Audit 375292

Assistance Listing Number, Federal Agency, and Program Name 10.553, 10.555 and 10.559, U.S. Department of Agriculture, Child Nutrition Cluster Federal Award Identification Number and Year 241960, 251960, 241970, 251970, 240900 Pass through Entity Michigan Department of Education Finding Type Material weakness and material noncompliance with laws and regulations Repeat Finding No Criteria The School District must submit monthly claims for reimbursement for meals served to eligible students within 60 days following the last day of the month covered by the claim (7 CFR sections 210.8, 220.11, 215.10, and 225.15 (c)). Upon preparation of meal reimbursement claims, the School District is required to have controls in place to ensure the accuracy of the request for reimbursement. Each month’s claim for reimbursement and all data used in the claims review process must be maintained on file. Records are required to be retained for a period of three years after submission of the final claim for reimbursement for the fiscal year. Condition The School District did not have a sufficiently detailed control in place to ensure that the number of meals served and claimed for reimbursement in the Michigan Nutrition Data (MiND) system was supported by School District records of actual meals served. As a result, the School District was unable to provide support for the complete number of meals requested for reimbursement, within our audit sample. Questioned Costs $233 If questioned costs are not determinable, description of why known questioned costs were undetermined or otherwise could not be reported N/A Identification of How Questioned Costs Were Computed The number of served meals in the sample tested that the School District did not have supporting records for (66) multiplied by the reimbursement rates in effect for breakfast and lunch. Context It was noted that the School District submitted for reimbursement with inaccurate or incomplete information for five of twelve days tested during the fiscal year. The School District could not provide support for 27 of the 9,108 breakfast meals requested for reimbursement and the School District could not provide support for 39 of the 13,186 lunch meals claimed for reimbursement, for the periods tested. This resulted in known questioned costs of $233. The extrapolated error was $3,383 for fiscal year 2025. Cause and Effect The absence of a secondary review, comparing the meals served tally sheets to what was input into the MiND system for reimbursement, resulted in the School District being reimbursed for meals that the School District did not have supporting records for. Recommendation The School District should implement a more detailed control whereby the monthly reimbursement request is compared to the detailed records of the number of meals served, to ensure that the School District has supporting documentation maintained for all meals requested for reimbursement. Views of Responsible Officials and Corrective Action Plan Management agrees. The School District will implement a secondary review of the monthly summary sheet used for MIND system claim submission to ensure it fully reconciles with the supporting daily tally sheets. The reviewer will initial and date the summary sheet upon completion of the review. In addition, the newly appointed Food Services Director will establish and maintain an organized filing system (physical and/or electronic) containing all claim-supporting documentation, ensuring records are complete and readily accessible for monitoring or audit purposes. These procedures will be in place effective December 1, 2025 and will be monitored for sustained compliance.