Massachusetts Operational Services Division Provides EEC UFR Reporting Guidance
The Massachusetts Department of Early Education and Care (EEC) introduced changes to its contract reimbursement model that give providers greater flexibility in how costs are recognized. As a reminder, effective October 1, 2024, contracts that were once primarily unit rate now follow a mix of unit rate and cost-reimbursable structures. The change applies to both Income Eligible programs—including Families Experiencing Homelessness (FEH) and Parents Under 24—and Department of Children and Families (DCF) programs, affecting Center-Based and Family Child Care providers alike. For many organizations, these changes introduce overlapping Uniform Financial Report (UFR) requirements from year to year, making careful planning essential.
Providers should note that the update may affect preparation of the UFR. Understanding how costs are categorized under the new model is critical to ensure accurate UFR submission and compliance with EEC expectations.
Prepare for the EEC Shift
AAFCPAs advises that clients use this opportunity to reassess and optimize business processes and systems to maximize efficiency and align with new requirements.
Impact on UFR Preparation
The Massachusetts Uniform Financial Report (UFR) is the standard tool EEC uses to track provider finances and ensure compliance. For those responsible for preparing the UFR, the new contract model introduces changes that require extra attention and adjustment from prior UFR filings. Between October 1, 2024 and June 30, 2025, EEC guidance allows Administrative and Supportive Services cost-reimbursable contracts to be combined into a single Schedule B for each contract type.
Providers must continue to separate programs in two ways:
- Income Eligible versus DCF programs
- Center-Based versus Family Child Care programs
For example, an organization that operates both Center-Based and Family Child Care programs, with contracts under both Income Eligible and DCF, will need to prepare separate Schedule Bs for each of the following.
Program Type Contract Type
Center-Based Income Eligible – Unit Rate
Center-Based Income Eligible – Admin & Supportive Services
Center-Based DCF – Unit Rate
Center-Based DCF – Admin & Supportive Services
Family Child Care Income Eligible – Unit Rate
Family Child Care Income Eligible – Admin & Supportive Services
Family Child Care DCF – Unit Rate
Family Child Care DCF – Admin & Supportive Services
Providers should also be aware that the Massachusetts Operational Services Division may update the UFR to reflect these changes, and teams should monitor for any official guidance to avoid reporting errors.
Other UFR Changes for Fiscal Year 2025
The fiscal year 2025 UFR Audit and Preparation Manual eases one reporting requirement by no longer requiring Schedule Bs to be broken out by age group. However, providers should note that this change does not apply to all contracts. Per EEC guidance, unit rate contracts in effect from July 1, 2024 through September 30, 2024 must still be reported by age group and reported in separate Schedule Bs. These must follow the rules outlined in the fiscal year 2024 UFR Audit and Preparation Manual. This creates a transition period where providers may be working under two different sets of reporting instructions, reinforcing the need to track overlapping requirements carefully.
For providers, the key steps are clear.
- Identify which contracts fall under the new cost-reimbursable model.
- Prepare separate Schedule Bs by care type—Center-Based and Family Child Care—and by contract type, distinguishing between Income Eligible and DCF as well as unit rate and cost reimbursement.
- At the same time, continue to report unit rate contracts that predate October 1, 2024, by age group to remain in compliance.
Careful organization at the outset will help providers manage these overlapping and year-to-year requirements smoothly.
How We Help
AAFCPAs’ Human & Social Services practice provides comprehensive financial, operational, and strategic solutions to help multi-service human services agencies thrive in complex, high-demand environments. Our team of CPAs, consulting tax attorneys, fractional CFOs, data analysts, and business process specialists works closely with leadership to optimize funding, ensure regulatory compliance, and streamline operations across programs such as behavioral health, workforce development, childhood services, foster care, housing, and disability support. We offer a full suite of services including reimbursement optimization, outsourced accounting, technical accounting advisory, business process improvement, system selection and implementation, financial forecasting, risk management, and board governance consulting. By aligning operational and financial strategies with organizational objectives, we enable agencies to manage overlapping requirements, adapt to funding changes, and focus on delivering mission-critical programs efficiently and sustainably.
Beyond compliance, we provide hands-on UFR expertise, assisting in the preparation of some of the most complex Uniform Financial Reports in Massachusetts. Our team helps organizations navigate cost allocation methodologies and understand their impact on financial outcomes. We also support automation of the UFR process using bot technology, reducing administrative burden and improving efficiency. In addition, we offer outsourced accounting and fractional CFO solutions, technology and process advisory, investment management, and financial training for boards and leadership teams, delivering tailored support that helps organizations maintain operational efficiency, financial stability, and compliance while continuing to provide high-quality services to the communities they serve.
These insights were contributed by Kevin Quinn, CPA, Director, Assurance and David Kelleher, CPA, CGMA, Partner.
Questions? Reach out to our authors directly or your AAFCPAs partner.
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