FAC Explorer

Audit 306676

FY End
2023-06-30
Total Expended
$6.43M
Findings
8
Programs
1
Organization: The Harry and Jeanette Weinberg Terrace, Inc. (MD)
Year: 2023 Accepted: 2024-05-20
Auditor: Cohnreznick LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
397967 2023-001 Material Weakness Yes A
397968 2023-002 Material Weakness - A
397969 2023-001 Material Weakness Yes A
397970 2023-002 Material Weakness - A
974409 2023-001 Material Weakness Yes A
974410 2023-002 Material Weakness - A
974411 2023-001 Material Weakness Yes A
974412 2023-002 Material Weakness - A

Programs

ALN Program Spent Major Findings
14.157 Supportive Housing for the Elderly $387,110 Yes 2

Contacts

Name Title Type
WJ2HVDD314G8 Victor Arthur Auditee
4105005331 Shari Grabush Auditor
No contacts on file

Notes to SEFA

Title: Note 1 - Basis of presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, 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: The Harry and Jeanette Weinberg Terrace, 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 award activity of The Harry and Jeanette Weinberg Terrace, Inc., HUD Project No.: 052-EE015, under programs of the federal government for the year ended June 30, 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 ("Uniform Guidance"). Because the Schedule presents only a selected portion of the operations of The Harry and Jeanette Weinberg Terrace, it is not intended to and does not present the financial position, changes in net assets, or cash flows of The Harry and Jeanette Weinberg Terrace, Inc. For the year ended June 30, 2023, no awards were passed through to subrecipients.
Title: Note 2 - Summary of significant accounting policies Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, 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: The Harry and Jeanette Weinberg Terrace, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Title: Note 3 - Indirect cost rate Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, 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: The Harry and Jeanette Weinberg Terrace, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The Harry and Jeanette Weinberg Terrace, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance.
Title: Note 4 - U.S. Department of Housing and Urban Development capital advance program Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, 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: The Harry and Jeanette Weinberg Terrace, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. The Organization entered into a capital advance agreement with HUD to assist in financing the Organization under Section 202 of the National Housing Act in the amount of $6,045,900. The capital advance is secured by a mortgage on the property and was recorded as grant revenue in prior years. The entire amount of the capital advance is included in federal expenditures presented in the Schedule. The Organization received no additional advances during the year. The capital advance does not bear interest and is not required to be repaid as long as the housing remains available to eligible low-income elderly persons for at least 40 years. Failure to keep the housing available for low-income elderly persons or other instances of default under the terms of the mortgage, capital advance agreement or regulatory agreement could cause the entire amount of the capital advance to be immediately payable, including interest from the date of the first advance. The capital advance restrictions expire in 2037. The restrictions on this grant are being released as net assets without donor restrictions on a straight-line basis over its term. See below for a reconciliation between the original capital advance and the amount shown as net assets with donor restriction as of June 30, 2023 on the statement of financial position:

