Source: https://www.cde.ca.gov/ls/nu/sf/mbsfsp022020.asp
Timestamp: 2020-08-08 15:52:34
Document Index: 209611883

Matched Legal Cases: ['art 200', 'arts 400', 'art 200', 'arts 400', 'art 200', 'art 200', 'art-225']

Financial Management Standards for the SFSP - Summer Meal Programs (CA Dept of Education)
Financial Management Standards for the SFSP
This management bulletin reviews the financial management standards that are required for all sponsors operating the Summer Food Service Program.
To: Summer Food Service Program Operators
Number: SFSP-02-2020
Reference: California School Accounting Manual; Title 7, Code of Federal Regulations, sections 225.7(f) and 225.11(c); Title 2, Code of Federal Regulations, Part 200, subparts D and E, parts 400 and 415; U.S. Department of Agriculture Food and Nutrition Service Instruction 796-4, Rev 4; SFSP 11-2015
Subject: Financial Management Standards for the Summer Food Service Program
This management bulletin (MB) provides information on the financial management standards (FMS) required for all sponsors operating the Summer Food Service Program (SFSP). The FMS and resources referenced in this MB instruct relevant agencies on the (1) rules governing the accounting revenues and costs, (2) federal regulations and policies that determine cost allowability, and (3) unallowable SFSP costs.
The FMS are intended to serve as the basis for the efficient and effective management of program funds. The SFSP accounting principles discussed in this MB do not apply to public school districts (SD), county offices of education (COE), joint powers authorities (JPA), and charter schools that are governmental entities. These aforementioned agencies must continue to refer to the California School Accounting Manual (CSAM) and all program-specific federal and state policy guidance to ensure compliance with the FMS. The CSAM is available on the California Department of Education (CDE) web document at https://www.cde.ca.gov/fg/ac/sa/documents/csam2019complete.pdf.
All other SFSP Operators, including charter schools that are organized as not-for-profit organizations, must rely on this MB for FMS policy guidance.
Accounting Standards for SFSP Operators
In accordance with Title 7, Code of Federal Regulations (7 CFR), Section 225.7(f); Title 2, Code of Federal Regulations (2 CFR), Part 200, subparts D and E; and 2 CFR, parts 400 and 415; as applicable; all program operators approved to operate the SFSP must follow the FMS, including the standards for recordkeeping and reporting, issued by the CDE. Although the CDE issued the CSAM, the FMS described in the accounting manual pertain to specific entity-types. SFSP entity-types (other than public SDs, COEs, JPAs, and charter schools that are governmental entities) will follow generally accepted accounting principles (GAAP) to ensure consistency in financial reporting. GAAP rules and procedures are derived from a variety of sources, including the Governmental Accounting Standards Board (a private nongovernmental organization that creates accounting reporting standards for state and local governments) and the Federal Accounting Standards Advisory Board.
To supplement GAAP, program operators may reference the U.S. Department of Agriculture (USDA) Food and Nutrition Service (FNS) SFSP Administrative Guide (FNS Instruction 796-4, Rev 4), available on the USDA Administrative Guidance for Sponsors web page at https://www.fns.usda.gov/sfsp/2016-administrative-guidance-sponsors as additional guidance for all SFSP Operators on acceptable FMS.
FNS Instruction 796-4, Rev 4, requires the SFSP Operator’s FMS to include:
Accounting records supported by source documents
Records showing source and application of funds
Accurate, current, and complete disclosure of financial transactions
Full control over, and accountability for, all program assets
Comparison of actual outlays against budgeted amounts
Organization-wide audits
A systematic method to resolve audit findings in a timely manner
Please note that all documentation must be made available during federal and state reviews and audits. Failure to provide documentation can result in disallowance of any and all costs supported by the missing documents and may lead to being declared seriously deficient in accordance with 7 CFR, Section 225.11(c).
Only allowable costs can be charged to the SFSP nonprofit food service account. The USDA FNS issued SFSP 11-2015, Assessing Costs in the Summer Food Service Program, providing additional federal guidance on determining allowability of costs. Factors affecting allowability of costs are that they must:
Be necessary and reasonable for the administration of the program
Be authorized and not prohibited under state or local laws or regulations
Conform to any limitations or exclusions as set forth in federal laws including the FNS Instruction of the SFSP
Be consistent with the requirements of 2 CFR, Part 200, Subpart E, Cost Principles
The USDA has determined that the following items are unallowable costs in the SFSP:
Losses arising from uncollectable accounts, including when reasonable efforts have been made to collect them
Payment of overclaims, fines, or penalties resulting from program violations
Entertainment (e.g., social activities, amusements)
Salary and other expenses of state and local legislators
Costs not included in the SFSP Operator’s budget, as approved by the CDE
Capital expenditures (e.g., acquisition of land and buildings, the alteration of existing facilities, or nonexpendable equipment)
Purchasing costs for vehicles
Fundraising (i.e., expenses incurred to obtain contributions)
Rental costs of school food service facilities or equipment if rental agreement includes option-to-purchase, and periods outside of SFSP operation
Costs for meals in excess of the number of meals eligible for reimbursement
All SFSP Operators must adhere to the Cost Allowability principles expressed in this MB; SFSP regulations; 2 CFR, Part 200; USDA FNS Instructions; and any other federal and state program-specific policy guidance.
Per 7 CFR, Section 225.7(f), available on the USDA SFSP web page at https://www.fns.usda.gov/part-225%E2%80%94summer-food-service-program, net cash resources should not exceed one months average expenditures for sponsors operating the SFSP and three months average expenditures for sponsors operating multiple Child Nutrition Programs throughout the year including the SFSP.
Failure to maintain effective control over, and accountability for, all funds, property, and other assets, as outlined in this MB, GAAP, and FNS Instruction 796-4, Rev 4, may result in your agency being billed for the unallowable costs and declared seriously deficient in accordance with 7 CFR, Section 225.11(c).
If you have any questions regarding this subject, please contact the Summer Meals Unit by phone at 916-324-6153 or by email at sfsp@cde.ca.gov.
Guidance from the California School Accounting Manual (CSAM) for accounting and financial reporting by local educational agencies.