Segregation of Duties
Type of Finding:
Material Weakness in Internal Control over Financial Reporting
Condition: There is not an ideal segregation of duties among personnel involved in the accounting
function. A lack of proper segregation of duties could allow errors or irregularities to occur and go
undetected. This condition is inherent in operations which, for sound economic conditions, must
function with a small number of office personnel, and correction of this condition would require the
employment of additional office personnel. Consequently, corrective action may not be practical.
Criteria or Specific Requirement: A proper segregation of duties is an important component of a
system of strong internal controls and should be implemented, if possible.
Cause: For sound economic reasons, the Corporation and the management company must function
with a small number of office personnel, and correction of this condition would require the employment
of additional office personnel. Consequently, corrective action may not be practical.
Effect: A lack of segregation of duties increases the risk that errors or fraud may occur and not be
prevented or detected on a timely basis.
Repeat Finding: Yes. Prior year finding 2022-001
Recommendation: When this condition exists, management’s and the board’s close supervision and
review of accounting information is the best means of preventing or detecting errors and irregularities.
Views of Responsible Officials and Planned Corrective Actions: We agree and will continue to
monitor monthly financial results and accounting information as correction is not practical.
Segregation of Duties
Type of Finding:
Material Weakness in Internal Control over Financial Reporting
Condition: There is not an ideal segregation of duties among personnel involved in the accounting
function. A lack of proper segregation of duties could allow errors or irregularities to occur and go
undetected. This condition is inherent in operations which, for sound economic conditions, must
function with a small number of office personnel, and correction of this condition would require the
employment of additional office personnel. Consequently, corrective action may not be practical.
Criteria or Specific Requirement: A proper segregation of duties is an important component of a
system of strong internal controls and should be implemented, if possible.
Cause: For sound economic reasons, the Corporation and the management company must function
with a small number of office personnel, and correction of this condition would require the employment
of additional office personnel. Consequently, corrective action may not be practical.
Effect: A lack of segregation of duties increases the risk that errors or fraud may occur and not be
prevented or detected on a timely basis.
Repeat Finding: Yes. Prior year finding 2022-001
Recommendation: When this condition exists, management’s and the board’s close supervision and
review of accounting information is the best means of preventing or detecting errors and irregularities.
Views of Responsible Officials and Planned Corrective Actions: We agree and will continue to
monitor monthly financial results and accounting information as correction is not practical.
Financial Statement Preparation
Type of Finding:
Material Weakness in Internal Control over Financial Reporting
Condition: The Corporation prepares certain accounts on the cash basis of accounting. As part of the
audit, these accounts were converted to the accrual basis as required by accounting principles
generally accepted in the United States of America. Audit adjustments were also made to record
depreciation and amortization.
The Corporation also engages CliftonLarsonAllen LLP (CLA) to assist in preparing its financial
statements and accompanying disclosures.
Criteria or Specific Requirement: A strong system of internal controls requires the Corporation to
prepare its own accounting records and financial statements in accordance with accounting principles
generally accepted in the United States of America.
Cause: The Corporation engages CLA to assist in this process. However, the Corporation has
reviewed and approved the annual financial statements and the related disclosures.
Effect: This increases the risk of material omissions or other errors in financial statements and
accompanying disclosures.
Repeat Finding: Yes. Prior year finding 2022-002.
Recommendation: Management should continue to evaluate their internal staff capacity to determine if
an internal control policy over the annual financial reporting is beneficial.
Views of Responsible Officials and Planned Corrective Actions: This condition is inherent in
operations which, for sound economic reasons, must function with a small number of office personnel.
Correction of this condition would require the employment of additional office personnel. We will
continue to monitor financial reports and accounting information as correction of this condition is
not practical.
Financial Statement Preparation
Type of Finding:
Material Weakness in Internal Control over Financial Reporting
Condition: The Corporation prepares certain accounts on the cash basis of accounting. As part of the
audit, these accounts were converted to the accrual basis as required by accounting principles
generally accepted in the United States of America. Audit adjustments were also made to record
depreciation and amortization.
The Corporation also engages CliftonLarsonAllen LLP (CLA) to assist in preparing its financial
statements and accompanying disclosures.
Criteria or Specific Requirement: A strong system of internal controls requires the Corporation to
prepare its own accounting records and financial statements in accordance with accounting principles
generally accepted in the United States of America.
Cause: The Corporation engages CLA to assist in this process. However, the Corporation has
reviewed and approved the annual financial statements and the related disclosures.
Effect: This increases the risk of material omissions or other errors in financial statements and
accompanying disclosures.
Repeat Finding: Yes. Prior year finding 2022-002.
Recommendation: Management should continue to evaluate their internal staff capacity to determine if
an internal control policy over the annual financial reporting is beneficial.
Views of Responsible Officials and Planned Corrective Actions: This condition is inherent in
operations which, for sound economic reasons, must function with a small number of office personnel.
Correction of this condition would require the employment of additional office personnel. We will
continue to monitor financial reports and accounting information as correction of this condition is
not practical.
