Finding 528777 (2024-002)

Material Weakness
Requirement
N
Questioned Costs
-
Year
2024
Accepted
2025-03-19

AI Summary

  • Core Issue: There are significant discrepancies in inventory reporting for USDA Foods due to a lack of review processes.
  • Impacted Requirements: Annual physical inventories and monthly reporting criteria for the Emergency Food Assistance Program were not met accurately.
  • Recommended Follow-Up: Implement a review process for inventory counts to ensure accuracy and compliance with reporting requirements.

Finding Text

Finding 2024-002: Special Tests and Provisions—Accountability for USDA Foods—Material Weakness in Controls over Compliance and Noncompliance Federal Program: Emergency Food Assistance Program (Food Commodities)—ALN 10.569 Year(s): 2024 Federal Agency: U.S. Department of Agriculture (USDA), Food, and Nutrition Services Contract—D-125, The Salvation Army, Reno Pass-Through Entity: Nevada Department of Agriculture Criteria—Agencies must conduct an annual physical inventory of all storage facilities used by the distributing agency or by a sub distributing agency. Such inventory must be reconciled annually with the storage facility’s inventory records and maintained on file by the agency that contracted with or maintained the storage facility. The Del Oro Reno Division (the Division) is required to submit monthly inventory reports of all The Emergency Food Assistance Program (TEFAP) USDA donated foods on hand at their own or contracted facility to the Contracted Regional Agency monthly. The report shall indicate for each TEFAP UDSA donated food item: the commodity description, inventory on hand, inventory received for the month, total available for the month, total distributed, total delivered to another agency, inventory adjustments and ending inventory for the month. Condition—We selected 4 of the 12 monthly reports to test the Division’s inventory process. The inventory was counted monthly and submitted to the grantor as required. However, there was no evidence of the review over the count process and the finalized inventory sheets that were submitted to the grantor. Further in the sampled reports, the following findings were noted. Month Selected Finding January 2024- Total cases received per delivery report was 1,192 whereas the total cases recorded in the report was 1,160. The discrepancy of 32 cases was a result of human error. April 2024/ August 2024 -The total cases distributed is calculated as Beginning Cases plus Cases received minus the cases in ending inventory at the end of the month. There was a mathematical error in the above process which led to a discrepancy of 10 cases in the April 2024 report and discrepancy of 26 cases inthe August 2024 report. September 2024 -This report contained inventory items that were donated by other sources and not a part of the Emergency Food Assistance Program. Cause—The lack of review over the inventory process. The inventory count sheets should be reviewed for accuracy and completed by personnel not performing the count. Effect—As a result of a lack of proper review, the Division had discrepancies in the inventory management and tracking process. Recommendation—We recommend the Division implement a review process to ensure the accuracy of the inventory management and reporting process. Views of the Responsible Officials—See Corrective Action Plan

Corrective Action Plan

Corrective Action Plan: The Division will implement a review process to ensure the accuracy of the inventory management and reporting process. Anticipated Date: April 2025 Name of Person Responsible for Implementation: Al Agpoon, Controller

Categories

Equipment & Real Property Management Special Tests & Provisions Subrecipient Monitoring Material Weakness Reporting School Nutrition Programs

Other Findings in this Audit

  • 528778 2024-002
    Material Weakness
  • 528779 2024-003
    Significant Deficiency
  • 1105219 2024-002
    Material Weakness
  • 1105220 2024-002
    Material Weakness
  • 1105221 2024-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
21.027 Coronavirus State and Local Fiscal Recovery Funds $877,372
93.575 Child Care and Development Block Grant $310,493
10.569 Emergency Food Assistance Program (food Commodities) $91,270
14.231 Emergency Solutions Grant Program $72,413
93.596 Child Care Mandatory and Matching Funds of the Child Care and Development Fund $54,661
10.559 Summer Food Service Program for Children $26,093
14.218 Community Development Block Grants/entitlement Grants $14,500
93.569 Community Services Block Grant $9,333
97.024 Emergency Food and Shelter National Board Program $3,000
10.558 Child and Adult Care Food Program $1,674