Great Plains Food Bank

U.S. Department of Agriculture Passed Through the North Dakota Department of Public Instruction and the Minnesota Department of Human Services 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 – 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. This includes a process to ensure proper completion of all tracking forms and documentation, including documented reviews in relation to eligibility. Condition – During our review of the eligibility determinations, it was identified that there were various instances where applications or other eligibility determinations and reviews were not completed timely or accurately. The files were missing the documented processes or were completed after the prior form’s 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 agencies were subsequently determined to be eligible for the program. Questioned Costs – $29,692 Context/Sampling – A nonstatistical sample of 32 participating agencies within TEFAP who received $2,061,190 in food commodities, out of a population of 151 agencies receiving food commodities totaling $5,958,935, were selected for eligibility testing. 4 out of the 32 eligibility determinations tested had an error, with 4 of those resulting in questioned costs, as reported above. Repeat Finding from Prior Year(s) – Yes, Finding 2024-003. Recommendation – Management should review internal control procedures 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.

U.S. Department of Agriculture Passed Through the North Dakota Department of Public Instruction and the Minnesota Department of Human Services Federal Financial Assistance Listing # 10.565 All Awards Federal Financial Assistance Listing # 10.568 All Awards Food Distribution Cluster Activities Allowed/Unallowed and Allowable Costs/Cost Principles Significant Deficiency in Internal Control over Compliance Criteria – 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition – As part of our audit, two payroll allocation errors were identified. It was determined that some errors resulted in overallocation of costs while others in underallocation of costs. Cause – No formal review of the allocations were completed before or after each payroll. This resulted in incorrect amounts being allocated to the programs. Effect – The failure to adequately review payroll allocations resulted in incorrect charges to the program. Questioned Costs – None Reported. Context/Sampling – A nonstatistical sample of 8 pay periods out of a population of 26 pay periods were selected for testing. 2 pay periods had an error. Repeat Finding from Prior Year(s) – Yes, Finding 2024-004. Recommendation – It is recommended that the Organization implement processes and controls to ensure that payroll allocations are reviewed and approved with each payroll processed. Views of Responsible Officials – Management agrees with the finding.

U.S. Department of Agriculture 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 – 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. This includes a process to ensure proper completion of all tracking forms and documentation, including documented reviews in relation to eligibility. Condition – During our review of the eligibility determinations, it was identified that there were various instances where applications or other eligibility determinations and reviews were not completed timely or accurately. The files were missing the documented processes or were completed after the prior form’s 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 agencies were subsequently determined to be eligible for the program. Questioned Costs – $249,549. Context/Sampling – A nonstatistical sample of 31 participating agencies within TEFAP out of a population of 157 were selected for eligibility testing. 4 out of the 31 eligibility determinations tested had an error, with 3 of those resulting in questioned costs, as reported above. Repeat Finding from Prior Year(s) – Yes, Finding 2023-005. Recommendation – Management should review internal control procedures 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.

U.S. Department of Agriculture Federal Financial Assistance Listing # 10.565 All Awards Federal Financial Assistance Listing # 10.568 All Awards Food Distribution Cluster Activities Allowed/Unallowed and Allowable Costs/Cost Principles Significant Deficiency in Internal Control over Compliance Criteria – 2 CFR 200.303(a) establishes that the auditee must establish and maintain effective internal control over the federal award that provides assurance that the entity is managing the federal award in compliance with federal statutes, regulations, and conditions of the federal award. Condition – As part of our audit, multiple payroll allocation errors were identified. It was determined that some errors resulted in overallocation of costs while others in underallocation of costs. Cause – No formal review of the allocations were completed before or after each payroll. This resulted in incorrect amounts being allocated to the programs. Effect – The failure to adequately review payroll allocations resulted in incorrect charges to the program. Questioned Costs – None Reported. Context/Sampling – A nonstatistical sample of 8 pay periods out of a population of 26 pay periods were selected for testing. 8 pay periods had an error. Repeat Finding from Prior Year(s) – Yes, Finding 2023-006. Recommendation – It is recommended that the Organization implement processes and controls to ensure that payroll allocations are reviewed and approved with each payroll processed. Views of Responsible Officials – Management agrees with the finding.

