FAC Explorer

Audit 18700

FY End
2022-12-31
Total Expended
$3.28M
Findings
2
Programs
1
Organization: Cornelia House (MN)
Year: 2022 Accepted: 2023-04-20
Auditor: Wipfli LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
27959 2022-002 Significant Deficiency Yes B
604401 2022-002 Significant Deficiency Yes B

Programs

ALN Program Spent Major Findings
14.135 Mortgage Insurance_rental and Cooperative Housing for Moderate Income Families and Elderly, Market Interest Rate - Section 221(d)(4) - Insured Mortgage $3.28M Yes 1

Contacts

Name Title Type
ULFWHKMBJ8A1 Tom Henry Auditee
6512098529 Kim Heller Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Project has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Cornelia House (HUD Project No. 092-35750) under a program of the federal government for the year ended December 31, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance). Because the Schedule presents only a selected portion of the operations of Cornelia House (HUD Project No. 092-35750), it is not intended to, and does not present the financial position, changes in net assets, or cash flows of Cornelia House (HUD Project No. 092-35750).
Title: U.S. Department of Housing and Urban Development Mortgage Insurance Renta Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Project has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. Cornelia House (HUD Project No. 092-35750) has a loan that is insured by HUD under Section 221(d)(4) of the National Housing Act. The loan balance outstanding at the beginning of the year is included in the federal expenditures presented in the Schedule. The Project received no additional loans during the year. The balance of the loan outstanding at December 31, 2022, is $3,209,102.
Title: Subrecipient Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Project has not elected to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The Project passed no federal awards through to subrecipients.

Finding Details

Finding 2022-002
U.S. Department of Housing and Urban Development Finding 2022.002, CFDA #14.135 Section 221(d)(4) ? Insured Mortgage Condition: At June 30, 2022, there was $145,939 of related party receivables included in the surplus cash calculation comprised of $116,973 related to the Small Business Administration Paycheck Protection Program described below and $28,966 for other matters. As of December 31, 2022, the related party receivable totaling $116,973 related to the Small Business Administration Paycheck Protection Program. Criteria: The Project may only distribute funds to affiliates up to the amount required for management fees, as reimbursement for payroll, benefits, and operating expenses, or from allowable distributions of surplus cash taken only after the semiannual or annual surplus cash calculations. Amounts in excess are unauthorized distributions. Cause: The Project?s has a related party receivable at December 31, 2022, for amounts earned by the Project as part of the Small Business Administration Paycheck Protection Program. These funds, earned by the Project, were received by an affiliated entity in 2021 and have not yet been remitted to the Project. Effect: An affiliate of the Project has not remitted amounts earned by the Project as part of the Small Business Administration Paycheck Protection Program in a timely manner. Recommendation: The Project should request the affiliate to remit the amounts earned by the Project as part of the Small Business Administration Paycheck Protection Program. View of Responsible Officials: The Project will request payment from the affiliate and will continue to monitor related party activity to ensure the Project does not pay reimbursements or advances to affiliates in excess of allowed expenditures or allowable distributions of surplus cash.
Finding 2022-002
U.S. Department of Housing and Urban Development Finding 2022.002, CFDA #14.135 Section 221(d)(4) ? Insured Mortgage Condition: At June 30, 2022, there was $145,939 of related party receivables included in the surplus cash calculation comprised of $116,973 related to the Small Business Administration Paycheck Protection Program described below and $28,966 for other matters. As of December 31, 2022, the related party receivable totaling $116,973 related to the Small Business Administration Paycheck Protection Program. Criteria: The Project may only distribute funds to affiliates up to the amount required for management fees, as reimbursement for payroll, benefits, and operating expenses, or from allowable distributions of surplus cash taken only after the semiannual or annual surplus cash calculations. Amounts in excess are unauthorized distributions. Cause: The Project?s has a related party receivable at December 31, 2022, for amounts earned by the Project as part of the Small Business Administration Paycheck Protection Program. These funds, earned by the Project, were received by an affiliated entity in 2021 and have not yet been remitted to the Project. Effect: An affiliate of the Project has not remitted amounts earned by the Project as part of the Small Business Administration Paycheck Protection Program in a timely manner. Recommendation: The Project should request the affiliate to remit the amounts earned by the Project as part of the Small Business Administration Paycheck Protection Program. View of Responsible Officials: The Project will request payment from the affiliate and will continue to monitor related party activity to ensure the Project does not pay reimbursements or advances to affiliates in excess of allowed expenditures or allowable distributions of surplus cash.