FAC Explorer

Audit 324336

FY End
2023-12-31
Total Expended
$4.06M
Findings
8
Programs
2
Organization: Community Directions, Inc. (LA)
Year: 2023 Accepted: 2024-10-09
Auditor: Vige Tujague & Noel

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
502112 2023-001 Significant Deficiency - N
502113 2023-002 Significant Deficiency - N
502114 2023-001 Significant Deficiency - N
502115 2023-002 Significant Deficiency - N
1078554 2023-001 Significant Deficiency - N
1078555 2023-002 Significant Deficiency - N
1078556 2023-001 Significant Deficiency - N
1078557 2023-002 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
14.239 Home Investment Partnerships Program $600,000 Yes 2
14.228 Community Development Block Grants/state's Program and Non-Entitlement Grants in Hawaii $150,000 - 0

Contacts

Name Title Type
SQBKKL9LM734 Joan Kirsch Auditee
3372611408 Shirely Vige, JR Auditor
No contacts on file

Notes to SEFA

Title: NOTE A – BASIS OF PRESENTATION Accounting Policies: NOTE A – BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards includes the federal grant activity of Community Directions, Inc. 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 Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the Schedule presents only a selected portion of the operations of Community Directions, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Community Directions, Inc. NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported 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. Community Directions, Inc. has not elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported 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. Community Directions, Inc. has not elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards includes the federal grant activity of Community Directions, Inc. 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 Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the Schedule presents only a selected portion of the operations of Community Directions, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Community Directions, Inc.
Title: NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: NOTE A – BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards includes the federal grant activity of Community Directions, Inc. 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 Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the Schedule presents only a selected portion of the operations of Community Directions, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Community Directions, Inc. NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported 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. Community Directions, Inc. has not elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported 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. Community Directions, Inc. has not elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. Expenditures reported on the Schedule are reported 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. Community Directions, Inc. has not elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.
Title: NOTE C – FEDERALLY FUNDED AND INSURED MORTGAGES Accounting Policies: NOTE A – BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards includes the federal grant activity of Community Directions, Inc. 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 Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the Schedule presents only a selected portion of the operations of Community Directions, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Community Directions, Inc. NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported 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. Community Directions, Inc. has not elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: NOTE B – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported 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. Community Directions, Inc. has not elected to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The mortgage balance at the beginning of the year and loans made during the year are included in the federal expenditures presented in the Schedule. The balance of the outstanding federally insured mortgages at December 31, 2023 is $3,311,036.

