Institutional Federal Compliance Report 2021

STATE OF NEW YORK

Schedule of Findings and Questioned Costs

Year ended March 31, 2018

Federal Agency:

U.S. Department of Health and Human Services

Federal Program:

Child Care and Development Fund Cluster (93.575, 93.596)

Federal Award Numbers:

G1503NYCCDF, 1601NYCCDF, 1701NYCCDF, 1801NYCCDF, G1503NYTANF, G1601NYTANF, 1701NYTANF

Federal Award Years:

2015, 2016, 2017, and 2018

State Agency:

Office of Children and Family Services

Reference:

2018-011

Criteria Title 45 U.S. Code of Federal Regulations Part 75 (45 CFR 75), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for HHS Awards , Section 75.303 states the non-Federal entity must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. This would include allowing the non-Federal entity to evaluate and monitor its compliance with statute, regulations and the terms and conditions of federal awards and to take prompt action when instances of noncompliance are identified and to take reasonable measures. Additionally, 45 CFR 75.351 states the non-Federal entity may concurrently receive Federal awards as a recipient, a subrecipient, and a contractor, depending on the substance of its agreements with HHS awarding agencies and pass-through entities. Therefore, a pass-through entity must make case-by-case determinations whether each agreement it makes for the disbursement of Federal program funds casts the party receiving the funds in the role of a subrecipient or a contractor. Condition In addition to establishing funding arrangements with local districts, the Office of Children and Family Services (the Office) enters into agreements with nonprofit organizations to provide services under the Child Care and Development Fund Cluster (CCDF). The Office does not have a formal vendor determination policy that it utilizes when identifying whether the agreements with the nonprofit organizations are contracts or subrecipient arrangements. Management has presented all these agreements as subrecipient arrangements in the schedule of expenditures of federal awards. For 3 of the 39 grant arrangements we tested, the description of services relate to contracted services and should not have been considered subrecipient arrangements. For 6 of 6 agreements selected for testing, the Office did not provided its determination of the agreement as a subrecipient arrangement or contractor arrangement. Additionally, for the agreements, which the Office indicated were subrecipient arrangements, the Office did not provide the required award identification information as required by 45 CFR 75.352. Cause The condition found is due to the Office’s lack of a formal vendor determination policy.

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