REFERENCE: 2025-101 CFDA NUMBER: 10.558 – CHILD AND ADULT CARE FOOD PROGRAM U.S. DEPARTMENT OF AGRICULTURE - FOOD AND NUTRITION - 2025 PASSED THROUGH ARIZONA STATE DEPARTMENT OF EDUCATION GRANT NUMBER 6AZ300003 QUESTIONED COSTS N/A CONDITION The following errors were noted during testing of FDCH Site Claims and 18 Day Care Home provider files for the months of May 2025 and September 2025: 1. For 1 of 18 provider files tested, menus were clerically inaccurate and did not support the meals claimed in September 2025. 2. For 1 of 18 provider files tested, meals were claimed for the incorrect meal type. Afternoon Snacks were claimed rather than Evening Snacks. This error occurred during September 2025. 3. For 1 of 18 provider files tested, meals were incorrectly disallowed when a credible meal component was provided. This error occurred in May 2025. 4. For 1 of 18 provider files tested, meals were claimed when a child was not in attendance. This error occurred in May 2025. 5. For 2 of 18 provider files tested, although 3 monitoring visits were completed, documentation was not available to demonstrate that 2 of the visits were unannounced. 6. For 2 of 18 provider files tested, the five-day reconciliation on a sponsor monitoring visit was not completed. For 1 provider's visit the reconciliation was only completed for 4 days, and for the other provider there was no indication of the number of children signed in for any of the 5 days tested. These errors resulted in the following revised meal counts: These variances resulted in an under payment (known questioned costs) of $100. However, after projecting the various types of errors over six meal categories for the entire year, likely under reported costs totaled $5,531. CRITERIA In accordance with the Arizona Department of Education, Day Care Home Compliance Manual, Revised June 2019, Chapter 10, Meal Requirements, Section 10.7 Other Meal Requirements, in order to claim a meal, the provider must abide by the following criteria: • The provider must serve a fully reimbursable meal that meets the meal pattern requirements and are supported by complete and up to date attendance, meal count, and menu records; • The child must be present and participate in the meal service; • All meal components must be served together; • The meal must be fully consumed on the premises in a congregate setting. Meals sent home with a child due to the parent picking up the child during meal service cannot be claimed; • Meal must be served during approved meal service time; • The provider can be reimbursed for a maximum of two meals and one snack or two snacks and one meal per child, per day; • Only children who are enrolled can be claimed and the number of children cannot exceed the allowable ratio; • Payment may be made for meals served to provider’s own child(ren) or foster children only when: Their child(ren) are enrolled and participating in the child care program during the time of the meal service; At least one enrolled, non-resident child is present and participating in the child care program; The provider meets the family size income standards for free or reduced price meals; • Seconds may be served but are not reimbursable; and • If a school age child receives a breakfast, lunch or afterschool snack at school, a provider may not claim the same meal. In accordance with 7 CFR, Subtitle B, Chapter II, Subchapter A, Part 226, Subpart E Operational Provisions, §226.16 (d)(4)(ii) Reconciliation of meal counts. Reviews must examine the meal counts recorded by the facility for five consecutive days during the current and/or prior claiming period. For each day examined, reviewers must use enrollment and attendance records (except in those outside-school-hours care centers, at-risk afterschool care centers, and emergency shelters where enrollment records are not required) to determine the number of participants in care during each meal service and attempt to reconcile those numbers to the numbers of breakfasts, lunches, suppers, and/or snacks recorded in the facility's meal count for that day. Based on that comparison, reviewers must determine whether the meal counts were accurate. If there is a discrepancy between the number of participants enrolled or in attendance on the day of review and prior meal counting patterns, the reviewer must attempt to reconcile the difference and determine whether the establishment of an overclaim is necessary. In accordance with 7 CFR, Subtitle B, Chapter II, Subchapter A, Part 226, Subpart E Operational Provisions, §226.16 (d)(4)(iii), Frequency and type of required facility reviews. Sponsoring organizations must review each facility three times each year, except as described in paragraph (d)(4)(iv) of this section. In addition: (A) At least two of the three reviews must be unannounced; (B) At least one unannounced review must include observation of a meal service; (C) At least one review must be made during each new facility's first four weeks of Program operations; (D) Not more than six months may elapse between reviews; (E) The timing of unannounced reviews must be varied so that they are unpredictable to the facility; and (F) All types of meal service must be subject to review and sponsoring organizations must vary the meal service reviewed. In accordance with the Uniform Guidance, Compliance Supplement, Part 6 – Internal Control, 2 CFR section 200.303 requires that recipients and subrecipients receiving federal awards establish, document and maintain effective internal control over the federal awards that provides reasonable assurance that the recipient or subrecipient is managing the federal awards in compliance with federal statutes, regulations, and the terms and conditions of the federal awards. EFFECT Program requirements were not complied with. Additionally, meal reimbursements were clerically inaccurate and the providers were incorrectly reimbursed. CAUSE Although the internal controls were adequately designed, there were deficiencies in the execution of the controls. Most menu errors occurred on paper menus, which have a higher risk of errors. RECOMMENDATION AND BENEFIT Menus should be reviewed to ensure all eligible meals are claimed, and provider meal count sheets should be reviewed for clerical accuracy and completion prior to the preparation of the reimbursement claim. Additionally, monitoring visits should be reviewed to ensure that all required information is properly included, including completion f the five day reconciliations and indication if the review is unannounced and . These reviews should be documented. This will help ensure that program requirements are complied with and only eligible meals served to eligible participants are claimed for reimbursement. VIEWS OF RESPONSIBLE OFFICIALS See Corrective Action Plan.