Finding 576165 (2024-001)

Material Weakness
Requirement
C
Questioned Costs
-
Year
2024
Accepted
2025-09-11

AI Summary

  • Core Issue: Subcontractors were not reimbursed on time due to delays in contract approval from OTDA.
  • Impacted Requirements: Compliance with 2 CFR §200.305(b) regarding timely payments was not met.
  • Recommended Follow-Up: HSNY should enhance efforts to ensure prompt reimbursement processes for subcontractors moving forward.

Finding Text

2024-001 Payment Timing Requirements Criteria: 2 CFR §200.305(b) requires payments methods must minimize the time elapsing between the transfer of funds from the federal agency and the disbursement of funds and that recipients must make timely payments to contractors in accordance with contract provisions. Condition: Instances were identified where subcontractors were not reimbursed in a timely manner. Recommendation: We recommend that the Organization make all necessary efforts to decrease the amount of time that passes between when funds are received and when subcontractors are reimbursed. Views of Responsible Officials and Planned Corrective Actions: HSNY was unable to submit monthly claims for their primary grant due to delays with New York State Office of Temporary and Disability Assistance (OTDA) drafting and approving a contract for the period. While OTDA approved appropriation of the funds to HSNY, without a contract in place, HSNY was unable to submit claims for payment for the period through June 30, 2024 until the contract was approved in May 2025. Changes to the submittal process implemented by OTDA also delayed HSNY’s ability to submit claims for approval. This had a detrimental impact to cash flow as operating costs needed to be paid during this period. With the approval of the contract and efforts being made at OTDA to expedite payment, HSNY’s cash flow position has since improved and reimbursements to subcontractors as of the audit date are being made timely.

Corrective Action Plan

Changes to the submittal process implemented by OTDA also delayed HSNY’s ability to submit claims for approval. This had a detrimental impact to cash flow as operating costs needed to be paid during this period. With the approval of the contract and efforts being made at OTDA to expedite payment, HSNY’s cash flow position has since improved and reimbursements to subcontractors as of the audit date are being made timely.

Categories

Cash Management Special Tests & Provisions

Other Findings in this Audit

  • 576166 2024-002
    Material Weakness Repeat
  • 1152607 2024-001
    Material Weakness
  • 1152608 2024-002
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
10.557 Wic Special Supplemental Nutrition Program for Women, Infants, and Children $1.90M
10.561 State Administrative Matching Grants for the Supplemental Nutrition Assistance Program $1.14M