Audit 18919

FY End

2022-09-30

Total Expended

$3.90M

Findings

2

Programs

2

Organization: Edward Romero Terrace (FL)

Year: 2022 Accepted: 2023-01-23

Auditor: Bellows Associates P A

Organization Exclusion Status:

Checking exclusion status...

ID	Ref	Severity	Repeat	Requirement
15867	2022-001	-	-	N
592309	2022-001	-	-	N

ALN	Program	Spent	Major	Findings
14.157	Section 202 Supportive Housing for the Elderly - Capital Advance	$3.61M	Yes	0
14.157	Section 202 Supportive Housing for the Elderly - Prac	$288,257	Yes	1

Contacts

Name	Title	Type
ET6GBML8NK16	Irene Phillips	Auditee
9548359200	Jennifer R. Koffman	Auditor
No contacts on file

Notes to SEFA

Title: NOTE C - U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT CAPITAL ADVANCE Accounting Policies: NOTE A - BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards includes the federal grant activity of Edward Romero Terrace, HUD Project No. 116-EE041, and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of Title2 U.S. Code of Federal Regulations 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 Edward Romero Terrace, it is not intended to and does not present the financial position, changes in net assets, or cash flows of Edward Romero Terrace. NOTE B - SUMMARY OF SIGNIFICANT 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: Edward Romero Terrace has elected not to use the 10-percent de minimis indirect cost rate allowed under the UniformGuidance. Edward Romero Terrace has received a HUD capital advance under Section 202 of the National Housing Act. The capital advance balance outstanding at the beginning of the year is included in the federal expenditures presented in the schedule. Edward Romero Terrace received no additional loans during the year. The balance of the capital advance outstanding as of September 30, 2022 was $3,612,101.

Finding Details

Finding 2022-001

FINDING No. 2022-001: Section 202 - Supportive Housing for the Elderly, CFDA 14.157 Finding Resolution Status: Resolved. Information on Universe Population Size: Total rent revenue from effective date through September 30, 2022. Sample Size Information: All monthly PRAC requests from effective date through September 30, 2022. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD regulations, a HUD approved rent change must be executed as of its effective date, and all earned revenue recorded in the correct period. Statement of Condition: The Project did not implement the HUD approved rent change to its monthly PRAC requests as of the July 1, 2022 effective date, resulting in a $13,155 omission. Cause: The Project did not follow HUD regulations for timely applying the gross rent change, resulting in an underpayment of PRAC for each unit. Effect or Potential Effect: The Project did not request $13,155 of PRAC funding in the audit period, nor record the receivable at year end. An audit adjustment was posted to reflect the correct PRAC revenue for the year. Auditor Non-Compliance Code: R ? Section 8 Program Administration. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor?s recommendation has been adopted. Recommendation: The Project should comply with HUD regulations for executing the required rent change as of its effective date and all earned revenue recorded in the correct period. Response Indicator: Agree. Completion Date: 12/1/2022 Response: Management has provided additional training on HUD regulations, inclusive of the timely processing of authorized rent changes.

Finding 2022-001

FINDING No. 2022-001: Section 202 - Supportive Housing for the Elderly, CFDA 14.157 Finding Resolution Status: Resolved. Information on Universe Population Size: Total rent revenue from effective date through September 30, 2022. Sample Size Information: All monthly PRAC requests from effective date through September 30, 2022. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD regulations, a HUD approved rent change must be executed as of its effective date, and all earned revenue recorded in the correct period. Statement of Condition: The Project did not implement the HUD approved rent change to its monthly PRAC requests as of the July 1, 2022 effective date, resulting in a $13,155 omission. Cause: The Project did not follow HUD regulations for timely applying the gross rent change, resulting in an underpayment of PRAC for each unit. Effect or Potential Effect: The Project did not request $13,155 of PRAC funding in the audit period, nor record the receivable at year end. An audit adjustment was posted to reflect the correct PRAC revenue for the year. Auditor Non-Compliance Code: R ? Section 8 Program Administration. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor?s recommendation has been adopted. Recommendation: The Project should comply with HUD regulations for executing the required rent change as of its effective date and all earned revenue recorded in the correct period. Response Indicator: Agree. Completion Date: 12/1/2022 Response: Management has provided additional training on HUD regulations, inclusive of the timely processing of authorized rent changes.