FAC Explorer

Audit 18831

FY End
2022-09-30
Total Expended
$5.63M
Findings
4
Programs
2
Organization: Woodstock Mutual Homes, Inc. (PA)
Year: 2022 Accepted: 2023-06-28
Auditor: Rubino & Company

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
15700 2022-001 Material Weakness Yes F
15701 2022-002 Material Weakness Yes E
592142 2022-001 Material Weakness Yes F
592143 2022-002 Material Weakness Yes E

Programs

ALN Program Spent Major Findings
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $4.36M Yes 0
14.195 Section 8 Housing Assistance Payments Program $1.27M Yes 2

Contacts

Name Title Type
CEPPCZN45FS8 Samuel Rotter Auditee
6096468861 Robert Kozak Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: Basis of PresentationThe accompanying schedule of expenditures of Federal Awards (the Schedule) includes the Federal Award activity of Woodstock Mutual Homes, Inc. (the Project) under programs of the Federal Government for the year ended September 30, 2022.The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Project, it is not intended to and does not present the Projects financial position, changes in net assets, or cash flows. Summary of Significant Accounting PoliciesExpenditures 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 auditee did not use the de minimis cost rate. MORTGAGE INSURANCE FOR THE PURCHASE OR REFINANCING OF EXISTING MULTIFAMILY HOUSING PROJECTS (14.155) - Balances outstanding at the end of the audit period were 4264773.

Finding Details

Finding 2022-001
2022-001 (CFDA NO. 14.195) ? Management and Occupancy Review (MOR) Statement of Condition Pennsylvania Multifamily Asset Managers (PMAM) conducted a Management and Occupancy Review (MOR) on October 19, 2020. Their report, dated November 16, 2020, reflected a below average rating related to Leasing and Occupancy, as well as General Management Practices. However, the report did, in fact, give a satisfactory rating related to physical building inspection. Criteria The Housing Assistance Payments (HAP) Contract requires compliance regarding the physical building and tenant files to be in accordance with that contract. Effect Failure to comply with the Regulatory Agreement and HAP Contract is a violation of HUD regulations. Cause The property has had a high turnover rate with onsite managers, making it more difficult to establish and strengthen effective policies and procedures related to tenant file maintenance. Recommendation Management must perform the corrective actions as required by the MOR by the target completion dates. Management/Owner Response The Board and Management agree with the finding and is taking action to correct the findings and to implement the recommendations. All other corrective actions will be performed and completed by onsite management personnel during the current year.
Finding 2022-002
2022-2 (CFDA NO. 14.195) ? Resident File Test Deficiencies Statement of Condition In July, 2020, US Housing Consultants, an outside consultant, performed a review of the Project?s resident files and noted that many of the resident files did not contain all of the proper documentation. Resident file deficiencies were also noted by us during our lease testing for the current year. The exceptions noted within the US Housing Consultants report and/or by us during our lease testing included, but were not limited to, incorrect or incomplete 50059 forms, missing or incomplete tenant applications, missing initial tenant move-in documentation, missing income verification reports, missing work order reports, and missing recertification reminder notices. Criteria The HAP Contract requires that the Project comply with the requirements in HUD Handbook 4350.3 regarding tenant lease files. Effect The Corporation did not maintain resident files in accordance with HUD regulations and policies. Recommendation The Corporation must maintain resident files in accordance with HUD regulations and policies. Management/Owner Response Management agrees with the finding. The resident files are undergoing a 100% file inspection by a separate CRM employee. All deficiencies will be identified and corrected such as items that cannot be re-created.
Finding 2022-001
2022-001 (CFDA NO. 14.195) ? Management and Occupancy Review (MOR) Statement of Condition Pennsylvania Multifamily Asset Managers (PMAM) conducted a Management and Occupancy Review (MOR) on October 19, 2020. Their report, dated November 16, 2020, reflected a below average rating related to Leasing and Occupancy, as well as General Management Practices. However, the report did, in fact, give a satisfactory rating related to physical building inspection. Criteria The Housing Assistance Payments (HAP) Contract requires compliance regarding the physical building and tenant files to be in accordance with that contract. Effect Failure to comply with the Regulatory Agreement and HAP Contract is a violation of HUD regulations. Cause The property has had a high turnover rate with onsite managers, making it more difficult to establish and strengthen effective policies and procedures related to tenant file maintenance. Recommendation Management must perform the corrective actions as required by the MOR by the target completion dates. Management/Owner Response The Board and Management agree with the finding and is taking action to correct the findings and to implement the recommendations. All other corrective actions will be performed and completed by onsite management personnel during the current year.
Finding 2022-002
2022-2 (CFDA NO. 14.195) ? Resident File Test Deficiencies Statement of Condition In July, 2020, US Housing Consultants, an outside consultant, performed a review of the Project?s resident files and noted that many of the resident files did not contain all of the proper documentation. Resident file deficiencies were also noted by us during our lease testing for the current year. The exceptions noted within the US Housing Consultants report and/or by us during our lease testing included, but were not limited to, incorrect or incomplete 50059 forms, missing or incomplete tenant applications, missing initial tenant move-in documentation, missing income verification reports, missing work order reports, and missing recertification reminder notices. Criteria The HAP Contract requires that the Project comply with the requirements in HUD Handbook 4350.3 regarding tenant lease files. Effect The Corporation did not maintain resident files in accordance with HUD regulations and policies. Recommendation The Corporation must maintain resident files in accordance with HUD regulations and policies. Management/Owner Response Management agrees with the finding. The resident files are undergoing a 100% file inspection by a separate CRM employee. All deficiencies will be identified and corrected such as items that cannot be re-created.