Finding Text
Type of Finding: SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL COMPLIANCE AND OTHER MATTERS ? CHILD NUTRITION CLUSTER Condition: During our audit we noted no formal record was retained of a comparison of rates or prices for a Region 1 hosting service charged to the Food Service Fund. We also noted that the invoice was incorrectly coded to the Food Service Fund and was subsequently moved to the General Fund. Criteria: The School should have controls in place to ensure compliance with procurement requirements of the Child Nutrition Cluster programs. This includes approving all purchases and performing a cost or price analysis in connection with every procurement action in excess of the Simplified Acquisition Threshold including contract modifications. The method and degree of analysis is dependent on the facts surrounding the particular procurement situation, but as a starting point, the non-Federal entity must make independent estimates before receiving bids or proposals. Effect: There was a procurement purchase made that did not have proper documentation retained to document the cost analysis performed. The purchase was also determined to not be allowable for the Food Service Fund. Cause: The School booked the reversal of a prepaid expenditure from fiscal year 2021 into the Food Service Fund, when it should have been booked into the General Fund. This was not caught during the year-end reconciliation process, journal entry approval process, or procurement process. Questioned costs: $5,512 ? Known Questioned Costs Context: One of the two contracts tested did not have supporting documentation following procurement guidelines, and also wasn?t allowable per the grant. The sample was a statistically valid sample. Recommendation: We recommend that the School develop internal controls to properly review and approve all expenditures that go into the Food Service Fund. In addition, we recommend that if there is purchase with a vendor over the School?s micro-purchase threshold of $3,000 that the procurement policy is followed and documentation is maintained to document the cost analysis performed. Prior Year Finding? No Views of responsible officials: There is no disagreement with the audit finding.