Finding 450 (2023-003)

Lack of Proper Review – Reporting, Eligibility, and Suspension and Debarment Federal Agency: U.S. Department of Agriculture Federal Program Name: Child Nutrition Cluster Assistance Listing Number: 10.553 and 10.555 Federal Award Identification Number and Year: 212MN061N1199 - 2023 Pass-Through Agency: Minnesota Department of Education Pass-Through Number(s): 1-2174-000 Award Period: July 1, 2022 - June 30, 2023 Type of Finding: • Material Weakness in Internal Control over Compliance Criteria or Specific Requirement: The District should have controls in place to ensure the accuracy of all draws for the District's Child Nutrition Cluster program, made via the reporting of meal counts in CLiCS. The District should have controls in place to ensure the accuracy of all eligibility applications. The District should have controls in place to review vendors showing they are not excluded or debarred for participating in procurement transactions that use federal funds. All controls should be formally documented to ensure they have been properly implemented. Condition: During report testing, it was noted that five out of five reports tested did not contain documentation of review and approval of the District's CLiCS meal count reports prior to submission. During eligibility testing, it was noted that the paper applications did not contain documentation of review and approval for the applicants final determination into the program. During suspension and debarment testing, it was noted that the review process was not operating effectively as there was no support for review of certification regarding debarment, suspension, and responsibility for two of two vendors tested. Questioned Costs: Not applicable. Context: Five of five reports tested had no review and approval process completed, all paper applications have no review and approval, and two of two vendors tested has no review support to ensure they were not suspended or debarred. The samples were statistically valid samples. Cause: Oversight. Effect: Lack of proper documentation of controls over compliance with reporting, eligibility and suspension and debarment requirements could result in incorrect meal counts being reported, going undetected or not being caught in a timely manner, errors or intentional misrepresentation of the applicants eligibility into the program and paying suspended or debarred vendors. This could ultimately result in questioned costs. Repeat Finding: Not applicable Recommendation: We recommend the District review and approve the CLiCS meals counts timely before they are submitted, review the paper applications, and implement procedures to ensure vendors are not suspended or debarred. The District should ensure that these controls are properly documented. Views of Responsible Officials: There is no disagreement with the audit finding.