OPERATING A NOT-FOR-PROFIT CACFP FOOD PROGRAM OPERATION FOR DAYCARE CENTERS

1. YES INC. OPERATING A NOT-FOR-PROFIT CACFP FOOD PROGRAM OPERATIONFOR DAYCARE CENTERS FINANCIAL MANAGEMENT

2. Not for Profit Food Service Operation for Day Care Centers • YES Inc. REQUIRES All Centers to Maintain a Separate Bank Account for the CACFP program beginning March , 2014 (No Co-Mingled Accounts Allowed) • CACFP is a separate not-for-profitbusiness within your business • Please submit, Bank Statements, Payroll Reports, Cancelled Checks, etc. to support Claim. • You must show how you spend CACFP reimbursement in an allowable way.

3. Child and Adult Care Food Program IS NOT “Free” money Funding for personal expenses To purchase soda/coffee for teachers, non-healthy and/or not enough food and snacks for participants Entitlement Program For the disorganized IS • Federally Funded • Passed through YES Inc. • A Not-for-profit Food Program Operation. • Healthy meals to eligible participants • Optional Program • Heavily Administered • Detailed program requirements.

4. Nonprofit Food Service [7 CFR 226.6(e)(13)] • CACFP funds used solely for operation of food service for enrolled participants. • Cannot make a profit on Federal food program • No more than 3 month operating balance per program year • Documentation to support actual costs • Must have other source of income • Costs Not Covered • Temporary interruptions in program payments • Unallowable program costs

5. MEASUREMENTS OF FINANCIAL VIABILITY 1. Accounting System • Does your agency have one? • If so is it in compliance to GAAP! Generally Accepted Accounting Principles (GAAP)

6. Accounting System • Cash/Accrual/Modified Accrual • Cash System: Recognizes revenues and costs when cash is received and bills are paid. • Accrual System: Recognizes revenues and costs when costs are incurred and uses a payable and receivable system. • Modified Accrual System: Certain expenses are reported on an accrual basis. • Compliance with Generally Accepted Accounting Principles (GAAP) • Rules for the accounting of costs and revenues • Resource: http://www.fasab.gov/accepted.html or Ask your staff Accountant • Financial Reports • General Ledger / Check Register • Profit/Loss Statement • Balance Sheet • Co-mingled CACFP funds with Agency funds • Method of separation (ie. independent account codes) • Approved allocation plan for shared costs

7. Accounting Systems Acceptable • Credit card • Checking account • Charge Account at local store • Invoice or COD • Food delivery vendor Unacceptable • Cash Purchases (without proper receipts or invoices) Cash Purchases must have paper trail! • Including cash-back • Food Stamps * Information per GAAP

8. Allowable Operational Costs Operational • Kitchen • Meals • Preparation • Delivery • Cleaning • Menus • Purchasing / Vended Meals

9. Frequent Allowable CACFP Costs(lists are not all inclusive) Allowable • Food (consumable) • Kitchen Supplies/Nonfood • Contract / Vended Meals • Food Program Personnel Operational • e.g. Grocery shopping • Equipment Purchase/Rental

10. Food Costs • Costs in purchasing ingredients for menu items (Food Supplies) AND/OR the cost of purchasing itemized CACFP meals from an outside vendor (Contracted Service) that are served to the participants

11. Food • Consumable food products used to create menu items served to program participants. • Costs can include delivery costs. • Report on the Food Supplies/Food Costs line On the Operating Form.

12. Food Vendors • Outside food service, not related to agency. • Contract approved with YES/DECAL • Provide all CACFP components. • Report as Food/Contracted Services on CACFP Operating Cost Form.

13. Contracted/Vended Meals • Costs of purchased, prepared meals are contracted service costs • Contract must be signed prior to beginning date (contracted service) • The vendor should keep production records(a record of quantity of food prepared)

14. Frequent Unallowable CACFP Costs(lists are not all inclusive) Unallowable • Bad Debts, Fines, Penalties • Non food program food costs • Coffee, non-CACFP personnel meals (i.e. car payment,mortgage,maintenance, non-employee/family member) • Entertainment • Toys, Cribs, Roof, • Purchase of food for personal use • Money received must be kept in food program account. Must have strict internal policy.

