Finding 366672 (2022-003)

Reference No.: 2022-003 Program: U.S. Department of Agriculture; Passed through Alabama Department of Education; Child and Adult Care Food Program (CACFP), Assistance Listing #10.558, for 1/1/2020 through 12/31/2021. Criteria: The Uniform Guidance in 2 CFR Section 200.303 requires that non-Federal entities receiving Federal Awards establish and maintain internal control designed to reasonably ensure compliance with Federal Statutes, regulations, and the terms and conditions of the Federal award. Condition: The Club was unable to adhere to accrual accounting as it pertains to providing a list of expenses for the year for our testing. Adjustments were proposed to correct the list of expenses. Context: This is a condition identified per review of the Club’s compliance with specified requirements using a statistically valid sample. Effect: Without adequate controls in place to ensure financial reports are properly reported to the state, the reimbursements requested for the program could be over-stated or under-stated. Cause: Policies and procedures were not in place to adjust expenditures monthly from cash to accrual basis. Repeat of a Prior-Year Finding: No Recommendation: Additional reviewing should be added to the procedures performed monthly to ensure all adjusting entries have been made. View of Responsible Officials: The Club and management agree with this finding.