Security Deposits
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program: Section 8 – Lower Income Housing Assistance Program
Mortgage Insurance for the Purchase or Refinancing of Existing
Multifamily Housing Projects
Assistance Listing #: 14.195
14.155
Type of Finding:
Other Matters
Condition: We noted a refund was not provided to a tenant within 30 days after the tenant’s move-out
date.
Criteria or specific requirement: HUD requires security deposit refunds to be disbursed to the former
tenant and in the appropriate amount within 30 days of move-out. If no refund is given, the tenant
should receive an itemized listing of any unpaid rent, damages to the unit and any estimated cost for
repair.
Questioned Costs: None
Context: We noted a refund was not provided to a tenant within 30 days after the tenant’s move-out
date.
Cause: Management oversight.
Effect: The Corporation is not in compliance with HUD requirements.
Repeat Finding: No
Recommendation: To establish proper internal control over security deposit refunds, the Corporation
should design and implement the necessary procedures to ensure the move-out notifications are
provided to the accounting office in a timely manner and ensure the tenant's security deposit is
processed and refunded within 30 days of the move-out date.
Views of responsible officials and planned corrective actions: There is no disagreement with the
finding. Management will monitor future move-outs to ensure the security deposits are processed and
refunded within 30 days of the move-out date.
Security Deposits
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program: Section 8 – Lower Income Housing Assistance Program
Mortgage Insurance for the Purchase or Refinancing of Existing
Multifamily Housing Projects
Assistance Listing #: 14.195
14.155
Type of Finding:
Other Matters
Condition: We noted a refund was not provided to a tenant within 30 days after the tenant’s move-out
date.
Criteria or specific requirement: HUD requires security deposit refunds to be disbursed to the former
tenant and in the appropriate amount within 30 days of move-out. If no refund is given, the tenant
should receive an itemized listing of any unpaid rent, damages to the unit and any estimated cost for
repair.
Questioned Costs: None
Context: We noted a refund was not provided to a tenant within 30 days after the tenant’s move-out
date.
Cause: Management oversight.
Effect: The Corporation is not in compliance with HUD requirements.
Repeat Finding: No
Recommendation: To establish proper internal control over security deposit refunds, the Corporation
should design and implement the necessary procedures to ensure the move-out notifications are
provided to the accounting office in a timely manner and ensure the tenant's security deposit is
processed and refunded within 30 days of the move-out date.
Views of responsible officials and planned corrective actions: There is no disagreement with the
finding. Management will monitor future move-outs to ensure the security deposits are processed and
refunded within 30 days of the move-out date.
Segregation of Duties
Type of Finding:
Material Weakness in Internal Control over Financial Reporting
Condition: There is not an ideal segregation of duties among personnel involved in the accounting
function. A lack of proper segregation of duties could allow errors or irregularities to occur and go
undetected. This condition is inherent in operations which, for sound economic conditions, must
function with a small number of office personnel, and correction of this condition would require the
employment of additional office personnel. Consequently, corrective action may not be practical.
Criteria or Specific Requirement: A proper segregation of duties is an important component of a
system of strong internal controls and should be implemented, if possible.
Cause: For sound economic reasons, the Corporation and the management company must function
with a small number of office personnel, and correction of this condition would require the employment
of additional office personnel. Consequently, corrective action may not be practical.
Effect: A lack of segregation of duties increases the risk that errors or fraud may occur and not be
prevented or detected on a timely basis.
Repeat Finding: Yes. Prior year finding 2022-001
Recommendation: When this condition exists, management’s and the board’s close supervision and
review of accounting information is the best means of preventing or detecting errors and irregularities.
Views of Responsible Officials and Planned Corrective Actions: We agree and will continue to
monitor monthly financial results and accounting information as correction is not practical.
Segregation of Duties
Type of Finding:
Material Weakness in Internal Control over Financial Reporting
Condition: There is not an ideal segregation of duties among personnel involved in the accounting
function. A lack of proper segregation of duties could allow errors or irregularities to occur and go
undetected. This condition is inherent in operations which, for sound economic conditions, must
function with a small number of office personnel, and correction of this condition would require the
employment of additional office personnel. Consequently, corrective action may not be practical.
Criteria or Specific Requirement: A proper segregation of duties is an important component of a
system of strong internal controls and should be implemented, if possible.
Cause: For sound economic reasons, the Corporation and the management company must function
with a small number of office personnel, and correction of this condition would require the employment
of additional office personnel. Consequently, corrective action may not be practical.
Effect: A lack of segregation of duties increases the risk that errors or fraud may occur and not be
prevented or detected on a timely basis.
Repeat Finding: Yes. Prior year finding 2022-001
Recommendation: When this condition exists, management’s and the board’s close supervision and
review of accounting information is the best means of preventing or detecting errors and irregularities.
Views of Responsible Officials and Planned Corrective Actions: We agree and will continue to
monitor monthly financial results and accounting information as correction is not practical.
