FAC Explorer

Audit 31440

FY End
2022-12-31
Total Expended
$13.93M
Findings
2
Programs
1
Organization: Rmc Tooele Property, LLC (UT)
Year: 2022 Accepted: 2023-09-28
Auditor: Wsrp

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
31937 2022-001 Material Weakness Yes N
608379 2022-001 Material Weakness Yes N

Programs

ALN Program Spent Major Findings
14.129 Mortgage Insurance_nursing Homes, Intermediate Care Facilities, Board and Care Homes and Assisted Living Facilities $13.93M Yes 1

Contacts

Name Title Type
EGHLQMFDMVV6 Nate Bangerter Auditee
8013974000 Tyler Curtis Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: The accompanying schedule of expenditures of federal awards includes the federal grant activity of RMCTooele Property, LLC, HUD Project No. 105-43073, and is presented on the accrual basis of accounting.The information in this schedule is presented in accordance with the requirements of audit requirements ofTitle 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, andAudit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in thisschedule may differ from amounts presented in, or used in the preparation of, the basic financial statements.Management has elected to use the 10% de minimis indirect cost rate for certain costs. De Minimis Rate Used: Y Rate Explanation: The auditee used the de minimis cost rate. RMC Tooele Property, LLC had the following loan balances outstanding at December 31, 2022:Section 232 insured mortgage in the amount of $ 13,737,087. (See Note 3-Mortgage Payable) This loanbalance outstanding is included in the federal expenditures presented in the schedule. Per Title 2 U.S. Codeof Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and AuditRequirements for Federal Awards paragraph 200.502 (Uniform Guidance), for loan guarantee programs theamount of federal awards expended is based on the beginning of the period balance of loans from previousyears for which the Federal government imposes continuing compliance requirements. So, the amount of thefederal awards expended for the loan guarantee program listed in this schedule will differ from the balancereflected on the balance sheet by the amount of principal paid during the reporting period.

Finding Details

Finding 2022-001
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS Finding No. 2022-1: Finding Resolution Status: Ongoing Information on Universe Population: Not applicable Statement of Condition: Management distributed funds before surplus cash was demonstrated at the end of the annual and semi-annual fiscal periods. Criteria: In accordance with HUD guidelines and requirements regarding the Section 232 Insured Mortgage, distributions may only be made after the end of any annual or semi-annual fiscal period, and when positive surplus cash is demonstrated. Effect: Noncompliance with HUD program guidelines. Cause: Management did not follow the established policies or HUD regulations because of the timing of when they believed surplus cash was available. Recommendation: We recommend that management review the regulatory agreement of how surplus cash is calculated and timing of when a distribution is allowed. Management should ensure if net positive surplus is calculated it is only distributed at annual or semi-annual intervals. Auditor non-compliance code: Z - Other Amount of questioned costs: $129,000.00 Reporting views of responsible officials: Management has reviewed the loan requirements and will ensure that excess cash will not be pulled from the Project except as allowed under the Section 232 guidelines and at annual or semi-annual intervals. Concur or Do Not Concur with this finding: Concur Auditor's summary of the auditee's comments on the findings Management has reviewed the loan requirements and will ensure that excess cash will not be pulled from the Project except as allowed under the Section 232 guidelines and at annual or semi-annual intervals.
Finding 2022-001
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS Finding No. 2022-1: Finding Resolution Status: Ongoing Information on Universe Population: Not applicable Statement of Condition: Management distributed funds before surplus cash was demonstrated at the end of the annual and semi-annual fiscal periods. Criteria: In accordance with HUD guidelines and requirements regarding the Section 232 Insured Mortgage, distributions may only be made after the end of any annual or semi-annual fiscal period, and when positive surplus cash is demonstrated. Effect: Noncompliance with HUD program guidelines. Cause: Management did not follow the established policies or HUD regulations because of the timing of when they believed surplus cash was available. Recommendation: We recommend that management review the regulatory agreement of how surplus cash is calculated and timing of when a distribution is allowed. Management should ensure if net positive surplus is calculated it is only distributed at annual or semi-annual intervals. Auditor non-compliance code: Z - Other Amount of questioned costs: $129,000.00 Reporting views of responsible officials: Management has reviewed the loan requirements and will ensure that excess cash will not be pulled from the Project except as allowed under the Section 232 guidelines and at annual or semi-annual intervals. Concur or Do Not Concur with this finding: Concur Auditor's summary of the auditee's comments on the findings Management has reviewed the loan requirements and will ensure that excess cash will not be pulled from the Project except as allowed under the Section 232 guidelines and at annual or semi-annual intervals.