CIVICA NevadaNon-Profit

Allowable Costs/Cost Principles U.S. Department of Treasury/Passed Through State of Nevada Department of Education and Nevada State Public Charter School Authority (SPCSA) Assistance Listing Number 21.027 – Coronavirus State and Local Fiscal Recovery Funds – AB495 (COVID-19) Award Date – 7/1/2022–12/31/2024 Criteria – The grant award budget included expenditures for salaries and retirement fringe benefits. Grant terms specify that recipients may use funds as outlined in the approved budget, and any changes to budget line items require prior approval from the grantor. Condition – The School charged $83,907 in contracted services to the grant; however, the approved grant budget did not include any allocation for contracted services. Cause – Due to an employment shortage, the School engaged individuals through a staffing agency to perform duties funded by the grant. Effect or Potential Effect – Although in December 2025 the grantor determined that the $83,907 in contracted services was allowable, the School did not obtain prior approval before incurring the expenditure. This created a compliance risk, including the potential for questioned costs and loss of funding, had the grantor determined the costs were unallowable. Questioned Costs – None reported. Recommendation – We recommend that the School obtain prior written approval from the grantor for any expenditures not included in the approved grant budget before incurring such costs. Repeat Finding – No. Views of Responsible Officials and Planned Corrective Actions – Management will ensure that submitted costs for reimbursement are in accordance with the approved grant budget. If an update to the budget is necessary, management will ensure the budget amendment is approved prior to submitting for reimbursement.

Procurement, Suspension and Debarment (Repeat Finding 2023-009) U.S. Department of Education/Passed Through Opportunity 180 Assistance Listing Number 84.282B – Charter Schools Program (CSP) – Grants for the Opening of New Charter Schools Award Number S282A200009-20A Subgrantee Number CSP-2021-08655 Award Date – 4/1/21 to 8/31/23 Criteria – Management is responsible for implementing internal controls related to Procurement, Suspension and Debarment, as required by the Uniform Guidance. Condition – Evidence of review and approval of the bids/quotes obtained and of the verification that the vendor was not suspended or debarred, prior to entering into a transaction with the vendor, could not be provided for one vendor tested. Questioned Costs – None Context/Sampling – A non-statistical sample of one vendor out of four was selected for testing. Cause – The School lacked sufficient internal controls to ensure that the review and approval of bids/quotes and the verification that the vendor was not suspended or debarred occurred and was documented prior to the expenditure. Effect or Potential Effect – There is a risk that the School could enter into a transaction with a vendor without proper approval, or with a vendor who is suspended or debarred. Recommendation – We recommend the School thoroughly document the review and approval process for all procurements to ensure compliance with Uniform Guidance. Additionally, we recommend maintaining records that confirm vendors have been verified as not being suspended or debarred prior to engaging in any transactions. The School can further include a clause in vendor contracts or obtain a certification from vendors to this effect. Views of Responsible Officials and Planned Corrective Actions – These findings were for purchases prior to the new School principal coming on board. Upon hiring in April 2024, the new principal was fully trained in School internal control policies. In addition, on July 1, 2024, a process was put in place to maintain evidence of verification of suspension and debarment with SAM.gov for all required vendors.

Allowable Costs/Cost Principles U.S. Department of Agriculture/Passed Through State of Nevada Department of Agriculture ALN 10.553, 10.555 – Child Nutrition Cluster Award Date – 7/1/2023–6/30/2024 Criteria – Management is responsible for implementing internal controls related to Allowable Costs and Cost Principles, as required by the Uniform Guidance. Condition – Evidence of review and approval prior to the payment could not be provided for one of the payroll expenditures tested. Questioned Costs – None Context/Sampling – A non-statistical sample of four payroll expenditures out of 24 payroll expenditures was selected for testing. Cause – The School lacked sufficient internal controls to ensure that the review and approval of costs were documented prior to payment of the expenditure. Effect or Potential Effect – There is a risk that unallowable costs may be charged to the program without being detected by the School. Recommendation – We recommend that the School document review and approval of all expenditures prior to expenditure to ensure compliance with the Uniform Guidance. Views of Responsible Officials and Planned Corrective Actions – A process was put in place in January 2024 to ensure that all principal approvals are documented in writing or electronic approval in the system which can be date stamped by the system. Payroll will not be run, nor grants submitted, until proper approval is received.

