Pike-Delta-York Local School DistrictLocal Government

Noncompliance and Material Weakness 2 CFR ? 400.1 gives regulatory effect to the Department of Agriculture for 2 CFR ? 200.303 which requires that non- Federal entities receiving Federal awards (i.e., auditee management) establish and maintain effective internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. 2 C.F.R. ? 200.514(c) requires auditors to obtain an understanding of the non-Federal entity?s internal control over Federal programs sufficient to plan the audit to support a low assessed level of control risk of noncompliance for major programs, and, unless internal control is likely to be ineffective, plan the testing of internal control over major programs to support a low assessed level of control risk for the assertions relevant to the compliance requirements for each major program and perform testing of internal control as planned. 7 CFR ? 210.7(c) states, in part, ?to be entitled to reimbursement under this part, each school authority shall ensure that the Claim for Reimbursement accurately reflects the number of lunches and meal supplements served to eligible children, and the school food authority shall, at a minimum: (iii) Base Claims for Reimbursement on lunch counts, taken daily at the point of service, which correctly identify the number of free, reduced price and paid lunches served to eligible children; (iv) Correctly record, consolidate and report those lunch and supplement counts on the Claim for Reimbursement; and (v) Ensure that Claims for Reimbursement do not request payment for any excess lunches produced, as prohibited in ?210.10(a)(2), or non-Program lunches (i.e., a la carte or adult lunches) or for more than one meal supplement per child per day. 7 CFR ? 210.8(c) states the Claim for Reimbursement shall include data in sufficient detail to justify the reimbursement claimed and to enable the State agency to provide the Report of School Program Operations required under ?210.5(d) of this part. Such data shall include, at a minimum, the number of free, reduced price and paid lunches and meal supplements served to eligible children. The claim shall be signed by a school food authority official. Two out of thirty (6.7%) site claim forms submitted by the District to the Ohio Department of Education were inaccurate, since the District claimed more meals served than what was actually distributed. These errors occurred due to a weakness in internal controls, which failed to ensure site claim forms for reimbursable meals served at each building and submitted by the District to the Ohio Department of Education were entered correctly. Failure to properly report the number of eligible meals resulted in the District receiving unsubstantiated reimbursements totaling $837. The District should implement policies and procedures to help ensure that monthly site claim forms for all District buildings are reviewed and submitted to reflect actual counts for reimbursable meals served.

Questioned Cost, Noncompliance and Material Weakness 2 CFR ? 400.1 gives regulatory effect for the U.S. Department of Agriculture to the Office of Management and Budget guidance, as supplemented by this part. This part adopts in the OMB guidance in subparts A through F of 2 CFR part 200. 2 CFR ? 200.430(a) provides that costs of compensation are allowable to the extent that they satisfy the specific requirements of this part, and that the total compensation for individual employees: 1. Is reasonable for the services rendered and conforms to the established written policy of the non-Federal entity consistently applied to both Federal and non-Federal activities; 2. Follows an appointment made in accordance with a non-Federal entity?s laws and/or rules or written policies and meets the requirements of Federal statute, where applicable; and 3. Is determined and supported as provided in paragraph (i) of this section, Standards for Documentation of Personnel Expenses, when applicable. Furthermore, Ohio Department of Education Grants Management Guidance 2014-002, revised on June 15, 2016 and August 29, 2019, further clarifies these requirements. The type of documentation required is based on the funding source and/or cost objective: ? Semi-annual certifications are allowed when an employee's compensation is funded by only one Federal grant. An employee funded by a federal grant and the General fund would fall under this category. ? Time and effort documentation is used when an employee's compensation is funded by more than one federal grant. ? The substitute system of collecting time and effort is used when an employee?s compensation is funded by more than one grant. Due to a deficiency in internal policies and procedures over compliance, District employees, who are paid by contract from the Child Nutrition Cluster funds, did not obtain semi-annual certifications for payroll and benefit expenditures which resulted in Child Nutrition Cluster actual and projected expenditures of $17,560 and $205,859, respectively, not being supported with semi-annual certifications and will be considered a questioned cost. Based on the above guidance, these employees should have completed semi-annual certifications as their compensation was funded by a single Federal grant. The District should implement control procedures to verify that all District employees who perform work for federal cost objectives complete semi-annual certifications for single source funded personnel and time and effort documentation for payroll charges for split funded personnel. The documentation should be signed by each individual employee or a supervisor who has firsthand knowledge of the information contained in the documentation.

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