Independent School District 719 Prior Lake-Savage Area Schools

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE – PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION – CHILD NUTRITION CLUSTER (FEDERAL ALN 10.555 AND 10.553) 2025-001 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Criteria – 2 CFR § 180 and 2 CFR § 200.318-327 requires Independent School District No. 719, Prior Lake-Savage Area Schools (the District) to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster federal programs. Condition – During our audit, we noted the District did not have sufficient controls in place within its child nutrition cluster federal programs to ensure compliance with federal requirements related to assuring that the District was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Questioned Costs – Not applicable. Context – The District did not obtain the appropriate documentation for 10 of the 10 vendors tested applicable to the child nutrition cluster to ensure the vendors were not suspended or debarred from participation in federal program contracts. This is not a statistically valid sample. The District’s internal controls required the District to review for compliance with suspension and debarment requirements on an annual basis. The District should also be reviewing for compliance with suspension and debarment requirements any time the District adds a new vendor. Repeat Finding – This is a current year and prior year finding. Cause – This was an oversight by district personnel. Effect – Noncompliance with suspension and debarment requirements could result in the District expending federal funds inappropriately or utilized vendors that are not eligible to be parties to such transactions, which could be viewed as a violation of the award agreement. Recommendation – We recommend that the District review its internal control procedures relating to suspension and debarment for the child nutrition cluster federal program. Internal controls over compliance for this area should include documentation of compliance with Uniform Guidance requirements related to suspension and debarment. These controls should also include steps to ensure any vendor with which the District contracts for goods or services exceeding $25,000 is not listed as suspended or debarred on the federal Excluded Parties List System website. View of Responsible Official and Planned Corrective Actions – The District agrees with the finding. The District will review procedures relating to suspension and debarment for its federal programs to ensure compliance with the Uniform Guidance in the future. The District has separately issued a Corrective Action Plan related to this finding.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE – PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION – CHILD NUTRITION CLUSTER (ALN 10.555 AND 10.553) 2025-001 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Finding Summary 2 CFR § 180 and 2 CFR § 200.318-327 requires Independent School District No. 719, Prior Lake-Savage Area Schools (the District) to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster federal programs. During our audit, we noted the District did not have sufficient controls in place within its child nutrition cluster federal programs to ensure compliance with federal requirements related to assuring that the District was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Corrective Action Plan Actions Planned – The District will review its policies and procedures relating to suspension and debarment for its federal programs to ensure compliance with the Uniform Guidance in the future. The review of procedures will also include steps to assure that district personnel are following the requirements of the Uniform Guidance related to suspension and debarment, including maintaining appropriate documentation. Official Responsible – The District’s Executive Director of Business Services, Lisa Rider. Planned Completion Date – June 30, 2026. Disagreement With or Explanation of Finding – The District agrees with this finding. Plan to Monitor – The District’s Executive Director of Business Services, Lisa Rider, will assure appropriate internal controls and procedures are in place to ensure compliance with suspension and debarment requirements.

