Field of Dreams, Inc. – Compliance With the Reimbursable Cost Manual

Issued Date
October 26, 2022
State Education Department (Preschool Special Education Audit Initiative)


To determine whether the costs reported by Field of Dreams, Inc. (FOD) on its Consolidated Fiscal Reports (CFRs) were properly calculated, adequately documented, and allowable under the State Education Department’s (SED) guidelines, including the Reimbursable Cost Manual (RCM) and the Consolidated Fiscal Reporting and Claiming Manual (CFR Manual). The audit covered the costs submitted by FOD to SED on its CFRs for the fiscal year ended June 30, 2019 and certain expenses for the fiscal year ended June 30, 2018.

About the Program

FOD is an SED-approved, for-profit special education provider located in Slate Hill, serving students from Orange and Ulster counties. FOD provides special education services to children with disabilities who are between the ages of 3 and 5 years. FOD is reimbursed for these services through rates set by SED. The reimbursement rates are based on financial information, including costs that FOD reports to SED on its annual CFR. To be eligible for reimbursement, reported costs must comply with RCM requirements. For the 2 fiscal years ended June 30, 2019, FOD reported approximately $2.4 million in reimbursable costs on its CFRs for two rate-based special education programs that it operated: Preschool Special Class – over 2.5 hours per day and Preschool Integrated Special Class – over 2.5 hours per day (collectively referred to as the Programs).

Key Findings

For the 2 fiscal years ended June 30, 2019, we identified $172,121 in ineligible costs reported by FOD on its CFRs for the Programs. The ineligible costs included:

  • $96,052 in personal service costs, consisting of $71,197 in executive compensation that was in excess of the allowable median rate and $24,855 in related-party salaries without supporting work documentation.
  • $76,069 in other than personal service costs, consisting of $43,574 in ineligible costs, $30,995 in insufficiently documented costs, and $1,500 in incorrectly allocated expenses.

Key Recommendations


  • Review the disallowances identified by our audit and, if warranted, make the necessary adjustments to the costs reported on FOD’s CFR and to FOD’s tuition reimbursement rates.
  • Remind FOD officials of the pertinent SED guidelines 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.

Brian Reilly

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