22025-001 – Meal Count Forms Not Reconciled to Claim for Reimbursement U.S. Department of Agriculture Child and Adult Care Food Program (CACFP) – AL #10.558 TN Department of Human Services Compliance Requirement – Activities Allowed Condition: We noted several instances in which the daily and monthly meal count forms were not reconciled to the claim for reimbursement for the month. In addition, there were instances in which the number of meals reported as served on a particular day exceeded the number of students in attendance. Criteria: Title 7 of the Code of Federal Regulations, Section 226.10(c) states, “In submitting a claim for reimbursement, the institution shall certify that the claim is correct and that records are available to support the claim.” Cause: There is a lack of documented controls in place relating to reconciling daily and monthly meal count information to the claim for reimbursement. Additionally, as this is a manual process as opposed to an automated process, errors are more likely to occur. Effect: Lack of proper reconciliation to the claim for reimbursement forms could ultimately result in funds to be returned to the State. Context: A sample of forty (40) daily meal count forms and twenty monthly meal count forms (20) were selected for testing. While the daily census data was reviewed by the Site Manager, the number of meals served for the individual day exceeded the number of students in attendance for four (4) selections. Additionally, while the claim for reimbursement was prepared by the Lead Cook and reviewed by the Site Manager, the claim did not agree to the monthly and daily meal count census data for eight (8) selections. This resulted in both known and projected questioned costs that were well below the reportable $25,000 and are not material to the program. Recommendation: We recommend that management implement additional controls over the CACFP meal count and reimbursement process. This should include implementing documented review procedures in which daily and monthly meal count forms are compared to attendance records and reconciled to the site’s claim for reimbursement by multiple program personnel prior to submission. Reviewers should document their review and approval. Management should also provide additional training to personnel responsible for completing and reviewing meal count forms, preparing claims for reimbursement, and performing reconciliations between these records. In addition, management should establish a separate supervisory review to verify that: the number of meals claimed does not exceed participant attendance, totals reporting on the site’s claim form agree to supporting meals count documentation, and any discrepancies identified are investigated and resolved in a timely manner. Management’s Response: See accompanying management’s corrective action plan.
2025-002 – Eligibility Determination Not in Place or Consistently Applied Across all Programs U.S. Department of Human Services Temporary Assistance for Needy Families – AL #93.558 TN Department of Human Services Compliance Requirement – Eligibility Condition: Controls over participant eligibility documentation were not in place or inconsistently applied. Required eligibility documentation was incomplete, missing, or inconsistent with program requirements. Additionally, some eligibility forms were signed by the applicant after year-end, indicating that eligibility was not properly established prior to the period of service. In some cases, limited or no documentation was provided. Criteria: Under 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal programs to provide reasonable assurance of compliance with Federal statutes, regulations, and the terms and conditions of the award. The OMB Compliance Supplement for TANF requires recipients to obtain, review, and retain sufficient documentation to verify participant eligibility at the time eligibility is determined. Cause: The Organization does not have formalized, consistently applied procedures in place to ensure that eligibility documentation is collected, verified, and reviewed prior to approving participants for TANF services. The Organization relied on informal practices rather than a formally defined process. Effect: Failure to properly document and verify eligibility increases risk that ineligible individuals may receive TANF-funded services, which could result in questioned costs or return of federal funds to the State. Context: A sample of twenty-five (25) participants were selected for eligibility testing. Exceptions included eight (8) eligibility forms were not signed by program personnel, eleven (11) eligibility forms that were signed by the applicant after year-end, no information was provided for two (2) participants selected, and limited information was provided for one (1) participant selected. Therefore, eligibility could not be determined due to insufficient documentation. Recommendation: We recommend the Organization establish and implement written eligibility determination procedures uniformly across all TANF programs to verify proof of residency, citizenship of the child or expectant mother within the home, income, resources, and, if applicable, work participation. This process should include eligibility documents to be completed, signed, and dated prior to services being provided. A level of review and approval should be performed to verify the above information and eligibility status. All supporting documentation required by Tennessee Department of Human Services should be maintained within the participant eligibility file. Management’s Response: See accompanying management’s corrective action plan.
2025-003 – Inaccurate Eligibility Classification and System Entry U.S. Department of Agriculture Child and Adult Care Food Program (CACFP) – AL #10.558 TN Department of Human Services Condition: We noted multiple instances in which eligibility determinations based on income levels, specifically related to rates at which student meals are reimbursed (paid, reduced, or free), lacked sufficient controls in place to categorize the student accurately. Criteria: Under 2 CFR 200.303, non-federal entities must establish and maintain effective internal control over federal programs to provide reasonable assurance of compliance with Federal statutes, regulations, and the terms and conditions of the award. The OMB Compliance Supplement for CACFP requires recipients to obtain, review, and retain sufficient documentation to verify participant eligilbility at the time eligibility is determined. Cause: Due to the process being heavily manual in nature, the deficiencies ultimately resulted from human error. Despite multiple levels of documented approvals of the application, the control failed as the different levels of review did not catch the participant being classified incorrectly based on income levels. Additionally, there is a lack of defined procedures to ensure that the approved documentation is reconciled with the eligibility category entered into the system, as there were instances where the student was classified correctly on the application form but not within the system. The errors affected both manual documentation review and data-entry classification, indicating a disconnect between approval and system processing. Effect: Due to the eligibility classifications being incorrect, the Organization was reimbursed at lower rates than supported by the documentation. As a result, the errors did not lead to overcharging the federal program, but instead, caused the Organization to claim less reimbursement than that for which it was eligible. Although this reduces the risk of questioned costs for overbillings, the conditions represent a control failure. Such control failures could lead to future noncompliance or incorrect claims in either direction if not addressed. Context: A sample of forty (40) students were selected for eligibility testing. Three (3) CACFP application forms were classified incorrectly as free, reduced, or paid based on income levels. Two (2) participants were entered into the system under the incorrect eligibility category, resulting in a discrepancy between the supporting documentation and the recorded classification. Recommendation: We recommend that management strengthen internal controls over the eligibility process. Management should retain the multi-level review structure; however, each level of review should include a documented verification of income information and eligibility categorization. In addition, management should implement a formal reconciliation process that confirms the eligibility classification approved on the application form matches the classification entered into the system prior to finalization or claim submission. Management’s Response: See accompanying management’s corrective action plan.
2025-004 – Lack of Controls over Reporting Corporation for National and Community Service Americorps Seniors Foster Grandparent Program – AL #94.011 TN Commission of National & Community Service/Americorps State and National Condition: The Organization does not have adequate internal controls in place over the preparation and submission of required program reports. Program reporting is prepared and submitted solely by the grant accountant, with no supervisory review and approval process to ensure accuracy prior to submission. Criteria: Uniform Guidance 2 CFR 200.303 requires non-federal entities to establish and maintain effective internal control over compliance, including controls that provide reasonable assurance that reporting is accurate, complete, and properly supported. Cause: Management has not implemented a control structure to ensure program reports are independently verified for accuracy and compliance. Effect: Although reports were ultimately submitted timely and included the necessary information, there is an increased risk that errors, omissions, or inconsistencies in program reporting may go undetected. The lack of a functioning review control increases the likelihood of future noncompliance or reporting inaccuracies. Context: During testing of reporting, it was noted that program reports were prepared and submitted by a single individual. Management confirmed that no secondary review and approval was performed prior to submitting required reports.