Finding 32932 (2022-001)

Significant Deficiency
Requirement
C
Questioned Costs
-
Year
2022
Accepted
2023-06-29

AI Summary

  • Core Issue: Day Care Home Sponsors failed to follow up on checks outstanding for over nine months, violating management guidelines.
  • Impacted Requirements: Compliance with Nutrition Services Division Management Bulletin No. NSD-CACFP-05-2007 regarding timely provider payments.
  • Recommended Follow-up: Implement a monitoring system to track outstanding checks and ensure timely follow-up with providers.

Finding Text

2022-001 CACFP ? Cash Management ? Significant Deficiency Criteria: Day Care Home Sponsors are required by Nutrition Services Division Management Bulletin No. NSD-CACFP-05-2007 to make adequate attempts to locate a provider when a check is issued to a provider and is outstanding more than nine months. Condition: Provider checks are outstanding more than nine months without being reissued. Questioned Costs: None. Effect: Provider payments are not being received in a timely manner. Context: We reviewed the outstanding checks for the 2021-2020 fiscal year. At year end there were nine outstanding checks identified, issued between October 2020 through December 2021, that had not cleared the bank. Cause: The Sponsor agency did not monitor outstanding items and follow up with providers. Views of Responsible Officials: Management agrees with the finding.

Corrective Action Plan

Corrective Action Plan Oxnard Pathway to Educated Nutrition, Inc. CNIPS ID# 05035 VENDOR # X278-00 Corrective Action Plan for Year Ending September 30, 2022 Oxnard Pathway to Educated Nutrition, Inc. respectfully submits the following corrective action plan for the fiscal year ending September 30, 2022. Findings: 2022-001 CACFP-Cash Management Provider checks outstanding without being reissued, payments not being received in a timely manner, not monitoring outstanding checks and follow up with providers. Reason: Fraud was found on our provider account. The account was closed in May 2022. New provider account opened May 2022. Oversight on our part by not referring back to uncleared checks on bank reconciliations in closed account. Action Taken: Payments were made as soon as we were able to verify that the checks were actually uncleared. The funds were sent via direct deposit to the providers that were found outstanding during our audit. A copy of those payments was sent to the auditors. Corrections: Provider Account- Our agency no longer issues paper checks to our providers. All providers receive their reimbursements via direct deposit. Providers are required to fill out an authorization form with their banking information giving us permission to deposit into the account listed on the form. If funds are returned due to incorrect banking information, the provider is contacted and made aware of the return. The money is redeposited into their account once the current banking information is received. A new updated authorization form is required to be sent in to keep on file. We monitor our accounts online frequently to ensure that any returned funds get resolved and reissued immediately. Administrative Costs Account- Our agency still issues paper checks to pay all administrative costs monthly. Between 8-12 checks are issued during the month. We monitor our account online and check off as each check clears. If a check has not cleared by the last week of the month, we will call the payee to verify receipt of check. If check has not been received, we will issue a stop payment on the check and reissue as soon as possible. Our CPA flags any uncleared checks or direct deposits that are outstanding when reconciling our accounts. Hard copies of the reconciliations are given to the director for review and to keep on file. The CPA is required to make the director immediately aware upon finding an outstanding check/direct credits via phone call or verbally in person.

Categories

Cash Management Significant Deficiency

Other Findings in this Audit

  • 609374 2022-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
10.558 Child and Adult Care Food Program $2.13M