White River School District No. 416Local Government

White River School District No. 416 September 1, 2019 through August 31, 2020 2020-001 The District?s internal controls were not adequate to ensure compliance with the federal Child Nutrition grant requirements for paid lunch equity. CFDA Number and Title: 10.553 ? School Breakfast Program 10.555 ? National School Lunch Program 10.559 ? COVID-19 ? Summer Food Service Program for Children Federal Grantor Name: Department of Agriculture, Food and Nutrition Service Federal Award/Contract Number: N/A Pass-through Entity Name: WA State Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: 207WAWA3N1099 Questioned Cost Amount: $0 Background During fiscal year 2020, the District received $1,035,663 in funding for the School Breakfast, National School Lunch Program and COVID-19 Summer Food Service Program for Children programs. These programs provide funding for free and reduced-price meals for eligible low-income students whose households meet specific income requirements set by the U.S. Department of Agriculture. Federal regulations require recipients of federal awards to establish and follow internal controls to ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established controls. Paid Lunch Equity The USDA requires school districts participating in the National School Lunch Program to provide sufficient funds to the non-profit school food service account for meals served to students not eligible for free or reduced-price meals (paid lunches). When the average paid lunch price is less than the difference between the free and paid lunch federal reimbursement rates (known as ?equity?), districts must take action by increasing the prices charged for paid lunches or providing additional non-Federal funding to cover the cost of providing full-price lunches. Each year, the USDA issues the Paid Lunch Equity (PLE) tool, which districts must complete to assist with calculations and decisions to meet this requirement. Description of Condition Paid Lunch Equity The District did not have effective controls in place to complete the PLE tool to ensure it met this requirement. We consider this deficiency in internal controls to be a material weakness that led to material noncompliance. The issue was not reported as a finding in the prior audit. Cause of Condition The District contracts with an outside company for child nutrition services. During fiscal year 2020, there was turnover at the food service company and the District?s bookkeeper position. The company?s representatives and District bookkeeper were responsible for completing the PLE tool. With turnover in both positions, there was a lack of knowledge as to responsibilities and standard procedures used to complete the PLE tool. In addition, because the District does not historically raise its lunch prices, it believed completion and certification of a fund balance tool, which calculates the amount of non-Federal funding the district actually contributed to its school food account, demonstrated PLE compliance. Effect of Condition Paid Lunch Equity (PLE) Because the District did not the complete the PLE tool as required, it was not able to demonstrate if it met equity requirements and increased full-price lunches or contributed an appropriate amount of local funds to be in compliance. During the audit, the District completed the PLE tool for the 19-20 school year, which showed that the District met equity and did not need to increase lunch prices. Recommendation We recommend the District improve its internal controls to ensure staff complete the PLE tool each year to demonstrate compliance with equity requirements. District?s Response We would like to thank the State Auditor?s Office for their collaboration and professionalism in their work on the federal Child Nutrition program. The District agrees with the auditor?s findings. The District will take steps to improve internal controls over completion of the PLE tool on a timely basis to ensure compliance with equity requirements. Auditor?s Remarks We thank the District for its cooperation and assistance throughout the audit, and the steps it is taking to address this issue. We will review the status of the District?s corrective action during our next audit. Applicable Laws and Regulations Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), section 516, Audit findings, establishes reporting requirements for audit findings. Title 2 CFR Part 200, Uniform Guidance, section 303 Internal controls, describes the requirements for auditees to maintain internal controls over federal programs and comply with federal program requirements. The American Institute of Certified Public Accountants defines significant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, Compliance Audits, paragraph 11. Title 7 CFR Part 210, National School Lunch Program, section 14, Resource management, describes the requirements for pricing paid lunches.

2019-001 The District?s internal controls were not adequate to ensure compliance with the federal Title I grant requirements for assessment system security. CFDA Number and Title: 84.010 ? Title I Grants to Local Education Agencies Federal Grantor Name: Department of Education Federal Award/Contract Number: Pass-through Entity Name: Office of Superintendent of Public Instruction (OSPI) Pass-through Award/Contract Number: 203054 Questioned Cost Amount: $0 Background The objective of the Title I program is to improve the teaching and learning of children who are at risk of not meeting state academic standards and who live in areas with high concentrations of low-income families. During fiscal year 2019, the District spent $424,859 in Title I program funds. Federal regulations require recipients to establish and follow internal controls to ensure compliance with program requirements. These controls include understanding grant requirements and monitoring the effectiveness of established controls. States, in consultation with school districts, must establish and maintain an assessment system that is valid, reliable and consistent with relevant professional and technical standards. States must have formal, well-documented policies and procedures to maintain test security and ensure that districts implement these policies and procedures for all standardized tests. To demonstrate compliance, OSPI provides districts with a Test Security and Building Plan template. This serves as the districts? written policies and procedures. The template contains a link to detailed guidance as well as links to other templates for logging staff that required training and test security staff assurances. These templates provide assurance school districts are following the prescribed requirements and understand any new requirements. However, School Districts are not required to use the templates and may use their plans provided they include the same elements as OSPI?s templates Description of Condition The District did not use OSPI?s Test Security and Building Plans template and did not have processes in place to ensure written plans included all of the required elements for all standardized tests it administered, as OSPI required. The District could describe the process and had school administrators complete their test security plans using the District?s template. The building plans must contain elements that: ? Address the school?s test schedules ? Identify persons responsible for student settings and accessibility features ? Identify all test administrators ? Log test administrators? training with accompanying test security staff assurances ? Identify test tools and supplies and the person responsible for them ? Identify persons responsible for participation codes, test communication plans, and test security and logistics Specifically, the District?s plans did not identify the persons responsible for the required tasks. We consider this internal control deficiency to be a material weakness. This issue was not reported as a finding in the prior audit. Cause of Condition The District was not aware their plan needed to include specific elements as outlined in the OSPI Test Coordinators Manual. Effect of Condition and Questioned Costs Without addressing and documenting all of the required elements in the Test Security and Building Plans, the District cannot show it maintained test security for all standardized tests. Recommendations We recommend the District establish and follow policies and procedures to comply with OSPI?s assessment system security requirements. Specifically, the District should use OSPI?s Test Security and Building Plan template that entails all required elements to ensure compliance. District's Response We would like to thank the State Auditor?s Office for their collaboration and professionalism in their work on the federal Title I audit. The District was aware of all the required security and building plan elements and the appropriate staff monitored them accordingly. Going forward, the District will ensure these monitoring activities are specifically documented in the building plans.