Finding 9485 (2023-001)

Significant Deficiency Repeat Finding

Requirement

Questioned Costs

Year

2023

Accepted

2024-01-23

Audit: 13071

Organization: Santa Paula Unified School District (CA)

Auditor: Nigro & Nigro PC

AI Summary

Core Issue: The District is incorrectly transferring revenues from the CACFP to the NSLP, leading to an inaccurate financial picture.
Impacted Requirements: This practice results in an understatement of CACFP revenues and expenditures, with a questioned cost variance of $533,461.22.
Recommended Follow-Up: The District should thoroughly review and correct the cost allocations to ensure accurate reporting for both nutrition programs.

Finding Text

Criteria: An interagency agreement authorizes the school food authority (SFA) to operate two programs within its one facility and utilize the same resources. Costs and expenditures may be tracked collectively, and the CACFP is billed based on the internal cost ratio. Context: This is a repeat finding of 2022-001. Condition: The District records revenues for the two programs separately and then transfers the revenues from the CACFP resource to the NSLP resource based on an internal cost ratio. This method understates both revenues and expenditures in the CACFP and overstates them in NSLP. Effect/Questioned Costs: The cost split between CACFP and NSLP was not allocated through the transfer of expenditures. The amount of the variance was $533,461.22. Cause: The District transferred CACFP revenue amounts to the NSLP resource instead of transferring the costs based on the allocation to the CACFP. Recommendation: We recommend that the District review the cost allocations and insure that all expenditures are allocated to the correct programs. District’s Response: The District will review the cost allocation and ensure that all expenditures are allocated between the two nutrition programs.

Corrective Action Plan

For the 2022-23 School Year, the District failed to correctly allocate expenditures to the CACFP accounts. In order to correct this action for the 2023-24 school year, the Director of Fiscal services will work with the Director of Child nutrition to reconcile each program and complete the cost allocation worksheet. The District utilizes a direct cost vending agreement, which will allocate the costs in an allowable manner. The Director of Fiscal Services will be responsible for making the transfer of expenditures from NSLP accounts to the CACFP accounts. The Director of Child Nutrition will verify the transfers have been completed correctly before the books are closed

Other Findings in this Audit

9486 2023-001

Significant Deficiency Repeat
9487 2023-001

Significant Deficiency Repeat
9488 2023-001

Significant Deficiency Repeat
9489 2023-001

Significant Deficiency Repeat
9490 2023-001

Significant Deficiency Repeat
9491 2023-001

Significant Deficiency Repeat
585927 2023-001

Significant Deficiency Repeat
585928 2023-001

Significant Deficiency Repeat
585929 2023-001

Significant Deficiency Repeat
585930 2023-001

Significant Deficiency Repeat
585931 2023-001

Significant Deficiency Repeat
585932 2023-001

Significant Deficiency Repeat
585933 2023-001

Significant Deficiency Repeat

Programs in Audit

ALN	Program Name	Expenditures
16.710	Public Safety Partnership and Community Policing Grants	$345,492
84.010	Title I Grants to Local Educational Agencies	$303,947
84.424	Student Support and Academic Enrichment Program	$299,609
84.367	Improving Teacher Quality State Grants	$258,187
84.365	English Language Acquisition State Grants	$192,398
10.555	National School Lunch Program	$125,570
84.048	Career and Technical Education -- Basic Grants to States	$55,522
84.027	Special Education_grants to States	$52,423
84.173	Special Education_preschool Grants	$35,070
10.558	Child and Adult Care Food Program	$34,818
84.425	Education Stabilization Fund	$13,841
10.553	School Breakfast Program	$1,584