Finding Text
Federal Agency: U.S. Department of Agriculture
Federal Program Name: Food Insecurity Nutrition Incentive Grants Program
Assistance Listing Number: 10.331Effect:
The reconciliation of the program expenditures was not performed in a timely manner. This resulted in
expenditures being charged to the program that were not allowable and funding may need to be
returned to the pass-through agency.
Repeat Finding:
N/A: Not a repeat finding.
Recommendation:
Management should review its practices to ensure there are adequate review controls in place so only
allowable costs are allocated to federal programs. In addition, the funding received for the questioned
costs should be remitted back to the funder by the Organization.
Viewed of Responsible Officials and Planned Corrective Actions:
Please refer to The Food Trust’s Corrective Action Plan.
Pass-through Agency: National Institute of Food and Agriculture
Pass-through Number: 2019-70030-30412
Award Period: September 1, 2019 - August 31, 2022
Compliance Requirement Affected: Allowable Costs
Type of Finding:
Significant Deficiency in Internal Control over Compliance
Criteria:
2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for
Federal Award requires compliance with the provisions of allowable costs and allowable activities. The
Organization should have procedures in place to ensure federal funds are only expended on allowable
costs and allowable activities as dictated in the contract and budget of the program. Proper
documentation should be maintained and reviewed to support all transactions.
Condition:
The detail of the expenditures incurred for the program included a transaction for bad debt expense
which is not an allowable cost per the program budgets. In addition, there was funding drawn down by
the agency for this transaction.
Questioned Costs:
The Organization was reimbursed for $3,943 of unallowable costs.
Context:
During the review of program expenditure detail for the program, it was noted there was a transaction
for bad debt expense that was not included in the budget as an allowable cost.
Cause:
The Organization had several key finance management positions turnover several times beginning in
September 2019 through June 2021. There was an analysis performed by current management for this
program which determined there was expenses incurred in prior years however not recognized as
revenue until this reconciliation was performed in fiscal year 2022. This specific transaction was
expensed in the year ended September 30, 2021. The charging to the federal program was an
oversight by management.