Audit 308265

FY End
2023-12-31
Total Expended
$5.54M
Findings
2
Programs
3
Year: 2023 Accepted: 2024-06-06

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
400142 2023-001 Significant Deficiency - C
976584 2023-001 Significant Deficiency - C

Contacts

Name Title Type
XVKLMLFQVL78 Bryan Joyce Auditee
4135254321 Julie Quink Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: The schedule of expenditures of federal awards is prepared 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. The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Project did not pass-through any federal funds to a subrecipient in 2023. De Minimis Rate Used: N Rate Explanation: The Project 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 includes the federal grant activity of Independent Housing II, Inc., HUD Project No. 023-EE-035-Costello House. 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 Independent Housing II, Inc., HUD Project No. 023-EE-035-Costello House, it is not intended to and does not present the financial position, change in net assets, or cash flows of Independent Housing II, Inc., HUD Project No. 023-EE-035-Costello House.
Title: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: The schedule of expenditures of federal awards is prepared 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. The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Project did not pass-through any federal funds to a subrecipient in 2023. De Minimis Rate Used: N Rate Explanation: The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The schedule of expenditures of federal awards is prepared 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. The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Project did not pass-through any federal funds to a subrecipient in 2023.
Title: DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT LOAN PROGRAM Accounting Policies: The schedule of expenditures of federal awards is prepared 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. The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Project did not pass-through any federal funds to a subrecipient in 2023. De Minimis Rate Used: N Rate Explanation: The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Section 202 Capital Advance accumulated balance is presented as of January 1, 2023. The Section 202 Capital Advance accumulated balance as of December 31, 2023 was $5,148,400.

Finding Details

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2023-001: Section 202 Supportive Housing for the Elderly Program, Capital Advance - Accumulated Balance, CFDA 14.157. STATEMENT OF CONDITION The surplus cash calculated for the year ended December 31, 2023, is required to be deposited by the Project within 60 days after year end. CRITERIA The HUD Audit Guide considers this to be an unauthorized use of project funds. CAUSE OF CONDITION The 60-day surplus cash deposit requirement of the Regulatory Agreement was missed due to a banking oversight. EFFECT OF CONDITION The surplus cash amount of $18,172 was not deposited into the residual receipts account by February 28, 2024. RECOMMENDATION The auditor recommends depositing the surplus cash amount of $18,172 into the residual receipts account immediately. The auditor also recommends that the management company continue to monitor the 60 days after year-end deadline and transmit the funds to the residual receipts account prior to this deadline, if applicable, in future years. MANAGEMENT’S RESPONSE Management has deposited the surplus cash amount of $18,172 into the residual receipts account and will continue to monitor the 60 days after year-end deadline in the future.
FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2023-001: Section 202 Supportive Housing for the Elderly Program, Capital Advance - Accumulated Balance, CFDA 14.157. STATEMENT OF CONDITION The surplus cash calculated for the year ended December 31, 2023, is required to be deposited by the Project within 60 days after year end. CRITERIA The HUD Audit Guide considers this to be an unauthorized use of project funds. CAUSE OF CONDITION The 60-day surplus cash deposit requirement of the Regulatory Agreement was missed due to a banking oversight. EFFECT OF CONDITION The surplus cash amount of $18,172 was not deposited into the residual receipts account by February 28, 2024. RECOMMENDATION The auditor recommends depositing the surplus cash amount of $18,172 into the residual receipts account immediately. The auditor also recommends that the management company continue to monitor the 60 days after year-end deadline and transmit the funds to the residual receipts account prior to this deadline, if applicable, in future years. MANAGEMENT’S RESPONSE Management has deposited the surplus cash amount of $18,172 into the residual receipts account and will continue to monitor the 60 days after year-end deadline in the future.