Financial Statement Preparation
Type of Finding:
Material Weakness in Internal Control over Financial Reporting
Condition: The Corporation prepares certain accounts on the cash basis of accounting. As part of the
audit, these accounts were converted to the accrual basis as required by accounting principles
generally accepted in the United States of America. Audit adjustments were also made to record
depreciation and amortization.
The Corporation also engages CliftonLarsonAllen LLP (CLA) to assist in preparing its financial
statements and accompanying disclosures.
Criteria or Specific Requirement: A strong system of internal controls requires the Corporation to
prepare its own accounting records and financial statements in accordance with accounting principles
generally accepted in the United States of America.
Cause: The Corporation engages CLA to assist in this process. However, the Corporation has
reviewed and approved the annual financial statements and the related disclosures.
Effect: This increases the risk of material omissions or other errors in financial statements and
accompanying disclosures.
Repeat Finding: Yes. Prior year finding 2022-002.
Recommendation: Management should continue to evaluate their internal staff capacity to determine if
an internal control policy over the annual financial reporting is beneficial.
Views of Responsible Officials and Planned Corrective Actions: This condition is inherent in
operations which, for sound economic reasons, must function with a small number of office personnel.
Correction of this condition would require the employment of additional office personnel. We will
continue to monitor financial reports and accounting information as correction of this condition is
not practical.
Financial Statement Preparation
Type of Finding:
Material Weakness in Internal Control over Financial Reporting
Condition: The Corporation prepares certain accounts on the cash basis of accounting. As part of the
audit, these accounts were converted to the accrual basis as required by accounting principles
generally accepted in the United States of America. Audit adjustments were also made to record
depreciation and amortization.
The Corporation also engages CliftonLarsonAllen LLP (CLA) to assist in preparing its financial
statements and accompanying disclosures.
Criteria or Specific Requirement: A strong system of internal controls requires the Corporation to
prepare its own accounting records and financial statements in accordance with accounting principles
generally accepted in the United States of America.
Cause: The Corporation engages CLA to assist in this process. However, the Corporation has
reviewed and approved the annual financial statements and the related disclosures.
Effect: This increases the risk of material omissions or other errors in financial statements and
accompanying disclosures.
Repeat Finding: Yes. Prior year finding 2022-002.
Recommendation: Management should continue to evaluate their internal staff capacity to determine if
an internal control policy over the annual financial reporting is beneficial.
Views of Responsible Officials and Planned Corrective Actions: This condition is inherent in
operations which, for sound economic reasons, must function with a small number of office personnel.
Correction of this condition would require the employment of additional office personnel. We will
continue to monitor financial reports and accounting information as correction of this condition is
not practical.
Security Deposits
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program: Section 8 – Lower Income Housing Assistance Program
Mortgage Insurance for the Purchase or Refinancing of Existing
Multifamily Housing Projects
Assistance Listing #: 14.195
14.155
Type of Finding:
Other Matters
Condition: We noted a refund was not provided to a tenant within 30 days after the tenant’s move-out
date.
Criteria or specific requirement: HUD requires security deposit refunds to be disbursed to the former
tenant and in the appropriate amount within 30 days of move-out. If no refund is given, the tenant
should receive an itemized listing of any unpaid rent, damages to the unit and any estimated cost for
repair.
Questioned Costs: None
Context: We noted a refund was not provided to a tenant within 30 days after the tenant’s move-out
date.
Cause: Management oversight.
Effect: The Corporation is not in compliance with HUD requirements.
Repeat Finding: No
Recommendation: To establish proper internal control over security deposit refunds, the Corporation
should design and implement the necessary procedures to ensure the move-out notifications are
provided to the accounting office in a timely manner and ensure the tenant's security deposit is
processed and refunded within 30 days of the move-out date.
Views of responsible officials and planned corrective actions: There is no disagreement with the
finding. Management will monitor future move-outs to ensure the security deposits are processed and
refunded within 30 days of the move-out date.
Security Deposits
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program: Section 8 – Lower Income Housing Assistance Program
Mortgage Insurance for the Purchase or Refinancing of Existing
Multifamily Housing Projects
Assistance Listing #: 14.195
14.155
Type of Finding:
Other Matters
Condition: We noted a refund was not provided to a tenant within 30 days after the tenant’s move-out
date.
Criteria or specific requirement: HUD requires security deposit refunds to be disbursed to the former
tenant and in the appropriate amount within 30 days of move-out. If no refund is given, the tenant
should receive an itemized listing of any unpaid rent, damages to the unit and any estimated cost for
repair.
Questioned Costs: None
Context: We noted a refund was not provided to a tenant within 30 days after the tenant’s move-out
date.
Cause: Management oversight.
Effect: The Corporation is not in compliance with HUD requirements.
Repeat Finding: No
Recommendation: To establish proper internal control over security deposit refunds, the Corporation
should design and implement the necessary procedures to ensure the move-out notifications are
provided to the accounting office in a timely manner and ensure the tenant's security deposit is
processed and refunded within 30 days of the move-out date.
Views of responsible officials and planned corrective actions: There is no disagreement with the
finding. Management will monitor future move-outs to ensure the security deposits are processed and
refunded within 30 days of the move-out date.