat Finding: No Recommendation: Expenses should be reviewed and approved by an individual with sufficient knowledge of requirements for allowability before recording in the accounting records. Views of Responsible Officials: Management agrees with the finding and will have staff attend additional training.

Assistance Listing Number: 93.958 Name of Federal Program: Block Grants for Community Mental Health Services Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entities and Award Periods: Wisconsin Department of Health Services – October 1, 2021 through September 30, 2022, April 1, 2022 through September 30, 2022, October 1, 2022 through September 30, 2023, Milwaukee County Behavioral Health Division – January 1, 2022 through December 31, 2022, and Milwaukee County Department of Health Services – January 1, 2022 through December 31, 2022 Criteria or Specific Requirement: The Code of Federal Regulations Section 200 subpart E outlines the allowability of cost provisions. Specifically, 2 CFR 200.403(e) states that costs should be determined in accordance with generally accepted accounting principles. Condition: A prepayment for a 2023 training conference was recorded as an expense of the current period and reimbursed from a grant in the federal program. Cause: The recording of this transaction as an expense instead of a prepaid expense was because the transaction was not properly reviewed and approved. Effect or Potential Effect: An expense charged to the federal program could be disallowed. Context: This appears to be an isolated incident that was identified during other audit procedures. During our testing of for allowability of costs, we selected a sample of 40 expense transactions and 4 payrolls and did not identify any additional questioned costs. Repeat Finding: No Recommendation: Expenses should be reviewed and approved by an individual with sufficient knowledge of requirements for allowability before recording in the accounting records. Views of Responsible Officials: Management agrees with the finding and will have staff attend additional training.

Assistance Listing Number: 93.958 Name of Federal Program: Block Grants for Community Mental Health Services Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entities and Award Periods: Wisconsin Department of Health Services – October 1, 2021 through September 30, 2022, April 1, 2022 through September 30, 2022, October 1, 2022 through September 30, 2023, Milwaukee County Behavioral Health Division – January 1, 2022 through December 31, 2022, and Milwaukee County Department of Health Services – January 1, 2022 through December 31, 2022 Criteria or Specific Requirement: The Code of Federal Regulations Section 200 subpart E outlines the allowability of cost provisions. Specifically, 2 CFR 200.403(e) states that costs should be determined in accordance with generally accepted accounting principles. Condition: A prepayment for a 2023 training conference was recorded as an expense of the current period and reimbursed from a grant in the federal program. Cause: The recording of this transaction as an expense instead of a prepaid expense was because the transaction was not properly reviewed and approved. Effect or Potential Effect: An expense charged to the federal program could be disallowed. Context: This appears to be an isolated incident that was identified during other audit procedures. During our testing of for allowability of costs, we selected a sample of 40 expense transactions and 4 payrolls and did not identify any additional questioned costs. Repeat Finding: No Recommendation: Expenses should be reviewed and approved by an individual with sufficient knowledge of requirements for allowability before recording in the accounting records. Views of Responsible Officials: Management agrees with the finding and will have staff attend additional training.

Assistance Listing Number: 93.958 Name of Federal Program: Block Grants for Community Mental Health Services Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entities and Award Periods: Wisconsin Department of Health Services – October 1, 2021 through September 30, 2022, April 1, 2022 through September 30, 2022, October 1, 2022 through September 30, 2023, Milwaukee County Behavioral Health Division – January 1, 2022 through December 31, 2022, and Milwaukee County Department of Health Services – January 1, 2022 through December 31, 2022 Criteria or Specific Requirement: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: During our testing of reimbursement requests, we identified an invoice that included expenses outside the period of performance for a grant in the federal program. Cause: Sufficient internal controls for reimbursement requests have not been implemented to ensure costs included for reimbursement are within the period of performance. Effect or Potential Effect: An expense charged to the federal program could be disallowed. Questioned Costs: $48,728. Context: This appeared to be an isolated incident from one grant invoice that was tested during audit procedures performed on financial statement account balances. For testing period of performance requirements, we selected a sample of 20 expense transactions and did not identify any expenses charged to grants outside the period of performance. Repeat Finding: No Recommendation: Additional internal controls for reimbursement requests should be implemented, including having another individual outside the process review and approve reimbursement requests prior to submission or require detailed accounting expense transactions be included with reimbursement requests to ensure expenses have been incurred within the period of performance. Views of Responsible Officials: Management agrees with the finding and the Organization and outsourced accounting rep will meet monthly to review cost reports and correlating invoices together before approving and submitting to the funder to ensure expenses submitted are within the grant performance period.

Assistance Listing Number: 93.958 Name of Federal Program: Block Grants for Community Mental Health Services Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entities and Award Periods: Wisconsin Department of Health Services – October 1, 2021 through September 30, 2022, April 1, 2022 through September 30, 2022, October 1, 2022 through September 30, 2023, Milwaukee County Behavioral Health Division – January 1, 2022 through December 31, 2022, and Milwaukee County Department of Health Services – January 1, 2022 through December 31, 2022 Criteria or Specific Requirement: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: During our testing of reimbursement requests, we identified an invoice that included expenses outside the period of performance for a grant in the federal program. Cause: Sufficient internal controls for reimbursement requests have not been implemented to ensure costs included for reimbursement are within the period of performance. Effect or Potential Effect: An expense charged to the federal program could be disallowed. Questioned Costs: $48,728. Context: This appeared to be an isolated incident from one grant invoice that was tested during audit procedures performed on financial statement account balances. For testing period of performance requirements, we selected a sample of 20 expense transactions and did not identify any expenses charged to grants outside the period of performance. Repeat Finding: No Recommendation: Additional internal controls for reimbursement requests should be implemented, including having another individual outside the process review and approve reimbursement requests prior to submission or require detailed accounting expense transactions be included with reimbursement requests to ensure expenses have been incurred within the period of performance. Views of Responsible Officials: Management agrees with the finding and the Organization and outsourced accounting rep will meet monthly to review cost reports and correlating invoices together before approving and submitting to the funder to ensure expenses submitted are within the grant performance period.

