HEARTLAND ALLIANCE FOR HUMAN NEEDS & HUMAN RIGHTS AND SUBSIDIARY

FINDING 2023-001 Internal Control over Compliance and Compliance with Allowable Costs/Cost Principles Program: Federal Agency: Department of Health and Human Services Funding Year(s): 2/1/2020 – 3/31/2023 Federal Award: 90ZU0351-03-05 AL Number: 93.676 Criteria: The Code of Federal Regulations 2 CFR 200.303, Internal Control, requires the non-federal entity to establish and maintain effective internal control over Federal awards that provides reasonable assurance that the non-federal entity is managing Federal awards in compliance with Federal statutes, regulations, and other terms and conditions. Per 2 CFR Section 200.430 Compensation – Personal Services: “Costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: (1) Is reasonable for the services rendered and conforms to the establish written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; (2) Follows an appointment made in accordance with a non-Federal entity’s laws and/or rules or written policies and meets the requirements of Federal statute, where applicable; and (3) Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable.” 2 CFR Section 200.430(i): “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; (iv) Encompass both federally assisted and all other activities compensated by the non Federal entity on an integrated basis, but may include the use of subsidiary records as defined in the non Federal entity’s written policy; (v) Comply with the established accounting policies and practices of the non-Federal entity; (vi) [Reserved] (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. (viii) Budget estimates (i.e., estimates determined before the services are performed) alone do not qualify as support for charges to Federal awards.” Condition: During the audit, we noted an instance for which an employee was reinstated and received retroactive payment for the months of September through November 2022 for which we were not able to substantiate the allowability of the payroll charges. Cause: The Organization did not follow its policies and procedures in place to ensure compliance with the requirements allowable personnel costs. Effect: Failure to follow the Organization’s control system related to review and document payroll benefits so that only allowable costs are charged to the program can lead to noncompliance with federal statutes, regulations could lead to disallowed costs. Context: This is a condition identified based upon our review of the Organization’s compliance with specified requirements. Questioned Costs: $9,864 Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Organization strictly enforce its existing policies and procedures to ensure that all payroll costs including benefits charged to the federal awards are reviewed and documented for allowability.

FINDING 2023-002 Internal Control over Compliance and Compliance with Period of Performance Program: Federal Agency: Department of Health and Human Services Funding Year(s): 2/1/2020 – 3/31/2023 Federal Award: 90ZU0351-03-05 AL Number: 93.676 Criteria: In accordance with §200.309, a non-Federal entity may charge to the Federal award only allowable costs incurred during the 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. Unless the Federal awarding agency or pass-through entity authorizes an extension, a non-Federal entity must liquidate all obligations incurred under the Federal award not later than 120 calendar days after the end date of the period of performance as specified in the terms and conditions of the Federal award as required by §200.344(b). When used in connection with a non-Federal entity’s utilization of funds under a Federal award, “obligations” means orders placed for property, services, contracts, and subawards made, and similar transactions during a given period that require payment by the non-Federal entity during the same or a future period as described in §200.71. Condition: During the audit, we identified 1 out of 40 items selected, whereby the expense was incurred after the end of the award period of performance. The expense totaled $1,407. Cause: The Organization has procedures in place to review expenditures to determine the appropriate period of performance; however, those procedures were not performed to a level of detail to identify this expense incurred outside of the period of the award. Effect: The lack of adherence to the established internal control procedures around the period of performance of the award resulted in noncompliance and questioned costs. Continued noncompliance with federal statutes, regulations, and the provisions of the grant agreements could ultimately result in additional disallowed costs for the major programs. Context: This is a condition identified based upon our review of the Organization’s compliance with specified requirements. Questioned Costs: $1,407 Identification as a Repeat Finding: This is a repeat finding, as 2022-006. Recommendation: We recommend management adhere to its internal control procedures around detecting expenditures incurred outside of the period of performance in order to prevent the charging of costs outside of the period of performance of the award.

FINDING 2023-003 Internal Control over Compliance and Compliance with Reporting Program: Federal Agency: USAID Funding Year(s): 8/1/2018 – 1/31/2023 Federal Award: 72026718CA00002 AL Number: 98.001 Criteria: Under the requirements of the Federal Funding Accountability and Transparency Act (“FFATA”) (Pub. L. No. 109-282), as amended by Section 6202 of Pub. L. No. 110-252, hereafter referred as the “Transparency Act” that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS). The award information must be reported in FSRS no later than the last day of the month following the month in which the subaward/subaward amendment obligation was made or the subcontract award/subcontract modification was made. Condition: During fiscal year 2023, the grant awarded a total of 3 sub-awards that exceeded $30,000 to subrecipients. Refer to the table below for results of our testing. Cause: We were unable to verify that the Organization has established policies and procedures to ensure that the required reports are accurately completed and submitted on a timely basis, we noted the following matters for the subawards tested: • For the two samples tested, the Organization was unable to provide proof of submission of the FFATA reports. Effect: Failure to comply with the FFATA requirements of could result in lack of compliance with the Federal Funding Accountability and Transparency Act. Context: This is a condition identified based upon our review of the Organization’s compliance with specified requirements. Questioned Costs: None identified. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Organization establish internal controls over the reporting process to ensure all FFATA reports are correctly submitted, and they keep a record of the submission.

FINDING 2023-004 Internal Control over Compliance and Compliance with Subrecipient Monitoring Program: Federal Agency: USAID Funding Year(s): 8/1/2018 – 1/31/2023 Federal Award: 72026718CA00002 AL Number: 98.001 Criteria: In accordance with §200.331(b) and §200.331(d), Requirements for Pass-Through Entities, the Organization, the recipient of these federal funds) must evaluate each subrecipient’s risk of noncompliance with federal statutes, regulations, and the terms and conditions of the subaward for purposes of determining the appropriate subrecipient monitoring. The Organization must also monitor the activities of the subrecipient as necessary to ensure that the subaward is used for authorized purposes, in compliance with federal statues, regulations, and the terms and conditions of the subaward; and that subaward performance goals are achieved. Pass-through entity monitoring of the subrecipient must include: (1) reviewing financial and performance reports required by the pass-through entity; (2) following-up and ensuring that the subrecipient takes timely and appropriate action on all deficiencies pertaining to the federal award provided to the subrecipient from the pass-through entity detected through audits, on-site reviews, and other means; and (3) issuing a management decision for audit findings pertaining to the federal award provided to the subrecipient from the pass-through entity. Condition: During our testing of subrecipient monitoring, we selected two subrecipient samples. We identified the following conditions: • For one of the two samples testing, the Organization was unable to provide documented evidence for the evaluation of the subrecipient’s risk assessment. • For one sample tested, there was no timely evidence that the Organization verified the subrecipient’s audit requirements. Therefore, monitoring activities related to the verification of the audit requirements were not performed in accordance with §200.331(b) and §200.331(d). Cause: The Organization did not follow its policies and procedures in place to ensure compliance with the requirements regarding subrecipient monitoring. Effect: Failure to comply with the subrecipient monitoring requirements of the Uniform Guidance could result in unallowable expenses being charged to the grants by the subrecipients. Context: This is a condition identified based upon our review of the Organization’s compliance with specified requirements. Questioned Costs: None identified. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the Organization strictly enforce its existing policies and procedures to ensure the subrecipient process from identification of that subrecipient through verification of subrecipients’ audit requirements, occurs to ensure compliance.

