School food authorities participating in School Nutrition Programs (SNPs) must maintain a financial management system that documents the revenues and expenses of the nonprofit school food service, and meets related requirements for the operation of the nonprofit school food service.
As part of the agreement to participate in SNP, school food authorities agree to:
− Maintain a financial management system that documents the revenues and expenses of the nonprofit school food service, in accordance with U.S. Department of Agriculture and Minnesota Department of Education (MDE) requirements.
Applicable sections of the regulations for the National School Lunch Program, 7 Code of Federal Regulations (CFR) 210 are:
7 CFR § 210.9(b): Agreement provisions.
7 CFR § 210.14(a)-(c): Resource management.
7 CFR § 210.19(a)(1): Additional responsibilities.
School food authorities must make their accounting system, including complete documentation of school food service revenues and expenses, available at the time of program administrative reviews and at any time upon request.
Public schools meet financial management standards for documentation of revenues and expenses by their required reporting in Uniform Accounting and Reporting Standards (UFARS), Fund 02.
Nonpublic schools and residential child care institutions may need to implement procedures so that their financial management system meets program standards.
Program regulations limit net cash resources in the nonprofit school food service account to no more than the school food authority’s average expenditures for three months. At the end of each fiscal year, a school food authority must compare its net cash resources to its average food service expenditures to determine whether it has any excess funds.
If using the Financial Report Form for Nonpublic Schools, this comparison of net cash resources to average expenditures is shown in the Net Cash Resources section of the form.
If there are excess funds in the school food service account as defined above, the school food authority must notify MDE Food and Nutrition Service of the amount of excess funds and the plan to reduce excess funds. Allowable expenses that excess funds may be used for include: