Audit 342991

FY End
2023-12-31
Total Expended
$1.44M
Findings
2
Programs
9
Organization: Iha, INC (CT)
Year: 2023 Accepted: 2025-02-19

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
523601 2023-001 - - N
1100043 2023-001 - - N

Contacts

Name Title Type
NCHUN3U967K6 Helen McAlinden Auditee
2032263426 John Visconti, CPA Auditor
No contacts on file

Notes to SEFA

Title: Note 1 – Basis of Presentation Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal award activity of Homes with Hope, Inc. and Affiliate (the Association) under programs of the federal government for the year ended December 31, 2023. 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 the Association, it is not intended to and does not present the financial position, changes in net assets, functional expenses, or cash flows of the Association.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. De Minimis Rate Used: N Rate Explanation: The Association has not elected to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal award activity of Homes with Hope, Inc. and Affiliate (the Association) under programs of the federal government for the year ended December 31, 2023. 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 the Association, it is not intended to and does not present the financial position, changes in net assets, functional expenses, or cash flows of the Association.
Title: Note 2 – Summary of Significant Accounting Policies Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal award activity of Homes with Hope, Inc. and Affiliate (the Association) under programs of the federal government for the year ended December 31, 2023. 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 the Association, it is not intended to and does not present the financial position, changes in net assets, functional expenses, or cash flows of the Association.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. De Minimis Rate Used: N Rate Explanation: The Association has not elected to use the 10 percent de minimus indirect cost rate 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.
Title: Note 3 – HUD Section 811 Capital Advance Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal award activity of Homes with Hope, Inc. and Affiliate (the Association) under programs of the federal government for the year ended December 31, 2023. 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 the Association, it is not intended to and does not present the financial position, changes in net assets, functional expenses, or cash flows of the Association.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. De Minimis Rate Used: N Rate Explanation: The Association has not elected to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance. The schedule of expenditures of federal awards includes proceeds from a capital advance totaling $840,000 issued by the Department of Housing and Urban Development (HUD) to IHA, Inc. for the purpose of acquiring residential housing. As a condition of this advance, IHA, Inc. is required to continue the use of the housing for eligible families until the maturity date of the advance, which ends June 30, 2041, or repay the entire amount of the advance plus interest at 6.25 percent. The balance of this capital advance at December 31, 2023 remained unchanged from the prior year.
Title: Note 4 – Indirect Cost Rate Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal award activity of Homes with Hope, Inc. and Affiliate (the Association) under programs of the federal government for the year ended December 31, 2023. 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 the Association, it is not intended to and does not present the financial position, changes in net assets, functional expenses, or cash flows of the Association.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. De Minimis Rate Used: N Rate Explanation: The Association has not elected to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance. The Association has not elected to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance.
Title: Note 5 – Subrecipient EXPENDITURES Accounting Policies: The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal award activity of Homes with Hope, Inc. and Affiliate (the Association) under programs of the federal government for the year ended December 31, 2023. 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 the Association, it is not intended to and does not present the financial position, changes in net assets, functional expenses, or cash flows of the Association.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. De Minimis Rate Used: N Rate Explanation: The Association has not elected to use the 10 percent de minimus indirect cost rate allowed under the Uniform Guidance. During the year ended December 31, 2023, the Association did not pass through any federal funds to subrecipients.

Finding Details

2023-001 SPECIAL TESTS AND PROVISIONS – REPLACEMENT RESERVE Grantor: U. S. Department of Housing and Urban Development – HUD Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811) FALN Number: 14.181 Pass-through Entities: N/A HUD Project Number: 017-HD015 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 (Regulatory Agreement item 5(a)). All disbursements from the reserve must be approved by HUD (24 CFR section 891.405). Condition: The required deposits were not made timely during the year and, as of year-end, deposits for seven months, totaling $7,927, had not yet been made to the reserve account. Questioned Costs: None. Effect: Certain necessary purchases for capital improvements and major repairs could be delayed or foregone because the funds were not deposited in the reserve as required. Cause: The property manager appears to have had some cash flow issues during the year as a result of delayed invoicing to HUD that was in part due to the use of a third-party vendor in the billing process. This, in turn, resulted in a longer wait for receipt of the related HUD subsidy funds that constitute the bulk of the rental income generated by the property. Recommendation: Improvements to the HUD invoicing process should be considered to ensure that adequate cash flow is maintained. Additional training of relevant staff regarding the timely deposit requirements should also be considered. Views of Responsible Officials: A new in-house billing process that does not rely on a third party has been implemented since year-end, which should correct the cash flow issue. Additionally, all delinquent deposits that were due at December 31, 2023, were deposited in March 2024.
2023-001 SPECIAL TESTS AND PROVISIONS – REPLACEMENT RESERVE Grantor: U. S. Department of Housing and Urban Development – HUD Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811) FALN Number: 14.181 Pass-through Entities: N/A HUD Project Number: 017-HD015 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 (Regulatory Agreement item 5(a)). All disbursements from the reserve must be approved by HUD (24 CFR section 891.405). Condition: The required deposits were not made timely during the year and, as of year-end, deposits for seven months, totaling $7,927, had not yet been made to the reserve account. Questioned Costs: None. Effect: Certain necessary purchases for capital improvements and major repairs could be delayed or foregone because the funds were not deposited in the reserve as required. Cause: The property manager appears to have had some cash flow issues during the year as a result of delayed invoicing to HUD that was in part due to the use of a third-party vendor in the billing process. This, in turn, resulted in a longer wait for receipt of the related HUD subsidy funds that constitute the bulk of the rental income generated by the property. Recommendation: Improvements to the HUD invoicing process should be considered to ensure that adequate cash flow is maintained. Additional training of relevant staff regarding the timely deposit requirements should also be considered. Views of Responsible Officials: A new in-house billing process that does not rely on a third party has been implemented since year-end, which should correct the cash flow issue. Additionally, all delinquent deposits that were due at December 31, 2023, were deposited in March 2024.