Audit 371829

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER – FEDERAL ALN 10.555, 10.559, AND 10.553 2024-006 - Internal Control Over Compliance With Federal Suspension and Debarment Requirements Criteria – 2 CFR § 180 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster. Condition – During our audit, we noted the District did not have sufficient controls in place within its child nutrition cluster to assure that it was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Questioned Costs – None. Our testing did not indicate any instances of noncompliance with these requirements. Context – The District did not obtain the appropriate documentation for seven of seven vendors tested applicable to the child nutrition cluster to ensure the vendors were not suspended or debarred from participation in federal program contracts. This was not a statistically valid sample. Repeat Finding – This is a current and prior year finding. Cause – This was an oversight by district personnel. Effect – Noncompliance with the suspension and debarment requirements could result in the District expending federal funds with vendors that are not eligible to be parties to such transactions, which could be viewed as a violation of the award agreement. Recommendation – We recommend that the District review its internal control procedures relating to suspension and debarment for the child nutrition cluster federal programs. Internal controls over compliance for this area should include verification that any vendor with which the District contracts for goods or services exceeding $25,000 is not listed as suspended or debarred on the federal Excluded Parties List System website. View of Responsible Official and Planned Corrective Actions – The District agrees with the finding. The District will review and update its policies and procedures relating to suspension and debarment for its federal programs to ensure compliance with the Uniform Guidance in the future. The District has separately issued a Corrective Action Plan related to this finding.

REPORTABLE NONCOMPLIANCE WITH FEDERAL REPORTING REQUIREMENTS – ALL FEDERAL PROGRAMS AWARDED UNDER THE UNIFORM GUIDANCE 2024-007 - Federal Reporting Deadline Criteria – 2CFR Part 200, Subpart F, § 200.512(a)(1) requires the District’s audited Schedule of Expenditures Federal Awards (SEFA) and federal reporting package to be submitted to the federal audit clearinghouse within the earlier of 30 calendar days after the receipt of the auditor’s report(s), or 9 months after the end of the audit period. Condition – The District’s audited SEFA and federal reporting package for the fiscal year ended June 30, 2024, were not submitted to the federal audit clearinghouse within nine months after the end of the audit period. Questioned Costs – Not applicable. Context – The District’s audited SEFA and federal reporting package for the fiscal year ended June 30, 2024, were not submitted to the federal audit clearinghouse by the federal reporting deadline. Repeat Finding – This is a current year finding. Cause – The completion of the District’s audited annual financial statements for the year ended June 30, 2024, which is a required component of the federal reporting package, was delayed beyond the nine-month deadline. Effect – The delay in the completion of the District’s financial audit for the year ended June 30, 2024, prevented the submission of the required information to the federal audit clearinghouse in a timely manner. Recommendation – We recommend the District ensure the timely submission of its audited SEFA and federal reporting package to the federal audit clearinghouse in the future. View of Responsible Official and Planned Corrective Actions – There is no disagreement with the audit finding. District management will ensure that all information required to comply with federal reporting requirements will be completed and submitted in a timely manner going forward. The District has separately issued a Corrective Action Plan related to this finding.