2024-001

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER – FEDERAL ALN 10.553 AND 10.559 2024-001 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Criteria – 2 CFR § 180 and 2 CFR § 200.318-327 requires Independent School District No. 719, Prior Lake-Savage Area Schools (the District) to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster federal programs. Condition – During our audit, we noted the District did not have sufficient controls in place within its child nutrition cluster federal programs to ensure compliance with federal requirements relating to assuring that the District was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Questioned Costs – Not applicable. Context – The District’s internal controls required the District to review for compliance with suspension and debarment requirements on an annual basis. The District should also be reviewing for compliance with suspension and debarment requirements any time the District adds a new vendor. Repeat Finding – This is a current year finding. Cause – This was an oversight by district personnel. Effect – Noncompliance with suspension and debarment requirements could result in the District expending federal funds inappropriately or utilized vendors that are not eligible to be parties to such transactions, which could be viewed as a violation of the award agreement. Recommendation – We recommend that the District review its internal control procedures relating to suspension and debarment for the child nutrition cluster federal program. Internal controls over compliance for this area should include documentation of compliance with Uniform Guidance requirements related to suspension and debarment. These controls should also include steps to ensure any vendor with which the District contracts for goods or services exceeding $25,000 is not listed as suspended or debarred on the federal Excluded Parties List System website. View of Responsible Official and Planned Corrective Actions – The District agrees with the finding. The District will review procedures relating to suspension and debarment for its federal programs to ensure compliance with the Uniform Guidance in the future. The District has separately issued a Corrective Action Plan related to this finding.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE – U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER – FEDERAL ALN 10.553 AND 10.559 2024-001 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Finding Summary - 2 CFR § 180 and 2 CFR § 200.318-327 requires Independent School District No. 719, Prior Lake-Savage Area Schools (the District) to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster federal programs. During our audit, we noted the District did not have sufficient controls in place within its child nutrition cluster federal programs to ensure compliance with federal requirements related to assuring that the District was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Corrective Action Plan Actions Planned – The District will review its policies and procedures relating to suspension and debarment for its federal programs to ensure compliance with the Uniform Guidance in the future. The review of procedures will also include steps to assure that district personnel are following the requirements of the Uniform Guidance related to suspension and debarment, including maintaining appropriate documentation. Official Responsible – The District’s Executive Director of Business Services, Tammy Fredrickson. Planned Completion Date – June 30, 2025. Disagreement With or Explanation of Finding – The District agrees with this finding. Plan to Monitor – The District’s Executive Director of Business Services, Tammy Fredrickson, will assure appropriate internal controls and procedures are in place to ensure compliance with suspension and debarment requirements.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE AND REPORTABLE INSTANCES OF NONCOMPLIANCE ? U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER ? CFDA NOS. 10.553, 10.555, AND 10.559 (COVID-19) 2020-002 Internal Controls Over Compliance and Reportable Instances of Noncompliance With Federal Procurement Requirements Criteria ? 2 CFR 200.320 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including procurement requirements applicable to the child nutrition cluster programs. Condition ? During our audit, we noted that the District did not have sufficient controls in place within its child nutrition cluster federal program to assure compliance with federal procurement requirements, which resulted in noncompliance. For 3 of 18 vendors tested, the District had not awarded a contract based on sealed bids or quotations as required by the Uniform Guidance. Questioned Costs ? None noted. Context ? Three of eighteen vendors tested were not in compliance. This was not a statistically valid sample. Repeat Finding ? This is a current year finding. Cause ? This was an oversight by district personnel. Effect ? Noncompliance with the procurement requirements could result in the District expending federal funds with vendors prior to obtaining bids or quotes if required, which could be viewed as a violation of the award agreement. Recommendation ? We recommend that the District review its internal control procedures relating to procurement for all federal programs. The District should verify compliance with federal procurement procedures, including awarding contracts based on sealed bids or quotations for the purchase of goods or services exceeding applicable federal dollar thresholds. View of Responsible Official and Planned Corrective Actions ? The District agrees with the finding. The District intends to review its procedures relating to procurement for its federal programs, and will ensure that bids and/or quotations are obtained when required. The District has separately issued a Corrective Action Plan related to this finding.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE AND REPORTABLE INSTANCES OF NONCOMPLIANCE ? U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER ? CFDA NOS. 10.553, 10.555, AND 10.559 (COVID-19) 2020-002 Internal Controls Over Compliance and Reportable Instances of Noncompliance With Federal Procurement Requirements Finding Summary 2 CFR 200.320 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including procurement requirements applicable to the child nutrition cluster programs. The District did not have sufficient controls in place to assure compliance with federal procurement requirements, which resulted in reportable instances of noncompliance. For 3 of 18 vendors tested, the District had not awarded a contract based on sealed bids or quotations as required by the Uniform Guidance. Corrective Action Plan Actions Planned ? The District will review policies and procedures relating to procurement for all federal programs to ensure compliance with Uniform Guidance in the future. Official Responsible ? Julie Cink, Director of Business Services. Planned Completion Date ? June 30, 2021. Disagreement With or Explanation of Finding ? The District agrees with this finding. Plan to Monitor ? Julie Cink, Director of Business Services, will assure appropriate internal controls and procedures are updated, in place, and being followed to assure compliance with Uniform Guidance for federal awards expenditures in the future.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE ? U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER ? CFDA NOS. 10.553, 10.555, AND 10.559 (COVID-19) 2020-003 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Criteria ? 2 CFR ? 180 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster federal program. Condition ? During our audit, we noted the District did not have sufficient controls in place within its child nutrition cluster federal program to assure that it was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Questioned Costs ? None. Our testing did not indicate any instances of noncompliance with these requirements. Context ? The District did not obtain the appropriate documentation for all six vendors we tested to ensure the vendor was not suspended or debarred from participation in federal program contracts. Repeat Finding ? This is a current year finding. Cause ? This was an oversight by district personnel. Effect ? Noncompliance with the suspension and debarment requirements could result in the District expending federal funds with vendors that are not eligible to be parties to such transactions, which could be viewed as a violation of the award agreement. Recommendation ? We recommend that the District review its internal control procedures relating to suspension and debarment for the child nutrition cluster federal program. Internal controls over compliance for this area should include verification that any vendor with which the District contracts for goods or services exceeding $25,000 is not listed as suspended or debarred on the federal Excluded Parties List System (EPLS) website. View of Responsible Official and Planned Corrective Actions ? The District agrees with the finding. The District intends to review its procedures relating to procurement for its federal programs, and will ensure that vendors with which the District contracts for goods or services exceeding $25,000 are not listed as suspended or debarred on the federal EPLS website. The District has separately issued a Corrective Action Plan related to this finding.

SIGNIFICANT DEFICIENCY IN INTERNAL CONTROL OVER COMPLIANCE ? U.S. DEPARTMENT OF AGRICULTURE, PASSED THROUGH MINNESOTA DEPARTMENT OF EDUCATION, CHILD NUTRITION CLUSTER ? CFDA NOS. 10.553, 10.555, AND 10.559 (COVID-19) 2020-003 Internal Control Over Compliance With Federal Suspension and Debarment Requirements Finding Summary 2 CFR ? 180 requires the District to establish and maintain effective internal control over compliance with requirements applicable to federal program expenditures, including suspension and debarment requirements applicable to the child nutrition cluster federal program. The District did not have sufficient controls in place within its child nutrition cluster federal program to assure that it was not contracting for goods or services with parties that are suspended or debarred, or whose principals are suspended or debarred from participating in contracts involving the expenditures of federal program funds. Corrective Action Plan Actions Planned ? The District will review policies and procedures relating to suspension and debarment for its federal programs and will ensure that all parties with which it contracts for goods or services are eligible to participate in contracts involving the expenditures of federal program funding. Official Responsible ? Julie Cink, Director of Business Services. Planned Completion Date ? June 30, 2021. Disagreement with or Explanation of Finding ? The District agrees with this finding. Plan to Monitor ? Julie Cink, Director of Business Services, will assure appropriate internal controls and procedures are updated, in place, and being followed to assure compliance with Uniform Guidance for federal awards expenditures in the future.