audit_findings: 47
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| 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 |
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| 47 | wa-sao | 1021380 | 2017-001 | WA | Newport Consolidated Joint School District No 56-415 | School District | 1990 | no_match | Washington State Auditor's Office | Financial and Federal audit — Newport Consolidated Joint School District No 56-415 | 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 it complied with verification requirements. CFDA Number and Title: 10.553 School Breakfast Program 10.555 National School Lunch Program 10.559 Summer Food Service 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-t | Background The District participa tes in the School Breakfast, National School Lunch and Summer Food Service programs, and received $455,699 from them during the 2016-17 school year. These programs provide funding for free and reduced -price meals for low-income students. Families must meet income guidelines to be eligible for these programs. Each year, districts must select a sample of program applications and verify that family income information re ported is correct. The Office of Superintendent of Public Instruction (OSPI) instructs school districts on ho w to verify program eligibility. Districts must review selected applicants’ income documentation to confirm students are receiving correct benefits of free or reduced-price meals. If the family’s income does not meet requirements, the student is not eligible and must pay full price for meals. OSPI instructions to districts include guidance for determining the number of applications that must be verif ied based on their non-response rate from previous years’ verifications. The verification process must Washington State Auditor's Office ___________________________________________________________________________________________________________________ be completed by November 15 each year. In addition, the verification summary report is to be submitted to OSPI by February 1. The District needed to use a 3 percent focused sampling method, because the District’s nonresponse rate exceeded 20 percent during the 2015-2016 school year’s verification process. This sampling method require d the District to select three “error prone” applications for verification. An error-prone application is defined as one in which the reported monthly household income falls within $100 of the upper income limit for free or reduced-priced meal eligibility. Description of Condition Although the District had a process in place to perform the verification process, internal controls were not effective to ensure the District performed the verification steps accurately and in compliance with federal requirements. We consider this control deficiency to be a material weaknesses. This issue was not reported as a finding in the prior audit. Cause of Condition The District had a basic understanding of the verification process but was not aware that to select the correct number of applications it had to follow U.S. Depar tment of Agriculture (USDA) requirements to round up all fractions and decimals to the nearest whole number. The District did not review the applications it selected to ensure each one met the criteria for classification as error-prone. Effect of Condit ion and Questioned Costs A lack of effective internal controls over the verification process increases the risk that error -prone applications are not properly selected for verification. It also increases the risk that free or reduced -price meals could be p rovided to children who are not eligible to receive them. Further, the District could receive funding for households that do not qualify for free and reduced-price meals. Our audit found that the District did not select the appropriate number of applications to test. In addition, one of the applications the District selected for verification was not error-prone. As such, it should not have been selected for verification. Washington State Auditor's Office ___________________________________________________________________________________________________________________ Recommendation s We recommend that the District: Provide sufficient training to emplo yees responsible for the nutrition program to ensure compliance with the verification requirements in accordance with OSPI and USDA guidance Review the verification process before the deadlines to ensure it is performed in accordance with OSPI guidelines District ’s Response The District will provide sufficient training to employees responsible for the nutrition program to ensure compliance with the verification requirements in accordance with OSPI and USDA guidance. The District will also review the verifi cation process prior to the deadlines to ensure it is performed in accordance with OSPI guidelines. Auditor’s Remarks We thank District management and staff for their assistance during the audit. We will follow up on the status of the issue during our next scheduled audit. Applicable Laws and Regulations The American Institute of Certified Public Accountants defines sign ificant deficiencies and material weaknesses in its Codification of Statements on Auditing Standards, section 935, paragraph 11. 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. Title 7 CFR Part 245, Determining Eligibility for Free and Reduced Price Meals and Free Milk in Scho ols, Section 6a – Verification requirements, establishes requirements for verifying eligibility of children for free and reduced price meal benefits. Washington State Auditor's Office ___________________________________________________________________________________________________________________ Newport School District #56-415 P.O. Box 70 Phone: (509) 447-3167 1380 W. 5th Street Fax: (509) 447-2553 Newport, WA 99156 Web: www.newport.wednet.edu | https://portal.sao.wa.gov/ReportSearch/Home/ViewReportFile?arn=1021380&isFinding=false&sp=false | 2026-07-30 13:24:54 |