FAC Explorer

Audit 304507

FY End
2023-12-31
Total Expended
$5.44M
Findings
6
Programs
1
Organization: Kimble Dover Street Apartments INC (TX)
Year: 2023 Accepted: 2024-04-25
Auditor: Pittsford Samuels PLLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
394616 2023-001 Significant Deficiency - P
394617 2023-002 - - P
394618 2023-003 - - N
971058 2023-001 Significant Deficiency - P
971059 2023-002 - - P
971060 2023-003 - - N

Programs

ALN Program Spent Major Findings
14.157 Supportive Housing for the Elderly $226,679 Yes 0

Contacts

Name Title Type
TT57KZ79QUX7 Nannette Vallis Auditee
2812987999 Nancy MacK Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in OMB Circular A-122, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited as to reimbursements. De Minimis Rate Used: N Rate Explanation: Kimble Dover has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards includes the federal grant activity of Kimble Dover, HUD Project No. 114EE085. 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. Therefore, some amounts presented in this schedule may differ from the amounts presented in, or used in the preparation of, the basic financial statements.
Title: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in OMB Circular A-122, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited as to reimbursements. De Minimis Rate Used: N Rate Explanation: Kimble Dover has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in OMB Circular A-122, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited as to reimbursements.
Title: INDIRECT COST RATE Accounting Policies: Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in OMB Circular A-122, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited as to reimbursements. De Minimis Rate Used: N Rate Explanation: Kimble Dover has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. Kimble Dover has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance.
Title: HUD CAPITAL ADVANCE Accounting Policies: Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in OMB Circular A-122, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited as to reimbursements. De Minimis Rate Used: N Rate Explanation: Kimble Dover has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The Project has received a capital advance under section 202 of the National Housing Act. The capital advance balance at the beginning of the year, amounting to $5,214,294, is included in the federal expenditures presented in the schedule. The Project received no additional funds during the year. The capital advance is included in net assets with donor restrictions in the statement of financial position.