Assistance Listing Number: 93.958 Name of Federal Program: Block Grants for Community Mental Health Services Name of Federal Agency: Department of Health and Human Services Name of Pass-through Entities and Award Periods: Wisconsin Department of Health Services – October 1, 2021 through September 30, 2022, April 1, 2022 through September 30, 2022, October 1, 2022 through September 30, 2023, Milwaukee County Behavioral Health Division – January 1, 2022 through December 31, 2022, and Milwaukee County Department of Health Services – January 1, 2022 through December 31, 2022 Criteria or Specific Requirement: A non-federal entity may charge only allowable costs incurred during the approved budget period of a federal award’s period of performance and any costs incurred before the federal awarding agency or pass-through entity made the federal award that were authorized by the federal awarding agency or pass-through entity (2 CFR sections 200.308 200.309 and 200.403(h)). Condition: During our testing of reimbursement requests, we identified an invoice that included expenses outside the period of performance for a grant in the federal program. Cause: Sufficient internal controls for reimbursement requests have not been implemented to ensure costs included for reimbursement are within the period of performance. Effect or Potential Effect: An expense charged to the federal program could be disallowed. Questioned Costs: $48,728. Context: This appeared to be an isolated incident from one grant invoice that was tested during audit procedures performed on financial statement account balances. For testing period of performance requirements, we selected a sample of 20 expense transactions and did not identify any expenses charged to grants outside the period of performance. Repeat Finding: No Recommendation: Additional internal controls for reimbursement requests should be implemented, including having another individual outside the process review and approve reimbursement requests prior to submission or require detailed accounting expense transactions be included with reimbursement requests to ensure expenses have been incurred within the period of performance. Views of Responsible Officials: Management agrees with the finding and the Organization and outsourced accounting rep will meet monthly to review cost reports and correlating invoices together before approving and submitting to the funder to ensure expenses submitted are within the grant performance period.

Finding #: 2022-003 Period of Performance – Noncompliance (not material to compliance requirement) Identification of Federal Program and Award Program title: U.S. Department of Health and Human Services (DHHS): Public Health Services Act, Title III, Section 330 (Health Center Cluster) CFDA #: 93.224/93.527 Award #: H8DCS36483 Program Year: 2022 Criteria Pursuant to 2 CFR sections 200.308, 200.309, and 200.403(h), a non-Federal entity may charge to the Federal award only allowable costs incurred during the approved budget period of a federal award's period of performance and any costs incurred before the Federal awarding agency or pass-through entity made the Federal award that were authorized by the Federal awarding agency or pass-through entity. Pursuant to 2 CFR section 200.305(b)(5), to the extent available, the non-Federal entity must disburse funds available from program income and interest earned on such funds before requesting additional cash payments. Condition During our testing of period of performance, we noted instances of noncompliance relating to the health center’s recognition of expenditures beyond the award’s period of performance. After inspection of invoices and canceled checks supporting disbursements tested, the auditor identified 3 out of 40 expenditures where costs were incurred after the period of performance end date. Upon further investigation, the auditor determined that $153,005 of the $433,455 amount reported as 2022 federal expenditures under award H8DCS36483 was incurred beyond the period of performance end date. Cause Health center personnel were not following financial expense allocation of revenue policies and procedures, which state that federal funds will be utilized according to regulations and what is established on the budget information form submitted with the grant application. Effect Possibility of interest payments due, and of draw down restriction being placed on Payment Management System (PMS) account or denial of future funding. Questioned Costs $153,005 Perspective Information We tested a statistically valid sample of 40 out of 250+ federal expenditures and determined that the audit finding represented a systemic problem. Repeat Finding This finding is not a repeated finding. Recommendation We recommend that management review financial expense allocation of revenue policies and closely monitor grant procedures in place to ensure CAMcare is in compliance with budget information stipulated in grant agreements. Views of Responsible Officials Management recognizes the noncompliance; on November 29, 2023, CAMcare’s CEO, Jillian Hudspeth, and CFO, Christopher Bernardi, agreed with this finding, and explained that the issue occurred during a time period when none of the current authorizing officials were employed by CAMcare.

2 CFR § 300.1 states the Department of Health and Human Services adopts the Office of Management and Budget (OMB) Guidance in 2 CFR part 200, and has codified the text, with HHS-specific amendments in 45 CFR part 75. Thus, this part gives regulatory effect to the OMB guidance and supplements the guidance as needed for the Department. 2 CFR § 200.403 which states, in part, that 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. The PRF and ARP Rural Distribution are administered by the Health Resources and Services Administration (HRSA) and support eligible health care providers in the battle against the COVID-19 pandemic. PRF provides relief funds to eligible providers of health care services and support for health care-related expenses or lost revenues attributable to coronavirus. ARP Rural Distribution addresses the disproportionate impact that COVID-19 has had on rural communities and rural health care providers. PRF and ARP Rural Distribution recipients must only use payments for eligible expenses. The recipient certifies that the payment will only be used to prevent, prepare for, and respond to coronavirus and COVID-19, and that the payment shall reimburse the recipient only for health care related expenses or lost revenues that are attributable to coronavirus and COVID-19. 2022 OBM Compliance Supplement, Part 4, 93.498. Reporting Entities are required to maintain adequate documentation to substantiate that the PRF funds were used for health care-related expenses or lost revenues that are attributable to coronavirus and COVID-19. See PRB Reporting and Auditing FAQ, Health Resources & Services Administration, https://www.hrsa.gov/provider-relief/faq/reporting?categories=210&keywords=. For 2022, five out of the twenty-five employees (20%) tested did not have adequate documentation to support the hours worked and paid to the employees for COV+10 and/or COV+7 pay. Logan County Logan Acres Care Center Department was unable to locate all of the pickup bonus forms for five of the employees. These forms indicate the day, number of hours, and type of bonus the employee was approved for and received. Therefore, $998 of the $6,882 of employee wages tested did not have supporting documentation, resulting in a projected error of $39,233 and a questioned cost. Failure to maintain and provide adequate detailed financial records to support payments made could result in unallowable federal grant expenditures, reimbursements to the grantor, and/or additional questioned costs issued in future audits. Logan County Logan Acres Care Center Department should implement policies and procedures to identify, gather, and verify that adequate supporting documentation is received, reviewed, and maintained prior to issuing payments of grant funds.

Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS Award/Pass-Through Entity Identifying Numbers: 558951 Criteria: The Uniform Guidance in 2 CFR §200.403 states that for costs to be allowable under Federal awards, they must be adequately documented and there must be sufficient documentation. “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. (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. (c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. See also §200.306(b). (g) Be adequately documented. See also §200.300 through §200.309. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to §200.308(e)(3).” Condition: The Village allocated expenditures to programs during 2022 based on a direct allocation methodology. This allocation is done manually, and the support was inconsistently maintained. During our testing of costs (excluding payroll and fringe benefits, see finding 2022-004), we noted in accordance with §200.403(g) that 12 of the 60 samples selected for testing within Housing Opportunities for Persons with AIDS, did not have sufficient support for the allocation of the costs, or the costs themselves. Cause: The Village did not have policies and procedures in place to ensure that sufficient documentation was maintained to support the allocation of costs. Effect or Potential Effect: Without adequate controls in place to ensure costs are allowable and reimbursable, including controls over review of allocation methodologies, the Village could incorrectly charge expenditures to the federal programs. Questioned Costs: Known Questioned Costs Housing Opportunities for Persons with AIDS: $6,830 Likely Questioned Costs Housing Opportunities for Persons with AIDS: $234,595 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Nonpayroll costs for the Housing Opportunities for Persons with AIDS in 2022 were $1,173,061. Questioned costs consist of amounts lacking underlying support or amounts in excess of supported allocations. Identification as a Repeat Finding: This is a repeat of prior year finding 2021-008. Recommendation: We recommend that sufficient documentation be maintained to support any allocations of costs as required by §200.403. Views of Responsible Officials: Management agrees with this finding. Management is developing a cost allocation worksheet and implementing new procedures to ensure accurate expenditure reporting.

Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.241 Program: Housing Opportunities for Persons with AIDS, COVID-19 Housing Opportunities for Persons with AIDS Award/Pass-Through Entity Identifying Numbers: 558951 Criteria: The Uniform Guidance in 2 CFR §200.403 states that for costs to be allowable under Federal awards, they must be adequately documented and there must be sufficient documentation. “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. (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. (c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. See also §200.306(b). (g) Be adequately documented. See also §200.300 through §200.309. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to §200.308(e)(3).” Condition: The Village allocated expenditures to programs during 2022 based on a direct allocation methodology. This allocation is done manually, and the support was inconsistently maintained. During our testing of costs (excluding payroll and fringe benefits, see finding 2022-004), we noted in accordance with §200.403(g) that 12 of the 60 samples selected for testing within Housing Opportunities for Persons with AIDS, did not have sufficient support for the allocation of the costs, or the costs themselves. Cause: The Village did not have policies and procedures in place to ensure that sufficient documentation was maintained to support the allocation of costs. Effect or Potential Effect: Without adequate controls in place to ensure costs are allowable and reimbursable, including controls over review of allocation methodologies, the Village could incorrectly charge expenditures to the federal programs. Questioned Costs: Known Questioned Costs Housing Opportunities for Persons with AIDS: $6,830 Likely Questioned Costs Housing Opportunities for Persons with AIDS: $234,595 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Nonpayroll costs for the Housing Opportunities for Persons with AIDS in 2022 were $1,173,061. Questioned costs consist of amounts lacking underlying support or amounts in excess of supported allocations. Identification as a Repeat Finding: This is a repeat of prior year finding 2021-008. Recommendation: We recommend that sufficient documentation be maintained to support any allocations of costs as required by §200.403. Views of Responsible Officials: Management agrees with this finding. Management is developing a cost allocation worksheet and implementing new procedures to ensure accurate expenditure reporting.

Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.218, 14.231 Program: CDBG-Entitlement Grants Cluster, Emergency Solutions Grants Program, COVID-19 Emergency Solutions Grants Program Award/Pass-Through Entity Identifying Numbers: HHI-21-03, HHI-22-21, NCIP-FY20-010, HHI-21-35, HHI-20-21, 563770 Criteria: The Uniform Guidance in 2 CFR §200.403 states that for costs to be allowable under Federal awards, they must be adequately documented and there must be sufficient documentation. “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. (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. (c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. See also §200.306(b). (g) Be adequately documented. See also §200.300 through §200.309. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to §200.308(e)(3).” Condition: During our testing of costs (excluding payroll and fringe benefits, see finding 2022-004), we noted in accordance with §200.403(g) that 10 of the 60 samples selected for testing within CDBG- Entitlement Grants Cluster, did not have sufficient support for their rationale regarding the allocation of the costs. For the Emergency Solutions Grants Program, 29 of the 60 samples selected for testing did not have sufficient support for their rationale regarding the allocation of the costs. Cause: The Village allocates many costs between individual grants and grant programs, without maintaining adequate support for the rationale behind the allocation of costs. Effect or Potential Effect: Without adequate support for the rationale behind cost allocations, the Village cannot adequately document that costs are fairly charged between individual grants and grant programs. The Village could charge expenses to federal programs that are not based on the programs usage. Questioned Costs: Known Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Likely Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Known Questioned Costs Emergency Solutions Grants Program: $6,232 Likely Questioned Costs Emergency Solutions Grants Program: $38,701 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Nonpayroll costs for the CDBG-Entitlement Grants Cluster in 2022 were $444,085 with known questioned costs of $7,732 and likely questioned costs of $20,400. Nonpayroll costs for the Emergency Solutions Grants Program in 2022 were $1,854,771. Questioned costs consist of amounts lacking underlying support or amounts in excess of supported allocations. Identification as a Repeat Finding: This is a repeat of prior year finding 2021-008. Recommendation: We recommend that the Village carefully document the rationale or justification for cost allocations. Views of Responsible Officials: Management agrees with this finding. Management is developing a cost allocation worksheet, which will include documentation for the rationale or justification for cost allocations.

Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.218, 14.231 Program: CDBG-Entitlement Grants Cluster, Emergency Solutions Grants Program, COVID-19 Emergency Solutions Grants Program Award/Pass-Through Entity Identifying Numbers: HHI-21-03, HHI-22-21, NCIP-FY20-010, HHI-21-35, HHI-20-21, 563770 Criteria: The Uniform Guidance in 2 CFR §200.403 states that for costs to be allowable under Federal awards, they must be adequately documented and there must be sufficient documentation. “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. (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. (c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. See also §200.306(b). (g) Be adequately documented. See also §200.300 through §200.309. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to §200.308(e)(3).” Condition: During our testing of costs (excluding payroll and fringe benefits, see finding 2022-004), we noted in accordance with §200.403(g) that 10 of the 60 samples selected for testing within CDBG- Entitlement Grants Cluster, did not have sufficient support for their rationale regarding the allocation of the costs. For the Emergency Solutions Grants Program, 29 of the 60 samples selected for testing did not have sufficient support for their rationale regarding the allocation of the costs. Cause: The Village allocates many costs between individual grants and grant programs, without maintaining adequate support for the rationale behind the allocation of costs. Effect or Potential Effect: Without adequate support for the rationale behind cost allocations, the Village cannot adequately document that costs are fairly charged between individual grants and grant programs. The Village could charge expenses to federal programs that are not based on the programs usage. Questioned Costs: Known Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Likely Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Known Questioned Costs Emergency Solutions Grants Program: $6,232 Likely Questioned Costs Emergency Solutions Grants Program: $38,701 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Nonpayroll costs for the CDBG-Entitlement Grants Cluster in 2022 were $444,085 with known questioned costs of $7,732 and likely questioned costs of $20,400. Nonpayroll costs for the Emergency Solutions Grants Program in 2022 were $1,854,771. Questioned costs consist of amounts lacking underlying support or amounts in excess of supported allocations. Identification as a Repeat Finding: This is a repeat of prior year finding 2021-008. Recommendation: We recommend that the Village carefully document the rationale or justification for cost allocations. Views of Responsible Officials: Management agrees with this finding. Management is developing a cost allocation worksheet, which will include documentation for the rationale or justification for cost allocations.

Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.218, 14.231 Program: CDBG-Entitlement Grants Cluster, Emergency Solutions Grants Program, COVID-19 Emergency Solutions Grants Program Award/Pass-Through Entity Identifying Numbers: HHI-21-03, HHI-22-21, NCIP-FY20-010, HHI-21-35, HHI-20-21, 563770 Criteria: The Uniform Guidance in 2 CFR §200.403 states that for costs to be allowable under Federal awards, they must be adequately documented and there must be sufficient documentation. “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. (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. (c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. See also §200.306(b). (g) Be adequately documented. See also §200.300 through §200.309. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to §200.308(e)(3).” Condition: During our testing of costs (excluding payroll and fringe benefits, see finding 2022-004), we noted in accordance with §200.403(g) that 10 of the 60 samples selected for testing within CDBG- Entitlement Grants Cluster, did not have sufficient support for their rationale regarding the allocation of the costs. For the Emergency Solutions Grants Program, 29 of the 60 samples selected for testing did not have sufficient support for their rationale regarding the allocation of the costs. Cause: The Village allocates many costs between individual grants and grant programs, without maintaining adequate support for the rationale behind the allocation of costs. Effect or Potential Effect: Without adequate support for the rationale behind cost allocations, the Village cannot adequately document that costs are fairly charged between individual grants and grant programs. The Village could charge expenses to federal programs that are not based on the programs usage. Questioned Costs: Known Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Likely Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Known Questioned Costs Emergency Solutions Grants Program: $6,232 Likely Questioned Costs Emergency Solutions Grants Program: $38,701 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Nonpayroll costs for the CDBG-Entitlement Grants Cluster in 2022 were $444,085 with known questioned costs of $7,732 and likely questioned costs of $20,400. Nonpayroll costs for the Emergency Solutions Grants Program in 2022 were $1,854,771. Questioned costs consist of amounts lacking underlying support or amounts in excess of supported allocations. Identification as a Repeat Finding: This is a repeat of prior year finding 2021-008. Recommendation: We recommend that the Village carefully document the rationale or justification for cost allocations. Views of Responsible Officials: Management agrees with this finding. Management is developing a cost allocation worksheet, which will include documentation for the rationale or justification for cost allocations.

Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.218, 14.231 Program: CDBG-Entitlement Grants Cluster, Emergency Solutions Grants Program, COVID-19 Emergency Solutions Grants Program Award/Pass-Through Entity Identifying Numbers: HHI-21-03, HHI-22-21, NCIP-FY20-010, HHI-21-35, HHI-20-21, 563770 Criteria: The Uniform Guidance in 2 CFR §200.403 states that for costs to be allowable under Federal awards, they must be adequately documented and there must be sufficient documentation. “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. (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. (c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. See also §200.306(b). (g) Be adequately documented. See also §200.300 through §200.309. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to §200.308(e)(3).” Condition: During our testing of costs (excluding payroll and fringe benefits, see finding 2022-004), we noted in accordance with §200.403(g) that 10 of the 60 samples selected for testing within CDBG- Entitlement Grants Cluster, did not have sufficient support for their rationale regarding the allocation of the costs. For the Emergency Solutions Grants Program, 29 of the 60 samples selected for testing did not have sufficient support for their rationale regarding the allocation of the costs. Cause: The Village allocates many costs between individual grants and grant programs, without maintaining adequate support for the rationale behind the allocation of costs. Effect or Potential Effect: Without adequate support for the rationale behind cost allocations, the Village cannot adequately document that costs are fairly charged between individual grants and grant programs. The Village could charge expenses to federal programs that are not based on the programs usage. Questioned Costs: Known Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Likely Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Known Questioned Costs Emergency Solutions Grants Program: $6,232 Likely Questioned Costs Emergency Solutions Grants Program: $38,701 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Nonpayroll costs for the CDBG-Entitlement Grants Cluster in 2022 were $444,085 with known questioned costs of $7,732 and likely questioned costs of $20,400. Nonpayroll costs for the Emergency Solutions Grants Program in 2022 were $1,854,771. Questioned costs consist of amounts lacking underlying support or amounts in excess of supported allocations. Identification as a Repeat Finding: This is a repeat of prior year finding 2021-008. Recommendation: We recommend that the Village carefully document the rationale or justification for cost allocations. Views of Responsible Officials: Management agrees with this finding. Management is developing a cost allocation worksheet, which will include documentation for the rationale or justification for cost allocations.

Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.218, 14.231 Program: CDBG-Entitlement Grants Cluster, Emergency Solutions Grants Program, COVID-19 Emergency Solutions Grants Program Award/Pass-Through Entity Identifying Numbers: HHI-21-03, HHI-22-21, NCIP-FY20-010, HHI-21-35, HHI-20-21, 563770 Criteria: The Uniform Guidance in 2 CFR §200.403 states that for costs to be allowable under Federal awards, they must be adequately documented and there must be sufficient documentation. “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. (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. (c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. See also §200.306(b). (g) Be adequately documented. See also §200.300 through §200.309. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to §200.308(e)(3).” Condition: During our testing of costs (excluding payroll and fringe benefits, see finding 2022-004), we noted in accordance with §200.403(g) that 10 of the 60 samples selected for testing within CDBG- Entitlement Grants Cluster, did not have sufficient support for their rationale regarding the allocation of the costs. For the Emergency Solutions Grants Program, 29 of the 60 samples selected for testing did not have sufficient support for their rationale regarding the allocation of the costs. Cause: The Village allocates many costs between individual grants and grant programs, without maintaining adequate support for the rationale behind the allocation of costs. Effect or Potential Effect: Without adequate support for the rationale behind cost allocations, the Village cannot adequately document that costs are fairly charged between individual grants and grant programs. The Village could charge expenses to federal programs that are not based on the programs usage. Questioned Costs: Known Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Likely Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Known Questioned Costs Emergency Solutions Grants Program: $6,232 Likely Questioned Costs Emergency Solutions Grants Program: $38,701 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Nonpayroll costs for the CDBG-Entitlement Grants Cluster in 2022 were $444,085 with known questioned costs of $7,732 and likely questioned costs of $20,400. Nonpayroll costs for the Emergency Solutions Grants Program in 2022 were $1,854,771. Questioned costs consist of amounts lacking underlying support or amounts in excess of supported allocations. Identification as a Repeat Finding: This is a repeat of prior year finding 2021-008. Recommendation: We recommend that the Village carefully document the rationale or justification for cost allocations. Views of Responsible Officials: Management agrees with this finding. Management is developing a cost allocation worksheet, which will include documentation for the rationale or justification for cost allocations.

Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.218, 14.231 Program: CDBG-Entitlement Grants Cluster, Emergency Solutions Grants Program, COVID-19 Emergency Solutions Grants Program Award/Pass-Through Entity Identifying Numbers: HHI-21-03, HHI-22-21, NCIP-FY20-010, HHI-21-35, HHI-20-21, 563770 Criteria: The Uniform Guidance in 2 CFR §200.403 states that for costs to be allowable under Federal awards, they must be adequately documented and there must be sufficient documentation. “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. (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. (c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. See also §200.306(b). (g) Be adequately documented. See also §200.300 through §200.309. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to §200.308(e)(3).” Condition: During our testing of costs (excluding payroll and fringe benefits, see finding 2022-004), we noted in accordance with §200.403(g) that 10 of the 60 samples selected for testing within CDBG- Entitlement Grants Cluster, did not have sufficient support for their rationale regarding the allocation of the costs. For the Emergency Solutions Grants Program, 29 of the 60 samples selected for testing did not have sufficient support for their rationale regarding the allocation of the costs. Cause: The Village allocates many costs between individual grants and grant programs, without maintaining adequate support for the rationale behind the allocation of costs. Effect or Potential Effect: Without adequate support for the rationale behind cost allocations, the Village cannot adequately document that costs are fairly charged between individual grants and grant programs. The Village could charge expenses to federal programs that are not based on the programs usage. Questioned Costs: Known Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Likely Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Known Questioned Costs Emergency Solutions Grants Program: $6,232 Likely Questioned Costs Emergency Solutions Grants Program: $38,701 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Nonpayroll costs for the CDBG-Entitlement Grants Cluster in 2022 were $444,085 with known questioned costs of $7,732 and likely questioned costs of $20,400. Nonpayroll costs for the Emergency Solutions Grants Program in 2022 were $1,854,771. Questioned costs consist of amounts lacking underlying support or amounts in excess of supported allocations. Identification as a Repeat Finding: This is a repeat of prior year finding 2021-008. Recommendation: We recommend that the Village carefully document the rationale or justification for cost allocations. Views of Responsible Officials: Management agrees with this finding. Management is developing a cost allocation worksheet, which will include documentation for the rationale or justification for cost allocations.

Federal Agencies: Department of Housing and Urban Development Federal Assistance Listing Numbers: 14.218, 14.231 Program: CDBG-Entitlement Grants Cluster, Emergency Solutions Grants Program, COVID-19 Emergency Solutions Grants Program Award/Pass-Through Entity Identifying Numbers: HHI-21-03, HHI-22-21, NCIP-FY20-010, HHI-21-35, HHI-20-21, 563770 Criteria: The Uniform Guidance in 2 CFR §200.403 states that for costs to be allowable under Federal awards, they must be adequately documented and there must be sufficient documentation. “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. (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. (c) Be consistent with policies and procedures that apply uniformly to both federally financed and other activities of the non-Federal entity. (d) Be accorded consistent treatment. A cost may not be assigned to a Federal award as a direct cost if any other cost incurred for the same purpose in like circumstances has been allocated to the Federal award as an indirect cost. (e) Be determined in accordance with generally accepted accounting principles (GAAP), except, for state and local governments and Indian tribes only, as otherwise provided for in this part. (f) Not be included as a cost or used to meet cost sharing or matching requirements of any other federally financed program in either the current or a prior period. See also §200.306(b). (g) Be adequately documented. See also §200.300 through §200.309. (h) Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to §200.308(e)(3).” Condition: During our testing of costs (excluding payroll and fringe benefits, see finding 2022-004), we noted in accordance with §200.403(g) that 10 of the 60 samples selected for testing within CDBG- Entitlement Grants Cluster, did not have sufficient support for their rationale regarding the allocation of the costs. For the Emergency Solutions Grants Program, 29 of the 60 samples selected for testing did not have sufficient support for their rationale regarding the allocation of the costs. Cause: The Village allocates many costs between individual grants and grant programs, without maintaining adequate support for the rationale behind the allocation of costs. Effect or Potential Effect: Without adequate support for the rationale behind cost allocations, the Village cannot adequately document that costs are fairly charged between individual grants and grant programs. The Village could charge expenses to federal programs that are not based on the programs usage. Questioned Costs: Known Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Likely Questioned Costs CDBG-Entitlement Grants Cluster: None above the $25,000 reporting threshold. Known Questioned Costs Emergency Solutions Grants Program: $6,232 Likely Questioned Costs Emergency Solutions Grants Program: $38,701 Context: This is a condition identified per review of the Village’s compliance with specified requirements not using a statistically valid sample. Nonpayroll costs for the CDBG-Entitlement Grants Cluster in 2022 were $444,085 with known questioned costs of $7,732 and likely questioned costs of $20,400. Nonpayroll costs for the Emergency Solutions Grants Program in 2022 were $1,854,771. Questioned costs consist of amounts lacking underlying support or amounts in excess of supported allocations. Identification as a Repeat Finding: This is a repeat of prior year finding 2021-008. Recommendation: We recommend that the Village carefully document the rationale or justification for cost allocations. Views of Responsible Officials: Management agrees with this finding. Management is developing a cost allocation worksheet, which will include documentation for the rationale or justification for cost allocations.

Finding 2022-003 ? Unallowable Use of Public Housing Program Funds (Noncompliance/Other Matter) Public Housing Program ? Assistance Listing No. 14.850a, Grant Period: Year-End December 31, 2022 Criteria The cost principles in 2 CFR Part 200, Sub-part E of the Uniform Guidance describe allowable and unallowable uses of federal award program subsidies. Parts 200.403 and 200.405 prohibit the use of federal award program subsidies to fund expenditures outside of the applicable federal award program. Specifically, the Public Housing Programs subsidies and reserves cannot be used to fund expenditures and/or deficits of other federal or non-federal programs, except through allowable Management, Book-keeping and Service Fees. Condition and Perspective During 2022, the Authority?s Public Housing Program loaned the Central Office Cost Center (COCC) $668,552. This amount was payable back to the Public Housing Program as of December 31, 2022.Questioned Costs ? None noted Cause Lack of non-federal funds available to finance non-federal expenditures. Effect Non-compliance with federal Allowable Cost requirements. Recommendation We recommend that the Authority limit funding the COCC from the Public Housing Program, to allowable Fees only as specified in the Uniform Guidance and applicable HUD literature. Management?s Response The Authority will limit funding the COCC from the Public Housing Program, to allowable Fees only. The Authority?s Executive Director, Trey George, has assumed the responsibility of executing this corrective action as of November 1, 2023.

