Audit Report on Edwin Gold services for Children And Its Compliance with Its Child Care Agreement

Executive Summary

Edwin Gould Services for Children (Edwin Gould), at 41-51 East 11th Street in Manhattan, is a not-for-profit organization that provides services to children in its Boarding Home, Group Home, Agency Operated Boarding Home, and Diagnostic/PINS (Persons In Need of Supervision) programs. Foster care providers are reimbursed for expenses based on a per diem rate that is calculated according to a formula developed by the New York State Office of Children and Family Services. The per diem administrative rate is limited to the Maximum State Aid Rate (MSAR) established by the New York State Office of Children and Family Services and the New York City Administration for Children’s Services (ACS).

This audit determined whether Edwin Gould maintained adequate internal controls over the recording and reporting of its expenses, revenues, and days-of-care; was paid based on the appropriate per diem rate in accordance with the New York State standards of payment and ACS regulations; and complied with certain promulgated announcements and regulations stated in the New York State Standards of Payment and the City’s CWA Foster-Care Reimbursement Bulletin No. 92-5 and applicable amendments.

From July 1, 2000, to June 30, 2001 (Fiscal Year 2001), ACS reimbursed Edwin Gould $9,655,944 for providing services to 575 individuals in its foster care programs. In addition, Edwin Gould received $264,862 from ACS for its Independent Living Skills Program, an educational program for individuals in its care who are at least 14 years of age and $82,815 for its Substance Abuse Prevention Program.

Edwin Gould generally complied with the provisions of its child care agreement with regard to promulgated announcements and regulations stated in the New York State Standards of Payment and the City’s CWA Foster-Care Reimbursement Bulletin No. 92-5. It had an adequate system of internal controls over the recording and reporting of its revenue, expenses, and days-of-care. In addition, Edwin Gould provided adequate and clean conditions for the residents in its care.

However, Edwin Gould owes the City $22,965 for Fiscal Year 2001, because of differences between the funds that ACS advanced to Edwin Gould and the expenses incurred by Edwin Gould that we audited. In addition, Edwin Gould did not use $6,928 in funding received from ACS for its Independent Living Skills Program. Consequently, Edwin Gould owes the City $29,893.(See Table I on page 5 of this report.)

We recommend that Edwin Gould remit $29,893 in excess funding to the City; include only those expenses allowed in the New York State Standards of Payment for Foster Care of Children and the CWA Foster-Care Reimbursement Bulletin No. 92-5 and applicable amendments on its Report of Actual Expenditures DSS-2652; and report days-of-care accurately, billing ACS for only those children in attendance at the foster homes. In addition, we recommend that ACS ensure that Edwin Gould complies with the report’s recommendations.

ACS, which also responded on behalf of Edwin Gould, stated that both organizations agreed with the audit’s findings and recommendations. ACS stated that Edwin Gould agreed to repay ACS $29,893, to include only allowable expenses on its Report of Actual Expenditures DSS-2652, and to report its days-of-care accurately and in accordance with New York State and ACS regulations. ACS also stated that it notified Edwin Gould officials of the repayment terms for the $29,893 assessment.