Finding Text
Finding 2023‐005—Allowability—MATERIAL WEAKNESS IN INTERNAL CONTROLS OVER COMPLIANCE Federal Program: Emergency Food Assistance Program (Administrative Costs) & The Emergency Food Assistance Program (“TEFAP”) (Food Commodities)—Food Distribution Cluster Assistance Listing Number: 10.565, 10.568 and 10.569 Year(s): 2023 Federal Agency: US Department of Agriculture (USDA) Pass‐Through Agencies: State of CA Department of Social Services, Second Harvest of Silicon Valley, San Francisco Marin Food Bank and CAPK Food Bank. Criteria—In accordance with 2 CFR 200.502(g), Federal non-cash assistance food commodities received as part of a Federal award to carry out a Federal program must be valued at fair market value at the time of receipt or the assessed value provided by the Federal agency and must be included in determining Federal awards expended under this part. Condition and Context—We selected 60 food commodity delivery receipts to sub-recipients (Sub—ERA’s) for testing; 11 selections did not have evidence of review, indicating a gap in the related internal controls. The delivery receipt includes the quantity of the food commodities distributed to sub-recipients. The monetary value of those food commodities is included in the Schedule. We also made 2 sign-in-sheet selections which contained the quantity of food commodity items that were distributed which were then used to populate the Schedule. The 2 sign-in-sheet selections did not have evidence of review. The monetary value of those food commodities is then included in the Schedule. Cause—Management did not have a control in place to ensure that evidence pertaining to the of review of the distribution of the food commodity items were required to be maintained. Effect—Lack of sufficient and appropriate recordkeeping can lead to food theft or misuse as well as incorrect information being communicated to the grantor which may lead to the eventual cessation of grant funding. Questioned Costs—None. Repeat Finding from Prior Year—Yes. Recommendation—We recommend that management implements a control to ensure that proper evidence of review is maintained. View of Responsible Officials—See Corrective Action Plan.