Finding Text
Noncompliance and Significant Deficiency in Internal Control Over Compliance 2025-001 Meals claimed for reimbursement that were served on dates not approved by the State Agency. U.S. Department of Agriculture Child Nutrition Cluster - Summer Food Service Program for Children (SFSP) – AL #10.559 TN Department of Human Services Grant #175TN331N1099 Compliance Requirement – Eligibility Condition: The Organization operates multiple Summer Food Service Program (SFSP) sites across the States of Tennessee and Mississippi. During our audit, we identified meals that were served on dates not approved by the State agency. Although the participants were eligible and properly documented, the meals served on the unapproved date were included in the reimbursement claim submitted to the State. Criteria: The Summer Food Service Program Administration Guide 2024 (current guidance for 2025), Unit 3: Administering the Summer Food Service Program and 7 CFR Part 225 states that sponsors may claim reimbursement only for eligible meals served in accordance with approved meal service times and approved dates of operation. Meals served outside approved dates of operation are not eligible for reimbursement, and meals served outside approved meal service times are only allowed when the State agency approves an exception due to an unanticipated event outside the sponsor's control. Cause: The Organization lacked sufficient internal controls to ensure that meals were served only on dates authorized by the State agency. Effect: As a result, the Organization claimed reimbursement for meals that were not eligible under program requirements. The total questioned costs amounted to approximately $52,556, calculated as follows: 5,617 breakfast meals * $3.09 = $17,342 6,518 lunch meals * $5.40 = $35,214 Context: During the 2025 program year, two selected sites – Campus Elementary and Smart Stars Enrichment Center - served meals on June 10, 2025, despite the approved operating period beginning on June 13, 2025, as authorized by the Tennessee Department of Human Services. No formal request to extend the operating dates was submitted, and no written approval was received prior to meal service. The Organization included these meals in its reimbursement claim, believing it was acting in good faith to meet community needs. However, the absence of documented approval rendered the meals ineligible for reimbursement. A sample of 40 meal count forms for various dates and locations were selected for testing. 2 out of the 40 selections consisted of meals served on an unapproved date, totaling 203 breakfast meals and 207 lunch meals served, with questioned costs of $1,745. A comparison of the State approved site listing with the Organization’s meal service summary revealed 18 additional sites that also served meals prior to the approved beginning date. These sites accounted for 5,414 breakfast meals and 6,311 lunch meals served, with questioned costs of $50,811. Instances were spread across the period of June 2, 2025 through June 30, 2025, resulting in a total of 5,617 breakfast and 6,518 lunch meals improperly claimed, totaling $52,556 in disallowed meals. An audit adjustment was made to reduce SFSP revenue by this amount. These funds will be returned to the State and excluded from the Schedule of Expenditures of Federal Awards and State Financial Assistance. See the chart on the following page and management’s corrective action plan. The locations and unapproved dates of service resulting in known questioned costs are as follows: Recommendation: We recommend the Organization strengthen internal controls over scheduling and monitoring of meal services to ensure that meals are served and claimed only on State approved dates and times. One potential control includes requiring site supervisors to document approved site details, including location, service period, operating dates, and meal times, on each meal count form prior to initiating meal service. Management’s Response: See accompanying management’s corrective action plan.