Finding 375771 (2023-003)

Federal Agency - United States Department of Agriculture Federal Program - Child Nutrition Cluster (10.553, 10.555) Federal Award Years - 2023 State Agency - Department of Education Reference - 2023-003 Criteria - Management is responsible for maintaining accurate accounting records, including the tracking of state and federal grants. Condition - Significant changes occurred in the District staffing during the year resulting in delays in reconciling asset and liability accounts in the school lunch fund, and therefore, the accounting records did not accurately reflect appropriate balances of the state and federal grants receivable, including the amounts reported on the schedule of expenditures of federal awards. Cause - The District’s change in staffing caused the controls over reconciling asset and liability accounts to not operate as designed. Effect of Condition - Audit adjusting journal entries were recorded amounting to $1,063,327 of federal awards that was previously excluded from the District’s schedule of expenditures of federal awards and the school lunch fund. Questioned Costs - None. Perspective - Two of the twelve months of child nutrition reimbursements were not accounted for in the school lunch fund or schedule of expenditures of federal awards. Audit adjusting journal entries were recorded to properly report the grants. Recommendation - We recommend that significant asset and liability accounts be reconciled at year-end to ensure accounting records accurately reflect appropriate balances. Views of Responsible Officials and Planned Corrective Actions - (a) Comments on the finding and recommendation: The District agrees with the finding. The District also agrees with the recommendation. See below for actions taken. (b) Actions Taken: Management will reconcile significant asset and liability accounts, including state and federal receivables, at year end to ensure accounting records accurately reflect appropriate balances. (c) Anticipated Completion Date: Management anticipates this finding will be resolved by June 30, 2024.