U.S. Department of Agriculture Federal Financial Assistance Listing # 10.569 All Awards Food Distribution Cluster Special Tests and Provisions Material Weakness in Internal Control over Compliance Criteria – A good system of internal accounting control should provide for the consistent processes and controls between locations for the receipt, distribution, and counting of inventory at year-end and throughout the fiscal year. Condition – The Organization does not have consistent and effective controls in place over inventory to properly track, record, and count warehouse inventory at the two main locations. Cause – This deficiency is due to changes in staff and facility changes, resulting in inconsistent processes and controls between warehouse locations. Effect – Inadequate controls over the inventory processes have the potential to result in incorrect recording of inventory ending balances. Questioned Costs – None Reported. Context/Sampling – Statistical sampling was not utilized for year-end inventory observation procedures. As part of inventory observation procedures at the Fargo warehouse, 12 list to floor USDA selections were counted and 3 additional USDA floor to list selections were counted. As part of inventory observation procedures at the Bismarck warehouse, 14 list to floor USDA selections were counted and 3 additional USDA floor to list selections were counted. Repeat Finding from Prior Year(s) – No. Recommendation – It is the responsibility of management to review process and their implementation to ensure consistency and effectiveness throughout the Organization. It is the recommendation that these processes be reviewed and revised regularly, as necessary to ensure the processes are consistent and evolving with the changes of the Organization. Views of Responsible Officials – Management agrees with the finding.

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.

U.S. Department of Agriculture Federal Financial Assistance Listing # 10.565 All Awards Federal Financial Assistance Listing # 10.568 All Awards Food Distribution Cluster Activities Allowed/Unallowed and Allowable Costs/Cost Principles Significant Deficiency in Internal Control over Compliance Criteria – A good system of internal controls includes a process to ensure that all costs are appropriately allocated to the programs. Condition – As part of our audit, it was identified that there were multiple payroll allocation errors that were not identified by management. It was determined that some errors resulted in overallocation of costs while others in underallocation of costs. Cause – No formal review was completed of the allocations before or after each payroll. This resulted in incorrect amounts being allocated to the programs. Effect – The failure to adequately review payroll allocations resulted in incorrect charges to the program. Questioned Costs – None Reported. Context/Sampling – A nonstatistical sample of 8 pay periods out of a population of 26 pay periods were selected for testing. 6 pay periods had an error. Repeat Finding from Prior Year(s) – Yes. Recommendation – It is recommended that the Organization implement processes and controls to ensure that payroll allocations are reviewed and approved with each payroll processed. Views of Responsible Officials – Management agrees with the finding.

2022-004 U.S. Department of Agriculture Federal Financial Assistance Listing # 10.565 All Awards Federal Financial Assistance Listing # 10.568 All Awards Food Distribution Cluster Activities Allowed/Unallowed and Allowable Costs/Cost Principles Significant Deficiency in Internal Control over Compliance Criteria ? A good system of internal controls includes a documented process to ensure that expenses with the potential to be charged to a federal program are allowable within the Uniform Guidance and grant requirements. Condition ? During review of invoices, it was identified that there were three expense transactions that were charged to accounts that were later allocated to federal programs that did not meet the requirements to be allowable within the grant requirements or under Uniform Guidance or were missing proper documentation of approval. Cause ? Due to oversight by management and lack of documented control processes, costs that are considered unallowable within the grant requirements were included in accounts determined to be allocated to the program for expenditure. Effect ? The Organization?s internal controls failed to ensure proper documentation of review and approval and identify costs that are not allowed within under the program. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 60 expenses out of a population of over 250 were selected for testing of allocated expenses. 3 out of the 60 transactions tested had an error. An additional nonstatistical sample of 8 expenses directly charged to CSFP out of a population of 26 were selected for testing. 1 out of the 8 transactions tested had an error. Repeat Finding from Prior Year(s) ? Yes. Recommendation ? Management should implement internal controls to ensure all expenses are properly documented and approved to accounts that will be allocated at year-end are considered allowable. Views of Responsible Officials ? Management agrees with the finding.

2022-005 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 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 two forms that were incomplete within the files, as they were missing signatures of participants or a documented review process. Cause ? Due to oversight by management, all forms were not completed and documented within participant files. Effect ? The Organization?s internal control process was not followed, resulting in lack of documentation of eligibility determination and no documented review process. However, it is noted that the individual participants and agencies were determined to be eligible for the program. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 60 participants within CSFP out of a population of over 250 were selected for eligibility testing. 1 out of the 60 eligibility determinations tested had an error. An additional nonstatistical sample of 29 participants within TEFAP out of a population of 146 were selected for eligibility testing. 1 out of the 29 eligibility determinations tested had an error. Repeat Finding from Prior Year(s) ? No. Recommendation ? Management should implement internal controls to ensure all eligibility determination reviews are documented and retained in the file. Views of Responsible Officials ? Management agrees with the finding.

