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State Education Department
Adirondack Helping Hands, Inc.
Compliance With the Reimbursable Cost Manual

Issued: August 02, 2017
Link to full audit report 2016-S-88
Link to 90-day response

To determine whether the costs reported by Adirondack Helping Hands, Inc. (Adirondack) on its Consolidated Fiscal Report (CFR) were properly calculated, adequately documented, and allowable under the State Education Department’s (SED) guidelines, including the Reimbursable Cost Manual (RCM). The audit covered expenses reported on Adirondack’s CFR for the fiscal year ended June 30, 2014.

Adirondack is an SED-approved, for-profit special education provider located in Clinton County, New York. Adirondack provides preschool special education services to children with disabilities who are between three and five years of age. Adirondack is reimbursed for preschool special education services through rates set by SED. The reimbursement rates are based on financial information, including costs, that Adirondack reports to SED on its annual CFR. To be eligible for reimbursement, reported costs must comply with the RCM requirements. For the fiscal year ended June 30, 2014, Adirondack reported $1.1 million in reimbursable costs on its CFR for the rate-based preschool special education programs (Programs) it operated.

Key Findings

For the fiscal year ended June 30, 2014, we identified $37,643 in ineligible costs that Adirondack reported on its CFR for the Programs. The ineligible costs included:

  • $22,215 in other than personal service costs that consisted of $9,453 in ineligible rent, $5,939 in non-reimbursable working capital interest, $3,756 in non-Program-related costs, and $3,067 in non-reimbursable expenses such as food, gifts, charitable donations, fundraising, insufficiently documented expenses, and life insurance costs; and
  • $15,428 in excess personal service costs for two Adirondack owners who also worked for a related entity.

Key Recommendations


  • Review the disallowances identified by our audit and, if warranted, make the necessary adjustments to the costs reported on Adirondack’s CFR and to Adirondack’s tuition reimbursement rates.
  • Remind Adirondack officials of the pertinent SED requirements that relate to the deficiencies we identified.

To Adirondack:

  • Ensure that costs reported on annual CFRs fully comply with SED’s requirements, and communicate with SED to obtain clarification as needed.
  • Ensure that less-than-arm’s-length transactions are disclosed on the CFR in accordance with SED’s requirements.

Other Related Audits/Reports of Interest

Jowonio School: Compliance With the Reimbursable Cost Manual (2016-S-48)
North Country Kids, Inc.: Compliance With the Reimbursable Cost Manual (2016-S-53)

State Government Accountability Contact Information:
Audit Director: Andrea Inman
Phone: (518) 474-3271; Email:
Address: Office of the State Comptroller; Division of State Government Accountability; 110 State Street, 11th Floor; Albany, NY 12236