{"database": "mytown-research", "table": "audit_findings", "rows": [[44, "wa-sao", "1021378", "2017-001", null, "WA", "Nine Mile Falls School District No 325/179", "School District", "2043", null, "no_match", "Washington State Auditor's Office", "Financial and Federal audit \u2014 Nine Mile Falls School District No 325/179", "Financial and Federal", 2017, "2016-09-01", "2017-08-31", "2018-05-21", "federal_award_compliance", "material_weakness", 0.0, "Questioned Cost Amount: $0", "The District did not have adequate internal controls to ensure compliance with verification requirements. CFDA Number and Title: 10.553 School Breakfast Program 10.555 National School Lunch Program Federal Grantor Name: U.S. Department of Agriculture Federal Award/Contract Number: NA Pass-through Entity Name: Office of Superintendent of Public Instruction Pass-through Award/Contract Number: NA Que", "Background \nThe District participates in the School Breakfast and National School Lunch \nprograms, and received $228,873 for them during fiscal year 2017. These programs \nprovide funding for free and reduced-price meals for low-income students. Families \nmust meet income guidelines to be eligible for these programs. \nEach year, districts must select a sample of applications and verify that family \nincome information reported to the District is correct. The Office of Superintendent \nof Public Instruction (OSPI) instructs school districts on how to verify program \neligibility, including the number of applications that must be verified based on their \nnonresponse rates from the previous school year\u2019s verifications. The verification \nprocess must be completed by November 15 of each year. \nThe District was required to use a 3 percent focused sampling method, because the \nDistrict\u2019s nonresponse rate exceeded 20 percent during the 2015-2016 school year\u2019s \nverification process. This sampling method require d the District to select three \n\u201cerror prone\u201d applications for verification. An error-prone application is defined as \none where the reported monthly household income falls within $100 of the upper \nincome limit for free or reduced-priced meal eligibility. \n \n \nWashington State Auditor's Office\n___________________________________________________________________________________________________________________\n \n \nDistricts must verify income support for the time period from the month before it \nreceived the application through the month it verifies the income reported on the \napplication. \nIf the verification process results in a reduction or termination of meal benefits, the \nDistrict must send a letter of adverse a ction to notify the family at least 10 days \nbefore the change takes effect. Also, the District must change the benefit status \nimmediately after this 10-day advance notice period. \nDescription of Condition \nAlthough the District did have a process in place t o perform the verification \nprocess, internal controls were not effective to ensure the District performed the \nverification steps accurately and in compliance with federal requirements. \nWe consider this control deficiency to be a material weaknesses. \nThis issue was not reported as a finding in the prior audit. \nCause of Condition \nThe District had a basic understanding of the verification process but was not aware \nit needed to use a different sampling method due to the change in the non-response \nrate it experi enced in the prior year. The District also was not aware of OSPI\u2019s \nguidelines for the support it needed to obtain to verify the reported household \nincomes. Because the District thought the household was eligible, it did not send \nthe letter of adverse actio n informing the household that benefits were being \nterminated. \nEffect of Condition and Questioned Costs \nA lack of proper internal controls over the verification process increases the risk \nthat free or reduced-price meals could be provided to children who were not eligible \nto receive them. \nOur audit found the District: \n\uf0b7 Used the wrong sampling method and selected an insufficient number of \napplications to verify \n\uf0b7 Did not obtain proper income verification documentation for one student \nand overclaimed meals by $242 \n\uf0b7 Did not inform a household it was no longer eligible to participate in the \nprogram within the 10-day period required by the program. This caused the \nDistrict to report incorrect response rate information to OSPI, which could \n \n \nWashington State Auditor's Office\n___________________________________________________________________________________________________________________\n \n \naffect the number of applications the District will need to verify during the \nnext fiscal year. \nRecommendation s \nWe recommend that the District: \n\uf0b7 Train employees responsible for the verification requirements to ensure \ncompliance with OSPI and U.S. Department of Agriculture regulations and \nguidance \n\uf0b7 Review its verification process to ensure its verifications follow OSPI \nguidelines \nDistrict \u2019s Response \nTo ensure that this doesn\u2019t occur in the future, the Director of Business will \nannually audit the accuracy of the program eligibility review by analyzing the \nfollowing: \n\uf0b7 The Sampling Method \u2013 The sampling method will be reviewed ensuring \nthat the correct method was selected based on federal guidelines. \n\uf0b7 The Review Process \u2013 the analysis of the error prone applications will be \nthoroughly audited looking for timely household income support, for wage \nverification that is clearly identifiable, and proper handling of benefit status \nchange when applicable. \nIn addition, the Director of Business will ensure that the Food Service Director has \nthe adequate training needed to properly adhere to USDA and/or OSPI regulations \nin regards to verification requirements. \nAuditor\u2019s Remarks \nWe thank District management and staff for their assistance during the audit. We \nwill follow up on the status of the issue during our next scheduled audit. \nApplicable Laws and Regulations \nThe American Institute of Certified Public Acco untants defines significant \ndeficiencies and material weaknesses in its Codification of Statements on Auditing \nStandards, section 935, paragraph 11. \nTitle 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative \nRequirements, Cost Princip les, and Audit Requirements for Federal Awards \n(Uniform Guidance) section 516 \u2013 Audit Findings, establishes reporting \nrequirements for audit findings. \n \n \nWashington State Auditor's Office\n___________________________________________________________________________________________________________________\n \n \nTitle 2 CFR Part 200, Uniform Guidance, section 303 \u2013 Internal controls, describes \nthe requirements for auditees to maintain internal controls over federal programs \nand comply with federal program requirements. \nTitle 7 CFR Part 245, Determining Eligibility for Free and Reduced Price Meals \nand Free Milk in Schools , Section 6a \u2013 Verification requirements, esta blishes \nrequirements for verifying eligibility of children for free and reduced price meal \nbenefits. \n \n \n \n \n \n \n \nWashington State Auditor's Office\n___________________________________________________________________________________________________________________", "https://portal.sao.wa.gov/ReportSearch/Home/ViewReportFile?arn=1021378&isFinding=false&sp=false", "2026-07-30 13:24:54"]], "columns": ["rowid", "source", "report_number", "finding_number", "muni_id", "state", "entity_name", "entity_type", "entity_ext_id", "place_geoid", "match_method", "auditor", "report_title", "audit_type", "fiscal_year", "period_start", "period_end", "published_date", "finding_category", "severity", "questioned_cost", "cost_basis", "finding_title", "finding_text", "report_url", "fetched_at"], "primary_keys": ["rowid"], "primary_key_values": ["44"], "units": {}, "query_ms": 11.414434004109353, "source": "MyTown", "source_url": "https://mytown.theboringparts.com", "license": "CC BY 4.0", "license_url": "https://creativecommons.org/licenses/by/4.0/"}