FINDING 2023-005 Internal Control over Compliance and Compliance with Reporting Programs: Federal Agency: Department of Health and Human services AL Number: 93.224/93.527 Federal Agency: USAID AL Number: 98.001 Criteria: CFR Section 200.303, Internal Controls, Section (a) states the Organization must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations, and terms and conditions of the federal award. Management is responsible for establishing and maintaining a system of internal control that should include controls over its reporting process. 2 CFR section 200.512(a) states that the data collection form and reporting package must be submitted the earlier of 30 calendar days after receipt of the auditor’s reports or nine months after the end of the audit period to the Federal Audit Clearinghouse (FAC). If the due date falls on a Saturday, Sunday, or federal holiday, the reporting package is due the next business day. The Uniform Guidance does not have a provision addressing whether the cognizant or oversight agencies may extend due dates. Condition: During the fiscal year, we noted that the Organization failed to submit the data collection form and reporting package to FAC on a timely basis. Cause: Policies and procedures were not appropriately adhered to in certain instances to ensure timely submission of required reports to federal funding source. Effect: Failure to properly track all reporting submission deadlines could lead to delayed funding. Context: This is a condition identified during the testing of the financial reporting requirements as outlined in the terms and conditions of the award documents. The data collection form and reporting package must be submitted to the FAC the earlier of 30 calendar days after receipt of the auditor’s reports or by March 31, 2023, nine months after the end of the audit period. Questioned Costs: None identified. Identification as a Repeat Finding: This is a repeat finding, as 2022-007. Recommendation: We recommend that the Organization strictly enforce its existing policies and procedures to ensure compliance with the requirements of the Uniform Guidance to ensure required reports are properly submitted to the federal government on a timely basis.

2022-002: Internal Control Over Compliance and Compliance with Allowable Costs/Cost Principles Program: U.S. Department of State AL Number: 19.016 AL Name: Iraq Assistance Program Grant Award Numbers Under the Uniform Guidance Requirements: Direct Award Number Award Period SLMAQM19GR2288 September 29, 2019 through June 30,2022 Program: U.S. Department of State AL Number: 19.518 AL Name: Overseas Refugee Assistance Program for Western Hemisphere Grant Award Numbers Under the Uniform Guidance Requirements: Direct Award Number Award Period SPRMCO20CA0209 September 20, 2020 through September 29, 2021 N/A September 20, 2021 through September 29, 2022 Criteria ? Code of Federal Regulation (CFR) ?200.303, Internal Controls, Section (a) states the Organization must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations, and terms and conditions of the federal award. Management is responsible for establishing and maintaining a system of internal control that should include controls over its activities allowed or unallowed, allowable cost/cost principle process. CFR 200.403(g) states that for costs to be allowed under federal awards, they must be adequately documented. Condition ? During our testing of period of performance, we noted exceptions in the ability of management to support expenditures incurred and charged to federal programs. Cause ? Policies and procedures were not appropriately adhered to in certain instances to ensure that supporting documentation was maintained to evidence that costs were allowable and that an appropriate level of review and approval was completed prior to charging costs to a federal program. Questioned Costs ? $28,787 Context: Assistance Listing Number: 19.016 During our testing of the period of performance compliance requirement for grant award periods that ended during the fiscal year, we sampled 12 expenditures, totaling $292,901, for the Iraq Assistance Program and noted one item amounting to $28,766 did not have adequate supporting documentation for the subrecipient expenditures charged to the program. Assistance Listing Number: 19.518 During our testing of the period of performance compliance requirement for grant award periods that started and ended during the fiscal year, we sampled 80 expenditures, totaling $15,252, for the Overseas Refugee Assistance Program for Western Hemisphere and noted two items, totaling $21, did not have adequate supporting documentation for the subrecipient expenditures charged to the program. Effect ? An ineffective control system related to review of transactions to ensure that only allowable costs are charged to federal programs can lead to noncompliance with federal statutes, regulations, and the provisions of grant agreements that could ultimately lead to disallowed costs for the major programs. Repeat Finding ? This is not a repeat finding. Recommendation - We recommend that the Organization ensure its policies and procedures ensure that documentation of expenditure payment is maintained and that these policies and procedures are followed on a consistent basis. Views of Responsible Officials ? Management agrees with the finding and takes responsibility to comply with allowed and allowable requirements. Management through the local offices has already developed a policy to ensure that the period of performance is adhered to.

2022-003: Internal Control Over Compliance and Compliance with Allowable Costs/Cost Principles Program: U.S. Department of State AL Number: 19.016 AL Name: Iraq Assistance Program Grant Award Numbers Under the Uniform Guidance Requirements: Direct Award Number Award Period SLMAQM19GR2288 September 29, 2019 through June 30,2022 Program: U.S. Department of State AL Number: 19.518 AL Name: Overseas Refugee Assistance Program for Western Hemisphere Grant Award Numbers Under the Uniform Guidance Requirements: Direct Award Number Award Period SPRMCO20CA0209 September 20, 2020 through September 29, 2021 N/A September 20, 2021 through September 29, 2022 Criteria ? CFR ?200.303, Internal Controls, Section (a) states the Organization must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations, and terms and conditions of the federal award. Management is responsible for establishing and maintaining a system of internal control that should include controls over its activities allowed or unallowed, allowable cost/cost principle process. CFR 200.403(g) states that for costs to be allowed under federal awards, they must be adequately documented. Condition ? During our testing of allowable costs and testing of period of performance for expenditures incurred throughout the year, we noted exceptions in the ability of management to support allocations of payroll and nonpayroll expenditures incurred in federal programs. Cause ? Policies and procedures were not appropriately adhered to in certain instances to ensure that supporting documentation was maintained to evidence that costs allocated to the program were allowable and that an appropriate level of review and approval was completed prior to charging costs to a federal program. Effect ? An ineffective control system related to review of transactions to ensure that only allowable costs are allocated to federal programs can lead to noncompliance with federal statutes, regulations, and the provisions of grant agreements that could ultimately lead to disallowed costs for the major programs. Questioned Costs ? $1,201 Context AL Number: 19.016 We sampled 25 payroll expenditures, totaling $9,560, for Iraq Assistance Programs and noted that two items, totaling $461, did not have proper documentation for allocation basis for the payroll expenditure charged to the program. Additionally, during our testing of the period of performance compliance requirement for grant costs incurred throughout the year, we sampled 40 expenditures, totaling $11,811, for Iraq Assistance Programs and noted that an additional two items, totaling $211, did not have proper documentation for allocation basis for payroll expenditures charged to the program. AL Number: 19.518 We sampled 25 payroll expenditures, totaling $9,068, for the Overseas Refugee Assistance Program for Western Hemisphere and noted that one item, amounting to $529, did not have proper documentation for allocation basis for the payroll expenditure charged to the program. Repeat Finding ? This is not a repeat finding. Recommendation - We recommend that the Organization ensure its policies and procedures ensure that documentation of expenditure payment and allocation is maintained and that these policies and procedures are followed on a consistent basis. Views of Responsible Officials - Management agrees with the finding and takes responsibility to comply with allowed and allowable requirements requirements. Management has developed a policy in the Iraq local office to aid in time and effort allocation.

