MONTE ALTO ISD

2025-001: Accounting Records and Documentation (Significant Deficiency) Federal Program: Child Nutrition Cluster – School Breakfast Program (AL No. 10.553) and National School Lunch Program (AL No. 10.555) Condition: During our audit of compliance with federal program requirements, we noted that the District did not consistently maintain accounting records and supporting documentation for Child Nutrition Program reimbursement transactions in a manner that ensured timely accessibility for audit testing. Certain reimbursement requests and related supporting documentation were not readily available during audit fieldwork. As a result, we were required to perform expanded audit procedures, including additional reconciliations and alternative testing, to obtain sufficient appropriate audit evidence supporting the reported reimbursement amounts. Criteria: Uniform Guidance (2 CFR §200.302 and §200.303) requires nonfederal entities to maintain accurate, complete, and adequately supported financial records and to establish effective internal controls to ensure compliance with federal program requirements. Cause: The deficiency appears to be attributable to weaknesses in the District’s documentation retention, organization, and supervisory review procedures related to Child Nutrition reimbursement reporting. Effect: Although documentation was not fully sufficient at the outset of audit testing, expanded audit procedures allowed us to obtain reliable support for the reimbursement amounts tested. No questioned costs or audit differences were identified as a result of this condition. Testing of reimbursement activity disclosed no variances between amounts reported and amounts received, based on a tested population totaling $793,987.13. Recommendation: We recommend that the District strengthen its internal controls over the preparation, review, organization, and retention of Child Nutrition Program reimbursement documentation to ensure that complete and accurate supporting records are maintained and readily available for audit and monitoring purposes. Views of Responsible Officials: The District’s management concurs with the finding and plans to implement procedures to improve the completeness and accessibility of accounting records and supporting documentation related to federal program reimbursements.