This audit examined State University of New York (SUNY) at Brooklyn's University Hospital's controls over contracting for food and nursing services, sole source contracts, accounts payable controls, supplies inventories, and equipment inventories. It examined selected practices from April 1, 1990, through March 31, 1993, through staff interviews, review of records, and comparison with comparable costs at similar facilities. The audit found that the Hospital had not made enough effort to attract qualified bidders before it awarded contracts. At the time of the food service contract renewal the Hospital received only two bids. The audit also found that the Hospital did not award per-diem nursing contracts to the lowest bidder and could not explain why certain bidders were disqualified. In addition, nursing staff were permitted to work for contractors outside their regular hours resulting in the Hospital paying nursing contractors for services not provided making a total overpayment of about $35,000 during the audit period. The audit also found that the Sterile Supply Unit was significantly overstated in value. Regarding equipment, some improvements were needed to ensure that new items were recorded on control records and that items removed were eventually returned. SUNY officials agreed with the report and their comments are included. (JB)