Slide 1 Welcome to the CACFP Annual Training called Recipe for - - PDF document

Slide 1

Fueling Oregon’s Future

Recipe for Success During CACFP Reviews

Financial Management for Child Centers, including:

• Outside School Hour Care Centers
• Afterschool At-Risk Meal & Snack Programs
• Homeless/Emergency Shelter Programs
• Adult Programs

Welcome to the CACFP Annual Training called “Recipe for Success during CACFP Reviews”, hosted by Oregon Department of Education Child Nutrition Programs. This session will discuss common review findings for Financial Management of Centers, including Outside School Hour Care Centers, Afterschool At-Risk Meal & Snack Programs, Homeless / Emergency Shelter Programs and Adult Programs. Slide 2

Fueling Oregon’s Future

Situation #1

Tracking of CACFP expenses incurred for the operation of the Program.

• Allowable
• Unallowable

2

The first situation we will discuss involves tracking allowable CACFP expenses incurred for the operation of the Program. Allowable costs are necessary, reasonable and authorized costs. During the review the Child Nutrition Specialist requests to review all allowable receipts and payroll documentation the sponsor has on file that support CACFP expenses incurred for the test period. The sponsor provides documentation for CACFP expenses that were charged to Program funds which includes: food receipts and

• invoices. In reviewing the

documentation provided, the Child Nutrition Specialist observes that the food receipts include costs for unallowable food items and unallowable food service supplies. The receipts and invoices documented purchases for crayons, toilet paper, bottled water, soda and candy. The costs of these items were not subtracted from the receipt totals.

Slide 3

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Why

Unallowable costs charged to CACFP funds

• Receipts containing unallowable costs

FNS 796-2 rev 4 (VIII A-G) 7 CFR 226.15(e)(6)

3

Situation # 1 is a finding. (click)The CACFP expense documentation provided does not separate allowable from unallowable costs.

• (click) The receipts

for food and non- food service supplies included costs for unallowable items such as crayons, toilet paper, bottled water, soda, and candy. The sponsor must document that unallowable items purchased are not charged to the CACFP. (click) FNS 796-2 Rev 4 (VIII A-G) and (click) 7CFR 226.15(e)(6) describe the allowable costs that may be charged to the CACFP

Slide 4

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How To Correct

Unallowable costs charged to CACFP

• Develop a system and implement procedures to

track CACFP expenses

4

Now let’s discuss corrections to prevent this finding. To correct, the sponsor would need to develop and implement a system to track all CACFP expenses including:

• a procedure that ensures

receipts containing unallowable CACFP food items and unallowable non- food service supplies are clearly identified and the cost

• f the unallowable items are

not charged to CACFP funds,

Slide 5

Fueling Oregon’s Future

Situation #2

Sponsor is unable to demonstrate nonprofit food service

• CACFP income exceeds CACFP expenses
• All allowable costs are not documented

5

The second situation we will discuss involves the inability of the sponsor to demonstrate nonprofit foodservice. Nonprofit foodservice is demonstrated when Program funds (CACFP reimbursement income) are used only for allowable Program expenses and when all allowable program expenses incurred are paid for with Program

• funds. If excess Program funds exist,

they must be retained and used only in the nonprofit food service program. During the review, the Child Nutrition Specialist compares the CACFP reimbursement received during the test month with the expenditures documented on receipts for the month. (click)The comparison shows the sponsor received $2525.00 in CACFP reimbursement and spent $1015.00 in food and supplies. When asked, the sponsor states they do not have an accounting system in place to track CACFP income and expenses separately from non-program income and

• expenses. (click)The Sponsor reconciles

the checking account monthly, but the account activity is not tracked to show the amount of CACFP reimbursement received and the amount of expenditures made on CACFP allowable food service costs. The sponsor reports they have determined that the CACFP balance is zero, as they are sure all CACFP program income is spent each month.

Slide 6

Fueling Oregon’s Future

Why

Unable to demonstrate nonprofit food service

• CACFP expenses meet or exceed CACFP income

Balance of CACFP account is unknown

• No assurance that CACFP funds support only

program food service activities 7 CFR 226.15(e)(13), Guidance for Mgmt. Plans & Budgets p.16, FNS 796-2 rev 4 (VI C)

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Situation #2 has two findings. (click)The first finding is that the sponsor is unable to demonstrate nonprofit food

