FAC Explorer

Audit 20747

FY End
2022-09-30
Total Expended
$61.37M
Findings
2
Programs
3
Organization: Hrca Housing for Elderly, Inc. D/b/a Jack Satter House (MA)
Year: 2022 Accepted: 2023-01-09
Auditor: Cliftonlarsonallen LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
21357 2022-001 Significant Deficiency - C
597799 2022-001 Significant Deficiency - C

Programs

ALN Program Spent Major Findings
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $55.34M Yes 0
14.195 Section 8 Housing Assistance Payments Program $5.91M Yes 1
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $118,485 - 0

Contacts

Name Title Type
DM9RFJEECP18 James Hart Auditee
6173638770 Jennifer Corliss Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances 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. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. HRCA Housing for Elderly, Inc. has not elected to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-122, Cost Principles for Nonprofit Organizations, or the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, 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 54358988.
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. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. HRCA Housing for Elderly, Inc. has not elected to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-122, Cost Principles for Nonprofit Organizations, or the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, 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. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of HRCA Housing for Elderly, Inc. 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 2 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 HRCA Housing for Elderly, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of HRCA Housing for Elderly, Inc.

Finding Details

Finding 2022-001
2022 ? 001 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Section 8 Housing Assistance Payments Program Assistance Listing Number: 14.195 Contract Number: MA060470201 Award Period: October 1, 2021 through September 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control Over Compliance ? Other Matters Criteria or specific requirement: Disbursements should be only for allowable expenses of the Project. Condition: A separated employee's earned time was paid out at the incorrect pay rate in error, resulting in an overpayment to the employee. Questioned costs: $18,048 Context: The error impacted one employee and appears to be an isolated incident. Cause: As part of the separated employee?s transition, the separated employee agreed to stay on and work on a per diem basis at a higher hourly rate. The employee?s hourly rate had been updated in the human resources information system prior to the earned time pay out. The earned time pay outs hours was then processed with the new hourly rate. As the total hours to be paid out was validated, the new rate was over looked, thus resulting in the separated employee being overpaid. This was caught by management subsequently after the pay-out as part of their monthly review and import into Yardi. Effect: An overpayment of $18,048 was made and is owed to the Organization by the employee as of the fiscal year end. Repeat Finding: No Recommendation: Management should review its internal control procedures to ensure proper oversight over the payroll disbursement process surrounding earned time payouts. View of responsible officials and planned corrective actions: In agreement with the finding. Upon realization of the overpayment, Human Resource (HR) and Payroll have developed a new process where the hourly rates are to be verified and validated for all employees that stay employed but are no longer eligible to accrue earned time, thus requiring their earned time to be paid out. On the bi-weekly HR changes worksheet, HR will denote what the hourly rate should be upon pay out of the earned time. Payroll will then cross-check the hourly rate and the earned time hours prior to processing payroll.
Finding 2022-001
2022 ? 001 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Section 8 Housing Assistance Payments Program Assistance Listing Number: 14.195 Contract Number: MA060470201 Award Period: October 1, 2021 through September 30, 2022 Type of Finding: ? Significant Deficiency in Internal Control Over Compliance ? Other Matters Criteria or specific requirement: Disbursements should be only for allowable expenses of the Project. Condition: A separated employee's earned time was paid out at the incorrect pay rate in error, resulting in an overpayment to the employee. Questioned costs: $18,048 Context: The error impacted one employee and appears to be an isolated incident. Cause: As part of the separated employee?s transition, the separated employee agreed to stay on and work on a per diem basis at a higher hourly rate. The employee?s hourly rate had been updated in the human resources information system prior to the earned time pay out. The earned time pay outs hours was then processed with the new hourly rate. As the total hours to be paid out was validated, the new rate was over looked, thus resulting in the separated employee being overpaid. This was caught by management subsequently after the pay-out as part of their monthly review and import into Yardi. Effect: An overpayment of $18,048 was made and is owed to the Organization by the employee as of the fiscal year end. Repeat Finding: No Recommendation: Management should review its internal control procedures to ensure proper oversight over the payroll disbursement process surrounding earned time payouts. View of responsible officials and planned corrective actions: In agreement with the finding. Upon realization of the overpayment, Human Resource (HR) and Payroll have developed a new process where the hourly rates are to be verified and validated for all employees that stay employed but are no longer eligible to accrue earned time, thus requiring their earned time to be paid out. On the bi-weekly HR changes worksheet, HR will denote what the hourly rate should be upon pay out of the earned time. Payroll will then cross-check the hourly rate and the earned time hours prior to processing payroll.