New York State Comptroller Thomas P. DiNapoli announced the following audits and reports were issued during the week ending August 28, 2021
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State Departments and Agencies
A report covering the period April 1, 2016, through May 31, 2019, found that while the department’s industrial hemp program had expanded opportunities for hemp production in the state, it did not always follow established practices when reviewing applications, conducting inspections and sampling plants. In a follow-up, auditors found department officials made progress in addressing the problems identified in the initial audit. Of the initial report’s three audit recommendations, one has been fully implemented and two have been partially implemented.
As of December 23, 2020, there were 448 OMH-licensed, -designated, and/or -funded mental health care providers operating 1,677 programs eligible to offer TMH; however, 307 of those 448 providers operating 1,050 programs were not approved to use TMH beyond the declared COVID-19 disaster emergency. As a result, some patients may no longer be able to access TMH services once the disaster emergency period ends.
Overall, Metro-North has procedures to address how its employees respond to most issues that cause unexpected or unplanned events. However, the procedures were not always followed. In 38 of the 80 events sampled by auditors, there was not always documented evidence that the procedures were followed completely. In addition, 26 of the 80 events required the railroad’s Emergency Management Task Force (EMTF) to be placed on standby or activated; however, the EMTF was notified of only one event. Metro-North’s procedures require customers to be notified of unexpected or unplanned events within a set time frame, but during the sampled events, customers either were not notified or were informed late.
DOB is responsible for regulating the safe and lawful use of more than 1 million buildings and construction sites in the city including sidewalk sheds, temporary structures installed to protect people and property on city sidewalks during construction and demolition operations. Auditors found DOB needs to better ensure that owners and other responsible parties comply with relevant codes, laws, and rules pertaining to the timely permitting, installation, maintenance, and removal of sheds. During the period Dec. 20, 2019, through March 10, 2020, auditors visited a sample of 74 sites located throughout the five boroughs, finding many with hazardous conditions and without posted permits.
DOE could not show how existing CTE programs aligned with the labor market and student demand. Information provided did not reflect how DOE is overseeing or assisting high schools to align CTE programs with high-growth, high-demand industries. For three high-growth industry programs reviewed, auditors found school requirements and program admission priorities (based on residence in a particular borough or attendance at a fair or information session) made it difficult or impossible for some students to qualify or attend.
The Mitchell-Lama Housing Program was created in 1955 to provide affordable rental and cooperative (co-op) housing to middle-income families. Auditors found that despite the scarcity of affordable housing, vacant apartments were generally not filled within the 120-day time frame, with 1,286 apartments taking, on average, 222 days to fill, including 214 that remained vacant for a year or longer. Protracted delays in filling apartments cost the developments about $9.1 million in unrealized income as of December 2019. At one development – Lindsay Park in Brooklyn – 15 apartments had been vacant for as long as 30 years.
Parks has generally established controls to ensure construction management term contractors are meeting contract terms and requirements. Auditors identified only limited instances where the office could not provide documentation showing requirements were met and minor overpayments were made, for which Parks has obtained a refund from the contractor. Auditors also found Parks paid over $229,000 in fees under the contract with the Dormitory Authority of the State of New York (DASNY) that could have been avoided if it had used a term contract rather than the DASNY contract.
The department generally complies with the act’s requirements, having processes in place to ensure only individuals meeting requirements are issued registration cards, and maintaining an accurate registry of security guard applicants. However, the department lacks sufficient internal controls to monitor training requirements for security guards classified as police and peace officers – a classification that includes individuals who are retired. Auditors identified instances where the department inappropriately renewed security guard registrations for security guards with these classifications without evidence that training was completed.
An audit issued in September 2019 found insufficient HR monitoring and oversight, as well as inadequate or poorly enforced policies and procedures, contributed to questionable and weak practices that rendered Upstate vulnerable to misuse of funds and safety and security risks. In a follow-up, auditors found Upstate officials made significant progress in addressing the problems identified in the initial audit, having implemented all four recommendations.