2022-004: Internal Control Over Compliance and Compliance with Cash Management U.S. Department of Housing and Urban Development AL Number: 14.195 AL Name: Section 8 Housing Assistance Payment Program Grant Award Numbers Under the Uniform Guidance Requirements: Pass-Through Entity Award Period Chicago Housing Authority January 1, 2016 through December 31, 2035 Criteria ? CFR ?200.303, Internal Controls, Section (a) states the Organization must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations, and terms and conditions of the federal award. Management is responsible for establishing and maintaining a system of internal control that should include controls over cash management process. Condition ? During our testing of cash management, we noted exceptions on the subsidy payment received in advanced were not appropriately applied based on executed tenant certifications, resulting in the net overcharging of subsidy rent. Cause ? Policies and procedures were not appropriately adhered to in certain instances to ensure that proper matching of the subsidy amount per tenant certification was performed to evidence accurate subsidy request and that an appropriate level of review and approval was completed prior to charging costs to a federal program. Effect ? The lack of adherence to the established internal control policies and procedures with respect to review of transactions to ensure system-generated receipt based on tenant certification is matched to the subsidy payment received can lead to noncompliance with federal statutes, regulations, and the provisions of grant agreements, which could ultimately lead to disallowed costs for the major programs. Questioned Costs ? $1,547 Context We sampled 36 rent subsidy receipts for Section 8 Housing Assistance Payment Program and noted two items, totaling $68,763 did not agree to details of rent subsidy payments per tenant certifications, resulting in the net overcharging $1,547 of subsidy rent to the federal program. Repeat Finding ? This is not a repeat finding. Recommendation - We recommend that the Organization ensure its policies and procedure ensure that system-generated receipt based on tenant certification is properly matched to the subsidy payment received and reviewed on a timely manner, and that these policies and procedures are followed on a consistent basis

2022-005: Internal Control Over Compliance and Compliance with Period of Performance Program: U.S. Department of State AL Number: 19.016 AL Name: Iraq Assistance Program Grant Award Numbers Under the Uniform Guidance Requirements: Direct Award Number Award Period SLMAQM19GR2288 September 29, 2019 through June 30,2022 Program: U.S. Department of State AL Number: 19.518 AL Name: Overseas Refugee Assistance Program for Western Hemisphere Grant Award Numbers Under the Uniform Guidance Requirements: Direct Award Number Award Period SPRMCO20CA0209 September 20, 2020 through September 29, 2021 N/A September 20, 2021 through September 29, 2022 Criteria - CFR ?200.303, Internal Controls, Section (a) states the Organization must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations, and terms and conditions of the federal award. Management is responsible for establishing and maintaining a system of internal control that should include controls over its grants? period of performance process. In accordance with CFR Section 200.403(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 period pursuant to ?200.308(e)(3). In accordance with CFR Section 200.458, pre-award costs are those incurred prior to the effective date of the federal award or subaward directly pursuant to the negotiation and in anticipation of the federal award where such costs are necessary for efficient and timely performance of the scope of the work. Such costs are allowable only to the extent they would have been allowable if incurred after the date of the federal award and only with the written approval of the federal awarding agency. In accordance with CFR Section 200.344, the federal awarding agency or pass-through entity will close out the federal award when it determines that all applicable administrative actions and all required work of the federal award have been completed by the nonfederal entity. Per CFR Section 200.344(b), unless the federal awarding agency or pass-through entity authorizes an extension, a non-federal entity must liquidate all obligations incurred under the federal award not later than 120 calendar days after the end date of the period of performance. Condition ? During our testing of period of performance, we noted exceptions in the ability of management to support expenditures were incurred and charged to federal programs within the period of performance. Cause ? Policies and procedures were not appropriately adhered to in certain instances to ensure that supporting documentation was maintained to evidence that costs were incurred during the period of performance and that an appropriate level of review and approval was completed prior to charging costs to a federal program. Effect - The lack of adherence to the established internal control procedures around the period of performance of the award can lead to noncompliance with laws, regulations, and the provisions of grant agreements, which could ultimately lead to expenditures not being charged to the major programs in the correct period. Questioned Costs ? $29,459 Context: Assistance Listing Number: 19.016 During our testing of the period of performance compliance requirement for grant award periods that ended during the fiscal year, we sampled 12 expenditures, totaling $292,901, for the Iraq Assistance Program and noted one item amounting to $28,766 did not have adequate supporting documentation for the subrecipient expenditures charged to the program. Additionally, during our testing of the period of performance compliance requirement for grant costs incurred throughout the year, we sampled 40 expenditures, totaling $11,811, for the Iraq Assistance Programs and noted that four items, totaling $672, did not have proper documentation for the allocation of the expenditure. Assistance Listing Number: 19.518 During our testing of the period of performance compliance requirement for grant award periods that started and ended during the fiscal year, we sampled 81 expenditures, totaling $15,252, for the Overseas Refugee Assistance Program for Western Hemisphere and noted two items, totaling $21, did not have adequate supporting documentation for the subrecipient expenditures charged to the program. Repeat Finding - This finding is not a repeat finding. Recommendation - We recommend that the Organization ensure its policies and procedures ensure that documentation of when the expenditure was incurred and liquidated is maintained and that these policies and procedures are followed on a consistent basis. Views of Responsible Officials - Management agrees with the finding and takes responsibility to comply with the period of performance compliance requirements. Management through the local offices has already developed a policy to ensure that the period of performance is adhered to.

