Audit 391596

2025-001 Child Nutrition Claims Reporting CFDA No: 10.553, 10.555 Program Name: Child Nutrition Cluster Award Number: 7AZ300AZ3 Federal Agency: U.S. Department of Agriculture Pass-Through Grantor: Arizona Department of Education Compliance Requirement: L. Reporting Questioned Costs: N/A Summary of Finding: Significant Deficiency in internal control over major programs Repeat Finding? No Condition For the period reviewed, the District submitted meal counts that did not agree to supporting documentation and accurate claim totals. Specifically, the District: Overreported breakfasts by 2,527 free breakfasts and 143 reduced-price breakfasts Underreported lunches by 2,139 free lunches and 125 reduced-price lunches. These errors indicate that the reported counts used to prepare the District’s Claim for Reimbursement were not accurate and were not adequately reviewed prior to submission. Criteria According to 7 CFR §210.8, the District shall establish internal controls which ensure the accuracy of meal counts prior to the submission of the monthly claim for reimbursement. The Uniform Guidance requires non-federal entities to establish and maintain effective internal control over the federal award to provide reasonable assurance that the entity is managing the award in compliance with federal statutes, regulations, and the terms and conditions of the federal award (2 CFR 200.303). Cause The District did not have adequately designed and/or consistently implemented internal controls over the reporting process to ensure meal counts reported on claims were accurate prior to submission. Effect The District is not in compliance with the requirements of the Uniform Guidance and related federal grant federal regulations. Recommendation The District should ensure adequate supporting documentation is maintained and the monthly meal reimbursements are reviewed by management before submission to the Arizona Department of Education.