Finding 1205345 (2025-001)

Material Weakness Repeat Finding

Requirement

Questioned Costs

Year

2025

Accepted

2026-03-31

Audit: 397048

Organization: Independent School District No. 548 (MN)

Auditor: EIDE BAILLY

AI Summary

Core Issue: Region Schools lack a system to retain Direct Certification documentation for eligible students, which is crucial for compliance.
Impacted Requirements: Proper internal controls require maintaining documentation to verify student eligibility for the National School Lunch and School Breakfast Programs.
Recommended Follow-Up: Management should implement a process to ensure all Direct Certification documents are retained in student files for future audits.

Finding Text

2025-001 U.S. Department of Agriculture Child Nutrition Cluster Federal Financial Assistance Listing #10.555 National School Lunch Program Federal Financial Assistance Listing #10.553 School Breakfast Program Eligibility Material Weakness in Internal Control Over Compliance Retention of Direct Certification Documentation Criteria: Proper controls over eligibility include the retention of Direct Certification documentation for all students eligible for the program within the student file. Condition: The Region Schools do not have an internal control system designed to retain the appropriate documentation related to direct certification from the State of Iowa (State). Cause: Each school location was not aware that documentation of direct certification needed to be maintained after the school year. Effect: Region Schools will not have documentation on hand to review by State or outside auditors to determine students were eligible for the program. Questioned Costs: None reported. Context/Sampling: A nonstatistical sample of 75 participants out of 784 participants were selected for eligibility testing. Repeat Finding from Prior Years: No Recommendation: We recommend management retain all Direct Certification information within the file for the students eligible to participate in the program. Views of Responsible Officials: Management agrees with the finding.

Corrective Action Plan

Finding 2025-001 Federal Agency Name: U.S. Department of Agriculture Program Name and FALN # : Child Nutrition Cluster Federal Financial Assistance Listing #10.555 National School Lunch Program Federal Financial Assistance Listing #10.553 School Breakfast Program Finding Summary: The Region Schools do not have an internal control system designed to retain the appropriate documentation related to direct certification from the State of Iowa (State). Responsible Individuals: Bryan Jordan, Controller Corrective Action Plan: The Region Schools will retain all Direct Certification information within the file for the students eligible to participate in the program going forward. Anticipated Completion Date: Fiscal year ended June 30, 2026

Other Findings in this Audit

1205343 2025-001

Material Weakness Repeat
1205344 2025-001

Material Weakness Repeat
1205346 2025-002

Material Weakness Repeat
1205347 2025-002

Material Weakness Repeat
1205348 2025-002

Material Weakness Repeat
1205349 2025-003

Material Weakness Repeat
1205350 2025-003

Material Weakness Repeat
1205351 2025-003

Material Weakness Repeat

Programs in Audit

ALN	Program Name	Expenditures
10.555	NATIONAL SCHOOL LUNCH PROGRAM	$628,865
10.553	SCHOOL BREAKFAST PROGRAM	$74,617
10.582	FRESH FRUIT AND VEGETABLE PROGRAM	$11,949