Finding Details

Finding 2023-001
Schedule reference number 2023-001. Title and AL Number of Federal Program: Supportive Housing for the Elderly, AL 14.157 Type of finding: Financial statement Resolution status: In process Population size: N/A Sample size: N/A Repeat finding: No. Criteria: All significant general ledger accounts were not reconciled for the year ended December 31, 2023. Condition: During the audit, several adjusting journal entries were recorded to reconcile certain accounts to underlying support. Cause: The Project had a change in the management company in December 2023 and during the transition, some accounts were not reconciled. Effect: Several audit adjusting journal entries were recorded. Noncompliance code: S. Internal control deficiency Questioned cost: None Reporting views of officials: Management agrees with the finding. Context: This was noted while performing certain procedures on various general ledger accounts during the audit. Recommendation: The new management company should ensure that all significant accounts are reconciled on a monthly basis. Auditors' summary of auditee's comments: They are in agreement. Completion date: 12/31/24 Response: The new management company agrees with the comments and will ensure that in the future, all transactions are properly recorded and all accounts are reconciled on a monthly basis.
Finding 2023-002
Schedule reference number 2023-002. Title and AL Number of Federal Program: Supportive Housing for the Elderly, AL 14.157 Type of finding: Compliance Resolution status: In Progress Population size: N/A Sample size: N/A Repeat finding: No Criteria: The Project did not have the proper insurance coverage as required by the capital advance agreement. Condition: The fidelity bond insurance coverage for the property was not in effect the entire year and excluded the apartment manager, board chair, board vice-chair, eight board members, board treasurer and CFO. Cause: The Project obtained fidelity bond insurance coverage effective February 27, 2023, however, the policy explicitly excluded certain officials and employees required by the capital advance agreement. Effect: The Property did not have adequate fidelity bond insurance coverage required by their regulatory agreement and had a lapse in other required insurance coverage. Noncompliance code: Z. Other Questioned cost: None Reporting views of officials: Management agrees with the finding. Context: This was noted during the audit. Recommendation: The proper coverage for fidelity bond insurance as required by the capital advance agreement should be put in place for the Project immediately. Auditors' summary of auditee's comments: The new management company understands the requirements and are in the process of obtaining all required coverage. Completion date: 12/31/24 Response: Management is in the process of obtaining all required insurance coverage. Corrective Action: In progress
Finding 2023-003
Finding 2023-003 Title and AL Number of Federal Program: Supportive Housing for the Elderly, AL 14.157 Type of finding: Compliance Resolution status: In Progress Population size: N/A Sample size: N/A Repeat finding: No Criteria: All of the required deposits to the replacement reserve were not made during the year. Condition: The required deposits to the replacement reserve for the year were short by $1,321. Cause: Prior management company oversight. Effect: There was a shortfall in the monthly deposits to the replacement reserve as required by HUD. Noncompliance code: N. Reserve for Replacement Deposits Questioned cost: None Reporting views of officials: Management agrees with the finding. Context: This was noted while performing audit procedures on the replacement reserve. Recommendation: All deposits required to be made to the replacement reserve should be made on a timely basis. Auditors' summary of auditee's comments: They are in agreement and the new management company will make a deposit for the shortfall. Completion date: 12/31/24 Response: The new management company plans to make all deposits in a timely manner. Corrective Action: In progress
Finding 2023-001
Schedule reference number 2023-001. Title and AL Number of Federal Program: Supportive Housing for the Elderly, AL 14.157 Type of finding: Financial statement Resolution status: In process Population size: N/A Sample size: N/A Repeat finding: No. Criteria: All significant general ledger accounts were not reconciled for the year ended December 31, 2023. Condition: During the audit, several adjusting journal entries were recorded to reconcile certain accounts to underlying support. Cause: The Project had a change in the management company in December 2023 and during the transition, some accounts were not reconciled. Effect: Several audit adjusting journal entries were recorded. Noncompliance code: S. Internal control deficiency Questioned cost: None Reporting views of officials: Management agrees with the finding. Context: This was noted while performing certain procedures on various general ledger accounts during the audit. Recommendation: The new management company should ensure that all significant accounts are reconciled on a monthly basis. Auditors' summary of auditee's comments: They are in agreement. Completion date: 12/31/24 Response: The new management company agrees with the comments and will ensure that in the future, all transactions are properly recorded and all accounts are reconciled on a monthly basis.
Finding 2023-002
Schedule reference number 2023-002. Title and AL Number of Federal Program: Supportive Housing for the Elderly, AL 14.157 Type of finding: Compliance Resolution status: In Progress Population size: N/A Sample size: N/A Repeat finding: No Criteria: The Project did not have the proper insurance coverage as required by the capital advance agreement. Condition: The fidelity bond insurance coverage for the property was not in effect the entire year and excluded the apartment manager, board chair, board vice-chair, eight board members, board treasurer and CFO. Cause: The Project obtained fidelity bond insurance coverage effective February 27, 2023, however, the policy explicitly excluded certain officials and employees required by the capital advance agreement. Effect: The Property did not have adequate fidelity bond insurance coverage required by their regulatory agreement and had a lapse in other required insurance coverage. Noncompliance code: Z. Other Questioned cost: None Reporting views of officials: Management agrees with the finding. Context: This was noted during the audit. Recommendation: The proper coverage for fidelity bond insurance as required by the capital advance agreement should be put in place for the Project immediately. Auditors' summary of auditee's comments: The new management company understands the requirements and are in the process of obtaining all required coverage. Completion date: 12/31/24 Response: Management is in the process of obtaining all required insurance coverage. Corrective Action: In progress
Finding 2023-003
Finding 2023-003 Title and AL Number of Federal Program: Supportive Housing for the Elderly, AL 14.157 Type of finding: Compliance Resolution status: In Progress Population size: N/A Sample size: N/A Repeat finding: No Criteria: All of the required deposits to the replacement reserve were not made during the year. Condition: The required deposits to the replacement reserve for the year were short by $1,321. Cause: Prior management company oversight. Effect: There was a shortfall in the monthly deposits to the replacement reserve as required by HUD. Noncompliance code: N. Reserve for Replacement Deposits Questioned cost: None Reporting views of officials: Management agrees with the finding. Context: This was noted while performing audit procedures on the replacement reserve. Recommendation: All deposits required to be made to the replacement reserve should be made on a timely basis. Auditors' summary of auditee's comments: They are in agreement and the new management company will make a deposit for the shortfall. Completion date: 12/31/24 Response: The new management company plans to make all deposits in a timely manner. Corrective Action: In progress