FAC Explorer

Audit 320277

FY End
2023-12-31
Total Expended
$2.04M
Findings
6
Programs
2
Organization: Canaan Manor Detroit (LA)
Year: 2023 Accepted: 2024-09-20
Auditor: Wharton CPA LLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
497545 2023-001 Significant Deficiency - P
497546 2023-002 Significant Deficiency Yes N
497547 2023-003 Significant Deficiency - L
1073987 2023-001 Significant Deficiency - P
1073988 2023-002 Significant Deficiency Yes N
1073989 2023-003 Significant Deficiency - L

Programs

ALN Program Spent Major Findings
14.157 Supportive Housing for the Elderly $1.80M Yes 3
14.195 Section 8 Housing Assistance Payments Program $238,179 - 0

Contacts

Name Title Type
U6LMM26SLNQ7 Willie Gable Auditee
5045245471 Brendel Wharton Auditor
No contacts on file

Notes to SEFA

Title: Note 1 – Summary of Significant Accounting Policies Accounting Policies: Basis of Presentation - This schedule includes the activity of NBC-USA Housing, Inc. Canaan Manor Detroit 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 (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Indirect Cost Rate – Canaan Manor - Detroit did not use the de minimis cost rate. Loan/Loan Guarantee Outstanding Balance - Supportive Housing for the Elderly - Mortgage Payable - The balance outstanding at the end of the audit period was $1,803,915. De Minimis Rate Used: N Rate Explanation: Canaan Manor Detroit did not use the de minimis cost rate. Basis of Presentation - This schedule includes the activity of NBC-USA Housing, Inc. Canaan Manor Detroit 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 (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Indirect Cost Rate – Canaan Manor - Detroit did not use the de minimis cost rate. Loan/Loan Guarantee Outstanding Balance - Supportive Housing for the Elderly - Mortgage Payable - The balance outstanding at the end of the audit period was $1,803,915.

Finding Details

Finding 2023-001
2023–1 Prior Year Audit Entries Not Posted Condition: Management failed to post prior year audit entries. Criteria: Agreed upon audit adjustments must be posted to the financial statements each year. Cause: The cause is undeterminable. Effect: The financial statement records did not contain all financial transactions of the property. Recommendation: I recommend management post audit entries to agree financial records to audit report.
Finding 2023-002
2023-2 Excess Residual Receipts Not Remitted to HUD Condition: The Project did not reduce its housing assistance payments by the amount needed to reduce the residual receipts account to the acceptable limit. Criteria: Notice H 2012-14 allows owners to retain an initial reserve balance up to $250 per unit to be used for project purposes to the extent to which Residual Receipts are available, also known as the “retained balance”. According to HUD, the Residual Receipt balance in excess of $250 per unit must be applied on a monthly basis to offset the HAP contract and must continue until the Residual Receipt account reaches the retained balance level. Cause: The cause is undeterminable. Effect: Residual receipts balance is $11,430 as of December 31, 2023. The allowable balance is $7,250 ($250 X 29 units), resulting in excess residual receipts of $4,180. Recommendation: I recommend the Property begin reducing HAP payments to bring the residual receipts account to an acceptable level, according to HUD rules and regulations.
Finding 2023-003
2023-3 Late HUD Financial Reporting Condition: The owner did not meet the HUD financial reporting requirement. Criteria: According to HUD’s Uniform Financial Reporting Standards rule, annually, an owner is required to submit a financial statement, prepared in accordance with generally accepted accounting principles (GAAP), in the electronic format specified by HUD. The unaudited financial statement is due three months after the owner’s fiscal year end and the audited financial statement is due nine months after its fiscal year-end (24 CFR section 5.801). The financial statement must include the financial activities of this program. Cause: The cause is undeterminable. Effect: The Project is not compliant with HUD program requirements. Recommendation: I recommend the owner meet HUD program requirements.
Finding 2023-001
2023–1 Prior Year Audit Entries Not Posted Condition: Management failed to post prior year audit entries. Criteria: Agreed upon audit adjustments must be posted to the financial statements each year. Cause: The cause is undeterminable. Effect: The financial statement records did not contain all financial transactions of the property. Recommendation: I recommend management post audit entries to agree financial records to audit report.
Finding 2023-002
2023-2 Excess Residual Receipts Not Remitted to HUD Condition: The Project did not reduce its housing assistance payments by the amount needed to reduce the residual receipts account to the acceptable limit. Criteria: Notice H 2012-14 allows owners to retain an initial reserve balance up to $250 per unit to be used for project purposes to the extent to which Residual Receipts are available, also known as the “retained balance”. According to HUD, the Residual Receipt balance in excess of $250 per unit must be applied on a monthly basis to offset the HAP contract and must continue until the Residual Receipt account reaches the retained balance level. Cause: The cause is undeterminable. Effect: Residual receipts balance is $11,430 as of December 31, 2023. The allowable balance is $7,250 ($250 X 29 units), resulting in excess residual receipts of $4,180. Recommendation: I recommend the Property begin reducing HAP payments to bring the residual receipts account to an acceptable level, according to HUD rules and regulations.
Finding 2023-003
2023-3 Late HUD Financial Reporting Condition: The owner did not meet the HUD financial reporting requirement. Criteria: According to HUD’s Uniform Financial Reporting Standards rule, annually, an owner is required to submit a financial statement, prepared in accordance with generally accepted accounting principles (GAAP), in the electronic format specified by HUD. The unaudited financial statement is due three months after the owner’s fiscal year end and the audited financial statement is due nine months after its fiscal year-end (24 CFR section 5.801). The financial statement must include the financial activities of this program. Cause: The cause is undeterminable. Effect: The Project is not compliant with HUD program requirements. Recommendation: I recommend the owner meet HUD program requirements.