FAC Explorer

Audit 300827

FY End
2023-06-30
Total Expended
$1.05M
Findings
8
Programs
1
Organization: El Paso Las Puertas Abiertas, Inc. (TX)
Year: 2023 Accepted: 2024-03-29
Auditor: Peña Briones McDaniel & CO

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
389916 2023-002 Material Weakness Yes L
389917 2023-003 Material Weakness Yes N
389918 2023-004 Material Weakness Yes N
389919 2023-005 Material Weakness - N
966358 2023-002 Material Weakness Yes L
966359 2023-003 Material Weakness Yes N
966360 2023-004 Material Weakness Yes N
966361 2023-005 Material Weakness - N

Programs

ALN Program Spent Major Findings
14.181 Supportive Housing for Persons with Disabilities $82,415 Yes 4

Contacts

Name Title Type
SRNHLJBXAVD8 Luz Mendoza Auditee
9154940329 Rene Peña Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: The accompanying Schedule of Expenditures of Federal and State Awards include the federal grant activity of El Paso Las Puertas Abiertas, Inc. (a nonprofit organization) and is presented on the accrual basis of accounting. 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 basic financial statements. De Minimis Rate Used: N Rate Explanation: The Organization has not elected to not use the 10% percent minimum indirect cost rate allowed under the Uniform Guidance. The accompanying Schedule of Expenditures of Federal and State Awards include the federal grant activity of El Paso Las Puertas Abiertas, Inc. (a nonprofit organization) and is presented on the accrual basis of accounting. 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 basic financial statements.
Title: INDIRECT COST RATE Accounting Policies: The accompanying Schedule of Expenditures of Federal and State Awards include the federal grant activity of El Paso Las Puertas Abiertas, Inc. (a nonprofit organization) and is presented on the accrual basis of accounting. 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 basic financial statements. De Minimis Rate Used: N Rate Explanation: The Organization has not elected to not use the 10% percent minimum indirect cost rate allowed under the Uniform Guidance. The Organization has not elected to not use the 10% percent minimum indirect cost rate allowed under the Uniform Guidance.
Title: SUBRECIPEINTS Accounting Policies: The accompanying Schedule of Expenditures of Federal and State Awards include the federal grant activity of El Paso Las Puertas Abiertas, Inc. (a nonprofit organization) and is presented on the accrual basis of accounting. 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 basic financial statements. De Minimis Rate Used: N Rate Explanation: The Organization has not elected to not use the 10% percent minimum indirect cost rate allowed under the Uniform Guidance. There were no subrecipients of the federal awards received by the Organization as of June 30, 2023.
Title: LOANS WITH OUTSTANDING COMPLIANCE REQUIREMENTS Accounting Policies: The accompanying Schedule of Expenditures of Federal and State Awards include the federal grant activity of El Paso Las Puertas Abiertas, Inc. (a nonprofit organization) and is presented on the accrual basis of accounting. 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 basic financial statements. De Minimis Rate Used: N Rate Explanation: The Organization has not elected to not use the 10% percent minimum indirect cost rate allowed under the Uniform Guidance. The Organization has a capital advance of $965,700 outstanding as of June 30, 2023. The advance is forgivable on July 1, 2041, as long as the Organization adheres to regulatory requirements.
Title: Reconciliation of Federal Awards Accounting Policies: The accompanying Schedule of Expenditures of Federal and State Awards include the federal grant activity of El Paso Las Puertas Abiertas, Inc. (a nonprofit organization) and is presented on the accrual basis of accounting. 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 basic financial statements. De Minimis Rate Used: N Rate Explanation: The Organization has not elected to not use the 10% percent minimum indirect cost rate allowed under the Uniform Guidance. 2023 Rental Recipts per page 6 $132,139 Less tenant portion of Rent (49,724) Capital advance funds per page 4 965,700 Total federal award per page 22 $1,048,115

