Finding Text
U.S. Department of Agriculture
Federal Financial Assistance Listing # 10.565 All Awards
Federal Financial Assistance Listing # 10.568 All Awards
Federal Financial Assistance Listing # 10.569 All Awards
Food Distribution Cluster
Eligibility
Significant Deficiency in Internal Control over Compliance and Noncompliance
Criteria – A good system of internal controls includes a process to ensure that eligibility determinations for the program are appropriate. This includes a process to ensure proper completion of all tracking forms and documentation, including documented reviews.
Condition – During our review of the eligibility determinations, it was identified that there were various instances where applications or other determinations and reviews were not completed timely or completely. The forms were missing signatures of participants or a documented review process or were completed after the prior forms expiration dates.
Cause – Due to oversight by management, all forms were not completed and documented within participant files. This was largely due to differences in fiscal years, calendar years, and terms of the applications and certifications not being appropriately considered when completing and monitoring the various eligibility documents.
Effect – The Organization’s internal control process was not appropriately enforced and monitored, resulting in lack of timely documentation of eligibility determination. However, it is noted that the individual participants and agencies were determined to be eligible for the program.
Questioned Costs – $7,964.
Context/Sampling – A nonstatistical sample of 60 participants within CSFP out of a population of over 250 were selected for eligibility testing. 17 out of the 60 eligibility determinations tested had an error. An additional nonstatistical sample of 30 participating agencies within TEFAP out of a population of 148 were selected for eligibility testing. 5 out of the 30 eligibility determinations tested had an error, with 1 of those resulting in questioned costs, as reported above.
Repeat Finding from Prior Year(s) – Yes.
Recommendation – Management should implement internal controls to ensure all eligibility determination reviews are documented and retained in the file and consideration is appropriately given to fiscal year, calendar year, and application terms.
Views of Responsible Officials – Management agrees with the finding.