Finding Details

Finding 2023-001
Finding No. 2023-001; Section 202 Supportive Housing for the Elderly, Assistance Listing 14.157 Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Condition In connection with our lease file review we noted the following deficiency:  One out of eight existing tenants tested had EIVs that were performed outside of the 120- day EIV window.  One out of one new tenants tested had an initial EIV certification that was performed outside of the 90-day EIV window. Cause Management's policies with respect to the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect The procedures for determining tenant security deposits and eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs There are no questioned costs. Identification as a Repeat Finding This is a repeat finding. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant security deposits are correctly recorded, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: Section 202 Supportive Housing for the Elderly program administration. Finding Resolution Status: Resolved. Views of Responsible Officials The inspection was conducted under previous management. The Franklin Johnston Group took over July 1st, 2023. The Franklin Johnston EIV policies and procedures require site staff to Run Existing tenant searches within 90 days prior to the move in date which is required to be uploaded to the assigned Compliance specialist for review prior to move in approvals. Although HUD requires quarterly reports, the new management require monthly. Site teams are only permitted to pull the “By Head of Household Report” at the time of recertification. 90- day EIV’s are to be ran within 90days of the anticipated voucher submission date. Site staff are required to go through our approval process, staff are not required to perform a move with without Compliance Approval. The Franklin Johnston performs quarterly audits to ensure that these processes are being followed along with ensuring that the files are being properly maintained. All site teams members have been trained as it relates to these policies. In addition to this training all site teams are required to attend monthly EIV training/Policies and procedures trainings according to HUD guidelines.
Finding 2023-002
Finding No. 2023-002; Section 202 Supportive Housing for the Elderly, Assistance Listing 14.157 Criteria Excess residual receipts funds should be remitted to HUD upon receipt of HUD approval. Condition The management received HUD approval to remit excess residual receipts funds in the amount of $2,794, on June 8, 2022. The funds have not been remitted to HUD as of June 30, 2023. Cause Controls were not in place to ensure that excess residual receipts funds were timely remitted. Effect or Potential Effect The Organization is not in compliance with the requirements of the Consolidated Appropriations Act of 2016, governing Residual Receipts for PRAC program. Questioned Costs $2,794 Identification as a Repeat Finding This is not a repeat finding. Recommendation Management should establish internal controls and procedures to ensure that excess residual receipts reserve funds are remitted timely. Auditor Noncompliance Code: B - Failure to make required residual receipts deposits. Finding Resolution Status: Resolved. Views of Responsible Officials The inspection was conducted under previous management. The Franklin Johnston Group took over July 1st, 2023. When the Franklin Johnston Group took over, the new management were unable to get in contact with HUD for months to receive confirmation wiring instructions. HUD requires residual receipts to be remitted and deposited no later than the termination/renewal date. The Franklin Johnston Group just received confirmation wiring instructions as of January 2024. Funds of $2,794 are now paid as of January of 2024. The Franklin Johnston Group will ensure that moving forward all residual receipts are to be remitted and expedited in a timely matter.
Finding 2023-001
Finding No. 2023-001; Section 202 Supportive Housing for the Elderly, Assistance Listing 14.157 Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Condition In connection with our lease file review we noted the following deficiency:  One out of eight existing tenants tested had EIVs that were performed outside of the 120- day EIV window.  One out of one new tenants tested had an initial EIV certification that was performed outside of the 90-day EIV window. Cause Management's policies with respect to the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect The procedures for determining tenant security deposits and eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs There are no questioned costs. Identification as a Repeat Finding This is a repeat finding. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant security deposits are correctly recorded, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: Section 202 Supportive Housing for the Elderly program administration. Finding Resolution Status: Resolved. Views of Responsible Officials The inspection was conducted under previous management. The Franklin Johnston Group took over July 1st, 2023. The Franklin Johnston EIV policies and procedures require site staff to Run Existing tenant searches within 90 days prior to the move in date which is required to be uploaded to the assigned Compliance specialist for review prior to move in approvals. Although HUD requires quarterly reports, the new management require monthly. Site teams are only permitted to pull the “By Head of Household Report” at the time of recertification. 90- day EIV’s are to be ran within 90days of the anticipated voucher submission date. Site staff are required to go through our approval process, staff are not required to perform a move with without Compliance Approval. The Franklin Johnston performs quarterly audits to ensure that these processes are being followed along with ensuring that the files are being properly maintained. All site teams members have been trained as it relates to these policies. In addition to this training all site teams are required to attend monthly EIV training/Policies and procedures trainings according to HUD guidelines.
Finding 2023-002
Finding No. 2023-002; Section 202 Supportive Housing for the Elderly, Assistance Listing 14.157 Criteria Excess residual receipts funds should be remitted to HUD upon receipt of HUD approval. Condition The management received HUD approval to remit excess residual receipts funds in the amount of $2,794, on June 8, 2022. The funds have not been remitted to HUD as of June 30, 2023. Cause Controls were not in place to ensure that excess residual receipts funds were timely remitted. Effect or Potential Effect The Organization is not in compliance with the requirements of the Consolidated Appropriations Act of 2016, governing Residual Receipts for PRAC program. Questioned Costs $2,794 Identification as a Repeat Finding This is not a repeat finding. Recommendation Management should establish internal controls and procedures to ensure that excess residual receipts reserve funds are remitted timely. Auditor Noncompliance Code: B - Failure to make required residual receipts deposits. Finding Resolution Status: Resolved. Views of Responsible Officials The inspection was conducted under previous management. The Franklin Johnston Group took over July 1st, 2023. When the Franklin Johnston Group took over, the new management were unable to get in contact with HUD for months to receive confirmation wiring instructions. HUD requires residual receipts to be remitted and deposited no later than the termination/renewal date. The Franklin Johnston Group just received confirmation wiring instructions as of January 2024. Funds of $2,794 are now paid as of January of 2024. The Franklin Johnston Group will ensure that moving forward all residual receipts are to be remitted and expedited in a timely matter.