Finding Details

Finding 2023-001
FINDING #2023-001 SURPLUS CASH Type of Finding: Compliance: Special Tests Program: The Home Investment Partnership Program (Assistance Listing 14.239) Condition: At December 31, 2022 the Entity had surplus cash totaling $9,162, due to Home Funds. Park Ridge Apartments, Phase 3 had surplus cash in the amount of $4,000. Park Ridge Apartments, Phase 4 had surplus cash in the amount of $2,077. Park Ridge Apartments, Phase 5 had surplus cash in the amount of $1,379. Parsk Ridge Apartments, Phase 6 had surplus cash in the amount of $1,706. The Entity did not make any payments on the loan as required by the loan agreement. Criteria: The loan agreement between the Entity and the Home Investment Partnership Program requires the Entity to make payments of principal and interest on the note in an annual installment equal to a certain percentage of surplus cash , to the extent that surplus cash exists. Effect: The Entity is in direct violation of the Home Funds loan agreement. Cause: This was an oversight by the management agent. Recommendation: The management agent should compute an estimate of surplus cash for the fiscal year upon completion of that period. In the event that surplus cash exists at the completion of the fiscal period, the management agent should make an installment payment on the HOME note. Views of Responsible Officials and Planned Corrective Action: The management agent agrees with the finding and the auditor’s recommendations have been adopted. Surplus cash will be calculated upon the completion of an annual fiscal period. If it is concluded that surplus cash exists at the end of the annual fiscal period, an installment payment will be made on the loan.
Finding 2023-002
FINDING #2023-002 RESERVE FOR REPLACEMENT Type of Finding: Compliance: Special Tests Program: The Home Investment Partnership Program (Assistance Listing 14.239) Condition: The Reserve for Replacement account balance for Park Ridge Apartments, Phase 4 underfunded in the amount of $750. Criteria: Owners shall establish and maintain a replacement reserve to aid in funding extraordinary maintenance and repair and replacement of capital items. The replacement reserve funds must be deposited in a federally insured depository in an interest-bearing account. All earnings including interest on the reserve must be added to the reserve. An amount as required by HUD will be deposited monthly in the reserve fund (Rental assistance contract item 2.6C Financial Requirements). All disbursements from the reserve must be approved by HUD (24 CFR Section 891.405). Annual deposits must be sufficient to rectify any previous account deficiencies. Effect: Failure on the part of the Entity to make required deposits to cure account deficiencies in a timely fashion is deemed to be a violation of the regulatory agreement between the Entity and HUD. Context: The required balance in the Reserve for Replacement account is calculated by adjusting the opening balance at the beginning of the fiscal year by the annual required monthly deposits; other required deposits; interest earned; and approved withdrawals. Cause: This was an oversight by the Entity’s management agent. Recommendation: The management agent should ensure that all required deposits are made to the Reserve for Replacement account and that the balance in that account meets the minimum required balance in accordance with the regulatory agreement between the Entity and HUD. View of Responsible Officials and Planned Corrective Action: The management agent agrees with the finding and the auditor’s recommendations have been adopted.
Finding 2023-001
FINDING #2023-001 SURPLUS CASH Type of Finding: Compliance: Special Tests Program: The Home Investment Partnership Program (Assistance Listing 14.239) Condition: At December 31, 2022 the Entity had surplus cash totaling $9,162, due to Home Funds. Park Ridge Apartments, Phase 3 had surplus cash in the amount of $4,000. Park Ridge Apartments, Phase 4 had surplus cash in the amount of $2,077. Park Ridge Apartments, Phase 5 had surplus cash in the amount of $1,379. Parsk Ridge Apartments, Phase 6 had surplus cash in the amount of $1,706. The Entity did not make any payments on the loan as required by the loan agreement. Criteria: The loan agreement between the Entity and the Home Investment Partnership Program requires the Entity to make payments of principal and interest on the note in an annual installment equal to a certain percentage of surplus cash , to the extent that surplus cash exists. Effect: The Entity is in direct violation of the Home Funds loan agreement. Cause: This was an oversight by the management agent. Recommendation: The management agent should compute an estimate of surplus cash for the fiscal year upon completion of that period. In the event that surplus cash exists at the completion of the fiscal period, the management agent should make an installment payment on the HOME note. Views of Responsible Officials and Planned Corrective Action: The management agent agrees with the finding and the auditor’s recommendations have been adopted. Surplus cash will be calculated upon the completion of an annual fiscal period. If it is concluded that surplus cash exists at the end of the annual fiscal period, an installment payment will be made on the loan.
Finding 2023-002
FINDING #2023-002 RESERVE FOR REPLACEMENT Type of Finding: Compliance: Special Tests Program: The Home Investment Partnership Program (Assistance Listing 14.239) Condition: The Reserve for Replacement account balance for Park Ridge Apartments, Phase 4 underfunded in the amount of $750. Criteria: Owners shall establish and maintain a replacement reserve to aid in funding extraordinary maintenance and repair and replacement of capital items. The replacement reserve funds must be deposited in a federally insured depository in an interest-bearing account. All earnings including interest on the reserve must be added to the reserve. An amount as required by HUD will be deposited monthly in the reserve fund (Rental assistance contract item 2.6C Financial Requirements). All disbursements from the reserve must be approved by HUD (24 CFR Section 891.405). Annual deposits must be sufficient to rectify any previous account deficiencies. Effect: Failure on the part of the Entity to make required deposits to cure account deficiencies in a timely fashion is deemed to be a violation of the regulatory agreement between the Entity and HUD. Context: The required balance in the Reserve for Replacement account is calculated by adjusting the opening balance at the beginning of the fiscal year by the annual required monthly deposits; other required deposits; interest earned; and approved withdrawals. Cause: This was an oversight by the Entity’s management agent. Recommendation: The management agent should ensure that all required deposits are made to the Reserve for Replacement account and that the balance in that account meets the minimum required balance in accordance with the regulatory agreement between the Entity and HUD. View of Responsible Officials and Planned Corrective Action: The management agent agrees with the finding and the auditor’s recommendations have been adopted.
