2024-007 Federal Agencies: U.S. Department of Agriculture Federal Program Names: The Child Nutrition Cluster: National School Lunch Program Summer Food Service Program Child and Adult Care Food Program Assistance Listing Numbers: 10.555 10.559 10.558 Pass-Through Agency: Commonwealth of Pennsylvania, Department of Education Pass-Through Number: 359-46-477-8 Award Period: July 1, 2023 through June 30, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance Criteria: Under 2 CFR 200.332(d), pass-through entities must monitor the activities of subrecipients as necessary to ensure that the subaward is used for authorized purposes and in compliance with Federal statutes, regulations, and the terms and conditions of the subaward. Additionally, Child and Adult Care Program (CACFP), National School Lunch Program (NSLP) and Summer Food Service Program (SFSP) monitoring requirements established by the Pennsylvania Department of Education (PDE) require CBS Food Program to conduct meal observation reviews at each contracted center every six months, including at least two unannounced visits, and maintain documentation of such reviews. Condition: During our testing of subrecipient monitoring activities for PDE programs CACFP, NLSP, and SFSP, we selected 31 contracted centers at random. Management provided documentation for each site, including contracts, meal pattern usage records, licensure and training documentation, and both announced and unannounced meal observation reviews. However, we found that CBS Food Program did not always maintain sufficient evidence to prove required monitoring was performed under the CACFP program. For one center, management could not produce proof that meal observation reviews or the mandated two unannounced visits occurred. At another center, neither a contract nor any meal observation review records, including the two required unannounced visits, could be provided. For the NLSP and SFSP, management was unable to provide contracts for any of the seven sampled centers. Additionally, there was no evidence of training for one center, and a second center had a noncompliant monitoring visit; although corrective action was prepared, follow-up occurred only after 66 days instead of within the required 45-day window. Questioned Costs: None Cause: Management did not maintain sufficient internal controls to ensure required monitoring documentation was consistently obtained, retained, and reviewed for each contracted center. In some cases, monitoring activities may not have been performed, or they were completed but not properly documented. Effect: Failure to perform and/or document required monitoring procedures increases the risk that contracted centers may not comply with PDE CACFP, NLSP and SFSP requirements, potentially resulting in: • Noncompliance with federal monitoring requirements • Inaccurate or unsupported program reimbursements • Risk of disallowed costs or questioned costs under the PDE CACFP, NLSP, and SFSP grants • Inability to demonstrate program oversight during audits Recommendation: We recommend that management strengthen internal controls to ensure all required PDE CACFP, NLSP and SFSP subrecipient monitoring activities, including scheduled meal observations and the mandated unannounced visits—are consistently performed, documented, and retained. Management should implement a centralized tracking system to monitor review deadlines, required follow up actions, and receipt of supporting documentation from each contracted center. In addition, staff responsible for monitoring should receive periodic refresher training on PDE CACFP, NLSP and SFSP specific expectations. Finally, management should conduct periodic internal reviews to verify that monitoring documentation is complete, compliant, and appropriately maintained. Views of Responsible Officers and Corrective Action Plan: Please refer to Community Benefit Solutions dba CBS Food Program’s Corrective Action Plan.