2022-006 U.S. Department of Agriculture Federal Financial Assistance Listing # 10.565 All Awards Food Distribution Cluster Special Tests and Provisions Significant Deficiency in Internal Control over Compliance Criteria ? A good system of internal controls includes a process to ensure that all inventory reports filed with various agencies are completed accurately and reviewed. Condition ? As part of our audit, it was identified that there was no formal documentation of the review process for inventory reports filed with various agencies. Cause ? Due to oversight of management involved with the process, no formal review has been documented or retained for the processes of the inventory reports being submitted to various agencies. Effect ? The failure to adequately review and document the review of the inventory reports could result in inaccurate reporting to various agencies. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 4 reports within CSFP out of a population of 12 were selected for testing. 1 out of the 4 tested had an error. Repeat Finding from Prior Year(s) ? No. Recommendation ? It is recommended that the Organization implement processes and controls to ensure that all inventory reports are reviewed prior to submission and that review be properly documented. Views of Responsible Officials ? Management agrees with the finding.

2022-007 U.S. Department of Agriculture Federal Financial Assistance Listing # 10.565 All Awards Federal Financial Assistance Listing # 10.568 All Awards Food Distribution Cluster Activities Allowed/Unallowed and Allowable Costs/Cost Principles Material Weakness in Internal Control over Compliance Criteria ? A good system of internal controls includes a process to ensure that all costs are appropriately allocated to the programs. Condition ? As part of our audit, it was identified that there were multiple payroll allocation errors that were not identified by management. It was determined that some errors resulted in overallocation of costs while others in under allocation of costs. Cause ? No formal review was completed of the allocations before or after each payroll. This resulted in incorrect amounts being allocated to the programs. Effect ? The failure to adequately review payroll allocations resulted in incorrect charges to the program. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 8 pay periods out of a population of 26 pay periods were selected for testing. All 8 pay periods had an error. Repeat Finding from Prior Year(s) ? No. Recommendation ? It is recommended that the Organization implement processes and controls to ensure that payroll allocations are reviewed and approved with each payroll processed. Views of Responsible Officials ? Management agrees with the finding.

2021-004 U.S. Department of Agriculture CFDA # 10.565, 10.568, 10.569 Food Distribution Cluster Allowable Costs and Allowable Activities Significant Deficiency in Internal Control over Compliance Criteria ? A good system of internal controls includes a process to ensure that expenses with the potential to be charged to a federal program are allowable within the Uniform Guidance and grant requirements. Condition ? During review of invoices, it was identified that there were four expense transactions that were charged to accounts that were later allocated to federal programs that did not meet the requirements to be allowable within the grant requirements or under Uniform Guidance. Cause ? Due to oversight by management, costs that are considered unallowable within the grant requirements were included in accounts determined to be allocated to the program for expenditure. Effect ? The Organization?s internal controls failed to identify costs that are not allowed within under the program. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 60 costs out of a population of over 250 were selected for expense allocation testing. 4 out of the 60 costs tested had an error. Repeat Finding from Prior Year(s) ? No. Recommendation ? Management should implement internal controls to ensure all expenses to accounts that will be allocated at year-end are considered allowable. Views of Responsible Officials ? Management agrees with the finding.

2021-005 U.S. Department of Agriculture CFDA # 10.565, 10.568, 10.569 Food Distribution Cluster Eligibility Significant Deficiency in Internal Control over Compliance Criteria ? A good system of internal controls includes a process to ensure that eligibility determinations for the program are appropriate. This includes a review or verification of the eligibility determination on a regular basis. Condition ? During our review of the eligibility determinations for both the Commodity Supplemental Food Program and Emergency Food Assistance Program, it was identified that there was no formal documentation of internal review of the eligibility determination for two participating individuals or agencies. Cause ? Due to oversight by management, formal documentation of the review of eligibility was not maintained in the file. Effect ? The Organization?s internal control process was not followed, resulting in lack of approval of the eligibility determination for the program. However, it is noted that the individual participants and agencies were determined to be eligible for the program. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 82 participants out of a population of over 250 were selected for eligibility testing. 2 out of the 82 eligibility determinations tested had an error. Repeat Finding from Prior Year(s) ? No. Recommendation ? Management should implement internal controls to ensure all eligibility determination reviews are documented and retained in the file. Views of Responsible Officials ? Management agrees with the finding.

