Audit 399714

1. FINDING NUMBER: 2025 - 004 2. THIS FINDING IS: New X Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: Child Nutrition Cluster - 2024 and 2025 4. Project No.: 2024-4210, 2024-4210-SC, 2025-4210, 2025-4211, 2024-4220, 2025-4220, 2025-4999 5. AL No.: 10.533; 10.555 6. Passed Through: Illinois State Board of Education 7. Federal Agency: U.S. Department of Agriculture 8. Criteria or specific requirement (including statutory, regulatory, or other citation): Per 2 CFR 200.303a, "The recipient and subrecipient establish, document, and maintain effective internal control over the Federal award that provides reasonable assurance that the recipient or subrecipient is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award." 9. Condition: The District is required to submit monthly claim information for the Child Nutrition Cluster to the Illinois State Board of Education (ISBE). The District was unable to produce support that the monthly claims were reviewed and internally approved prior to transmission to ISBE. This is deemed to be a material weakness in internal control over compliance for reporting requirements. 10. Questioned Costs: None 11. Contex: No instances of noncompliance were noted and the District indicated that the reports were informally reviewed prior to transmission to ISBE. 12. Effect: The lack of documentation is an indicator that the control structure implemented by the District is not effectively designed. Improperly designed internal controls can lead to instances of noncompliance with applicable requirements. 13. Cause: The District's internal control structure is missing the documentation of review and approval prior to transmission to ISBE. 14. Recommendation: We recommend that the District review the design of its internal control over compliance to ensure that documentation requirements are incorporated into the control design. 15. Management's response: To enhance internal controls and ensure the segregation of duties, the Assistant Director of Food Services will be responsible for the initial preparation and completion of all claims. Subsequently, a secondary review and final approval will be performed by either the Director or the Chief School Business Official (CSBO) prior to submission.

1. FINDING NUMBER: 2025 - 002 2. THIS FINDING IS: New Repeat from Prior year X Year originally reported? 2024 3 .Federal Program Name and Year: Elementary and Secondary School Emergency Relief (ESSER) - 2024 and 2025 4. Project No.:2024-4998-HL, 2024-4998-E3, 2025-4998-C3, 2025-4998-E2 5. AL No.: 84.425D, 84.425U, 84.425W 6. Passed Through: Illinois State Board of Education 7. Federal Agency: U.S. Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation): The Illinois State Board of Education requires that grant expenditure reports be submitted by the 20th day after the through date of the expenditure report. In order to prepare accurate and timely expenditure reports, postings to the general ledger should be accurate and any necessary adjustments should be kept at a minimum, if possible. 9. Condition: Out of 4 quarterly expenditure reports reviewed, 1 of them (25%) were filed beyond the 20th day after the through date. This is considered a repeat of finding 2024-002 and is considered an instance of noncompliance over reporting. 10. Questioned Costs: None 11. Contex: The District did not file the report for the quarter ended September 30, 2024 until October 30, 2024, which is 10 days after the due date. 12. Effect: Late filings of required information to oversight agencies constitutes noncompliance with applicable requirements and can impact monitoring activities that are important for ensuring federal funds are properly spent in a timely manner. 13. Cause: The District indicated that this late filing was an oversight in the compliance requirements. 14. Recommendation: The District should review its reporting internal control processes and procedures and emphasize the need for timely reporting to ensure compliance. 15. Management's response: Administration will implement a formal compliance calendar mandating the Grant Administrator to monitor and verify all expenditure reports. This internal schedule will ensure all filings are submitted no later than the 20th day following the close of each quarter to maintain compliance with reporting requirements.

1. FINDING NUMBER: 2025 - 003 2. THIS FINDING IS: New Repeat from Prior yearX Year originally reported? 2024 3. Federal Program Name and Year:Elementary and Secondary School Emergency Relief (ESSER) - 2024 and 2025 4. Project No.: 2024-4998-HL, 2024-4998-E3, 2025-4998-C3, 2025-4998-E2 5. AL No.: 84.425D, 84.425U, 84.425W 6. Passed Through: Illinois State Board of Education 7. Federal Agency: U.S. Department of Education 8. Criteria or specific requirement (including statutory, regulatory, or other citation): Per 2 CFR 200.313(d)(2), "A physical inventory of the property must be conducted, and the results must be reconciled with the property records at least once every two years." 9. Condition: The District was unable to demonstrate that a physical inventory was performed over the past two years. This is considered a material weakness in internal control over compliance and an instance of noncompliance over equipment and real property management. This is a repeat of finding 2024-003. 10. Questioned Costs: None 11. Context: The District has contracted with an outside vendor to perform the annual inventory but that inventory is not scheduled to take place until summer 2026. 12. Effect: Failure to perform an inventory of equipment purchased by the District could result in the inability to detect a potential loss of assets and noncompliance with federal regulations regarding the proper disposal of equipment purchased with federal funding. 13. Cause: The District did not timely engage its third party contractor to complete the capital asset inventory in time for the 2025 audit. 14. Recommendation: In addition to the District ensuring that the upcoming capital asset inventory is completed timely, we recommend that the District enact procedures to ensure future inventory updates are scheduled in a timely manner. 15. Management's response: A comprehensive physical inventory and asset verification is officially scheduled for completion during the Summer of 2026. This initiative will reconcile existing records with physical counts to ensure accurate financial reporting.