Finding 2023-001
FINDING #2023-001 SURPLUS CASH Type of Finding: Compliance: Special Tests Program: The Home Investment Partnership Program (Assistance Listing 14.239) Condition: At December 31, 2022 the Entity had surplus cash totaling $9,162, due to Home Funds. Park Ridge Apartments, Phase 3 had surplus cash in the amount of $4,000. Park Ridge Apartments, Phase 4 had surplus cash in the amount of $2,077. Park Ridge Apartments, Phase 5 had surplus cash in the amount of $1,379. Parsk Ridge Apartments, Phase 6 had surplus cash in the amount of $1,706. The Entity did not make any payments on the loan as required by the loan agreement. Criteria: The loan agreement between the Entity and the Home Investment Partnership Program requires the Entity to make payments of principal and interest on the note in an annual installment equal to a certain percentage of surplus cash , to the extent that surplus cash exists. Effect: The Entity is in direct violation of the Home Funds loan agreement. Cause: This was an oversight by the management agent. Recommendation: The management agent should compute an estimate of surplus cash for the fiscal year upon completion of that period. In the event that surplus cash exists at the completion of the fiscal period, the management agent should make an installment payment on the HOME note. Views of Responsible Officials and Planned Corrective Action: The management agent agrees with the finding and the auditor’s recommendations have been adopted. Surplus cash will be calculated upon the completion of an annual fiscal period. If it is concluded that surplus cash exists at the end of the annual fiscal period, an installment payment will be made on the loan.
Finding 2023-002
FINDING #2023-002 RESERVE FOR REPLACEMENT Type of Finding: Compliance: Special Tests Program: The Home Investment Partnership Program (Assistance Listing 14.239) Condition: The Reserve for Replacement account balance for Park Ridge Apartments, Phase 4 underfunded in the amount of $750. Criteria: Owners shall establish and maintain a replacement reserve to aid in funding extraordinary maintenance and repair and replacement of capital items. The replacement reserve funds must be deposited in a federally insured depository in an interest-bearing account. All earnings including interest on the reserve must be added to the reserve. An amount as required by HUD will be deposited monthly in the reserve fund (Rental assistance contract item 2.6C Financial Requirements). All disbursements from the reserve must be approved by HUD (24 CFR Section 891.405). Annual deposits must be sufficient to rectify any previous account deficiencies. Effect: Failure on the part of the Entity to make required deposits to cure account deficiencies in a timely fashion is deemed to be a violation of the regulatory agreement between the Entity and HUD. Context: The required balance in the Reserve for Replacement account is calculated by adjusting the opening balance at the beginning of the fiscal year by the annual required monthly deposits; other required deposits; interest earned; and approved withdrawals. Cause: This was an oversight by the Entity’s management agent. Recommendation: The management agent should ensure that all required deposits are made to the Reserve for Replacement account and that the balance in that account meets the minimum required balance in accordance with the regulatory agreement between the Entity and HUD. View of Responsible Officials and Planned Corrective Action: The management agent agrees with the finding and the auditor’s recommendations have been adopted.
Finding 2023-001
FINDING #2023-001 SURPLUS CASH Type of Finding: Compliance: Special Tests Program: The Home Investment Partnership Program (Assistance Listing 14.239) Condition: At December 31, 2022 the Entity had surplus cash totaling $9,162, due to Home Funds. Park Ridge Apartments, Phase 3 had surplus cash in the amount of $4,000. Park Ridge Apartments, Phase 4 had surplus cash in the amount of $2,077. Park Ridge Apartments, Phase 5 had surplus cash in the amount of $1,379. Parsk Ridge Apartments, Phase 6 had surplus cash in the amount of $1,706. The Entity did not make any payments on the loan as required by the loan agreement. Criteria: The loan agreement between the Entity and the Home Investment Partnership Program requires the Entity to make payments of principal and interest on the note in an annual installment equal to a certain percentage of surplus cash , to the extent that surplus cash exists. Effect: The Entity is in direct violation of the Home Funds loan agreement. Cause: This was an oversight by the management agent. Recommendation: The management agent should compute an estimate of surplus cash for the fiscal year upon completion of that period. In the event that surplus cash exists at the completion of the fiscal period, the management agent should make an installment payment on the HOME note. Views of Responsible Officials and Planned Corrective Action: The management agent agrees with the finding and the auditor’s recommendations have been adopted. Surplus cash will be calculated upon the completion of an annual fiscal period. If it is concluded that surplus cash exists at the end of the annual fiscal period, an installment payment will be made on the loan.
Finding 2023-002
FINDING #2023-002 RESERVE FOR REPLACEMENT Type of Finding: Compliance: Special Tests Program: The Home Investment Partnership Program (Assistance Listing 14.239) Condition: The Reserve for Replacement account balance for Park Ridge Apartments, Phase 4 underfunded in the amount of $750. Criteria: Owners shall establish and maintain a replacement reserve to aid in funding extraordinary maintenance and repair and replacement of capital items. The replacement reserve funds must be deposited in a federally insured depository in an interest-bearing account. All earnings including interest on the reserve must be added to the reserve. An amount as required by HUD will be deposited monthly in the reserve fund (Rental assistance contract item 2.6C Financial Requirements). All disbursements from the reserve must be approved by HUD (24 CFR Section 891.405). Annual deposits must be sufficient to rectify any previous account deficiencies. Effect: Failure on the part of the Entity to make required deposits to cure account deficiencies in a timely fashion is deemed to be a violation of the regulatory agreement between the Entity and HUD. Context: The required balance in the Reserve for Replacement account is calculated by adjusting the opening balance at the beginning of the fiscal year by the annual required monthly deposits; other required deposits; interest earned; and approved withdrawals. Cause: This was an oversight by the Entity’s management agent. Recommendation: The management agent should ensure that all required deposits are made to the Reserve for Replacement account and that the balance in that account meets the minimum required balance in accordance with the regulatory agreement between the Entity and HUD. View of Responsible Officials and Planned Corrective Action: The management agent agrees with the finding and the auditor’s recommendations have been adopted.