Kingsley Area Schools

2022-001 U.S. DEPARTMENT OF AGRICULTURE Program Title: Child Nutrition Cluster ALN (s): 10.553, 10.555, & 10.559 Federal Award Number: 211971, 211961, 220910-2022, 220904, 210904, 220904-2122, 221970, 221960 & Entitlement Commodities Federal Award Year: July 1, 2021 to June 30, 2022 Pass-Through Entity: Passed-Through Michigan Department of Education Type of Compliance: Immaterial Noncompliance (Special Test & Provisions) Criteria: The USDA requires that the ending balance of the non-profit school food service fund does not exceed three months? average of operating expenses [7 CFR Part 210.14(b)]. Condition: As of June 30, 2022, the District?s fund balance exceeded three months? average of operating expenses. Cause: This condition appears to be the result of additional revenues received from the summer food service program. Effect: As a result of this condition, the District did not fully comply with USDA fund balance requirements. Questioned Costs: None Perspective Information: The District?s fund equity of $496,000 at fiscal year-end exceeded the allowable three months of expenditures threshold by $107,769. Recommendations: We recommend the District closely monitor its budget for the year ended June 30, 2023 to ensure that fund balance is reduced to an appropriate level. Views of Responsible Officials: The Food Service Director and Business Manager will prepare and submit a spend down plan. The District is working on replacing all outdated equipment along with other various renovations. The District expects these updates to reduce the fund balance within the food service fund to an appropriate level for the year ending June 30, 2023.

CORRECTIVE ACTION PLAN 2022-001 This finding is caused by the District?s Food Service Fund?s fund balance being over the USDA?s threshold of 3 months? average expenditures. The District is fully aware of this situation and will create and submit a spend down plan in place to help alleviate the excess fund balance down to a reasonable level and anticipates the completion date for the corrective action plan be before the end of the 2022-23 fiscal year. The persons responsible for the corrective action are Kristy Donner, the food service director and Nicole Darby, the business manager. The anticipated completion date of the corrective action plan is before the end of the 2023 fiscal year. The District anticipates certain projects may require lead time for getting new equipment or renovation projects completed and therefore will plan accordingly to make sure projects get completed prior to the end of the fiscal year. The plan for monitoring adherence is the food service director and business manager will work together to assess where the fund balance is after all of the projects from the spend down plan are completed.

2021-001

2021-001 U.S. DEPARTMENT OF AGRICUTURE Program Title: Child Nutrition Cluster CFDA Number(s): 10.553, 10.555, & 10.559 Federal Award Number: 200902, 201960, 201970, 200900, & 210904 Federal Award Year: July 1, 2020 to June 30, 2021 Pass-Through Entity: Passed-Through Michigan Department of Education Type of Compliance: Immaterial Noncompliance (Special Test & Provisions) Criteria: The USDA requires that the ending balance of the non-profit school food service fund does not exceed three months? average of operating expenses [7 CFR Part 210.14(b)]. Condition: As of June 30, 2021, the District?s fund balance exceeded three months? average of operating expenses. Cause: This condition appears to be the result of additional revenues received from the summer food service program. Effect: As a result of this condition, the District did not fully comply with USDA fund balance requirements. Questioned Costs: None Perspective Information: The District?s fund equity of $508,737 at fiscal year-end exceeded the allowable three months of expenditures threshold by $214,767. Recommendations: We recommend the District closely monitor its budget for the year ended June 30, 2022 to ensure that fund balance is reduced to an appropriate level. Views of Responsible Officials: The Food Service Director and Business Manager will prepare and submit a spend down plan. The District is working on replacing all outdated equipment along with other various renovations. The District expects these updates to reduce the fund balance within the food service fund to an appropriate level for the year ending June 30, 2022.

CORRECTIVE ACTION PLAN 2021-001 This finding is caused by the District?s Food Service Fund?s fund balance being over the USDA?s threshold of 3 months? average expenditures. The District is fully aware of this situation and will create and submit a spend down plan in place to help alleviate the excess fund balance down to a reasonable level and anticipates the completion date for the corrective action plan be before the end of the 2021-22 fiscal year. The persons responsible for the corrective action are Kristy Donner, the food service director and Nicole Darby, the business manager. The anticipated completion date of the corrective action plan is before the end of the 2022 fiscal year. The District anticipates certain projects may require lead time for getting new equipment or renovation projects completed and therefore will plan accordingly to make sure projects get completed prior to the end of the fiscal year. The plan for monitoring adherence is the food service director and business manager will work together to assess where the fund balance is after all of the projects from the spend down plan are completed.