Audit 401821

GRANT COMMUNITY CONSOLIDATED SCHOOL DISTRICT 110 50-082-1100-04 SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ending June 30, 2025 SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER:14 2025 - 004 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: National School Lunch Program, School Breakfast Program 4. Project No.: 25-4210-00, 24-4210-00, 25-4220-00, 24-4220-00 5. AL No.: 10.555 & 10.553 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 §200.303, non-federal entities must establish and maintain effective internal control over federal awards to provide reasonable assurance of compliance with federal statutes, regulations, and the terms and conditions of the award. Additionally, 7 CFR §210.8(a) requires school food authorities to establish internal controls to ensure the accuracy of meal counts prior to submitting monthly claims for reimbursement. 9. Condition Claims submitted for reimbursement did not reconcile with the District’s internally prepared monthly claim summary report. 10. Questioned Costs Total questioned costs equal $78,821.37. 11. Context The District participates in the National School Lunch Program (ALN 10.555) and the School Breakfast Program (ALN 10.553), which require accurate reporting of meal counts to determine reimbursement. Meal count claims are prepared monthly by a designated staff member and submitted to the state agency. However, the District’s independent review process for these claims is not functioning effectively. This lack of review contributed to errors in the reimbursement claims for October 2024, December 2024, and February 2025. 12. Effect The District submitted reimbursement claims that did not reconcile to its internally prepared monthly claim summary report, resulting in both underclaims & overclaims of meals. 13. Cause The District had a review process in place requiring a secondary review of meal count claims; however, the process was not functioning effectively. 14. Recommendation The District should strengthens internal controls over meal count claims prior to submission. 15. Management's response Management concurs with finding.

GRANT COMMUNITY CONSOLIDATED SCHOOL DISTRICT 110 50-082-1100-04 SCHEDULE OF FINDINGS AND QUESTIONED COSTS Year Ending June 30, 2025 SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS 1. FINDING NUMBER:14 2025 - 005 2. THIS FINDING IS: X New Repeat from Prior year? Year originally reported? 3. Federal Program Name and Year: National School Lunch Program, School Breakfast Program 4. Project No.: 25-4210-00, 24-4210-00, 25-4220-00, 24-4220-00 5. AL No.: 10.555 & 10.553 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 7 CFR §210.14(a), school food authorities are required to establish and maintain a nonprofit school food service account and ensure that all revenues received from the food service operation are properly credited to that account. This regulation requires that federal reimbursements and all other food service revenues be deposited into the nonprofit food service account and used solely for the operation and improvement of the school food service program. 9. Condition The District did not prepare bank reconciliations during fiscal year 2025. As a result, a portion of National School Lunch and School Breakfast program receipts were not promptly credited to the appropriate food service revenue accounts, and those reimbursements that were recorded incorrectly recorded to the Evidence-Based Funding revenue account in error. 10. Questioned Costs No reportable questioned costs identified. 11. Context The District participates in the National School Lunch Program (ALN 10.555) and the School Breakfast Program (ALN 10.553), which require that federal reimbursements be promptly recorded to the food service account. However, the District does not currently have a bank reconciliation process in place to ensure timely identification and posting of these reimbursements. This lack of a reconciliation process contributed to an error in which the December 2024, February 2025 and April 2025 reimbursements were not recorded to the food service account. 12. Effect The District’s food service revenues were misclassified and understated, resulting in reimbursements not being promptly recorded to the food service account. 13. Cause The District did not have bank reconciliations prepared during fiscal year 2025. 14. Recommendation The District should prepare bank reconciliations to ensure all bank accounts are reconciled on a monthly basis and reviewed by appropriate personnel. 15. Management's response Management concurs with finding.