FAC Explorer

Audit 336058

FY End
2024-06-30
Total Expended
$8.06M
Findings
14
Programs
12
Organization: Centralia School District (CA)
Year: 2024 Accepted: 2025-01-06
Auditor: Eide Bailly LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
517863 2024-002 Significant Deficiency - AB
517864 2024-002 Significant Deficiency - AB
517865 2024-002 Significant Deficiency - AB
517866 2024-002 Significant Deficiency - AB
517867 2024-002 Significant Deficiency - AB
517868 2024-002 Significant Deficiency - AB
517869 2024-002 Significant Deficiency - AB
1094305 2024-002 Significant Deficiency - AB
1094306 2024-002 Significant Deficiency - AB
1094307 2024-002 Significant Deficiency - AB
1094308 2024-002 Significant Deficiency - AB
1094309 2024-002 Significant Deficiency - AB
1094310 2024-002 Significant Deficiency - AB
1094311 2024-002 Significant Deficiency - AB

Programs

ALN Program Spent Major Findings
84.010 Title I Grants to Local Educational Agencies $720,514 Yes 0
10.553 School Breakfast Program $353,766 Yes 1
84.425 Education Stabilization Fund $240,000 - 0
10.555 National School Lunch Program $133,351 Yes 1
84.367 Supporting Effective Instruction State Grants (formerly Improving Teacher Quality State Grants) $114,265 - 0
10.579 Child Nutrition Discretionary Grants Limited Availability $73,507 - 0
10.582 Fresh Fruit and Vegetable Program $65,306 Yes 1
84.424 Student Support and Academic Enrichment Program $60,853 - 0
84.027 Special Education Grants to States $48,091 Yes 0
84.173 Special Education Preschool Grants $35,915 Yes 0
10.558 Child and Adult Care Food Program $35,823 - 0
84.365 English Language Acquisition State Grants $13,515 - 0

Contacts

Name Title Type
K3ENZDN8VN17 Timothy Sohn Auditee
7142283149 Bobby Patel Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported in the schedule are reported on the modified accrual basis of accounting. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The District has not elected to use the ten percent de minimis cost rate. The accompanying Schedule of Expenditures of Federal Awards (the schedule) includes the federal award activity of the Centralia School District (the District) under programs of the federal government for the year ended June 30, 2024. The information is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents only a selected portion of the operations of the District, it is not intended to and does not present the financial position, changes in net position or fund balance or cash flow of the District.
Title: Summary of Significant Accounting Policies Accounting Policies: Expenditures reported in the schedule are reported on the modified accrual basis of accounting. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The District has not elected to use the ten percent de minimis cost rate. Expenditures reported in the schedule are reported on the modified accrual basis of accounting. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient.
Title: Indirect Cost Rate Accounting Policies: Expenditures reported in the schedule are reported on the modified accrual basis of accounting. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The District has not elected to use the ten percent de minimis cost rate. The District has not elected to use the ten percent de minimis cost rate.
Title: Food Donation Accounting Policies: Expenditures reported in the schedule are reported on the modified accrual basis of accounting. When applicable, such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The District has not elected to use the ten percent de minimis cost rate. Nonmonetary assistance is reported in this schedule at the fair market value of the commodities received and disbursed. At June 30, 2024, the District had no food commodities in inventory.

Finding Details

Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.
Finding 2024-002
50000 – Child Nutrition Cluster – Indirect Costs (Significant Deficiency in Internal Controls Over Compliance, Noncompliance) Federal Agency: U.S. Department of Agriculture Pass-Through Entity: California Department of Education Program Name: Child Nutrition Cluster Federal Financial Assistance Listing: 10.553, 10.555, 10.582 Compliance Requirement: A/B – Allowed or Unallowed & Allowable Costs/Cost Principles Type of Finding: Significant deficiency and noncompliance Criteria or Specific Requirements The United States Department of Education has approved a delegation agreement with the California Department of Education (CDE) that authorizes the CDE to establish indirect cost rates for California local education agencies (LEAs). The CDE has been delegated authority to calculate and approve indirect cost rates annually for LEAs. For the Child Nutrition Cluster in fiscal year 2023-2024, California Education Code Section 38101(c) limits school district indirect costs to the lesser of the District’s individual CDE approved indirect cost rate or the statewide average indirect rate. Condition The District charged unallowable indirect costs totaling $67,037 to the Child Nutrition Cluster. Cause The condition identified appears to be due to the District not properly excluding food costs when performing the indirect costs calculations for the federal program. Effect The District has charged unallowable expenditures to the federal programs. Questioned Costs The condition identified above resulted in $67,037 of questioned costs for unallowable indirect costs charged to the grant funds. Context/Sampling The condition was identified through recalculation of the indirect costs charged to the federal programs. Repeat Finding No. Recommendation It is recommended that the District implements a review process for indirect costs, which should include review of relevant grant agreements and relevant federal guidance.