An audit issued in June 2020 determined that Upstate’s access controls were not sufficient to prevent unnecessary or inappropriate access to various applications. Upstate employees maintained unnecessary and inappropriate access to applications after a change in their status, such as employment separation or death, and some of these user accounts were logged into during the period of inappropriate active access. In a follow-up, auditors found Upstate made significant progress in addressing the problems identified in the initial audit. Both of the initial report’s recommendations were implemented.
Although the clerk recorded, deposited, remitted and reported all tax collections, she did not always record dates of receipts or deposit or remit payments timely. Auditors also found that the clerk did not properly record dates of collections for clerk fees on 21 of 29 daily collections totaling $438 (64%). The clerk did not deposit all tax collections within 24 hours as required. In addition, the clerk did not remit real property tax collections to the town supervisor or the county treasurer in a timely manner.
The board did not effectively manage fund balance and reserve levels, establish multiyear plans or ensure the proper procurement of professional services and playground equipment. The board also did not adopt an adequate reserve policy, which resulted in the unrestricted general fund balance to increase to an excessive level. The board did not always seek competition for professional services or have adequate written agreements for the services provided. In addition, the board did not properly procure playground equipment totaling $397,000.
The town’s bookkeeper maintained adequate records and the accounting records auditors reviewed were accurate and complete. However, the supervisor did not prepare and submit appropriate reports or provide sufficient oversight of the bookkeeper. Annual update documents were not filed with the Office of the State Comptroller, as required. Bank reconciliations were not always performed by the bookkeeper and were not reviewed by the supervisor. In addition, monthly financial reports were not always prepared for and submitted to the town board. The reports did not include a detail of money received and disbursed as required.
District officials did not establish adequate internal controls to safeguard the district’s user accounts. Specifically, network user accounts were not adequately managed. Officials did not monitor compliance with the district’s acceptable use policy. The board also did not adopt adequate information technology (IT) policies or a disaster recovery plan. Sensitive IT control weaknesses, including issues related to software updates, were communicated confidentially to officials.
The district did not claim any Medicaid reimbursements to which it was entitled. District officials did not claim Medicaid reimbursements for 12 students that auditors identified were likely Medicaid-eligible who received speech, occupational or physical therapy services during 2019-20. Had these services been claimed, the district could have realized revenue totaling about $25,000. District officials also believed it was not cost-effective to file Medicaid claims but could not support their assertions because the district did not prepare a recent cost benefit analysis to support it is not cost-effective. In addition, district officials did not establish Medicaid claim policies or procedures or ensure that sufficient documentation was maintained for the eligible services provided.
Officials did not establish adequate controls over the district’s user accounts to prevent unauthorized use, access and loss. Officials also did not periodically review and disable unneeded network user accounts.
The audit found 46 unenrolled students had active network user accounts and 13 former employees who left between 2013 and 2020 also had active network user accounts. In addition, auditors found nine generic accounts last used between 2015 and 2018. Officials also did not develop a breach notification policy, as required by New York State Technology Law. Sensitive information technology (IT) control weaknesses were communicated confidentially to officials.
The board and district officials did not properly manage fund balance in accordance with statute. The board and district officials overestimated budgetary appropriations and appropriated fund balance, resulting in surplus fund balance exceeding the 4% statutory limit by approximately $1.4 million, or 15 percentage points. The board and district officials also did not develop and adopt a comprehensive written multiyear financial plan and did not adhere to the fund balance policy.
While the district’s payroll payments were paid at accurate rates, payroll payments were not always properly supported and approved and leave time accruals were not always accurate. Further, district officials did not properly monitor the payroll and leave accrual process and they have not developed any payroll policies or procedures. Auditors reviewed 41 timecards and found that while not required by the district, more than 70% of the timecards (30 of 41) were not signed by a supervisor and none were signed by the employee. More than 60% of the timecards (25 of 41) were incomplete as a result of missed punches totaling approximately 250 hours or $4,400. Timecard adjustments totaling $3,130 were not properly reviewed or approved, as required. In addition, the payroll clerk did not deduct a total of 13 days of approved leave time, valued at $2,100, from two employees’ leave accrual records.