FINDING 2022-002 Subject: Child Support Enforcement - Activities Allowed or Unallowed, Allowable Costs/Cost Principles Federal Agency: Department of Health and Human Services Federal Program: Child Support Enforcement Assistance Listings Number: 93.563 Federal Award Number and Year (or Other Identifying Number): FY2022 Pass-Through Entity: Indiana Department of Child Services Compliance Requirements: Activities Allowed or Unallowed, Allowable Costs/Cost Principles Audit Findings: Material Weakness, Modified Opinion Condition and Context Clerk's Incentive Fund The Clerk Incentive fund is a separate statutorily created fund held at the local County level and represents 22.2 percent of the total incentive funds received by the County. These funds are available for the use of the County Clerk which must be used to improve the efficiency and effectiveness of the Title IV-D program in the County. A Deputy Court Clerk was hired in 1999 to work solely for the County Clerk's Title IV-D Child Support office. From the date of hire, the salary of this employee was paid out of the County's General fund. Beginning in 2016, and through the current audit period, the County paid the employee's salary solely from Fund 8899, the Clerk's Incentive Fund. During the audit period, wages, and benefits, totaling $68,693, were paid out of the Clerk's Incentive Fund. Although salaries and benefits of employees performing Title IV-D duties are an allowable expense of incentive funds, incentive funds must be used to supplement and not supplant existing program funding. Due to the County paying the Deputy Court Clerk's wages and benefits entirely from the Clerk's Incentive Fund, incentive funds were then used to supplant instead of supplement existing program funding. Indirect Costs Indirect costs are expenses that are incurred by other County offices and departments, which indirectly benefit the County Title IV-D offices. Indirect expenses are allocated to the County Title IV-D offices through an indirect Cost Allocation Plan (CAP), which is submitted by the County to the Child Support Bureau of the Indiana Department of Child Services (DCS). Indirect costs charged are based on two-year prior expenditures; therefore, indirect costs charged in 2022 were based on expenditures from 2020. A sample of 25 indirect cost expenditures, totaling $27,077, from the department cost pools from the Cost Allocation Plan (CAP) was selected for testing. For 3 of the 25 expenditures examined, the County was unable to provide the vendor contract; therefore, we were unable to verify if the correct rate for the contract payment was charged. In addition, the County did not have written procedures for determining the allowability of costs in accordance with Subpart E of 2 CFR 200. 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). . . ." 45 CFR 305.35(a) states: "A State must expend the full amount of incentive payments received under this part to supplement, and not supplant, other funds used by the State to carry out IV-D program activities or funds for other activities approved by the Secretary which may contribute to improving the effectiveness or efficiency of the State's IV-D program, including cost-effective contracts with local agencies, whether or not the expenditures for the activity are eligible for reimbursement under this part." Indiana Code 31-25-4-23(c) states: "The amount that a county receives and the terms under which the incentive payment is paid must be in accordance with relevant federal statutes and the federal regulations promulgated under the statutes. However, amounts received as incentive payments may not, without the approval of the county fiscal body, be used to increase or supplement the salary of an elected official. The amounts received as incentive payments must be used to supplement, rather than take the place of, other funds used for Title IV-D program activities." 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. (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 200.302(b) states in part: "The financial management system of each non-Federal entity must provide for the following: . . . (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." Cause A proper system of internal controls over child support enforcement expenditures was not designed by management of the County. Embedded within a properly designed and implemented internal control system should be internal controls consisting of policies and procedures. Policies reflect the County's management statements of what should be done to effect internal controls, and procedures should consist of actions that would implement these policies. Effect Without the proper implementation of an effectively designed system of internal controls the internal control system cannot be capable of effectively preventing, or detecting and correcting, material noncompliance. As a result, direct costs associated with one individual's salary paid form the incentive fund were used to supplant not supplement the Child Support program. In addition, expenses within the cost application plan could be verified as accurate. INDIANA STATE BOARD OF ACCOUNTS 19 VIGO COUNTY SCHEDULE OF FINDINGS AND QUESTIONED COSTS (Continued) Noncompliance with the provisions of federal statutes, regulations, and the terms and conditions of the federal award could result in the loss of future federal funding to the County. Questioned Costs Known questioned costs in the amount of $68,693 were identified as detailed in the Condition and Context. Recommendation We recommended that management of the County establish a proper system of internal controls and develop policies and procedures to ensure all expenses paid out of incentive funds supplement the Title IV-D program, and that costs included within the cost allocation plan have adequate supporting documentation to support the amount paid. Views of Responsible Officials For the views of responsible officials, refer to the Corrective Action Plan that is part of this report.

Finding 2022-005 Identification of the Federal Program: Federal Agency: U.S. Department of Health and Human Services, United States Department of Defense Assistance Listing: Various ? Research & Development (R&D) Cluster Pass-Through Grantor: Various Pass-Through Award Number: Various Pass-Through Award Period: 1/1/2022-12/31/2022 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): 2 CFR Section 200.303 of the Uniform Guidance States the Following Regarding Internal Control: ?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 section 200.403(h)) states: ?Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to ? 200.308(e)(3).? Condition: Management does not track expenses by budget period for Corewell Health East federal Research and Development (R&D) grants and is therefore unable to support that expenses are recorded in the appropriate period of performance. Cause: Management?s General Ledger system was not designed to record R&D expenditures by budget period. Effect or Potential Effect: Expenses could be expensed outside the period performance. Questioned Costs: Unknown Context: Corewell Health East has twenty-five R&D grants. We were unable to test period of performance for seven grants, totalling $765,791, which had budget periods beginning or ending during the audit period. As such, we were unable to conclude if expenses were incurred in the appropriate budget period. Total R&D Cluster expenditures reported on the Schedule for Corewell Health East are $3,348,876 for the year ended December 31, 2022, The total R&D Cluster expenditures reported on the Schedule are $10,507,754 for the year ended December 31, 2022. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management design appropriate cost structure to monitor R&D expenditures by performance period Views of Responsible Officials: The hierarchy and functionality of the Corporate financial management system does not support separate budget periods during a single award project period. This was managed manually by the CHE Sponsored Programs Administration via a customized internal report. Effective 7/1/2023, the System transitioned Corewell Health East onto Workday, the common financial management system used by Corewell Health West. The Workday financial management system includes a separate grant module that has the capability to establish defined budget periods under a single award. With the functionality now enabled by Workday, we do not anticipate any barriers to maintaining defined budget periods within an award funding cycle to assure that expenses are recorded in the appropriate period of performance.

Finding 2022-005 Identification of the Federal Program: Federal Agency: U.S. Department of Health and Human Services, United States Department of Defense Assistance Listing: Various ? Research & Development (R&D) Cluster Pass-Through Grantor: Various Pass-Through Award Number: Various Pass-Through Award Period: 1/1/2022-12/31/2022 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): 2 CFR Section 200.303 of the Uniform Guidance States the Following Regarding Internal Control: ?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 section 200.403(h)) states: ?Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to ? 200.308(e)(3).? Condition: Management does not track expenses by budget period for Corewell Health East federal Research and Development (R&D) grants and is therefore unable to support that expenses are recorded in the appropriate period of performance. Cause: Management?s General Ledger system was not designed to record R&D expenditures by budget period. Effect or Potential Effect: Expenses could be expensed outside the period performance. Questioned Costs: Unknown Context: Corewell Health East has twenty-five R&D grants. We were unable to test period of performance for seven grants, totalling $765,791, which had budget periods beginning or ending during the audit period. As such, we were unable to conclude if expenses were incurred in the appropriate budget period. Total R&D Cluster expenditures reported on the Schedule for Corewell Health East are $3,348,876 for the year ended December 31, 2022, The total R&D Cluster expenditures reported on the Schedule are $10,507,754 for the year ended December 31, 2022. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management design appropriate cost structure to monitor R&D expenditures by performance period Views of Responsible Officials: The hierarchy and functionality of the Corporate financial management system does not support separate budget periods during a single award project period. This was managed manually by the CHE Sponsored Programs Administration via a customized internal report. Effective 7/1/2023, the System transitioned Corewell Health East onto Workday, the common financial management system used by Corewell Health West. The Workday financial management system includes a separate grant module that has the capability to establish defined budget periods under a single award. With the functionality now enabled by Workday, we do not anticipate any barriers to maintaining defined budget periods within an award funding cycle to assure that expenses are recorded in the appropriate period of performance.

Finding 2022-005 Identification of the Federal Program: Federal Agency: U.S. Department of Health and Human Services, United States Department of Defense Assistance Listing: Various ? Research & Development (R&D) Cluster Pass-Through Grantor: Various Pass-Through Award Number: Various Pass-Through Award Period: 1/1/2022-12/31/2022 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): 2 CFR Section 200.303 of the Uniform Guidance States the Following Regarding Internal Control: ?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 section 200.403(h)) states: ?Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to ? 200.308(e)(3).? Condition: Management does not track expenses by budget period for Corewell Health East federal Research and Development (R&D) grants and is therefore unable to support that expenses are recorded in the appropriate period of performance. Cause: Management?s General Ledger system was not designed to record R&D expenditures by budget period. Effect or Potential Effect: Expenses could be expensed outside the period performance. Questioned Costs: Unknown Context: Corewell Health East has twenty-five R&D grants. We were unable to test period of performance for seven grants, totalling $765,791, which had budget periods beginning or ending during the audit period. As such, we were unable to conclude if expenses were incurred in the appropriate budget period. Total R&D Cluster expenditures reported on the Schedule for Corewell Health East are $3,348,876 for the year ended December 31, 2022, The total R&D Cluster expenditures reported on the Schedule are $10,507,754 for the year ended December 31, 2022. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management design appropriate cost structure to monitor R&D expenditures by performance period Views of Responsible Officials: The hierarchy and functionality of the Corporate financial management system does not support separate budget periods during a single award project period. This was managed manually by the CHE Sponsored Programs Administration via a customized internal report. Effective 7/1/2023, the System transitioned Corewell Health East onto Workday, the common financial management system used by Corewell Health West. The Workday financial management system includes a separate grant module that has the capability to establish defined budget periods under a single award. With the functionality now enabled by Workday, we do not anticipate any barriers to maintaining defined budget periods within an award funding cycle to assure that expenses are recorded in the appropriate period of performance.

Finding 2022-005 Identification of the Federal Program: Federal Agency: U.S. Department of Health and Human Services, United States Department of Defense Assistance Listing: Various ? Research & Development (R&D) Cluster Pass-Through Grantor: Various Pass-Through Award Number: Various Pass-Through Award Period: 1/1/2022-12/31/2022 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): 2 CFR Section 200.303 of the Uniform Guidance States the Following Regarding Internal Control: ?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 section 200.403(h)) states: ?Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to ? 200.308(e)(3).? Condition: Management does not track expenses by budget period for Corewell Health East federal Research and Development (R&D) grants and is therefore unable to support that expenses are recorded in the appropriate period of performance. Cause: Management?s General Ledger system was not designed to record R&D expenditures by budget period. Effect or Potential Effect: Expenses could be expensed outside the period performance. Questioned Costs: Unknown Context: Corewell Health East has twenty-five R&D grants. We were unable to test period of performance for seven grants, totalling $765,791, which had budget periods beginning or ending during the audit period. As such, we were unable to conclude if expenses were incurred in the appropriate budget period. Total R&D Cluster expenditures reported on the Schedule for Corewell Health East are $3,348,876 for the year ended December 31, 2022, The total R&D Cluster expenditures reported on the Schedule are $10,507,754 for the year ended December 31, 2022. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management design appropriate cost structure to monitor R&D expenditures by performance period Views of Responsible Officials: The hierarchy and functionality of the Corporate financial management system does not support separate budget periods during a single award project period. This was managed manually by the CHE Sponsored Programs Administration via a customized internal report. Effective 7/1/2023, the System transitioned Corewell Health East onto Workday, the common financial management system used by Corewell Health West. The Workday financial management system includes a separate grant module that has the capability to establish defined budget periods under a single award. With the functionality now enabled by Workday, we do not anticipate any barriers to maintaining defined budget periods within an award funding cycle to assure that expenses are recorded in the appropriate period of performance.