Activities Allowed or Unallowed and Allowable Costs/Cost Principles U.S. Department of Treasury/Passed Through State of Nevada Department of Education and Nevada State Public Charter School Authority (SPCSA) ALN 21.027 – Coronavirus State and Local Fiscal Recovery Funds – AB495 (COVID-19) Award Date – 7/1/2022–12/31/2024 Criteria – Management is responsible for implementing internal controls related to Activities Allowed or Unallowed and Allowable Costs and Cost Principles, as required by the Uniform Guidance. Condition – Evidence of review and approval prior to the payment could not be provided for two of the nonpayroll expenditures tested. Questioned Costs – None Context/Sampling – A non-statistical sample of four nonpayroll expenditures out of 23 nonpayroll expenditures was selected for testing. Cause – The School lacked sufficient internal controls to ensure that the review and approval of costs were documented prior to payment of the expenditure. Effect or Potential Effect – There is a risk that unallowable costs may be charged to the program without being detected by the School. Recommendation – We recommend that the School document review and approval of all expenditures prior to expenditure to ensure compliance with the Uniform Guidance. Views of Responsible Officials and Planned Corrective Actions – These findings were for purchases prior to the School’s new principal coming on board. Upon hiring in April 2024, the new principal was fully trained in the School’s internal control policies.

Activities Allowed or Unallowed and Allowable Costs/Cost Principles (Repeat Finding 2022-010) U.S. Department of Education / Passed-through Opportunity 180 Federal Assistance Listing Number 84.282B– Charter Schools (CSP) Award Number S282A200009-20A, Subgrantee Number CSP-2021-08655, Award Date 4/1/21-8/31/23 Criteria – Management is responsible for internal controls over Activities Allowed or Unallowed and Allowable Costs/Cost Principles in accordance with the Uniform Guidance. Condition – Eight expenditures tested did not have evidence of review and approval. Questioned Costs - None Context/Sampling – A non-statistical sample of eight expenditures out of 50 expenditures was selected for testing. We also tested the corresponding request for reimbursement of allowable cost submission for each expenditure tested. Cause – The School did not have adequate internal controls to ensure review of costs charged to the program occurred and was documented. Effect or potential effect – Unallowable costs may be charged to the program and submitted for reimbursement and not detected by the School. Recommendation – We recommend that the School document review and approval of all expenditures to ensure compliance with the Uniform Guidance. Views of responsible officials and planned corrective actions – A process was put in place in May 2023 to ensure that all principal approvals are documented in writing or electronic approval in the system which can be date stamped by the system. Payroll will not be run, nor grants submitted, until proper approval is received.

Activities Allowed or Unallowed and Allowable Costs/Cost Principles U.S. Department of Education / Passed Through Nevada Department of Education and State of Neveda State Public Charter School Authority (SPCSA) Federal Assistance Listing Numbers 84.425C, 84.425D, and 84.425U – COVID-19 - Education Stabilization Fund Pass-Through Entity Identifying Number 22-748-110000 84.425U Award Number S425U200018, Subgrantee Number T27044315, Award Date 7/1/21-9/30/24 84.425D, 84.425C Award Number S425D200018, S424C210033, Subgrantee Number T27044315, Award Date 12/29/21-9/30/23 Criteria – Management is responsible for internal controls over Activities Allowed or Unallowed and Allowable Costs/Cost Principles in accordance with the Uniform Guidance. Condition – 12 expenditures tested did not have evidence of review and approval. Questioned Costs: None Context/Sampling – A non-statistical sample of 22 expenditures out of 141 expenditures was selected for testing. We also tested the corresponding cost submission for each expenditure tested. Cause – The School did not have adequate internal controls to ensure review of costs charged to the program occurred and was documented. Effect or potential effect – Unallowable costs may be charged to the program and submitted for reimbursement and not detected by the School. Recommendation – We recommend that the School document review and approval of all expenditures to ensure compliance with the Uniform Guidance. Views of responsible officials and planned corrective actions – A process was put in place in May 2023 to ensure that all principal approvals are documented in writing or electronic approval in the system which can be date stamped by the system. Payroll will not be run, nor grants submitted, until proper approval is received.

