FAC Explorer

Audit 25534

FY End
2022-12-31
Total Expended
$2.15M
Findings
4
Programs
2
Organization: Trinity Terrace (WI)
Year: 2022 Accepted: 2023-04-18
Auditor: Cliftonlarsonallen

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
29180 2022-002 Significant Deficiency - L
29181 2022-003 Significant Deficiency - L
605622 2022-002 Significant Deficiency - L
605623 2022-003 Significant Deficiency - L

Programs

ALN Program Spent Major Findings
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Units $1.93M Yes 2
14.856 Lower Income Housing Assistance Program (section 8 Moderate Rehabilitation) Housing Assistance Payments $225,515 - 0

Contacts

Name Title Type
PJPZW1L1JBF6 Nicole Chwala Auditee
9202064930 Dawn Yarrington Auditor
No contacts on file

Notes to SEFA

Title: FEDERAL LOAN PROGRAMS Accounting Policies: BASIS OF PRESENTATION: The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal award activity of the Corporation under programs of the federal government for the year ended December 31, 2022. The information in this 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 for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the financial statements.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-122, Cost Principles for Non-Profit Organizations, or the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The Project has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Expenditures reported on the Schedule related to the Mortgage Insurance for the Purchase or Refinancing of Existing Multi-Family Housing Units program represent the balance at the beginning of the audit period. Amounts outstanding as of December 31, 2022, under this program total $1,877,588.
Title: SUBRECIPIENTS Accounting Policies: BASIS OF PRESENTATION: The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal award activity of the Corporation under programs of the federal government for the year ended December 31, 2022. The information in this 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 for Federal Awards (Uniform Guidance). Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the financial statements.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-122, Cost Principles for Non-Profit Organizations, or the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The Project has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Of the federal expenditures presented in the Schedule, the Corporation did not provide federal awards to subrecipients during the year ended December 31, 2022.

Finding Details

Finding 2022-002
Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Section 223(f) Mortgage Insurance for the Purchase or Refinance of Existing Multi-Family Housing Units Assistance Listing Number: 14.155 Federal Award Identification Number and Year: 075-11186 - 2022 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires compliance with the provisions of regulatory agreement. Trinity Terrace, Inc., should have internal controls designed to ensure compliance with those provisions. Condition: During our testing, we noted that Trinity Terrace, Inc., did not have adequate internal controls designed to ensure replacement reserve deposits were updated based on the provisions of the regulatory agreement. Questioned costs: None Context: During our testing, it was noted that Trinity Terrace, Inc., did not update the October and November 2022 replacement reserve deposits as prescribed in the regulatory agreement. Cause: Trinity Terrace, Inc., was unaware the bank did not update the October and November 2022 replacement reserve deposits. Effect: Noncompliance with the HUD regulatory agreement. Recommendation: We recommend that management develop procedures to ensure replacement reserve deposits are updated timely to ensure compliance with the HUD regulatory agreement. Views of responsible officials: There is no disagreement with the audit finding.
Finding 2022-003
Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Section 223(f) Mortgage Insurance for the Purchase or Refinance of Existing Multi-Family Housing Units Assistance Listing Number: 14.155 Federal Award Identification Number and Year: 075-11186 - 2022 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires compliance with the provisions of regulatory agreement. Trinity Terrace, Inc., should have internal controls designed to ensure compliance with those provisions. Condition: During our testing, we noted that Trinity Terrace, Inc., did not have adequate internal controls designed to ensure management fees were charged in accordance with the provisions of the project/management agent certification. Questioned costs: None Context: During our testing, we noted that the management fees charged to Trinity Terrace, Inc., were in excess of the agreed upon amount based on the provisions of the management agent certification. Cause: The management agent charged Trinity Terrace, Inc., fees based on revenue recorded and not revenue collected as described in the project/management agent certification. Effect: Noncompliance with the HUD regulatory agreement. Recommendation: We recommend that management develop procedures to ensure management fees are charged in accordance with the project/management agent certification. Views of responsible officials: There is no disagreement with the audit finding.
Finding 2022-002
Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Section 223(f) Mortgage Insurance for the Purchase or Refinance of Existing Multi-Family Housing Units Assistance Listing Number: 14.155 Federal Award Identification Number and Year: 075-11186 - 2022 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires compliance with the provisions of regulatory agreement. Trinity Terrace, Inc., should have internal controls designed to ensure compliance with those provisions. Condition: During our testing, we noted that Trinity Terrace, Inc., did not have adequate internal controls designed to ensure replacement reserve deposits were updated based on the provisions of the regulatory agreement. Questioned costs: None Context: During our testing, it was noted that Trinity Terrace, Inc., did not update the October and November 2022 replacement reserve deposits as prescribed in the regulatory agreement. Cause: Trinity Terrace, Inc., was unaware the bank did not update the October and November 2022 replacement reserve deposits. Effect: Noncompliance with the HUD regulatory agreement. Recommendation: We recommend that management develop procedures to ensure replacement reserve deposits are updated timely to ensure compliance with the HUD regulatory agreement. Views of responsible officials: There is no disagreement with the audit finding.
Finding 2022-003
Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Section 223(f) Mortgage Insurance for the Purchase or Refinance of Existing Multi-Family Housing Units Assistance Listing Number: 14.155 Federal Award Identification Number and Year: 075-11186 - 2022 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: 2022 Type of Finding: ? Significant Deficiency in Internal Control over Compliance Criteria or specific requirement: 2 CFR Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards requires compliance with the provisions of regulatory agreement. Trinity Terrace, Inc., should have internal controls designed to ensure compliance with those provisions. Condition: During our testing, we noted that Trinity Terrace, Inc., did not have adequate internal controls designed to ensure management fees were charged in accordance with the provisions of the project/management agent certification. Questioned costs: None Context: During our testing, we noted that the management fees charged to Trinity Terrace, Inc., were in excess of the agreed upon amount based on the provisions of the management agent certification. Cause: The management agent charged Trinity Terrace, Inc., fees based on revenue recorded and not revenue collected as described in the project/management agent certification. Effect: Noncompliance with the HUD regulatory agreement. Recommendation: We recommend that management develop procedures to ensure management fees are charged in accordance with the project/management agent certification. Views of responsible officials: There is no disagreement with the audit finding.