CORRECTIVE ACTION PLAN September 16, 2024 Chickahominy Indian Tribe - Eastern Division respectfully submits the following corrective action plan for the year ended December 31, 2022. Name and address of independent public accounting firm: Brown, Edwards & Company, L.L.P. 1909 Financial Drive Harrisonburg, VA 2280 I Audit period: December 31, 2023 The findings from the December 31, 2023 Schedule of Findings and Questioned Costs (the "Schedule") are discussed below. The findings are numbered consistently with the number assigned in the Schedule. FINDINGS-FINANCIAL STATEMENT AUDIT 2023-001: Payroll Tracking and Allocation (Material Weakness) Condition: The client was unable to provide a payroll allocation by fund that agreed to the payroll registers. Criteria: Payroll allocations were not supported by adequate documentation and was not consistent with methods used in the prior year. Cause: The prior CFO had created an allocation method in which the exist in g employees could not follow. After the CFO' s departure, emailed allocat io ns were sent whic h o nly specified which funding source the payroll expenditures would be paid from, not the fund the expenditures were incurred tn. Effect: Material audit adjustments were required. 2023-001: Payroll Tracking and Allocation (Material Weakness) Recommendation: We recommend that payroll allocations be supported by a logical method and be allocated by fund. Views of Responsible Officials and Planned Corrective Action: We will begin to reconcile payroll records to Abila and ensure allocations are properly recorded. The previous administration who were responsible for the 2023 and prior audits are no longer employed by the Tribe, therefore all future audit recommendations will be required to be implemented by the new administration. 2023-002: Material Audit Adjustments (Material Weakness) Condition: In fiscal year 2022, the Tribe elected to convert from the cash basis of accounting to governmental accrual accounting. During 2023, the Tribe continued to function on a cash basis and did not record most accruals. Additionally, there was a software issue which caused duplicate d and triplicated transactions. Criteria: Financial informat io n provided should be accessible and materially correct. Cause: As noted in previous audits, the Tribe has not consistently used the accounting software and has relied heavily on program specific spreadsheets. The Tribe did not fully switch to accrual basis for internal purposes during 2023. Effect: Material audit adjustments were required. Recommendation: We recommend that monthly reports be generated from Abila and reviewed for accuracy. Any discrepancies between Abila reports and program specific spreadsheets should be reconciled or adjusted. These reports should be reJjable and able to be used to present to Council as part of monthly financial reporting. Views of Responsible Officials and Planned Corrective Action: Reporting will begin monthly to the Executive Council on financial con dition ; further training will also be required to learn how to pull reports effectively. Also see the response above regarding admin ist ration turnover. 2023-003: Capital Projects and Asset Records (Material Weakness) Condition: Significant adjustments related spec ificall y to capital assets. Criteria: Co ntro ls over capital asset tracking should be in place. Cause: While the Tribe has started to use the fixed asset module in the acco unting software, there were material differences between prior year asset balances and the final audit report. Additionally, not all assets were captured within the software. Effect: Material adjustments were required. Recommendation: We recommend developing a capital asset policy which should include a threshold for capitalization. All eligible expenditures above the set threshold should be tracked by the Tribe throughout the year using capital outlay expenditure accounts. Views of Responsible Officials and Planned Corrective Action: A capital asset policy will be implemented after research and development of the policy. Any expenditures over $5,000 will be considered a capital asset. Also see the comment above regarding administration turnover. FINDINGS AND QUESTIONED COSTS - MAJOR FEDERAL AWARD PROGRAM AUDIT 2023-004: Bureau of Indian Affairs- Aid to Tribal Governments ALN 15.020, Late filing of Data Collection Form Condition: The Tribe did not file the data collection form for the year ended December 31, 2022 timely. Criteria: Under the requirements of the Uniform Gu idance and the Office of Management and Budget (0MB), all entities are required to file the annual data collection form with the Federal Audit Clearingh ouse the earlier of 30 days after the issuance of the entity's annual audit or 12 months after the entity's fiscal year end. Collection Form Cause: Management did not complete and certify the auditee portion of the form before the deadline. Effect: The Tribe's form was not submitted timely to the Federal Audit Clearinghouse. Recommendation: Management should take steps to ensure that the form is filed timely. Views f Responsible Officials and Planned Corrective Action: We will schedule the due date of the data collection form to be submitted in time to prevent delays. Also see the comment above regarding administration turnover. 2023-005: Bureau of Indian Affairs- Aid to Tribal Governments ALN 15.020, Activities Allowed and Unallowed Condition: An expenditure was entered into grant tracking spreadsheets twice, once individually and once included in a group total for multiple invoice s. Criteria: All expenditures drawn-down from the grant should be supported by adequate documentation and expenditures should be tracked accurately to ensure no duplication of requests. Cause: The Tribe is not using the accounting software as intended and grant tracking spreadsheets are not reconciled and adequately ma i nta ine d. Effect: A SLngle expenditure was requested and drawn-down twice. Questioned Cost Amount: The instance identified was $9,500. This amount projected across the population would be $33,937. Unallowed Perspective Jriformation One of eight disbursements tested. Recommendation: We recommend that all financial transactions should be recorded i_n the acco unting software and reports should be ran and reconciled to underlying document at ion on a regular basis. When grant tracking spreadsheets are necessa ry, these should be reco nciled to the accounting software as well. Views of Responsible Officials and Planned Corrective Action: Our staff will receive traini_ng in the proper use of our accounting program with stronger teaching for data entry and tracking reports. Also se e the co mment above regarding administration turnover. 2023-006: Bureau of Indian Affairs- Aid to Tribal Governments ALN 15.020, Annual Narrative Reporting Criteria: An Annual Narrative report is due within 90 days of the Tribe ' s year end. Cause: The Trib a l Administrator was not aware this reporting was still required. Effect: The Annual Narrative report was not subm itte d timely. Recommendation: Each grant should have a designated responsible person who understands grant requireme nts and ensures those requi_rements are met. Views of Re!>p o nsibl e Officials and Planned Corrective Action: We will work on staff training for working with grants to understand proper procedures for reports required for the grant. Also see the comment above regarding administration turnover. If the Federal A ud it Clear ingho use has questions regarding this pla n, please call Ch ief Joanne Howard at 804-966- 7815. Sincere ly yours, Joan ne Howa rd Chief