FAC Explorer

Audit 19584

FY End
2022-06-30
Total Expended
$2.36M
Findings
2
Programs
3
Organization: Caritas Plaza (OR)
Year: 2022 Accepted: 2022-10-12
Auditor: Jones & Roth PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
16016 2022-001 Significant Deficiency Yes E
592458 2022-001 Significant Deficiency Yes E

Programs

ALN Program Spent Major Findings
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $2.01M Yes 1
14.191 Multifamily Housing Service Coordinators $32,054 - 0
14.195 Section 8 Housing Assistance Payments Program $8,280 - 0

Contacts

Name Title Type
ES6QKJ7PMKX6 Marci Pierce Auditee
5036882646 Kari Young Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: Basis of Presentation: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Caritas Plaza (the Organization) under programs of federal government for the year ended June 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 operation of the Organization, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Organization. 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 OMB Circular A-122 and Uniform Guidance. The Organization elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance; however, the agreements with HUD do not include indirect cost reimbursement, so there were no indirect costs charged to the federal award programs for the year ended June 30, 2022. Section 223(f) Mortgage Insurance for the Refinancing of Existing Multi-Family Housing Projects The Schedule includes the balance of the Section 223(f) refinanced loan as of the beginning of the fiscal year. As of June 30, 2022, the balance outstanding on the Section 223(f) refinanced loan was as follows :Assistance Amount Program or Cluster Title Listing Number Outstanding Mortgage Insurance for the Purchase or Refinancing of Existing Multi-Family Housing Projects 14.155 $ 1,974,297 Subrecipients There were no federal awards passed through to subrecipients. De Minimis Rate Used: Y Rate Explanation: The auditee used 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 1974297.

Finding Details

Finding 2022-001
Finding 2022-001 Type of Finding: Significant deficiency in internal control over compliance and instance of immaterial noncompliance. Federal Program: HUD Mortgage Insurance for the Purchase or Refinancing of Existing Multi-family housing projects (Assistance Listing #14.155) Compliance Requirement: Eligibility Criteria: In accordance with Caritas Plaza?s regulatory agreement with HUD for its HUD Section 223(f) Insured Mortgage, Caritas Plaza is required to annually recertify its tenants as eligible tenants. It is the responsibility of management to design and implement internal controls to ensure the tenants are recertified within the applicable timeframe required by HUD. Condition: Caritas Plaza did not recertify all of its tenants within the timeframe specified by HUD. Cause: There were not properly designed or implemented internal controls to ensure the tenant recertifications were performed in the timeframe required by HUD. Effect: The effect is immaterial non-compliance with the terms of the HUD program listed above. The deficiency in internal controls over compliance could lead to material non-compliance with the eligibility compliance requirement. Questioned Costs: None. Repeat Finding: Yes. See Finding 2021-002. Context: We selected a sample of 8 tenants from a population of 30. The sample size was determined based upon guidelines provided by the AICPA and was not considered a statistically valid sample. We performed procedures to determine whether the annual tenant recertification occurred within the timeframe specified by HUD. From our sample, two tenant recertifications were not performed within the 12 month timeframe specified by HUD. Additionally, during our performance of other audit procedures, there were indications of additional late recertifications that fell outside of our sample. Recommendation: We recommend management review the current internal control procedures and implement additional procedures to ensure annual recertifications are performed as required by HUD. Views of Responsible Officials: Management agrees with the finding. See Corrective Action Plan.
Finding 2022-001
Finding 2022-001 Type of Finding: Significant deficiency in internal control over compliance and instance of immaterial noncompliance. Federal Program: HUD Mortgage Insurance for the Purchase or Refinancing of Existing Multi-family housing projects (Assistance Listing #14.155) Compliance Requirement: Eligibility Criteria: In accordance with Caritas Plaza?s regulatory agreement with HUD for its HUD Section 223(f) Insured Mortgage, Caritas Plaza is required to annually recertify its tenants as eligible tenants. It is the responsibility of management to design and implement internal controls to ensure the tenants are recertified within the applicable timeframe required by HUD. Condition: Caritas Plaza did not recertify all of its tenants within the timeframe specified by HUD. Cause: There were not properly designed or implemented internal controls to ensure the tenant recertifications were performed in the timeframe required by HUD. Effect: The effect is immaterial non-compliance with the terms of the HUD program listed above. The deficiency in internal controls over compliance could lead to material non-compliance with the eligibility compliance requirement. Questioned Costs: None. Repeat Finding: Yes. See Finding 2021-002. Context: We selected a sample of 8 tenants from a population of 30. The sample size was determined based upon guidelines provided by the AICPA and was not considered a statistically valid sample. We performed procedures to determine whether the annual tenant recertification occurred within the timeframe specified by HUD. From our sample, two tenant recertifications were not performed within the 12 month timeframe specified by HUD. Additionally, during our performance of other audit procedures, there were indications of additional late recertifications that fell outside of our sample. Recommendation: We recommend management review the current internal control procedures and implement additional procedures to ensure annual recertifications are performed as required by HUD. Views of Responsible Officials: Management agrees with the finding. See Corrective Action Plan.