2022-006: Internal Control Over Compliance and Compliance with Period of Performance Program: U.S. Department of State AL Number: 19.518 AL Name: Overseas Refugee Assistance Program for Western Hemisphere Grant Award Numbers Under the Uniform Guidance Requirements: Direct Award Number Award Period SPRMCO20CA0209 September 20, 2020 through September 29, 2021 N/A September 20, 2021 through September 29, 2022 Criteria ? CFR ?200.303, Internal Controls, Section (a) states the Organization must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations, and terms and conditions of the federal award. Management is responsible for establishing and maintaining a system of internal control that should include controls over its grants? period of performance process. In accordance with CFR Section 200.403(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 period pursuant to ?200.308(e)(3). In accordance with CFR Section 200.458, pre-award costs are those incurred prior to the effective date of the federal award or subaward directly pursuant to the negotiation and in anticipation of the federal award where such costs are necessary for efficient and timely performance of the scope of the work. Such costs are allowable only to the extent they would have been allowable if incurred after the date of the federal award and only with the written approval of the federal awarding agency. In accordance with CFR Section 200.344, the federal awarding agency or pass-through entity will close out the federal award when it determines that all applicable administrative actions and all required work of the federal award have been completed by the nonfederal entity. Per CFR Section 200.344(b), unless the federal awarding agency or pass-through entity authorizes an extension, a non-federal entity must liquidate all obligations incurred under the federal award not later than 120 calendar days after the end date of the period of performance. Condition ? During our testing of period of performance, we noted exceptions where expenditures were incurred outside of the grant?s performance period. Cause ? Policies and procedures were not appropriately adhered to in certain instances to ensure that supporting documentation was maintained to evidence that costs were incurred during the period of performance and that an appropriate level of review and approval was completed prior to charging costs to a federal program. Effect - The lack of adherence to the established internal control procedures around the period of performance of the award can lead to noncompliance with law and regulations and possible loss of funding for the related program. Questioned Costs ? $125 Context: During our testing of the allowable costs/cost principles compliance requirements, we sampled 25 nonpayroll expenditures, totaling $6,365, for the Overseas Refugee Assistance Program for Western Hemisphere and noted that four items, totaling $125, were incurred and paid outside of the grant award period. Repeat Finding - This finding is a repeat finding from prior year. This finding was reported as finding 2021-001 in the 2021 reporting package. Recommendation - We recommend management revisits and considers revising its internal procedures around detecting expenditures incurred outside of the period of performance of the awards. Views of Responsible Officials - Management agrees with the finding and takes responsibility to comply with the period of performance compliance requirements. Management is emphasizing prompt period closing to ensure that no items are recorded in the wrong period.

2022-007: Internal Control over Compliance with Reporting Requirements Program: U.S. Department of Housing and Urban Development AL Number: 14.195 AL Name: Section 8 Housing Assistance Payments Program Grant Award Numbers under the Uniform Guidance Requirements: Pass-Through Entity Award Period City of Milwaukee Housing Authority February 4, 2009 through February 4, 2024 City of Milwaukee Housing Authority January 27, 2014 through January 27, 2029 City of Madison Housing Authority June 1, 2016 through May 31, 2031 City of Madison Housing Authority June 20, 2018 through June 20, 2033 Dane County Housing Authority June 1, 2016 through May 29, 2031 Dane County Housing Authority June 20, 2018 through June 20, 2033 Milwaukee County Housing July 15, 2011 through July 15, 2026 Chicago Housing Authority March 1, 2012 through February 28, 2041 Chicago Housing Authority March 1, 2012 through March 31, 2043 Chicago Housing Authority April 1, 2013 through March 31, 2044 Chicago Housing Authority August 27, 2014 through July 31, 2044 Chicago Housing Authority January 1, 2016 through December 31, 2035 Chicago Housing Authority January 9, 2020 through December 31, 2034 Chicago Housing Authority January 23, 2020 through December 31, 2034 Chicago Housing Authority March 1, 2020 through February 28, 2050 Program: U.S. Department of Housing and Urban Development AL Number: 14.249 AL Name: Section 8 Moderate Rehabilitation Single Room Occupancy Grant Award Numbers under the Uniform Guidance Requirements: Pass-Through Entity Award Period Chicago Housing Authority March 12, 2020 through March 13, 2022 Chicago Housing Authority December 17, 2020 through December 16, 2022 Program: U.S. Department of Housing and Urban Development AL Number: 14.239 AL Name: Home Investment Partnerships Program Grant Award Numbers under the Uniform Guidance Requirements: Pass-Through Entity Award Period City of Chicago April 22, 2019 through April 21, 2034 City of Chicago June 15, 1993 through July 13, 2033 City of Chicago October 3, 2003 through July 2050 Illinois Housing Development Authority January 16, 1997 through January 16, 2027 City of Milwaukee April 17, 2008 through April 21, 2028 City of Milwaukee November 1, 2017 through October 31, 2051 City of Milwaukee August 21, 2020 through August 20, 2040 Program: U.S. Department of Housing and Urban Development AL Number: 14.181 AL Name: Supportive Housing for Persons with Disabilities (Section 811) Grant Award Numbers under the Uniform Guidance Requirements: Pass-Through Entity Award Period City of Chicago January 1, 2003 through January 1, 2043 City of Chicago March 30, 2007 through March 30, 2039 Program: U.S. Department of State AL Number: 19.016 AL Name: Iraq Assistance Program Grant Award Numbers Under the Uniform Guidance Requirements: Direct Award Number Award Period SLMAQM19GR2288 September 29, 2019 through June 30,2022 Program: U.S. Department of State AL Number: 19.518 AL Name: Overseas Refugee Assistance Program for Western Hemisphere Grant Award Numbers Under the Uniform Guidance Requirements: Direct Award Number Award Period SPRMCO20CA0209 September 20, 2020 through September 29, 2021 N/A September 20, 2021 through September 29, 2022 Program: U.S. Department of Veterans Affairs AL Number: 64.033 AL Name: VA Supportive Services for Veteran Families Program Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period SPRMCO19CA0226 December 1, 2020 through June 30, 2022 N/A December 1, 2020 through June 30, 2022 N/A February 1, 2021 through September 30, 2022 SPRMCO20CA0209 October 1, 2019 through September 30, 2022 Criteria ? CFR ?200.303 Internal Controls, section (a) states the Organization must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. Management is responsible for establishing and maintaining a system of internal control that should include controls over its reporting process. 2 CFR section 200.512(a) states that the data collection form and reporting package must be submitted the earlier of 30 calendar days after receipt of the auditor?s reports or nine months after the end of the audit period to the Federal Audit Clearinghouse (FAC). If the due date falls on a Saturday, Sunday, or Federal holiday, the reporting package is due the next business day. The Uniform Guidance does not have a provision addressing whether the cognizant or oversight agencies may extend due dates. Condition ? During the fiscal year, we noted that the Organization failed to submit the data collection form and reporting package to FAC on a timely basis. Cause ? Policies and procedures were not appropriately adhered to in certain instances to ensure timely submission of required reports to federal funding source. Questioned Costs ? There are no questioned costs as the items outlined above are internal control related matters and not matters related to the accuracy of the information reported to the awarding agency in the financial reports. Effect - Failure to properly track all reporting submission deadlines could lead to delayed funding. Repeat Finding - This finding is not a repeat finding. Recommendation - We recommend management adhere to its documented policies and procedures and the documented instructions for reporting requirements contained within grant agreements to ensure that the required reports are properly submitted to the federal government on a timely basis. Further, we recommend management implement a policy of formally tracking all required reports and submission deadlines to address the delayed submissions identified above. Views of Responsible Officials - Management agrees with the finding and takes responsibility to comply with reporting requirements. Management plans to adhere to documented policies and procedures and documented instructions for reporting requirements contained within grant agreements to ensure that the required reports are properly submitted to the federal government on a timely basis.

