FAC Explorer

Audit 305779

FY End
2023-12-31
Total Expended
$1.81M
Findings
2
Programs
2
Organization: Greenvale Place of Northfield, Inc. 092-11311 (MN)
Year: 2023 Accepted: 2024-05-08
Auditor: Mahoney Ulbrich Christiansen and Russ PA

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
396160 2023-001 Significant Deficiency - N
972602 2023-001 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
14.134 Mortgage Insurance_rental Housing $1.23M Yes 1
14.856 Lower Income Housing Assistance Program_section 8 Moderate Rehabilitation $577,963 - 0

Contacts

Name Title Type
MYRYZNPTJLK1 Elyse Clifford Auditee
6512889014 Katie McDonnell Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting, except for the loan balances as discussed below. 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. Greenvale Place of Northfield, Inc.’s federal awards are not based on eligible costs incurred. De Minimis Rate Used: N Rate Explanation: Greenvale Place of Northfield, Inc. has not made an election related to the use of the 10% de minimis indirect cost rate described in the Uniform Guidance. This schedule includes the federal grant activity of Greenvale Place of Northfield, Inc. under programs of the federal government for the year ended December 31, 2023. 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 (the Uniform Guidance). Because the Schedule presents only a selected portion of the operations of Greenvale Place of Northfield, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Greenvale Place of Northfield, Inc.
Title: Mortgage Loans Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting, except for the loan balances as discussed below. 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. Greenvale Place of Northfield, Inc.’s federal awards are not based on eligible costs incurred. De Minimis Rate Used: N Rate Explanation: Greenvale Place of Northfield, Inc. has not made an election related to the use of the 10% de minimis indirect cost rate described in the Uniform Guidance. Federal expenditures for the Mortgage Insurance – Rental Housing program represent the December 31, 2022 balances of loans outstanding from previous years for which HUD imposes continuing compliance requirements. The balances of the Mortgage Insurance – Rental Housing loans as of December 31, 2023 are $471,218 and $713,147.

Finding Details

Finding 2023-001
2023-001 – Income Certifications Federal Program – U.S. Department of Housing and Urban Development Assistance Listing Number 14.134 – Insured Mortgage – Rental Housing Noncompliance and Significant Deficiency Category of Finding – Special Tests and Provisions Use of Surplus Cash Criteria – Under HUD’s Mark-to-Market (M2M) program, the HUD Audit Guide states that the incentive performance fee is provided to recognize owner equity and as an incentive for demonstrating operating efficiencies. The owner can collect this payment annually if certain conditions are met. One of the conditions to payment are that required HUD Restructuring Note payments are made by April 10 of each year. Condition – The required payments on the HUD Restructuring Note were not made by April 10, 2023. The Organization still paid an incentive performance fee even though the conditions to payment were not met. Context – The Organization paid an incentive performance fee to CommonBond of $37,387 when it was disallowed. Cause – Turnover and inexperience in the property accounting role caused the Restructuring Note payment to be late. Effect - The Organization was not in compliance with the M2M program. The incentive performance fee is not allowed. Identification of repeat finding - No Recommendation – CommonBond Communities should return the incentive performance fee to the organization. Employees should be reminded of the M2M program requirements and conditions for making incentive performance fee payments. Views of responsible officials and planned corrective actions - The Organization agrees with the finding, and CommonBond Communities has repaid the incentive performance fee to the Organization as of March 22, 2024.
Finding 2023-001
2023-001 – Income Certifications Federal Program – U.S. Department of Housing and Urban Development Assistance Listing Number 14.134 – Insured Mortgage – Rental Housing Noncompliance and Significant Deficiency Category of Finding – Special Tests and Provisions Use of Surplus Cash Criteria – Under HUD’s Mark-to-Market (M2M) program, the HUD Audit Guide states that the incentive performance fee is provided to recognize owner equity and as an incentive for demonstrating operating efficiencies. The owner can collect this payment annually if certain conditions are met. One of the conditions to payment are that required HUD Restructuring Note payments are made by April 10 of each year. Condition – The required payments on the HUD Restructuring Note were not made by April 10, 2023. The Organization still paid an incentive performance fee even though the conditions to payment were not met. Context – The Organization paid an incentive performance fee to CommonBond of $37,387 when it was disallowed. Cause – Turnover and inexperience in the property accounting role caused the Restructuring Note payment to be late. Effect - The Organization was not in compliance with the M2M program. The incentive performance fee is not allowed. Identification of repeat finding - No Recommendation – CommonBond Communities should return the incentive performance fee to the organization. Employees should be reminded of the M2M program requirements and conditions for making incentive performance fee payments. Views of responsible officials and planned corrective actions - The Organization agrees with the finding, and CommonBond Communities has repaid the incentive performance fee to the Organization as of March 22, 2024.