Audit 388928

Criteria Per Title 7, U.S. Code of Federal Regulations, Subtitle B, Chapter II, Subchapter A, Parts 210.8 and 220.11, School Food Authorities (SFA) must establish internal controls which ensure the accuracy of meal counts prior to the submission of the monthly Claim for Reimbursement. Prior to submission of a monthly Claim for Reimbursement, each school food authority shall review the breakfast and lunch count data for each school under its jurisdiction to ensure the accuracy of the monthly Claim for Reimbursement. The objective of this review is to ensure that monthly claims include only the number of free, reduced price and paid breakfasts and lunches served on any day of operation to children currently eligible for such meals. SFA staff shall maintain on file each month's Claim for Reimbursement and all data used in the claims review process, by school. Condition Significant Deficiency in Internal Control over Compliance and Instance of Noncompliance - For two of the four monthly Claims for Reimbursement reviewed, the number and type of meals served was not accurately reported. The source system reports reviewed did not agree to the meal counts reported on the Claims for Reimbursement. Discrepancies included the misclassification of 260 lunch meals claimed as breakfast meals, and the misstatement of 366 breakfast meals served. The misclassification of lunch meals resulted in understated revenue of $206. The misstatement of the number of breakfast meals served resulted in overstated revenue of $689. Cause The District’s internal controls were not sufficient to ensure meal counts were accurately reported. Effect The District’s submitted monthly Claims for Reimbursement were not accurately reported. Questioned Costs There were no questioned costs associated with the identified condition. Context A nonstatistical sample of four monthly reports out of a total of 12 monthly reports was selected for testing. The District claimed a total of 101,577 lunch meals and 64,538 breakfast meals for the year ended June 30, 2025. Repeat Finding No. Recommendation The District should implement additional review processes to ensure to monthly Claims for Reimbursements are accurate and the number and type of meals reported agrees to the underlying supporting system reports.