FAC Explorer

Audit 21384

FY End
2022-12-31
Total Expended
$6.51M
Findings
4
Programs
2
Organization: Pacific Housing Oahu Corporation - Elderly Residence (HI)
Year: 2022 Accepted: 2023-09-28
Auditor: N&k CPAS INC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
15951 2022-002 - - N
15952 2022-001 - Yes N
592393 2022-002 - - N
592394 2022-001 - Yes N

Programs

ALN Program Spent Major Findings
14.239 Home Investment Partnerships Program $900,024 - 0
14.157 Supportive Housing for the Elderly $136,002 Yes 0

Contacts

Name Title Type
Q48CAZSNMRK3 Audrey Awaya Auditee
8085235681 John Paul Bautista Auditor
No contacts on file

Notes to SEFA

Title: NOTE A - BASIS OF PRESENTATION Accounting Policies: 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: 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 the Pacific Housing Oahu Corporation - Elderly Residence (Company), under programs of the federal government for the year ended December 31, 2022. The information in the 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 of Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Company, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Company.
Title: NOTE D - CAPITAL ADVANCES AND LOANS Accounting Policies: 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: The auditee did not use the de minimis cost rate. The federal expenditures for capital advances and loans are the balances of advances and loans from the previous years for which compliance requirements continue. At December 31, 2022, the outstanding loan balances totaled $6,378,124.

Finding Details

Finding 2022-002
Criteria: The Capital Advance Program Regulatory Agreement requires that the replacement reserve account be maintained for funding extraordinary maintenance and repair and replacement of capital items. Monthly deposits in an amount required by HUD must be made with disbursements made only with the approval of HUD. Condition: The Company made an unauthorized withdrawal of $12,817 from the replacement reserve account. Cause: Documentation of a HUD authorization for the withdrawal was not maintained by the Company. Effect: The Company is not in compliance with the Capital Advance Program Regulatory Agreement and the replacement reserve is underfunded by $12,817. $ -- Identification as a Repeat Finding, if applicable: Not applicable. Recommendation Management should transfer $12,817 from the operating cash account to the replacement reserve fund and maintain documentation of HUD authorizations. Views of Responsible Officials and Planned Corrective Action The Company agrees with the finding and the recommendation. See Part V Corrective Action Plan
Finding 2022-001
Criteria: Under the Capital Advance Program Regulatory Agreement, the mortgagor (Company) is required to establish and maintain a replacement reserve to aid in funding extraordinary maintenance and repair and replacement of capital items. The replacement reserve funds must be deposited in a federally insured depository in an interest-bearing account. An amount as required by HUD ($24,000 annually) will be deposited monthly in the reserve fund. Condition: Although the total annual required deposit was made, the Company did not make the deposits on a monthly basis to the replacement reserve account. Cause: The management agent of the Company did not implement a process to make the monthly deposits on a timely basis. Effect: The Company did not meet the replacement reserve funding requirement under the Capital Advance Program Regulatory Agreement requiring monthly deposits. $ -- Identification as a Repeat Finding, if applicable: 2021-001 Recommendation The Company should implement a process to adhere to the Regulatory Agreement requirements and ensure that the replacement reserve account deposits are completed monthly. Views of Responsible Officials and Planned Corrective Action The Company agrees with the finding and the recommendation. See Part V Corrective Action Plan
Finding 2022-002
Criteria: The Capital Advance Program Regulatory Agreement requires that the replacement reserve account be maintained for funding extraordinary maintenance and repair and replacement of capital items. Monthly deposits in an amount required by HUD must be made with disbursements made only with the approval of HUD. Condition: The Company made an unauthorized withdrawal of $12,817 from the replacement reserve account. Cause: Documentation of a HUD authorization for the withdrawal was not maintained by the Company. Effect: The Company is not in compliance with the Capital Advance Program Regulatory Agreement and the replacement reserve is underfunded by $12,817. $ -- Identification as a Repeat Finding, if applicable: Not applicable. Recommendation Management should transfer $12,817 from the operating cash account to the replacement reserve fund and maintain documentation of HUD authorizations. Views of Responsible Officials and Planned Corrective Action The Company agrees with the finding and the recommendation. See Part V Corrective Action Plan
Finding 2022-001
Criteria: Under the Capital Advance Program Regulatory Agreement, the mortgagor (Company) is required to establish and maintain a replacement reserve to aid in funding extraordinary maintenance and repair and replacement of capital items. The replacement reserve funds must be deposited in a federally insured depository in an interest-bearing account. An amount as required by HUD ($24,000 annually) will be deposited monthly in the reserve fund. Condition: Although the total annual required deposit was made, the Company did not make the deposits on a monthly basis to the replacement reserve account. Cause: The management agent of the Company did not implement a process to make the monthly deposits on a timely basis. Effect: The Company did not meet the replacement reserve funding requirement under the Capital Advance Program Regulatory Agreement requiring monthly deposits. $ -- Identification as a Repeat Finding, if applicable: 2021-001 Recommendation The Company should implement a process to adhere to the Regulatory Agreement requirements and ensure that the replacement reserve account deposits are completed monthly. Views of Responsible Officials and Planned Corrective Action The Company agrees with the finding and the recommendation. See Part V Corrective Action Plan