New York City Administration for Children's Services

Internal Controls Over Payments to Foster Care Contractors

The New York City Administration for Children's Services (ACS) is responsible for the health and safety of children in foster care and for reimbursing foster care contractors. We identified material weaknesses in ACS' internal controls over payments to foster care contractors. ACS pays monthly advances to contractors based on the contractor's report of the number of days that children were in care as well as approved per diem rates based on expenses reported by the contractor. However, ACS did not conduct periodic audits of contractor records to ensure that they contained support for the payment requests. As a result, inaccurate payments were less likely to be detected. When we compared ACS payment records to the expense records maintained by four selected contractors, we found that three of the four were paid more than was indicated in their expense records. These potential overpayments totaled $1,037,458.

For a complete copy of Report 98-N-9 click here.
For a copy of the 90-day response click here.
For a copy of the associated follow-up report click here.