Finding 2022-005 Identification of the Federal Program: Federal Agency: U.S. Department of Health and Human Services, United States Department of Defense Assistance Listing: Various ? Research & Development (R&D) Cluster Pass-Through Grantor: Various Pass-Through Award Number: Various Pass-Through Award Period: 1/1/2022-12/31/2022 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): 2 CFR Section 200.303 of the Uniform Guidance States the Following Regarding Internal Control: ?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 section 200.403(h)) states: ?Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to ? 200.308(e)(3).? Condition: Management does not track expenses by budget period for Corewell Health East federal Research and Development (R&D) grants and is therefore unable to support that expenses are recorded in the appropriate period of performance. Cause: Management?s General Ledger system was not designed to record R&D expenditures by budget period. Effect or Potential Effect: Expenses could be expensed outside the period performance. Questioned Costs: Unknown Context: Corewell Health East has twenty-five R&D grants. We were unable to test period of performance for seven grants, totalling $765,791, which had budget periods beginning or ending during the audit period. As such, we were unable to conclude if expenses were incurred in the appropriate budget period. Total R&D Cluster expenditures reported on the Schedule for Corewell Health East are $3,348,876 for the year ended December 31, 2022, The total R&D Cluster expenditures reported on the Schedule are $10,507,754 for the year ended December 31, 2022. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management design appropriate cost structure to monitor R&D expenditures by performance period Views of Responsible Officials: The hierarchy and functionality of the Corporate financial management system does not support separate budget periods during a single award project period. This was managed manually by the CHE Sponsored Programs Administration via a customized internal report. Effective 7/1/2023, the System transitioned Corewell Health East onto Workday, the common financial management system used by Corewell Health West. The Workday financial management system includes a separate grant module that has the capability to establish defined budget periods under a single award. With the functionality now enabled by Workday, we do not anticipate any barriers to maintaining defined budget periods within an award funding cycle to assure that expenses are recorded in the appropriate period of performance.

Finding 2022-005 Identification of the Federal Program: Federal Agency: U.S. Department of Health and Human Services, United States Department of Defense Assistance Listing: Various ? Research & Development (R&D) Cluster Pass-Through Grantor: Various Pass-Through Award Number: Various Pass-Through Award Period: 1/1/2022-12/31/2022 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): 2 CFR Section 200.303 of the Uniform Guidance States the Following Regarding Internal Control: ?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 section 200.403(h)) states: ?Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to ? 200.308(e)(3).? Condition: Management does not track expenses by budget period for Corewell Health East federal Research and Development (R&D) grants and is therefore unable to support that expenses are recorded in the appropriate period of performance. Cause: Management?s General Ledger system was not designed to record R&D expenditures by budget period. Effect or Potential Effect: Expenses could be expensed outside the period performance. Questioned Costs: Unknown Context: Corewell Health East has twenty-five R&D grants. We were unable to test period of performance for seven grants, totalling $765,791, which had budget periods beginning or ending during the audit period. As such, we were unable to conclude if expenses were incurred in the appropriate budget period. Total R&D Cluster expenditures reported on the Schedule for Corewell Health East are $3,348,876 for the year ended December 31, 2022, The total R&D Cluster expenditures reported on the Schedule are $10,507,754 for the year ended December 31, 2022. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management design appropriate cost structure to monitor R&D expenditures by performance period Views of Responsible Officials: The hierarchy and functionality of the Corporate financial management system does not support separate budget periods during a single award project period. This was managed manually by the CHE Sponsored Programs Administration via a customized internal report. Effective 7/1/2023, the System transitioned Corewell Health East onto Workday, the common financial management system used by Corewell Health West. The Workday financial management system includes a separate grant module that has the capability to establish defined budget periods under a single award. With the functionality now enabled by Workday, we do not anticipate any barriers to maintaining defined budget periods within an award funding cycle to assure that expenses are recorded in the appropriate period of performance.

Finding 2022-005 Identification of the Federal Program: Federal Agency: U.S. Department of Health and Human Services, United States Department of Defense Assistance Listing: Various ? Research & Development (R&D) Cluster Pass-Through Grantor: Various Pass-Through Award Number: Various Pass-Through Award Period: 1/1/2022-12/31/2022 Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): 2 CFR Section 200.303 of the Uniform Guidance States the Following Regarding Internal Control: ?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 section 200.403(h)) states: ?Cost must be incurred during the approved budget period. The Federal awarding agency is authorized, at its discretion, to waive prior written approvals to carry forward unobligated balances to subsequent budget periods pursuant to ? 200.308(e)(3).? Condition: Management does not track expenses by budget period for Corewell Health East federal Research and Development (R&D) grants and is therefore unable to support that expenses are recorded in the appropriate period of performance. Cause: Management?s General Ledger system was not designed to record R&D expenditures by budget period. Effect or Potential Effect: Expenses could be expensed outside the period performance. Questioned Costs: Unknown Context: Corewell Health East has twenty-five R&D grants. We were unable to test period of performance for seven grants, totalling $765,791, which had budget periods beginning or ending during the audit period. As such, we were unable to conclude if expenses were incurred in the appropriate budget period. Total R&D Cluster expenditures reported on the Schedule for Corewell Health East are $3,348,876 for the year ended December 31, 2022, The total R&D Cluster expenditures reported on the Schedule are $10,507,754 for the year ended December 31, 2022. Identification as a Repeat Finding: Not applicable. Recommendation: We recommend that management design appropriate cost structure to monitor R&D expenditures by performance period Views of Responsible Officials: The hierarchy and functionality of the Corporate financial management system does not support separate budget periods during a single award project period. This was managed manually by the CHE Sponsored Programs Administration via a customized internal report. Effective 7/1/2023, the System transitioned Corewell Health East onto Workday, the common financial management system used by Corewell Health West. The Workday financial management system includes a separate grant module that has the capability to establish defined budget periods under a single award. With the functionality now enabled by Workday, we do not anticipate any barriers to maintaining defined budget periods within an award funding cycle to assure that expenses are recorded in the appropriate period of performance.

2022 ? 001 Emergency Rental Assistance Eligibility Prior Year Finding: N/A Federal Agency: Department of the Treasury Federal Program: COVID-19 ? Emergency Rental Assistance Assistance Listing Number: 21.023 Award Number and Period: ERA0279 (1/12/2021 ? 9/30/2022) ERAE0206 (5/10/2021 ? 9/30/2025) ERAE0299 (5/10/2021 ? 9/30/2025) Compliance Requirement: Eligibility Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: Compliance: In accordance with Consolidated Appropriations Act, 2021 and 2 CFR 200.403 costs must be adequately documented, and benefits paid to or on behalf of individuals must be calculated correctly. Control: Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should comply with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States or the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: The County incorrectly processed a benefit payment that included an overpayment of $30 by inadvertently including utilities on top of base rent. Questioned Costs: $30 ? Federal share of overpayment made Context: Sixty cases were selected for testing and the following exception was noted: ? For 1 of 60 cases tested, an overpayment was made. Total benefit amount overpaid totaled $30 by including utilities on top of base rent. Per the rent ledger and rental agreement, base rent and utilities totaled $1,525 and the payment total $1,555. Cause: The County did not have sufficient controls in place to ensure that all payments were processed adequately and could be supported. Effect The County made an overpayment of $30 to eligible participants using Emergency Rental Assistance funds. Recommendation: We recommend the County review its procedures and controls over the processing of beneficiary payments to ensure amounts are properly paid and reimbursed. Views of responsible officials: Management agrees with the finding.