15. Allowable Operational Food Service Labor • Menu planning • Food purchasing • Cooking • Serving the food • Cleaning-up after the meal • Meal Attendance

16. Food Service Labor • All wages • salaries • Employee benefits, and the share of the employee taxes paid by the center

18. How would YES Inc know what I spent my CACFP reimbursement on? • Review of Food Program Receipts/Invoices • Food Service Labor Time Sheets/and Time Distribution Reports • Payroll Statements • Balance Sheet or Bank Statements • On-Site Financial Reviews

19. Operating Cost Form

20. Remember! The CACFP funds are replacing funds you are now spending

21. CACFP Reimbursement • CACFP Reimbursement is based upon: • Number of meals your Center serve to the children in your care • Eligibility of the participants • There MUST be Food Services Expense to Account for the Food Reimbursement Need. • MUST BE ALLOWABLE and CREDITABLE

22. Nonprofit Food Service Financial • Costs should equal expenditures charged to food service program • Amounts must be supported by actual documentation – NO ESTIMATES

23. Other Source of Income • CACFP is part of your overall organization. • Funds received to run organization must also be available to fund CACFP costs not covered by reimbursement. • Food Stamps is not another source of income for the center.

24. Best use of your CACFP Reimbursement Plan, budget, and organize the funds available will help you to maximize your CACFP reimbursement. No planning, using funds on non-program needs, no accountability of funds spent will result in repayment of funds, loss of funding and/or participation

25. CACFP Financial Reviews • SA Reviews (continued) • Any non-food program/unallowable cost found to be paid with CACFP funds will be disallowed. • May result in repayment to YES/DECAL • CACFP funds exceed CACFP costs • MUST BE ORGANIZED • Be able to show and explain your organizations system • USDA Reviews • Monitoring SA as part of Management Evaluation • YES Inc. will work with Child Care Centers on Corrective Action (if needed)

26. Let’s Summarize…

27. Which are allowable food costs? • Milk • Beer & Liquor • Personal Groceries • Spices • Bread • Crab meat • Soda Pop • Rabbit Food • Teacher Meals • Refrigerator          

28. Which are allowable nonfood/kitchen supplies? • Dishes • Milk • Cups • Arts/Crafts Supplies • Toilet paper • Cooking utensils • Dishwashing detergent • Paper towels used in the classrooms         Need to be separated from food supplies on receipts.

29. What are some “Other” allowable CACFP expenses? • Food Service labor • Operational Exp. • Admin. Labor • Only CACFP % • Vended Meals • Contracted Service • Kitchen Equipment • Gas for Vehicles • Only CACFP % • Maintenance/Repairs • Only CACFP %       CACFP funds should always be spent on food and kitchen supplies FIRST

30. What items should you retain to support your CACFP costs? • Receipts • Invoices • Payroll (timesheets, paystubs, etc.) • Checkbook/check register • General Ledger • CACFP Claim documentation • Bank Statements • A shoebox or garbage bag • The number to your accountant          Retained for 4 years (3 yrs plus the current)

31. Resources Financial Management: • Guidance Memo 11 • State agency Financial Management policy Child and Adult Care sites (Sponsors & Independent) • Instructions Completion of NPFS Report(s) • Allowable/Unallowable costs • Fiscal Action Procedures • FNS Instruction 796-2 (rev. 3) • Abbreviated version • Available Electronically – User Friendly • http://dpi.wi.gov/fns/centermemos.html (under Guidance memo 11)

32. THANK YOU Please contact YES Inc 2321 Main Street Tucker GA 30084 770-938-3188 For any questions !

33. Day Care Centers FINANCIAL MANAGEMENTTRAINING FFY2014 CACFP Training - 2014