2021-001: Internal Control Over Compliance and Compliance with Period of Performance Program: U.S. Department of State Assistance Listing Number: 19.016 Assistance Listing Name: Iraq Assistance Program Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period SLMAQM18GR2021 April 9, 2018 through August 31, 2020 SLMAQM19GR2288 September 29, 2019 through June 30, 2022 U.S. Department of State Assistance Listing Number: 19.518 Assistance Listing Name: Overseas Refugee Assistance Program for Western Hemisphere Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period SPRMCO19CA0226S September 20, 2019 through September 19, 2020 SPRMCO20CA0209 September 20, 2020 through September 19, 2021 Criteria - The Organization must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations, and terms and conditions of the federal award. Management is responsible for establishing and maintaining a system of internal control that should include controls over its grants? period of performance process. In accordance with ?200.309, a non-federal entity may charge to the federal award only allowable costs incurred during the 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. Unless the federal awarding agency or pass-through entity authorizes an extension, a non-federal entity must liquidate all obligations incurred under the federal award not later than 90 calendar days after the end date of the period of performance as specified in the terms and conditions of the federal award as required by ?200.343(b). When used in connection with a non-federal entity?s utilization of funds under a federal award, ?obligations? means orders placed for property, services, contracts, and subawards made, and similar transactions during a given period that require payment by the non-federal entity during the same or a future period as described in ?200.71. Condition ? During our testing of period of performance, we noted exceptions where expenditures were incurred outside of the grant?s performance period. Cause ? Policies and procedures were not appropriately adhered to in certain instances to ensure that supporting documentation was maintained to evidence that costs were incurred during the period of performance and that an appropriate level of review and approval was completed prior to charging costs to a federal program.Questioned Costs ? $1,081 Context: Assistance Listing Number: 19.016 During our testing of current-year expenditures, we sampled 40 nonpayroll expenditures, totaling $13,734, for the Iraq Assistance Program and noted one item amounting to $100 relates to an expense incurred and paid in fiscal year 2020 but was reported as an expense on the fiscal year 2021 Schedule of Expenditures of Federal Awards (SEFA). During our testing of the period of performance compliance requirement for grant award periods that started and ended during the fiscal year, we noted three items, totaling $690, were incurred and paid outside of the grant award period. Assistance Listing Number: 19.518 During our testing of current-year expenditures, we sampled 40 payroll expenditures, totaling $12,598, for Overseas Refugee Assistance Program for Western Hemisphere and noted one item amounting to $165 relates to an expense incurred and paid in fiscal year 2020 but was reported as an expense on the fiscal year 2021 SEFA. During our testing of current-year expenditures, we sampled 40 nonpayroll expenditures, totaling $1,685, for Overseas Refugee Assistance Program for Western Hemisphere and noted three items totaling to $57 relate to an expense incurred and paid in fiscal year 2020 but were reported as an expense on the fiscal year 2021 SEFA. During our testing of the period of performance compliance requirement for grant award periods that started and ended during the fiscal year, we noted four payroll expenses, totaling $69, were incurred and paid outside of the grant award period. Repeat Finding - This finding is not a repeat finding. Effect - The lack of adherence to the established internal control procedures around the period of performance of the award can lead to noncompliance with law and regulations and possible loss of funding for the related program. Recommendation - We recommend management revisits and considers revising its internal procedures around detecting expenditures incurred outside of the period of performance of the awards. Views of Responsible Officials and Planned Corrective Actions - Management agrees with the finding and takes responsibility to comply with the period of performance compliance requirements. Management has engaged a third-party service provider to upgrade the local offices financial system that is in position to help automate most of the internal control processes and, as a result, be able to read, review, approve, and post the entries on time in line with U.S. GAAP and other guiding principles. Further, program Controller and respective program officers will conduct a companywide accounting training with the local staff and will perform site visits to ensure proper implementation of the re-structuring of the accounting and procurement processes

Finding No. 2020-001: Internal Control Over Compliance and Compliance with Reporting (Preparation of the Schedule of Expenditures of Federal Awards) Information on the Federal Program: U.S. Department of Health and Human Services CFDA Number: 93.676 CFDA Name: Unaccompanied Alien Children Program Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period 90ZU0189 February 1, 2019 through January 31, 2020 90ZU0351 February 1, 2020 through January 31, 2021 90ZU0233 February 1, 2019 through March 31, 2020 90ZU0190 February 1, 2019 through December 31, 2020 U.S. Department of Housing and Urban Development CFDA Number: 14.181 CFDA Name: Supportive Housing for Persons with Disabilities Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period 071-HD119/IL06-O001-005 June 18, 2020 through March 1, 2044 U.S. Department of Housing and Urban Development CFDA Number: 14.239 CFDA Name: Home Investment Partnerships Program Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period City of Chicago N/A April 22, 2019 through April 1, 2054 City of Chicago N/A June 15, 1993 through June 14, 2033 Illinois Housing Development Authority N/A January 16, 1997 through December 31, 2027 City of Milwaukee N/A April 21, 2008 through April 20, 2028 City of Milwaukee N/A October 5, 2017 through October 4, 2032 U.S. Department of Housing and Urban Development CFDA Number: 14.218/14.225 CFDA Name: CDBG Entitlement Grants Cluster Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period Chicago Department of Family and Support S 85526; 85628; 85341 January 1, 2020 through December 31, 2020 Cook County 1804-047 October 1, 2019 through September 30, 2020 U.S. Department of Health and Human Services CFDA Number: 93.224/93.527 CFDA Name: Health Centers Cluster Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period H80CS00111 January 1, 2018 through December 31, 2020 H8DCS36106 April 1, 2020 through March 31, 2021 H8ECS37700 May 1, 2020 through April 30, 2021 H8CCS34450 March 15, 2020 through March 14, 2021 U.S. Department of Housing and Urban Development CFDA Number: 14.267 CFDA Name: Continuum of Care Program Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period IL0107L5T101710 November 1, 2018 through October 31, 2019 IL1633D5T101800 December 1, 2019 through November 30, 2020 