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NYS Comptroller


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State Education Department
Headstart of Rockland, Inc.
Compliance With the Reimbursable Cost Manual

Issued: December 27, 2018
Link to full audit report 2018-S-25
Link to 90-day response

To determine whether the costs reported by Head Start of Rockland, Inc. (HSOR) 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 HSOR’s CFR for the fiscal year ended June 30, 2015.

HSOR is an SED-approved, not- for-profit special education provider located in Rockland County, New York. HSOR provides preschool special education services to children with disabilities who are between three and five years of age. HSOR is reimbursed for preschool special education services through rates set by SED. The reimbursement rates are based on financial information, including costs, that HSOR 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, 2015, HSOR reported approximately $869,436 in reimbursable costs on its CFR for two rate-based preschool special education programs (Programs) that it operated.

Key Findings
For the fiscal year ended June 30, 2015, we identified $7,958 in ineligible costs that HSOR reported on its CFR for the Programs. The ineligible costs included $6,841 in personal service costs and $1,117 in other than personal service costs.

Key Recommendations

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


  • Ensure that costs reported on annual CFRs fully comply with SED’s requirements, and communicate with SED to obtain clarification as needed.

Other Related Audits/Reports of Interest
School for Language and Communication Development: Compliance With the Reimbursable Cost Manual (2017-S-59)
Kinderwise Learning Associates, LLC: Compliance With the Reimbursable Cost Manual (2018-S-21)

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