Finding Text
ALLOWABLE COSTS Federal Agency: Department of Agriculture Federal Program or Cluster: Child Nutrition Cluster Assistance Listing Number: 10.553, 10.555, and 10.559 Federal Award Numbers and Years: Award Periods 7/1/2021-6/30/2022: K241 Questioned Costs: $10,159 Condition: The School did not maintain proper supporting documentation for expenses, including those claimed under the major federal program. These expenses include employee reimbursements. Criteria: The School must establish and maintain effective internal controls over federal awards that provide reasonable assurance that the non-federal entity is managing federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Cause: The School has not properly implemented a system of internal control over disbursements. Effect: The Food Service program revenue is based on meals served, but allowable costs affect the food service bank balance which is restricted for food service program expenses only. Spending funds on unrelated School expenses could result in the grantor not approving the School to operate the program in the next school year. Asset misappropriation could occur if supporting documentation is not required and approved before funds are disbursed. Recommendation: The School should establish and maintain effective internal controls over federal awards that require proper documentation to be maintained on file to support the purpose and amount of all expenditures of federal awards. Identification of repeat findings: This is not a repeat finding. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and has established a monthly meeting between the Business Manager and the Cafeteria Director in order to review the monthly budget and ascertain that all appropriate expenses are disbursed only for the federally funded department. The Business Manager has implemented these changes. The School represents that this was completed during the fiscal year ended June 30, 2023, however, a single audit has not been conducted for this period.