2021-006 U.S. Department of Agriculture CFDA # 10.565, 10.568, 10.569 Food Distribution Cluster Special Tests and Provisions ? Accountability for USDA Foods Material Weakness in Internal Control over Compliance Criteria ? A good system of internal controls includes a process to ensure that all USDA food commodities are properly accounted for and tracked within the inventory system and general ledger. Condition ? As part of our audit, it was identified that there was material inventory activity added to the inventory system after month-end close procedures due to a storage warehouse that was not included in the inventory system. This was not identified by management until audit procedures discovered discrepancies. Cause ? Due to oversight of management involved with the inventory process, all inventory held in one storage warehouse was not recorded in the general ledger, nor was it monitored in the inventory system while located at the warehouse. Effect ? The failure to post all inventory activity results in misstated inventory balances and revenue earned. Questioned Costs ? None Reported. Context/Sampling ? Not Applicable. Repeat Finding from Prior Year(s) ? No. Recommendation ? It is recommended that the Organization implement processes and controls to ensure that all inventory received at any warehouse is captured within the inventory system and general ledger. Views of Responsible Officials ? Management agrees with the finding.

U.S. Department of Agriculture CFDA # 10.565, 10.568, 10.569 Food Distribution Cluster Allowable Costs and Allowable Activities Significant Deficiency in Internal Control over Compliance Criteria ? A good system of internal controls includes a process to ensure that all expense documentation is maintained for future review. Condition ? We noted that the Organization?s internal controls did not have adequate internal controls to ensure all expense documentation is maintained and saved. As a result, we were unable to ensure the expenses were a legitimate business expense. Cause ? During the course of our engagement, we noted that two of the expenses selected for testing did not have an invoice or other documentation as support. The invoices could not be located by program staff. Effect ? The Organization?s internal controls either failed to locate two invoices or other documentation to support a program expense. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 60 costs out of a population of over 250 were selected for expense allocation testing. 2 out of the 60 costs tested had an error. Repeat Finding from Prior Year(s) ? No. Recommendation ? Management should implement internal controls to ensure all documentation of expenses is maintained and stored for future review. Views of Responsible Officials ? Management agrees with the finding.

U.S. Department of Agriculture CFDA # 10.565, 10.568, 10.569 Food Distribution Cluster Allowable Costs and Allowable Activities Significant Deficiency in Internal Control over Compliance Criteria ? A good system of internal controls includes a process to ensure that only allowable costs and activities, as defined by Uniform Guidance, are included in the expenditure of federal awards. Condition ? We noted that the Organization?s internal controls did not have an adequate process and review for the expense coding and allocation process as it included costs for unallowed activities. Cause ? During the course of our engagement, we noted that the overall cost allocation process included one account that includes unallowable activities that were allocated to the program. Additionally, we noted that an employee reimbursement was improperly coded and was not reviewed properly. Effect ? The Organization?s internal controls failed to identify misallocation of federal funds and non-compliance with the provisions of applicable requirements. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 60 costs out of a population of over 250 were selected for expense allocation testing. 1 out of the 60 costs tested had an error. Repeat Finding from Prior Year(s) ? Yes, prior year finding 2018-001 Recommendation ? Management should implement internal controls that allow for the proper identification of the allocation of costs and activities that are allowable within the federal program. Views of Responsible Officials ? Management agrees with the finding.

U.S. Department of Agriculture CFDA # 10.565, 10.568, 10.569 Food Distribution Cluster Eligibility Significant Deficiency in Internal Control over Compliance Criteria ? A good system of internal controls includes a process to ensure that all certification files are maintained for all food package recipients. Condition ? We noted that the Organization?s internal controls did not have adequate internal controls to ensure all recipients? files are maintained and saved. As a result, we were unable to review one recipient?s file to ensure the file contained the required documentation to support their eligibility. Cause ? During the course of our engagement, we noted that one of the recipients selected for testing did not have a file or other documentation to support their eligibility. The file could not be located by program staff. Effect ? The Organization?s internal controls failed to locate one file or other documentation to support a recipient?s eligibility. Questioned Costs ? None Reported. Context/Sampling ? A nonstatistical sample of 60 recipients files out of a population of 606 recipients were selected for testing. 1 out of the 60 files tested had an error. Repeat Finding from Prior Year(s) ? No. Recommendation ? Management should implement internal controls to ensure all eligibility files are maintained and stored for future review. Views of Responsible Officials ? Management agrees with the finding.

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