Finding Text
2023-007 U.S. Department of Agriculture, For the period July 1, 2022 through June 30, 2023, Assistance Listing #10.553, 10.555, 10.556, 10.559, and 10.582 - Internal Controls over Child Nutrition Cluster
Criteria: The School Department receives federal reimbursement for free and reduced price meals provided to children at established reimbursement rates. Monthly claims for reimbursement must be based on lunch counts taken daily at the point of service, which correctly identify the number of free, reduced price, and paid lunches served to eligible students.
In addition, the School Department participates in the Fresh Fruit and Vegetable Program which provides reimbursement of fresh fruit and vegetable purchases and related operational program costs. Charges for salaries and wages to the program must be based on records that accurately reflect the work performed.
Condition: The April claim reimbursement form overstated breakfast meal counts by 1,000 meals, which comprised 7% of total meals claimed. In addition, operational and administrative payroll costs charged to the Fresh Fruit and Vegetable Program were based on estimated hours worked, rather than actual time and effort records.
Cause: The Business Manager approves all monthly claims in the CNPWeb system prior to submission to the State. However, the School Department does not have a policy to provide supporting claim documentation to the Business Manager to verify the accuracy of the monthly claim. In addition, the School Department does not have policies and procedures that provide reasonable assurance that payroll charges to the Fresh Fruit and Vegetable Program are accurate, allowable, and properly allocated.
Effect: Errors in monthly claims may not be detected and corrected in a timely basis resulting in potential questioned costs. Unsupported payroll charges may not meet cost principal requirements resulting in potential questioned costs.
Recommendation: We recommend the School Department establish policies and procedures that ensure the Business Manager has adequate supporting documentation to verify monthly nutrition claims before they are submitted to the State. We also recommend that policies and procedures be established to ensure employees allocating their time to the Fresh Fruit and Vegetable Program complete documentation as required by 2 CFR 200.430(i).
Likely Questioned Costs: None.