Finding 46944 (2022-003)

Significant Deficiency Repeat Finding
Requirement
L
Questioned Costs
-
Year
2022
Accepted
2023-01-02
Audit: 45879
Organization: Edgar School District (WI)

AI Summary

  • Core Issue: There is a significant deficiency in internal controls due to a lack of proper segregation of duties in the Child Nutrition Cluster claims process.
  • Impacted Requirements: Compliance with reporting requirements is compromised, as claims submitted by the Food Service Director were not reviewed by another employee.
  • Recommended Follow-Up: Implement a review process for claims to ensure compliance and prevent errors or fraud, addressing the repeat finding from the previous year.

Finding Text

Federal Agency: U.S. Department of Agriculture Federal Program Title: Child Nutrition Cluster Assistance Listing Number: 10.553 and 10.555 Pass-Through Agency: Wisconsin Department of Public Instruction Pass-Through Entity Identifying Number: 2022-371561-DPI-SB-546, 2022-371561-DPI-NSL-547, Unknown Award period: July 1, 2021 ? June 30, 2022 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria or Specific Requirement: Segregation of duties is an internal control intended to prevent or decrease the occurrence of errors or intentional fraud. Segregation of duties ensures that no single employee has control over all phases of a transaction. Compliance Requirements: Reporting. Condition: The Food Service Director is responsible for preparing and submitting claims related to the Child Nutrition Cluster. For a portion of the year, there was no review or verification by someone other than the Food Service Director that the claims appeared accurate and complete. Accordingly, this does not allow for a proper segregation of duties for internal control purposes. Questioned Costs: None. Context: When identifying internal controls over compliance related to reporting (reimbursement requests), it was noted that two out of the six reports tested did not have proper reviews on the claim by someone other than the preparer. Cause: The lack of segregation of duties is due to the limited number of employees and the size of the District?s operations. In addition, the District had not initially completed a formal risk assessment and review of internal controls to identify additional mitigating and compensating controls at the beginning of the fiscal year which lead to a portion of reports not being reviewed. Effect: Errors or intentional fraud could occur and not be detected timely by other employees in the normal course of their responsibilities as a result of the lack of segregation of duties. Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2021-003. Recommendation: We recommended that the District implement a review process over the reporting requirements related to the Child Nutrition Cluster during the fiscal year. Views of Responsible Officials: There is no disagreement with the audit finding.

Categories

Subrecipient Monitoring Internal Control / Segregation of Duties Cash Management HUD Housing Programs Reporting School Nutrition Programs Significant Deficiency

Other Findings in this Audit

  • 46942 2022-003
    Significant Deficiency Repeat
  • 46943 2022-003
    Significant Deficiency Repeat
  • 623384 2022-003
    Significant Deficiency Repeat
  • 623385 2022-003
    Significant Deficiency Repeat
  • 623386 2022-003
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
84.425 Education Stabilization Fund $176,065
84.010 Title I Grants to Local Educational Agencies $112,180
10.553 School Breakfast Program $106,667
93.778 Medical Assistance Program $49,223
10.555 National School Lunch Program $37,327
84.358 Rural Education $32,941
84.027 Special Education_grants to States $27,981
84.367 Improving Teacher Quality State Grants $17,471
84.424 Student Support and Academic Enrichment Program $11,581
32.009 Emergency Connectivity Fund Program $6,000
84.048 Career and Technical Education -- Basic Grants to States $4,217
84.173 Special Education_preschool Grants $3,173