Finding Details

Finding 2023-002
Compliance Requirement: Reporting Criteria: In accordance with the Department of Housing and Urban Development Chapter 3 Audit Guidance, the regulatory agreement related to the Project requires that the Project submit an annual operating budget 30 days before the beginning of each fiscal year. Condition: During our audit procedures and per review of prior year audit Finding 2022-005, it was noted that management failed to prepare and submit an annual operating budget to HUD for the fiscal year ending June 30, 2023. Management submitted an annual operating budget to HUD approximately 23 days after the fiscal year began. Cause: Management was unaware of certain reporting requirements Effect: The Organization is not in full compliance with the requirements prescribed in its regulatory agreement with HUD. Recommendation: To avoid potential non-compliance, we recommend that the executive director and property manager prepare and submit an annual operating budget no later than 30 days prior to the beginning of the next fiscal year. Management’s Response: Refer to Corrective Action Plan.
Finding 2023-003
Compliance Requirement: Special Tests and Provisions Criteria: In accordance with the Project’s regulatory agreement with HUD, management shall establish a residual receipts account and make deposits into the account in accordance with HUD requirements (within 90 days after the close of the fiscal year). Disbursements from such fund may be made only after written consent is received from HUD. Condition: Based on the Computation of Surplus Cash, the deposit due to the residual receipts fund is $5,015. The deposit has not been made. Cause: Management was unaware of how to calculate the amount due to the residual receipts funds. Effect: The organization is not in compliance with this requirement. Recommendation: To avoid potential non-compliance, we recommend that management only make deposits into the residual receipts account of surplus cash at the end of each fiscal year. The required deposit should be made within 90 days after the close of the fiscal year. Disbursements will only be made after obtaining written consent from HUD. Management’s Response: Refer to Corrective Action Plan.
Finding 2023-004
Compliance Requirement: Special Tests and Provisions Criteria: In accordance with the Project’s regulatory agreement with HUD, management shall establish and maintain a replacement reserve account to aid in funding extraordinary maintenance and repair and replacement of capital items. The replacement reserve funds must be deposited in a federally secured depository in an interest-bearing account. All earnings including interest on the reserve must be added to the reserve. An amount as required by HUD will be deposited monthly in the reserve fund. All disbursements from the reserve must be approved by HUD. Condition: Based on the evaluation of the cash account that holds the replacement reserve funds, the account is not interest-bearing. Cause: Management was unaware of replacement reserve compliance requirements. Effect: The organization is not in compliance with this requirement. Recommendation: To avoid potential non-compliance, we recommend that management transfer the funds into an interest-bearing account. Management’s Response: Refer to Corrective Action Plan.
Finding 2023-005
Compliance Requirement: Special Tests and Provisions Criteria: In accordance with the Project’s regulatory agreement with HUD, management shall establish and maintain a replacement reserve account to aid in funding extraordinary maintenance and repair and replacement of capital items. HUD regulation mandates that permission be obtained prior to any withdrawals from the replacement reserve. Condition: Based on the evaluation of withdrawal and permission obtained, it was noted that withdrawal took place prior to receiving permission from HUD. Cause: Management was unaware of replacement reserve compliance requirements. Effect: The organization is not in compliance with this requirement. Recommendation: To avoid potential non-compliance, we recommend that management request and receive permission for withdrawals prior to processing any withdrawals. Management’s Response: Refer to Corrective Action Plan.
Finding 2023-002
Compliance Requirement: Reporting Criteria: In accordance with the Department of Housing and Urban Development Chapter 3 Audit Guidance, the regulatory agreement related to the Project requires that the Project submit an annual operating budget 30 days before the beginning of each fiscal year. Condition: During our audit procedures and per review of prior year audit Finding 2022-005, it was noted that management failed to prepare and submit an annual operating budget to HUD for the fiscal year ending June 30, 2023. Management submitted an annual operating budget to HUD approximately 23 days after the fiscal year began. Cause: Management was unaware of certain reporting requirements Effect: The Organization is not in full compliance with the requirements prescribed in its regulatory agreement with HUD. Recommendation: To avoid potential non-compliance, we recommend that the executive director and property manager prepare and submit an annual operating budget no later than 30 days prior to the beginning of the next fiscal year. Management’s Response: Refer to Corrective Action Plan.
Finding 2023-003
Compliance Requirement: Special Tests and Provisions Criteria: In accordance with the Project’s regulatory agreement with HUD, management shall establish a residual receipts account and make deposits into the account in accordance with HUD requirements (within 90 days after the close of the fiscal year). Disbursements from such fund may be made only after written consent is received from HUD. Condition: Based on the Computation of Surplus Cash, the deposit due to the residual receipts fund is $5,015. The deposit has not been made. Cause: Management was unaware of how to calculate the amount due to the residual receipts funds. Effect: The organization is not in compliance with this requirement. Recommendation: To avoid potential non-compliance, we recommend that management only make deposits into the residual receipts account of surplus cash at the end of each fiscal year. The required deposit should be made within 90 days after the close of the fiscal year. Disbursements will only be made after obtaining written consent from HUD. Management’s Response: Refer to Corrective Action Plan.
Finding 2023-004
Compliance Requirement: Special Tests and Provisions Criteria: In accordance with the Project’s regulatory agreement with HUD, management shall establish and maintain a replacement reserve account to aid in funding extraordinary maintenance and repair and replacement of capital items. The replacement reserve funds must be deposited in a federally secured depository in an interest-bearing account. All earnings including interest on the reserve must be added to the reserve. An amount as required by HUD will be deposited monthly in the reserve fund. All disbursements from the reserve must be approved by HUD. Condition: Based on the evaluation of the cash account that holds the replacement reserve funds, the account is not interest-bearing. Cause: Management was unaware of replacement reserve compliance requirements. Effect: The organization is not in compliance with this requirement. Recommendation: To avoid potential non-compliance, we recommend that management transfer the funds into an interest-bearing account. Management’s Response: Refer to Corrective Action Plan.
Finding 2023-005
Compliance Requirement: Special Tests and Provisions Criteria: In accordance with the Project’s regulatory agreement with HUD, management shall establish and maintain a replacement reserve account to aid in funding extraordinary maintenance and repair and replacement of capital items. HUD regulation mandates that permission be obtained prior to any withdrawals from the replacement reserve. Condition: Based on the evaluation of withdrawal and permission obtained, it was noted that withdrawal took place prior to receiving permission from HUD. Cause: Management was unaware of replacement reserve compliance requirements. Effect: The organization is not in compliance with this requirement. Recommendation: To avoid potential non-compliance, we recommend that management request and receive permission for withdrawals prior to processing any withdrawals. Management’s Response: Refer to Corrective Action Plan.