Reporting U.S. Department of Education/Passed Through Nevada Department of Education Federal Assistance Listing Numbers 84.425C and 84.425D – COVID-19 - Education Stabilization Fund Pass-Through Entity Identifying Number 22-748-110000 84.425D, 84.425C - Award Number S425D200018, S424C210033, Subgrantee Number T27044315, Award Date 12/29/21-9/30/23 Criteria – Management is responsible for internal controls over compliance with Reporting in accordance with the Uniform Guidance. Condition – The School did not report grant expenditures on the correct grant tab of the report to the Nevada Department of Education, there was no support maintained for the data that was submitted including FTEs, and there was no review of the report before it was submitted. Questioned Costs: None Context – The Nevada Department of Education (NDE) requires information to be reported by Local Education Agencies in order to complete the NDE’s annual ESSER Reporting. Cause – The School did not have adequate internal controls to ensure that the data reported to the NDE was accurate, that the form was completed correctly, and that a review was performed prior to submission. Effect or potential effect – Inaccurate data was reported to the grantor. Recommendation – We recommend the School put in place controls over reporting required by the School’s grants to ensure complete and accurate reporting in accordance with the compliance requirement. Views of responsible officials and planned corrective actions – Due to unexpected turnover a secondary review was not performed to verify the preparation of the ESSER reporting. To strengthen the oversight of financial management of the School, Academica Nevada, the School’s management company, filled all open positions and realigned staff responsibilities to reduce individual workloads and provide additional oversight and review. In addition, a financial controller has been added to ensure that secondary reviews occur on all required filings and reconciliations.

Procurement, Suspension and Debarment U.S. Department of Education / Passed-through Opportunity 180 Federal Assistance Listing Number 84.282B– Charter Schools (CSP) Award Number S282A200009-20A, Subgrantee Number CSP-2021-08655, Award Date 4/1/21-8/31/23 Criteria – Management is responsible for internal controls over compliance with Procurement, Suspension and Debarment in accordance with the Uniform Guidance. Condition – The School has policies and procedures which make reference and are in accordance with state regulation and state law, but have not been updated with sufficient clarity and detail to ensure compliance with federal law in accordance with the Uniform Guidance. Four vendors tested did not have evidence of review and approval of the bids/quotes obtained. One vendor tested did not have evidence of review and approval of the process of verifying suspension and debarment procedures. Questioned Costs – None Context/Sampling – A non-statistical sample of four vendors was selected for testing. Cause – The School did not have adequate internal controls over compliance with Procurement, Suspension and Debarment in accordance with the Uniform Guidance. Effect or potential effect – The School may follow its documented procurement policies and not identify non-compliance with federal procurement law in cases where federal procurement law is more restrictive. The School could select a vendor without proper approval. The School could enter into a transaction with a suspended or debarred vendor. Recommendation – We recommend the School review its procurement policy and include federal procurement requirements with proper minimum and maximum thresholds and requirements of the type of bids/quotes and documentation required to meet federal compliance requirements. We recommend that the School document review and approval of all approvals and quotes/bids to ensure compliance with the Uniform Guidance. We recommend that the School maintain documentation that vendors have been verified to not be suspended or debarred before entering into a transaction with a vendor. Views of responsible officials and planned corrective actions – Going forward, as part of the process of verifying suspension and debarment a screenshot will be saved as evidence of the process. Additionally, Academica Nevada, the School’s management company, is in the process of reviewing all existing policies and procedures to ensure clarity and compliance with federal and state standards.

