Finding Text
Criteria:
Districts are required by the Texas Department of Agriculture to obtain prior approval for the purchase of capital assets (equipment) with a cost of $5,000 or greater.
Condition:
The district failed to obtain the prior approval for the purchase of 8 equipment items. As listed below for a total of $134,020.
$7,522.00 HVAC
8,900.00 Humidified Holding Cabinet
26,241.50 Heat Pump System
26,241.50 Heat Pump System
26,241.50 Heat Pump System
26,241.50 Heat Pump System
6,301.00 Ice Machine
6,301.00 Ice Machine
$134,020.00
Cause:
Management did not have clear job duties established as to who was responsible for obtaining the approval. The staff of the District were not properly educated on the requirements of the program. The internal controls of the district were not effectively designed and implemented to mitigate the risk of non-compliance.
Effect:
The District is at risk of being required to cover the cost of assets purchased without approval from resources of the general fund or the capital projects fund. The District was not incompliance with the rules related to procurement for the National School Lunch and Breakfast Program as administered by the Texas Department of Agriculture.
Questioned Cost Identified: $134,020