Audit 391025

Major Program: 10.558 - Child and Adult Care Food Program (Grantor - Department of Agriculture) Type of Finding: Noncompliance and Significant Deficiency in Internal Control over Compliance Compliance Requirement: Eligibility Condition: We tested 16 provider files and identified billing errors within three provider files for the December 2024 claim submissions. For each instance of error, the number of meals served was incorrectly determined and submitted for reimbursement. Criteria: Federal assistance to institutions takes the form of cash reimbursement for meals served. An institution's entitlement to cash reimbursement is computed by multiplying the number of meals served, by category and type, by prescribed per-unit payment rates called “reimbursement rates.” “Type” refers to the kind of meal service for which the institution seeks reimbursement (breakfast, lunch, snack, or supper). For meals served in centers, “category” refers to the economic need of the child or adult to whom a meal is served; such meals are categorized as paid, reduced, or free. Meals served in day care homes are categorized by the tiering structure (Tier I or II). Under this formula, an institution's entitlement to funding is a function of the categories and types of services provided. An institution establishes its entitlement to reimbursement payments by submitting claims for reimbursement. Cause: Human error in summarizing the meals served by providers. Effect: The December 2024 claims contained immaterial billing errors. Recommendation: We suggest that Charities review its controls and implement procedures to ensure accurate claims are being submitted for reimbursement.