FAC Explorer

Audit 305906

FY End
2023-09-30
Total Expended
$5.88M
Findings
6
Programs
4
Organization: Evangeline Council Housing for the Elderly, INC (FL)
Year: 2023 Accepted: 2024-05-09
Auditor: Bellows Associates P A

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
396251 2023-001 - - E
396252 2023-002 - - N
396253 2023-003 - - E
972693 2023-001 - - E
972694 2023-002 - - N
972695 2023-003 - - E

Programs

ALN Program Spent Major Findings
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $5.00M Yes 3
14.195 Section 8 Housing Assistance Payments Program $855,764 - 0
14.191 Multifamily Housing Service Coordinators $17,300 - 0
14.195 Covid-19 Csp - Section 8 Housing Assistance Payments Program $7,558 - 0

Contacts

Name Title Type
KANHE98W62B5 Irene Phillips Auditee
9548359200 Jennifer R. Koffman 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. 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: Evangeline Council Housing for the Elderly, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (Schedule) includes the federal grant activity of Evangeline Council Housing for the Elderly, Inc., HUD Project 064-11118, 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). Because the Schedule presents only a selected portion of the operations of Evangeline Council Housing for the Elderly, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Evangeline Council Housing for the Elderly, Inc.
Title: U.S. DEPARTMENT OF HUD REFINANCE PROGRAM 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: Evangeline Council Housing for the Elderly, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. Evangeline Council Housing for the Elderly, Inc. has received a HUD mortgage insurance for the refinancing of existing multifamily housing projects under section 207/223(f) of the National Housing Act. The loan balance outstanding at the beginning of the year is included in the federal expenditures presented in the Schedule. Evangeline Council Housing for the Elderly, Inc. received no additional loans during the year. The balance of the loan outstanding as of September 30, 2023, was $4,855,145.

