Finding Text
Federal Agency: U.S. Department of Agriculture
Federal Program Name: Child Nutrition Cluster
Assistance Listing Number: 10.553, 10.555, 10.555C, 10.559
Federal Award Identification Number and Year: 202020N109942, 22MIN061N1199
Pass-Through Agency: Minnesota Department of Education
Pass-Through Numbers: Unknown
Award Period: Fiscal Year 2023
Type of Finding:
• Material Weakness in Internal Control over Compliance
• Other Matters
Criteria: The District should have controls in place to ensure compliance per the requirements of 2 CFR §200.303. The Uniform Guidance requires that when a non-federal entity enters into a covered transaction with an entity at a lower tier, the non-federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by either checking the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA), collecting a certification from the entity, or adding a clause to the covered transaction with the entity.
Condition: The School District did not perform the required verification procedures for two Child Nutrition Cluster covered transactions prior to entering into the contracts. The District did complete the verification procedures before entering into the related contracts, but the District did complete the procedures a few months after the contracts were awarded.
Context: Of two covered transactions tested in the Child Nutrition Cluster, it was noted that the District did not perform the required verifications for either of the two covered transactions before entering into the related contracts.
Questioned Costs: None
Cause: Nutrition Services has limited ability to obtain food and materials due to supply chain issues.
Effect: The District could have entered into a covered transaction with an entity which was suspended or debarred without realizing it.
Repeat Finding: Yes – 2022-003
Recommendation: We recommend that the District follow its procurement policies as well as requirements within the Uniform Guidance to perform the proper verification procedures on all covered transactions entered into with federal funds.
View of Responsible
Official: There is no disagreement with the audit finding.