California Code of Regulations › Title 17 - Public Health › Division 2 - Health and Welfare Agency-Department of Developmental Services Regulations › Chapter 3 - Community Services › Subchapter 21 - Habilitation Services Program › Article 8 - Ratesetting Methodology for Work Activity Programs › Section 58874 - Reporting Requirements

Current through Register 2024 Notice Reg. No. 28, July 12, 2024
(a)
					 To receive a rate based on allowable cost, in accordance with these
					 regulations, a vendor shall establish a historical period. In the case of new
					 vendors meeting all other criteria for vendorization, the historical period
					 need not extend a full year, but it shall occupy at least three months ending
					 no later than March 31 preceding the payment year for which the Work Activity
					 Program's rate is being established. That historical period shall be
					 representative of the vendor's ongoing operating costs excluding start-up
					 costs.
(b) The vendor shall submit,
					 as required by the Department, a completed Cost Statement for the historical
					 period in accordance with the principles, policies, procedures, and
					 instructions specified in Section
					 58864. Using representative cost
					 and consumer data in the Cost Statement, the Department shall apply the
					 policies and procedures in these regulations to establish the rate for the
					 upcoming payment year. If service provider operations during the historical
					 period are dependent upon establishment grant funds which will terminate before
					 the payment year for which the rate is being set, the Department shall not
					 apply such grant funds as a recovery in its computation of the rate.
(c) If the Department determines that the
					 minimum required historical period is not sufficiently representative of cost
					 and consumer data as the basis for establishing the rate, the policy set forth
					 in Section
					 58860(c) shall be
					 in effect. To be sufficiently representative, the historical period shall not
					 contain costs that are essentially start-up costs (security deposits, moving
					 expenses, etc.), and the consumer attendance during the historical period shall
					 reasonably approximate the caseload level that had been anticipated in the
					 service provider's request -for vendorization.
(d) Expenses for other programs not provided
					 as part of the Work Activity Program shall be reported separately from the
					 expenses of Work Activity Program services. However, such expenses may be
					 consolidated under one cost center unless a portion of those expenses are
					 allowable Work Activity Program expenses.
(e) An independent review of financial
					 statements performed by an accountant may be submitted instead of an
					 independent audit and shall cover at a minimum the following:
(1) An inquiry as to the vendor's accounting
					 principles and practices and methods used in applying them;
(2) An inquiry as to the vendor's procedures
					 for recording, classifying, and summarizing transactions and accumulating
					 information;
(3) Analytical
					 procedures designed to identify relationships or items that appear to be
					 unusual;
(4) An inquiry about
					 budgetary actions taken at meetings of board of directors or other comparable
					 meetings;
(5) An inquiry about
					 whether the financial statements have been properly prepared in conformity with
					 Generally Accepted Accounting Principles and whether any events subsequent to
					 the date of the financial statements would have a material effect on the
					 statements under review;
(6)
					 Working papers prepared in connection with a review of financial statements
					 describing the items covered as well as any unusual items, including their
					 disposition.