2022-010: U.S. Department of Education Passed through Opportunity 180 Charter Schools, 84.282 Activities Allowed or Unallowed and Allowable Costs/Cost Principles Material Weakness in Internal Control over Compliance Grant Award Number: Affects all grant awards included under assistance listing 84.282 on the Schedule of Expenditures of Federal Awards. Criteria: Title 2 U.S. Code of Federal Regulations (CFR) Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.303 provides that non-federal entities must establish and maintain effective internal control that provides reasonable assurance that the non-federal entity is managing the federal award in compliance federal statutes, regulations, and the terms and conditions of the Federal award. A key component of effective internal control is the segregation of duties through a review and approval process. Condition: Payroll costs charged to the program did not have evidence of review by an individual independent of the preparation of the allocation to the program. Cause: The School did not have adequate internal controls to ensure review of payroll costs charged to the program occurred and was documented. Effect: Unallowable costs may be charged to the program and not detected by the School. Questioned Costs: None noted Context/Sampling: A non-statistical sample of four payroll transactions out of a population of 29 was selected for testing. There was no evidence of review on any of the four transactions tested. Repeat Finding from Prior Year: No Recommendation: We recommend the School enhance internal controls to ensure review of payroll costs charged to the program occurs and is documented. Views of Responsible Officials: Management agrees with this finding.

2022-011: U.S. Department of Education Passed through Opportunity 180 Charter Schools, 84.282 Cash Management Material Weakness in Internal Control over Compliance Grant Award Number: Affects all grant awards included under assistance listing 84.282 on the Schedule of Expenditures of Federal Awards. Criteria: Title 2 U.S. Code of Federal Regulations (CFR) Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) section 200.303 provides that non-federal entities must establish and maintain effective internal control that provides reasonable assurance that the non-federal entity is managing the federal award in compliance federal statutes, regulations, and the terms and conditions of the Federal award. A key component of effective internal control is the segregation of duties through a review and approval process. Condition: Reimbursement requests submitted to the grantor did not have evidence of review by an individual independent of the preparation of the reimbursement request. Cause: The School did not have adequate internal controls to ensure review of reimbursement requests occurred or was documented. Effect: Unallowable costs may be charged to the program and not detected by the School. Questioned Costs: None noted Context/Sampling: A non-statistical sample of three reimbursement requests out of a population of five was selected for testing. There was no evidence of review on any of the three reimbursement requests tested. Repeat Finding from Prior Year: No Recommendation: We recommend the School enhance internal controls to ensure review of reimbursement requests occurs and is documented. Views of Responsible Officials: Management agrees with this finding.

2022-012: U.S. Department of Education Passed through Opportunity 180 Charter Schools, 84.282 Other Material Weakness in Internal Control over Compliance Grant Award Number: Affects all grant awards included under assistance listing 84.282 on the Schedule of Expenditures of Federal Awards. Criteria: Title 2 Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) requires the School to prepare a Schedule of Expenditures of Federal Awards (SEFA). Condition: Amounts were originally reported incorrectly on the SEFA. Cause: The School did not have adequate internal controls to provide for the review of journal entries that allocate expenses to federal programs or the SEFA to ensure total federal expenditures were appropriately reported on the SEFA. Effect: Prior to correction, total expenditures reported under the program were overstated by $36,186 as they included costs from the prior period. Questioned Costs: None noted Context/Sampling: No sampling was used; all program expenditures on the SEFA were reconciled to supporting records. Repeat Finding from Prior Year: No Recommendation: We recommend the School enhance internal controls to provide for the review of journal entries that allocate expenses to federal programs and the SEFA to ensure total federal expenditures are appropriately reported on the SEFA. Views of Responsible Officials: Management agrees with this finding.