IL0093L5T101805 July 1, 2019 through September 30, 2020 IL0167L5T101811/IL0167L5T101912 February 1, 2019 through January 31, 2021 IL0173L5T101710 November 1, 2018 through October 31, 2019 IL0174L5T101710 November 1, 2018 through October 31, 2019 IL0209L5T101811/IL0209L5T101912 April 1, 2019 through May 31, 2021 IL0099L5T101609/IL0099L5T101811 February 1, 2019 through January 31, 2020 IL0096L5T101609 / IL0096L5T101710 November 1, 2019 through October 31, 2020 IL0178L5T101811/IL0178L5T101912 April 1, 2019 through May 31, 2020 IL0180L5T101609 / IL0180L5T101710 November 1, 2019 through October 31, 2020 IL0179L5T101609/ IL0179L5T101710 November 1, 2019 through October 31, 2020 IL0216L5T101609/ IL0216L5T101710 March 1, 2019 through February 29, 2020 IL0097L5T101710/IL0097L5T101811 December 1, 2018 through November 30, 2019 IL0393L5T101709/ IL0393L5T101810 September 1, 2018 through August 30, 2019 Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period AIDS Foundation - Chicago 8566 May 1, 2019 through November 30, 2019 AIDS Foundation - Chicago N/A May 1, 2019 through April 30, 2019 AIDS Foundation - Chicago 8574-D/8574-EI L0162L5T101710 September 1, 2018 through September 30, 2019 Corporation for Supportive Housing 19045-C August 1, 2019 through July 31, 2020 Corporation for Supportive Housing 17069-C November 1, 2018 through October 31, 2019 Threshold IL0578L5T101804/IL0578L5T101905 March 1, 2020 through February 28,2021 Housing Forward IL July 1, 2019 through June 30, 2020 Chicago Department of Family and Support S IL0130L5T101708 July 1, 2019 through June 30, 2020 Chicago Department of Family and Support S IL0374L5T101606/IL0374L5t101707 January 2, 2019 through January 1, 2020 Cook County IL0269L5T111609/IL0269L5T111811 February 1, 2019 through January 31, 2020 U.S. Department of Housing and Urban Development CFDA Number: 14.241 CFDA Name: Housing Opportunities for Persons with AIDS Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period City of Chicago Department of Public Health 92320 March 1, 2019 through February 28, 2022 City of Chicago Department of Public Health 92320 January 1, 2020 through December 31, 2020 City of Chicago Department of Public Health 31792 March 1, 2019 through December 31, 2019 City of Chicago Department of Public Health N/A January 1, 2019 through December 31, 2019 AIDS Foundation - Chicago 8465-A February 1, 2019 through November 30, 2019 U.S. Department of Health and Human Services CFDA Number: 93.243 CFDA Name: Substance Abuse and Mental Health Services Projects of Regional and National Significance Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period 1U79SM063213-01 September 30, 2018 through September 29, 2023 Pass-through Entity Award Number Award Period Illinois Department of Human Services 43CYC03314 July 1, 2019 through June 30, 2020 U.S. Department of Health and Human Services CFDA Number: 93.566 CFDA Name: Refugee and Entrant Assistance State/Repleace Designee Administered Programs Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period Jewish Federation of Metropolitan Chicago RSS EECM 02621 July 1, 2019 through June 30, 2020 Jewish Federation of Metropolitan Chicago RSS YM 02629 July 1, 2019 through June 30, 2020 Jewish Federation of Metropolitan Chicago RSS CI 02621 July 1, 2019 through June 30, 2020 Jewish Federation of Metropolitan Chicago RSS NAS 02621 July 1, 2019 through June 30, 2020 Illinois Department of Public Health 90180001G July 1, 2019 through June 30, 2020 U.S. Department of Health and Human Services CFDA Number: 93.576 CFDA Name: Refugee and Entrant Assistance Discretionary Grants Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period Jewish Federation of Metropolitan Chicago RSS K-12 02625 July 1, 2019 through June 30, 2020 United States Committee on Refugee and Im 90RP0099-03-00 July 1, 2019 through June 30, 2020 Illinois Department of Public Health 90180004G October 1, 2018 through September 30, 2020 U.S. Department of Health and Human Services CFDA Number: 93.914 CFDA Name: HIV Emergency Relief Project Grants Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period Chicago Department of Public Health N/A March 1, 2019 through February 29, 2020 Chicago Department of Public Health 72915/94390 March 1, 2019 through February 28, 2020 Chicago Department of Public Health 116673 September 1, 2019 through February 29, 2020 U.S. Department of Health and Human Services CFDA Number: 93.917 CFDA Name: HIV Care Formula Grants Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period AIDS Foundation - Chicago N/A January 1, 2019 through March 31, 2020 U.S. Department of Health and Human Services CFDA Number: 93.918 CFDA Name: Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period H76HA00113 April 1, 2019 through March 31, 2020 P06HA32252 September 1, 2018 through August 31, 2019 H7CHA37146 April 1, 2010 through March 31, 2021 Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period Access Community Health Network H76HA00550 May 1, 2019 through Apirl 30, 2020 Erie Family Health Centers N/A July 1, 2019 through June 30, 2020 U.S. Department of Health and Human Services CFDA Number: 93.924 CFDA Name: Ryan White/ AIDS Dental Reimbursement and Community Based Dental Partnership Grants Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period UIC - Board of Trustees H65HA00016 July 1, 2019 through June 30, 2020 U.S. Department of Health and Human Services CFDA Number: 93.940 CFDA Name: HIV Prevention Activities Health Department Based Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period City of Chicago Department of Public Health 82828 September 30, 2018 through September 29, 2019 City of Chicago Department of Public Health 110217 September 1, 2019 through December 31, 2019 U.S. Department of Health and Human Services CFDA Number: 93.958 CFDA Name: Block Grants for Community Mental Health Services Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period Illinois Department of Human Services - DMH 45CWB00271 July 1, 2019 through June 30, 2020 Illinois Department of Human Services - DMH 45CXB00269 July 1, 2019 through June 30, 2020 U.S. Department of Health and Human Services CFDA Number: 93.959 CFDA Name: Block Grants for Prevention and Treatment of Substance Abuse Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period Illinois Department of Human Services 43CYZ03537 July 1, 2019 through June 30, 2020 Illinois Department of Human Services 43CVC00156 July 1, 2019 through June 30, 2020 Illinois Department of Human Services 43CYC00150 July 1, 2019 through June 30, 2020 U.S. Department of Housing and Urban Development CFDA Number: 14.182/14.195/14.249/14.856 CFDA Name: Section 8 Project Based Cluster Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period City of Milwaukee Housing Authority N/A February 4, 2009 through February 3, 2024 City of Milwaukee Housing Authority N/A January 27, 2014 through January 26, 2029 City of Madison Housing Authority N/A June 1, 2016 through May 31, 2031 City of Madison Housing Authority N/A June 20, 2018 through June 19, 2033 Dane County Housing Authority N/A June 1, 2016 through May 31, 2031 Dane County Housing Authority N/A June 20, 2018 through June 19, 2033 Milwaukee County Housing N/A July 15, 2011 through July 14, 2026 Chicago Housing Authority N/A March 1, 2012 through February 28, 2041 Chicago Housing Authority N/A March 1, 2012 through February 28, 2041 Chicago Housing Authority