Finding Text
Criteria: According to 7 CFR Section 210.14(a), a school food authority shall maintain a nonprofit school food service. In addition, 7 CFR Section 210.14(b) states that the school food service authority shall limit its net cash resources to an amount that does not exceed three months' average expenditures for its nonprofit school food service. Condition: The District has food service net cash resources in excess of the three month average expenditure carryover limit. Questioned Costs: None. Context: The District has net cash resources of $262,147, and the three month average expenditures is $64,983, resulting in excess net cash resources of $197,164. Effect: The District has earned $197,164 in its food service program in excess of what is allowed. Cause: The District was previously unaware of the requirements, and was not charging all of the expenditures allowable to operate the food service program to the program. Recommendation: We recommend that the District monitor the profit made by the food service program. All allowable expenditures used to operate the program should be charged to the program. In addition, the District needs to adopt a plan to spend the accumulated cash reserves. Management's Response: The cafeteria will be billed indirect cost items based on the rate provided by the Illinois State Board of Education. The cafeteria will also make a plan to spend the carryover amount.