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State Education Department
Minds in Motion, Inc.
Compliance With the Reimbursable Cost Manual

Issued: December 31, 2019
Link to full audit report 2019-S-28

To determine whether the costs reported by Minds in Motion, Inc. (MIM) on its Consolidated Fiscal Reports (CFR) were properly calculated, adequately documented, and allowable under the State Education Department’s (SED) guidelines, including the Reimbursable Cost Manual (RCM). We audited the costs that MIM reported on its CFR for the fiscal year ended June 30, 2015.

About the Program
MIM is an SED-approved, for-profit special education provider located in Newburgh. MIM provides preschool special education services to children with disabilities who are between three and four years of age. MIM is reimbursed for these services through rates set by SED. The reimbursement rates are based on financial information, including costs, that MIM 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, MIM reported $571,094 in reimbursable costs for the one rate-based preschool special education program it operated.

Key Findings
For the fiscal year ended June 30, 2015, we identified $27,970 in costs reported by MIM on its CFR that were ineligible for reimbursement. The ineligible costs included:

  • $25,412 in personal service costs, consisting of $20,003 in salaries and $1,994 in fringe benefits for compensation to an executive that exceeded 1.0 full-time equivalent, and $3,024 in salaries and $391 in fringe benefits for executive compensation that was inappropriately allocated to the preschool program; and
  • $2,558 in other than personal service costs, consisting of $1,580 in expenses that lacked appropriate documentation or were not program related, $933 in costs for meals provided at meetings for staff, and $45 in gifts.

Key Recommendations

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


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

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