N/A April 1, 2013 through March 31, 2043 Chicago Housing Authority N/A August 27, 2014 through July,31, 2044 Chicago Housing Authority IL002SRO015-0065 March 14, 2020 through March 13, 2021 Chicago Housing Authority IL002SCO0030069 December 17, 2019 through December 16, 2020 U.S. Department of Housing and Urban Development CFDA Number: 14.238 CFDA Name: Shelter Plus Care Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period Milwaukee County Housing WI0112C5I010900 August 18, 2010 through August 17, 2015 Milwaukee County Housing N/A December 1, 2018 through November 30, 2028 U.S. Department of Housing and Urban Development CFDA Number: 14.850 CFDA Name: Public and Indian Housing Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period Chicago Housing Authority N/A August 1, 2004 through July 31, 2044 U.S. Department of Housing and Urban Development CFDA Number: 14.871 CFDA Name: Housing Voucher Cluster Pass-through Awards under the Uniform Guidance Requirements: Pass-through Entity Award Number Award Period City of Madison Housing Authority N/A June 1, 2016 through May 31, 2031 Criteria ? CFR Section ?200.510(b) states in part: ?The auditee must also prepare a Schedule of Expenditures of Federal Awards (SEFA) for the period covered by the auditee?s financial statements which must include the total Federal awards expended as determined in accordance with CFR Section ?200.502 Basis for determining Federal awards expended.? The schedule must provide total Federal awards expended for each individual Federal program. In accordance with ?200.302 Financial Management, a non-federal entity's financial management systems, including records documenting compliance with federal statutes, regulations, and the terms and conditions of the federal award, must be sufficient to permit the preparation of reports required by general and program-specific terms and conditions; and the tracing of funds to a level of expenditures adequate to establish that such funds have been used according to the federal statutes, regulations, and the terms and conditions of the federal award. The financial management system of each non-federal entity must provide for the following: (1) Identification, in its accounts, of all federal awards received and expended and the federal programs under which they were received. (2) Accurate, current, and complete disclosure of the financial results of each federal award or program in accordance with the reporting requirements set forth in ?200.327 Financial Reporting and ?200.328 Monitoring and Reporting Program Performance. (3) Records that identify adequately the source and application of funds for federally-funded activities. (4) Effective control over, and accountability for, all funds, property, and other assets. Condition ? During management's preparation of the SEFA, the finance team of each organization reviews federal grant agreements for various programs and the related Assistance Listing, formerly known as Catalog of Federal Domestic Assistance (CFDA) number, and follows the reporting format prescribed by the Federal Audit Clearinghouse for ones with no CFDA number. The SEFA review and approval process did not detect and correct the following errors that were identified during the audit procedures performed: 1. The SEFA originally prepared by management included a sub-contract agreement under CFDA 93.676 - Unaccompanied Alien Children Program. The SEFA, as presented in these consolidated financial statements, has been adjusted to exclude the sub-contract agreement in the amount of $2,280,759 under Heartland Alliance. 2. The SEFA originally prepared by management did not include six federal loan awards under Heartland Housing. The SEFA, as presented in these consolidated financial statements, has been adjusted to include the six federal loan awards which increase expenditures under CFDA 14.181 - Supportive Housing for Persons with Disabilities (Section 811) by $3,125,700 and CFDA 14.239 ? Home Investment Partnerships Program by $7,383,197. 3. The SEFA originally prepared by management reported expenditures less than the total awards for Heartland Alliance Health. This adjustment increased total federal expenditures by $914,895 and are now correctly reflected in the final SEFA as presented: CFDA Number 93.224/93.527 - Health Centers Cluster: $6,294,933 CFDA Number 14.218/14.225 - CDBG Entitlement Grants Cluster: $240,022 CFDA Number 14.267 - Continuum of Care Program: $10,045,214 CFDA Number 14.241 - Housing Opportunities for Persons with AIDS: $1,209,617 CFDA Number 93.243 - Substance Abuse and Mental Health Services Projects of Regional and National Significance: $1,286,049 CFDA Number 93.566 - Refugee and Entrant Assistance State/Replace Designee Administered Programs: $ 379,809 CFDA Number 93.576 - Refugee and Entrant Assistance Discretionary Grants: $171,435 CFDA Number 93.914 - HIV Emergency Relief Project Grants: $1,229,003 CFDA Number 93.917 - HIV Care Formula Grants: $145,052 CFDA Number 93.918 - Grants to Provide Outpatient Early Intervention Services with Respect to HIV Disease: $921,433 CFDA Number 93.924 - Ryan White/ AIDS Dental Reimbursement and Community Based Dental Partnership Grants: $114,131 CFDA Number 93.940 - HIV Prevention Activities Health Department Based: $69,164 CFDA Number 93.958 - Block Grants for Community Mental Health Services: $228,716 CFDA Number 93.959 - Block Grants for Prevention and Treatment of Substance Abuse: $305,575 4. The SEFA originally prepared by management included $4,096,584 of expenditures under CFDA 14.235 - Supportive Housing Program under Heartland Housing. A review of agreements confirmed the programs associated with these expenditures were not associated with CFDA 14.235. Expenditures were reclassified and reported under the following CFDAs and are now correctly reflected in the final SEFA as presented: CFDA 14.182/14.195/14.249/14.856 ? Section 8 Project Based Cluster: $3,296,428 CFDA 14.238 ? Shelter Plus Care: $489,932 CFDA 14.850 ? Public and Indian Housing: $163,445 CFDA 14.871 ? Section 8 Housing Choice Vouchers: $146,779 Cause - The internal controls established for the review and approval of the SEFA to ensure its completeness and accuracy did not operate as designed. Effect - The SEFA provided for the audit was inaccurate for the reasons outlined in the condition section above. Failure to accurately report expenditures and programs on the SEFA result in audit adjustments. Questioned Costs ? There are no questioned costs as the items outlined above are internal control related matters and not matters related to the accuracy of the information reported to the awarding agency in the financial reports. Context ? The conditions outlined above are based on overall testing of the accuracy of the SEFA. The nature of these findings is detailed in the condition section above. Repeat Finding - This is not a repeat finding. Recommendation - We recommend management require agreements to explicitly state whether the grant is a sub-award or a sub-contract. Detailed review of the SEFA and tie out with the related report will improve controls surrounding preparation of the SEFA. This will ensure that Federal funds are reported accurately on the SEFA and that programs are reported under the correct CFDA number. Views of Responsible Officials: Management agrees with the finding. See management?s corrective action plan filed separately.

