Finding 5664 (2023-001)

Material Weakness
Requirement
E
Questioned Costs
$1
Year
2023
Accepted
2023-12-20

AI Summary

  • Core Issue: The District provided free or reduced meals to students without current applications, potentially affecting eligibility.
  • Impacted Requirements: Federal guidelines require that only eligible students receive free or reduced meals based on approved applications.
  • Recommended Follow-Up: Implement controls to ensure all free and reduced students have valid applications or are switched to full pay status in the system.

Finding Text

Federal Program: Child Nutrition Cluster ALN #: 10.553 and 10.555 Federal Agency: U.S. Department of Agriculture Pass-through entity: Michigan Department of Education Pass-through number: 220910, 221960, 231960, 221970, 231970 Criteria: According to Federal guidelines, all free and reduced priced meals claimed for reimbursement will be served only to eligible students based on direct certifications and applications submitted by families, which are reviewed and approved by District personnel, according to annually adjusted income thresholds. Condition: During our auditing testing, we noted instances where free or reduced students did not have a current application on file with the District. Typically, the software used by the District would give a 30 day grace period for not having an application and then change the student in the system to being full pay, until an application was submitted. At the start of the year, the District switched software and the software did not automatically change the students to full pay status. This only affected one school building in the District, as the other buildings in the District were under the Community Eligibility Provision (CEP). CEP buildings do not have to use the normal free and reduced application process. Cause: The District failed to follow up on free and reduced students who did not submit new applications for the current year. The District did not have proper internal controls over eligibility. Effect: As a result, the District provided free or reduced priced meals to students who may not have been eligible to receive them. Questioned Costs: $2,295 - actual; $19,279- estimated amount when extrapolated Recommendation: We recommend that the District put in place controls to ensure that there is a process to verify the free and reduced students submit applications or be switched to full pay status in their software. District’s Response: The District concurs with the facts of this finding and will put procedures in place to verify that free and reduced students all have applications on file and properly qualify for that status.

Corrective Action Plan

Recommendation: The District should put into place internal controls that ensure there is a process to verify the free and reduced students submit applications or be switched to full pay status in their software. Action to be taken: The District concurs with the finding and will put procedures in place to verify that free and reduced students all have applications on file and properly qualify for that status.

Categories

Questioned Costs School Nutrition Programs Subrecipient Monitoring Cash Management Eligibility Internal Control / Segregation of Duties

Other Findings in this Audit

  • 5665 2023-001
    Material Weakness
  • 5666 2023-001
    Material Weakness
  • 5667 2023-001
    Material Weakness
  • 5668 2023-001
    Material Weakness
  • 5669 2023-002
    Significant Deficiency
  • 5670 2023-002
    Significant Deficiency
  • 5671 2023-002
    Significant Deficiency
  • 5672 2023-002
    Significant Deficiency
  • 5673 2023-002
    Significant Deficiency
  • 582106 2023-001
    Material Weakness
  • 582107 2023-001
    Material Weakness
  • 582108 2023-001
    Material Weakness
  • 582109 2023-001
    Material Weakness
  • 582110 2023-001
    Material Weakness
  • 582111 2023-002
    Significant Deficiency
  • 582112 2023-002
    Significant Deficiency
  • 582113 2023-002
    Significant Deficiency
  • 582114 2023-002
    Significant Deficiency
  • 582115 2023-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
10.555 National School Lunch Program $402,169
84.027 Special Education_grants to States $392,290
84.425 Education Stabilization Fund $366,869
84.010 Title I Grants to Local Educational Agencies $252,568
10.553 School Breakfast Program $229,670
84.367 Improving Teacher Quality State Grants $37,921
84.424 Student Support and Academic Enrichment Program $7,557
10.649 Pandemic Ebt Administrative Costs $628