Finding Details

Finding 2023-001
FINDING No. 2023-001: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Housing Projects, ALN 14.155 Finding Resolution Status: Unresolved. Information on Universe Population Size: All security deposits for the year ended September 30, 2023. Sample Size Information: All security deposits for the year ended September 30, 2023. Identification of Repeat Finding and Finding Reference Number: No. Criteria: In accordance with HUD, the Project must hold tenant security deposits in a segregated interest bearing account and maintain a sufficient balance equal to the total security deposits collected from current tenants, plus accrued interest. Statement of Condition: The Project did not maintain sufficient funds equal to or exceeding the total security deposits collected from current residents. Cause: The Project’s security deposits liability exceeded its cash deposits by $6,980. Effect or Potential Effect: The Project would not have sufficient funds to satisfy its obligations to its tenants strictly using the security deposits account. Auditor Non-Compliance Code: M – Security Deposits Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations will be adopted. Recommendation: Management should implement procedures to ensure adequate funding of the security deposits account that equals or exceeds the corresponding security deposits liability. Response Indicator: Agree. Completion Date: 09/30/2024 Response: The Security Deposit liability is reconciled to the underlying report to ensure proper amounts are maintained. New procedures have been implemented to reconcile the Security Deposit Liability to cash funding.
Finding 2023-002
FINDING No. 2023-002: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Housing Projects, ALN 14.155 Finding Resolution Status: Resolved. Information on Universe Population Size: All replacement reserve deposits for the year ended September 30, 2023. Sample Size Information: All replacement reserve deposits for the year ended September 30, 2023. Identification of Repeat Finding and Finding Reference Number: No. Criteria: In accordance with HUD, required monthly deposits must be made to the Project’s reserve for replacement account. Statement of Condition: The Project underfunded the account by $676. Cause: An increase in funding was not implemented. Effect or Potential Effect: Deficiently funded reserve for replacement account. Auditor Non-Compliance Code: N – Reserve for Replacements Deposits Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations have been adopted. Recommendation: Management should implement procedures to ensure that the correct amount is deposited into the replacement reserve account each month. Response Indicator: Agree. Completion Date: 12/13/2023 Response: Deposits are made to the replacement reserves on a monthly basis. A new checklist is being implemented to ensure the accuracy of the amounts and completeness of the transfers.
Finding 2023-003
FINDING No. 2023-003: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Housing Projects, ALN 14.155 Finding Resolution Status: Resolved. Information on Universe Population Size: One hundred and thirty-seven tenants Sample Size Information: Twenty tenants Identification of Repeat Finding and Finding Reference Number: No. Criteria: HUD regulation requires timely verification of tenant’s current and initial income through the use of Enterprise Income Verification (EIV) reports. Statement of Condition: One tenant file did not contain verification of current income through the use of EIV reports. Cause: The Project did not perform and/or maintain the most current income verification of one tenant. Effect or Potential Effect: Unable to verify tenant eligibility and cost of assistance and residency may be disallowed. Auditor Non-Compliance Code: R – Section 8 Program Admin. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations have been adopted. Recommendation: Management should implement procedures to ensure that the required documentation is performed timely and maintained in the tenant files. Response Indicator: Agree. Completion Date: 03/17/2023 Response: Monthly reminders are being sent to all managers to run their EIV reports for the month. In addition, random files are being reviewed to ensure EIV reports are pulled as required. Training has been conducted with managers on EIV reports and EIV requirements.
Finding 2023-001
FINDING No. 2023-001: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Housing Projects, ALN 14.155 Finding Resolution Status: Unresolved. Information on Universe Population Size: All security deposits for the year ended September 30, 2023. Sample Size Information: All security deposits for the year ended September 30, 2023. Identification of Repeat Finding and Finding Reference Number: No. Criteria: In accordance with HUD, the Project must hold tenant security deposits in a segregated interest bearing account and maintain a sufficient balance equal to the total security deposits collected from current tenants, plus accrued interest. Statement of Condition: The Project did not maintain sufficient funds equal to or exceeding the total security deposits collected from current residents. Cause: The Project’s security deposits liability exceeded its cash deposits by $6,980. Effect or Potential Effect: The Project would not have sufficient funds to satisfy its obligations to its tenants strictly using the security deposits account. Auditor Non-Compliance Code: M – Security Deposits Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations will be adopted. Recommendation: Management should implement procedures to ensure adequate funding of the security deposits account that equals or exceeds the corresponding security deposits liability. Response Indicator: Agree. Completion Date: 09/30/2024 Response: The Security Deposit liability is reconciled to the underlying report to ensure proper amounts are maintained. New procedures have been implemented to reconcile the Security Deposit Liability to cash funding.
Finding 2023-002
FINDING No. 2023-002: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Housing Projects, ALN 14.155 Finding Resolution Status: Resolved. Information on Universe Population Size: All replacement reserve deposits for the year ended September 30, 2023. Sample Size Information: All replacement reserve deposits for the year ended September 30, 2023. Identification of Repeat Finding and Finding Reference Number: No. Criteria: In accordance with HUD, required monthly deposits must be made to the Project’s reserve for replacement account. Statement of Condition: The Project underfunded the account by $676. Cause: An increase in funding was not implemented. Effect or Potential Effect: Deficiently funded reserve for replacement account. Auditor Non-Compliance Code: N – Reserve for Replacements Deposits Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations have been adopted. Recommendation: Management should implement procedures to ensure that the correct amount is deposited into the replacement reserve account each month. Response Indicator: Agree. Completion Date: 12/13/2023 Response: Deposits are made to the replacement reserves on a monthly basis. A new checklist is being implemented to ensure the accuracy of the amounts and completeness of the transfers.
Finding 2023-003
FINDING No. 2023-003: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Housing Projects, ALN 14.155 Finding Resolution Status: Resolved. Information on Universe Population Size: One hundred and thirty-seven tenants Sample Size Information: Twenty tenants Identification of Repeat Finding and Finding Reference Number: No. Criteria: HUD regulation requires timely verification of tenant’s current and initial income through the use of Enterprise Income Verification (EIV) reports. Statement of Condition: One tenant file did not contain verification of current income through the use of EIV reports. Cause: The Project did not perform and/or maintain the most current income verification of one tenant. Effect or Potential Effect: Unable to verify tenant eligibility and cost of assistance and residency may be disallowed. Auditor Non-Compliance Code: R – Section 8 Program Admin. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations have been adopted. Recommendation: Management should implement procedures to ensure that the required documentation is performed timely and maintained in the tenant files. Response Indicator: Agree. Completion Date: 03/17/2023 Response: Monthly reminders are being sent to all managers to run their EIV reports for the month. In addition, random files are being reviewed to ensure EIV reports are pulled as required. Training has been conducted with managers on EIV reports and EIV requirements.