Finding Text
Internal Controls Systems and Compliance Over Special Tests and Provisions (Accountability for USDA Foods) - U.S. Department of Agriculture Food Distribution Cluster, Passed Through the State of Nevada Department of Agriculture Criteria: In accordance with 2 CFR 200.62(c), the auditee must maintain a system of internal control to provide reasonable assurance that federal commodities are safeguarded against unauthorized disposition. Condition: During the year, Three Square distributed TEFAP commodities to 4 Agency Partners for which TEFAP Agency Partner Services Agreements were unable to be produced. Further, management was unable to produce evidence of compliance with warehousing accountability requirements for those Agency Partners improperly distributed to. Context: The TEFAP Agency Partner Services Agreement communicates to the Agency Partner specific requirements related to accountability for TEFAP commodities. Without a signed Agreement, the Agency Partner may be unaware of the federal compliance requirements related to these commodities which could result in noncompliant handling of USDA food product. Effect: Improper distribution of federal commodities could result in material noncompliance with the terms and conditions of the federal award. Cause: The design and implementation of internal controls over special tests and provisions (accountability for USDA foods) was not effective. Recommendation: We recommend management design and implement a system whereby a fully executed TEFAP Agency Partner Services Agreement is obtained prior to any TEFAP distribution being made to an Agency Partner.