• service. The Program income received

by the sponsor is greater than the allowable Program expenses documented by the sponsor. (click)The second finding is the sponsor is not able to document the CACFP fund account balance. Let’s discuss the first finding: (click) Sponsors must operate a nonprofit food service principally for the benefit of enrolled participants and maintain records documenting the operation of the food service. CACFP funds may be comingled (or combined) with other funds in one single bank account, but if they are comingled the sponsor must be able to track CACFP income and expenses separately from other funds. The Sponsor must be able to show that reimbursement received from the CACFP is spent only on food service

• expenses. The expenses for the food

service must meet or exceed the CACFP reimbursement. (click)Because they do not have an accounting system in place to track CACFP program income and expenses, the sponsor is unable to ensure that the CACFP funds they receive are being used to support only CACFP food service activities. Additionally, without an accounting system in place, the sponsor is unable to demonstrate that all allowable expenses incurred in running the CACFP are being paid with Program funds. (click) 7CFR226.15(e)(13) and (click)page 16 of the USDA Guidance

for Management Plans and Budgets describe the requirement to track comingled funds. (click)FNS 796-2 Rev 4 (VI C) provides the requirements for making sure CACFP funds support only CACFP Food Service activities. Slide 7

Fueling Oregon’s Future

How To Correct

A procedure to track CACFP income & expenses

• Create and maintain a fund account for

Program income and expenses

Demonstrate nonprofit food service

• Charge all allowable Program expenses to

Program funds

7

Now let’s discuss corrections you can make to prevent these findings from

• ccurring.

In order to correct, the sponsor must implement a procedure to account for the receipt and expenditure of all CACFP funds. Elements to be included in the procedure::

• Create a CACFP fund account. A

fund account is a type of recordkeeping system (software program or manual) used to track income and expenses for a specific program, in this case the CACFP

• program. The purpose of the fund

account is to document how much money was received, how much was spent and what is was spent on.

• Set up the fund account to track all

CACFP revenue and allowable CACFP expense transactions. This would involve setting up a Chart of Accounts by assigning account codes for individual income and expense categories in the CACFP fund account.

• Maintain the CACFP fund account,

ensuring CACFP income and

allowable CACFP expense receipts are recorded on a timely basis. A Fund account is a self-balancing account, meaning it always has a

• balance. This allows sponsors to

evaluate the status of the nonprofit food service account at any given time. (click)The Sponsor must also develop and implement a procedure to charge all allowable CACFP Program expenses to Program funds. Slide 8

Fueling Oregon’s Future

Resources

FNS 796-2 rev. 4 http://www.fns.usda.gov/sites/default/files/ 796-2%20Rev%204.pdf 7 CFR Part 226 http://www.fns.usda.gov/sites/default/files/ CFR226.pdf Guidance for Management Plans & Budgets http://www.fns.usda.gov/sites/default/files/ CACFP%20Management_PlansHandbook.p df ODE Annual Budget Guidance (see budget spreadsheet)

8

All resources discussed during this training, including : FNS 796-2 Revision 4, 7 CFR Part 226 and USDA Guidance for Management Plans and Budgets are available on the ODE CNP public website at the links included on this slide. Slide 9

In accordance with Federal civil rights law and U.S. Department of Agriculture (USDA) civil rights regulations and policies, the USDA, its Agencies, offices, and employees, and institutions participating in or administering USDA programs are prohibited from discriminating based on race, color, national origin, sex, disability, age, or reprisal or retaliation for prior civil rights activity in any program or activity conducted or funded by USDA. Persons with disabilities who require alternative means of communication for program information (e.g. Braille, large print, audiotape, American Sign Language, etc.), should contact the Agency (State or local) where they applied for

• benefits. Individuals who are deaf, hard of hearing or have speech disabilities may contact USDA through the

Federal Relay Service at (800) 877-8339. Additionally, program information may be made available in languages

• ther than English.

T

• file a program complaint of discrimination, complete the USDA Program Discrimination Complaint Form, (AD-

3027) found online at: http://www.ascr.usda.gov/complaint_filing_cust.html, and at any USDA office, or write a letter addressed to USDA and provide in the letter all of the information requested in the form. T

• request a copy of the

complaint form, call (866) 632-9992. Submit your completed form or letter to USDA by: (1) mail: U.S. Department of Agriculture Office of the Assistant Secretary for Civil Rights 1400 Independence Avenue, SW Washington, D.C. 20250-9410; (2) fax: (202) 690-7442; or (3) email: program.intake@usda.gov This institution is an equal opportunity provider.

Thank you for participating in Financial Management of Centers Training for Child and Adult Care Food Program. If you have any questions please contact your assigned Child Nutrition Specialist. We greatly appreciate the work that you do to fuel Oregon’s future.