Finding 2023-001
Finding No. 2023-001; Section 202 Supportive Housing for the Elderly, Assistance Listing 14.157 Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Condition In connection with our lease file review we noted the following deficiency:  One out of eight existing tenants tested had EIVs that were performed outside of the 120- day EIV window.  One out of one new tenants tested had an initial EIV certification that was performed outside of the 90-day EIV window. Cause Management's policies with respect to the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect The procedures for determining tenant security deposits and eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs There are no questioned costs. Identification as a Repeat Finding This is a repeat finding. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant security deposits are correctly recorded, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: Section 202 Supportive Housing for the Elderly program administration. Finding Resolution Status: Resolved. Views of Responsible Officials The inspection was conducted under previous management. The Franklin Johnston Group took over July 1st, 2023. The Franklin Johnston EIV policies and procedures require site staff to Run Existing tenant searches within 90 days prior to the move in date which is required to be uploaded to the assigned Compliance specialist for review prior to move in approvals. Although HUD requires quarterly reports, the new management require monthly. Site teams are only permitted to pull the “By Head of Household Report” at the time of recertification. 90- day EIV’s are to be ran within 90days of the anticipated voucher submission date. Site staff are required to go through our approval process, staff are not required to perform a move with without Compliance Approval. The Franklin Johnston performs quarterly audits to ensure that these processes are being followed along with ensuring that the files are being properly maintained. All site teams members have been trained as it relates to these policies. In addition to this training all site teams are required to attend monthly EIV training/Policies and procedures trainings according to HUD guidelines.
Finding 2023-002
Finding No. 2023-002; Section 202 Supportive Housing for the Elderly, Assistance Listing 14.157 Criteria Excess residual receipts funds should be remitted to HUD upon receipt of HUD approval. Condition The management received HUD approval to remit excess residual receipts funds in the amount of $2,794, on June 8, 2022. The funds have not been remitted to HUD as of June 30, 2023. Cause Controls were not in place to ensure that excess residual receipts funds were timely remitted. Effect or Potential Effect The Organization is not in compliance with the requirements of the Consolidated Appropriations Act of 2016, governing Residual Receipts for PRAC program. Questioned Costs $2,794 Identification as a Repeat Finding This is not a repeat finding. Recommendation Management should establish internal controls and procedures to ensure that excess residual receipts reserve funds are remitted timely. Auditor Noncompliance Code: B - Failure to make required residual receipts deposits. Finding Resolution Status: Resolved. Views of Responsible Officials The inspection was conducted under previous management. The Franklin Johnston Group took over July 1st, 2023. When the Franklin Johnston Group took over, the new management were unable to get in contact with HUD for months to receive confirmation wiring instructions. HUD requires residual receipts to be remitted and deposited no later than the termination/renewal date. The Franklin Johnston Group just received confirmation wiring instructions as of January 2024. Funds of $2,794 are now paid as of January of 2024. The Franklin Johnston Group will ensure that moving forward all residual receipts are to be remitted and expedited in a timely matter.
Finding 2023-001
Finding No. 2023-001; Section 202 Supportive Housing for the Elderly, Assistance Listing 14.157 Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Condition In connection with our lease file review we noted the following deficiency:  One out of eight existing tenants tested had EIVs that were performed outside of the 120- day EIV window.  One out of one new tenants tested had an initial EIV certification that was performed outside of the 90-day EIV window. Cause Management's policies with respect to the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect The procedures for determining tenant security deposits and eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs There are no questioned costs. Identification as a Repeat Finding This is a repeat finding. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant security deposits are correctly recorded, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: Section 202 Supportive Housing for the Elderly program administration. Finding Resolution Status: Resolved. Views of Responsible Officials The inspection was conducted under previous management. The Franklin Johnston Group took over July 1st, 2023. The Franklin Johnston EIV policies and procedures require site staff to Run Existing tenant searches within 90 days prior to the move in date which is required to be uploaded to the assigned Compliance specialist for review prior to move in approvals. Although HUD requires quarterly reports, the new management require monthly. Site teams are only permitted to pull the “By Head of Household Report” at the time of recertification. 90- day EIV’s are to be ran within 90days of the anticipated voucher submission date. Site staff are required to go through our approval process, staff are not required to perform a move with without Compliance Approval. The Franklin Johnston performs quarterly audits to ensure that these processes are being followed along with ensuring that the files are being properly maintained. All site teams members have been trained as it relates to these policies. In addition to this training all site teams are required to attend monthly EIV training/Policies and procedures trainings according to HUD guidelines.
Finding 2023-002
Finding No. 2023-002; Section 202 Supportive Housing for the Elderly, Assistance Listing 14.157 Criteria Excess residual receipts funds should be remitted to HUD upon receipt of HUD approval. Condition The management received HUD approval to remit excess residual receipts funds in the amount of $2,794, on June 8, 2022. The funds have not been remitted to HUD as of June 30, 2023. Cause Controls were not in place to ensure that excess residual receipts funds were timely remitted. Effect or Potential Effect The Organization is not in compliance with the requirements of the Consolidated Appropriations Act of 2016, governing Residual Receipts for PRAC program. Questioned Costs $2,794 Identification as a Repeat Finding This is not a repeat finding. Recommendation Management should establish internal controls and procedures to ensure that excess residual receipts reserve funds are remitted timely. Auditor Noncompliance Code: B - Failure to make required residual receipts deposits. Finding Resolution Status: Resolved. Views of Responsible Officials The inspection was conducted under previous management. The Franklin Johnston Group took over July 1st, 2023. When the Franklin Johnston Group took over, the new management were unable to get in contact with HUD for months to receive confirmation wiring instructions. HUD requires residual receipts to be remitted and deposited no later than the termination/renewal date. The Franklin Johnston Group just received confirmation wiring instructions as of January 2024. Funds of $2,794 are now paid as of January of 2024. The Franklin Johnston Group will ensure that moving forward all residual receipts are to be remitted and expedited in a timely matter.