Finding No. 2020-002: Internal Control Over Compliance and Compliance with Procurement Program: U.S. Department of Health and Human Services CFDA Number: 93.224/93.527 CFDA Name: Health Center Program Cluster Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period H80CS00111 January 1, 2018 through December 31, 2020 H8DCS36106 April 1, 2020 through March 31, 2021 U.S. Department of Housing and Urban Development CFDA Number: 14.267 CFDA Name: Continuance of Care Program Direct Award Number Award Period IL0107L5T101710 November 1, 2018 through October 31, 2019 IL1633D5T101800 December 1, 2019 through November 31, 2020 IL0093L5T101805 July 1, 2019 through September 30, 2020 IL0167L5T101811/IL0167L5T101912 February 1, 2019 through January 31, 2021 IL0173L5T101710 November 1, 2018 through October 31, 2019 IL0174L5T101710 November 1, 2018 through October 31, 2019 IL0209L5T101811/IL0209L5T101912 April 1, 2019 through May 31, 2020 U.S. Department of Health and Human Services CFDA Number: 93.676 CFDA Name: Unaccompanied Alien Children Program Grant Award Numbers under the Uniform Guidance Requirements: Direct Award Number Award Period 90ZU0189 February 1, 2019 through January 31, 2020 90ZU0351 February 1, 2020 through January 31, 2021 Criteria - The Organization must establish and maintain effective internal control over federal awards that provides reasonable assurance that the Organization is managing the federal awards in compliance with federal statutes, regulations and terms and conditions of the federal award. Management is responsible for establishing and maintaining a system of internal control that should include controls over its procurement process. In addition, Section 200.318-326 of the Code of Federal Regulation (CFR) states that all procurement transactions must be conducted in a manner providing full and open competition. A non-Federal entity must have written policies and procedures on procurement, which should define required approvals for purchases and thresholds for each procurement method defined under Section 200.320. Moreover, Section 200.318(i) of the CFR states that a non-Federal entity must maintain records sufficient to detail the history of procurement. These records will include, but are not necessarily limited to, the following: rationale for the method of procurement, selection of contract type, contractor selection or rejection, and the basis for the contract price. Section 200.333 of the CFR states that financial records, supporting documents 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. It also states that a non-Federal entity must award contracts only to responsible contractors possessing the ability to perform successfully under the terms and conditions of a proposed procurement. Consideration will be given to such matters as contractor integrity, compliance with public policy, record of past performance, and financial and technical resources. Award recipients must not utilize any vendor which is suspended or debarred or is otherwise excluded from the central contractor registry. Condition - The Organization?s procurement policy states that purchases of more than $3,500 require a formal Request for Proposal (RFP)/Request for Quote (RFQ) to be issued to at least three potential vendors. The requestor shall use the RFP/RFQ template and guidelines for guidance. The solicitation should include the minimum basis for award (price alone or other factors), and all vendors should receive the same specifications, including delivery, licensing, or warranty requirements. After individual Vendor Technical and Quality Evaluation Criteria and Vendor Technical and Quality Evaluation Criteria Matrix and Cost or Price Analysis Summaries are completed, the requestor will consolidate the evaluation results into a Vendor Technical and Quality Evaluation Team Summary and Cost or Price Analysis. Based on the Vendor Technical and Quality Evaluation Summary Matrix and summary Cost or Price Analysis, along with the result of any negotiations, the Director of Enterprise Procurement provides a final approval of selection. The requestor must complete a Vendor Selection Memorandum taking into account the evaluation and negotiation process. The Vendor Selection Memorandum documents the rationale for selection against the criteria described in the solicitation. The Selection Memorandum must be maintained as part of the procurement file. During our testing of 24 procurement transactions, totaling $1,108,629 we noted the following: CFDA 93.527 Health Center Program Cluster, 1. For 1 of 4 transactions tested the Organization completed the procurement procedures per its policy, but did not include the required approval signature by the Director of Enterprise Procurement. CFDA 93.676 Unaccompanied Alien Children Program 1. Vendor solicitation requirements, in accordance with the Organization?s procurement policy, was not conducted for 1 of 9 transactions tested and consisted of nine vendors. Total purchases of individual transactions over $3,500 for this vendor aggregated to $143,372. 2. Sole source justification documentation was not maintained for 1 of 9 transactions tested. Total procurement transactions for this vendor was $12,492. CFDA 14.267 Continuum of Care Program 1. Vendor solicitation requirements, in accordance with the Organization?s procurement policy, was not conducted for 2 of 5 transactions tested and consisted of five vendors. Total purchases of individual transactions over $3,500 for this vendor aggregated to $59,019. Cause - The Organization is not applying a consistent standard for processing, documenting, accessing, and retrieving required procurement forms. Effect - Failure to obtain vendor solicitation for procurements above small purchase acquisition threshold and failure to maintain proper documentation for vendor selection process is noncompliance with Federal regulations and the Organization?s policy. Questioned Costs - $214,883 Context ? See the condition section for the sample size relative to the population. This is a condition identified per review of the Organization?s compliance with specified requirements using a statistically valid sample. The total population for procurement testing was $7,449,889 and the 24 procurement transactions reviewed accounted for $1,108,629 of that population. The 5 exceptions that were noted totaled $270,278 of the transactions tested. Recommendation - We recommend management continue to review and improve its internal controls over procurement and update its procurement policy to ensure compliance with the Organization?s policy and Federal regulations. Views of Responsible Officials: The Organization has established and maintained a system of internal control that includes procurement policies and procedures. Although the Organization has control policies and procedures in place to comply with federal and internal procurement policies, we must improve measures to ensure that procedures are implemented consistently. Management engaged an outside firm to assist in evaluation of the Organization?s procurement environment, created new policies in compliance with new federal regulations, updated the internal website to provide job aids and documentation, provided enterprise wide training, and completed phase one of the procurement process implementation strategy as recommended by the external firm. The Organization is currently implementing upgrades to procurement technology systems and will offer additional training to staff once the system deploys. Management intends to update and formalize existing policies and procedures to address and document procurement procedures. The Organization is committed to establishing a strong procurement process and guidelines to protect resources and comply with government regulations. Management agrees with the finding; see management?s corrective action plan filed separately.