FAC Explorer

Audit 349089

FY End
2024-12-31
Total Expended
$1.24M
Findings
8
Programs
2
Organization: Elderly Housing Corporation of Clay County 092-35748-Np-L8 (MN)
Year: 2024 Accepted: 2025-03-27
Auditor: Brady Martz & Associates PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
538057 2024-001 Significant Deficiency Yes N
538058 2024-001 Significant Deficiency Yes N
538059 2024-002 Significant Deficiency - N
538060 2024-002 Significant Deficiency - N
1114499 2024-001 Significant Deficiency Yes N
1114500 2024-001 Significant Deficiency Yes N
1114501 2024-002 Significant Deficiency - N
1114502 2024-002 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
14.195 Project-Based Rental Assistance (pbra) $822,020 Yes 2
14.191 Multifamily Housing Service Coordinators $109,923 - 0

Contacts

Name Title Type
CCKMGHAD3HZ5 Dara Lee Auditee
2182338883 Brian Opsahl Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the schedule of expenditures of federal awards (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. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: Houge Estates 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 award activity for HUD Project No. 092-35748-NP-L8 of Houge Estates under programs of the federal government for the year ended December 31, 2024. 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 Project, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Corporation.
Title: LOAN PROGRAMS Accounting Policies: Expenditures reported on the schedule of expenditures of federal awards (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. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: N Rate Explanation: Houge Estates has not elected to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The outstanding balance on loan programs as of December 31, 2024 was as follows: (SEE TABLE IN NOTES TO SEFA)

Finding Details

Finding 2024-001
Special Tests and Provisions: Housing Quality Standards – Significant Deficiency Federal Program Project Based Rental Assistance 14.195 Grant Award No. MN460010054 Federal Award Year 2024 Criteria The PHA or owner must provide housing that is decent, safe, and sanitary. To achieve this end, the PHA or owner must perform housing quality inspections at the time of initial occupancy and at least annually thereafter to ensure that the units are decent, safe, and sanitary (24 CFR sections 880.612, 881.601, 882.516, 882.808(n), 883.701, 884.217, 886.123, and 886.323). Condition During our review of six tenant files, we noted the Corporation did not follow up on one failed inspection in a timely manner. It was noted as of the date of the auditor’s testing, no follow up or corrective action had occurred on the failed inspection. Context We reviewed a sample of 6 of the Corporation's 52 outstanding tenant files for Housing Quality Standards requirements. Questioned Costs N/A Effect Inspected units may not have met Housing Quality Standards, which could result in housing assistance payments being made for units that were not up to the Housing Quality Standards. Cause The Corporation noted a change in software caused confusion as to whether the failed inspection had been corrected or not. Repeat Finding This is a repeat finding of 2023-001. Recommendation We recommend the Corporation review its quality control process over inspections. Views of Responsible Officials The Corporation is aware of the issue and has taken subsequent steps to ensure compliance with the requirement.
Finding 2024-001
Special Tests and Provisions: Housing Quality Standards – Significant Deficiency Federal Program Project Based Rental Assistance 14.195 Grant Award No. MN460010054 Federal Award Year 2024 Criteria The PHA or owner must provide housing that is decent, safe, and sanitary. To achieve this end, the PHA or owner must perform housing quality inspections at the time of initial occupancy and at least annually thereafter to ensure that the units are decent, safe, and sanitary (24 CFR sections 880.612, 881.601, 882.516, 882.808(n), 883.701, 884.217, 886.123, and 886.323). Condition During our review of six tenant files, we noted the Corporation did not follow up on one failed inspection in a timely manner. It was noted as of the date of the auditor’s testing, no follow up or corrective action had occurred on the failed inspection. Context We reviewed a sample of 6 of the Corporation's 52 outstanding tenant files for Housing Quality Standards requirements. Questioned Costs N/A Effect Inspected units may not have met Housing Quality Standards, which could result in housing assistance payments being made for units that were not up to the Housing Quality Standards. Cause The Corporation noted a change in software caused confusion as to whether the failed inspection had been corrected or not. Repeat Finding This is a repeat finding of 2023-001. Recommendation We recommend the Corporation review its quality control process over inspections. Views of Responsible Officials The Corporation is aware of the issue and has taken subsequent steps to ensure compliance with the requirement.
Finding 2024-002
Special Tests and Provisions: Vacant Units – Significant Deficiency Federal Program Project Based Rental Assistance 14.195 Grant Award No. MN460010054 Federal Award Year 2024 Criteria Perform procedures to obtain an understanding of internal control sufficient to plan the audit to support a low assessed level of control risk for the vacant unit requirements. Condition During our review of the documents sent to HUD monthly, it was noted that no signature was included on the document to signify who performed the procedures. The Corporations control procedures note this as a control process. This document contained tenant HAP reimbursement request information as well as vacant unit information. Context We reviewed 2 months of documents submitted to HUD for tenant HAP reimbursements and vacancy data for proper control procedures. Questioned Costs N/A Effect The Corporation may be providing incorrect information to HUD for reimbursements. Cause The Corporation noted a change in employees performing the tasks as well as oversight errors. Repeat Finding This is not a repeat finding. Recommendation We recommend the Corporation review its quality control process over reimbursement requests and vacant unit reporting to HUD. Views of Responsible Officials The Corporation is aware of the issue and has taken subsequent steps to ensure internal procedures are followed as established.
Finding 2024-002
Special Tests and Provisions: Vacant Units – Significant Deficiency Federal Program Project Based Rental Assistance 14.195 Grant Award No. MN460010054 Federal Award Year 2024 Criteria Perform procedures to obtain an understanding of internal control sufficient to plan the audit to support a low assessed level of control risk for the vacant unit requirements. Condition During our review of the documents sent to HUD monthly, it was noted that no signature was included on the document to signify who performed the procedures. The Corporations control procedures note this as a control process. This document contained tenant HAP reimbursement request information as well as vacant unit information. Context We reviewed 2 months of documents submitted to HUD for tenant HAP reimbursements and vacancy data for proper control procedures. Questioned Costs N/A Effect The Corporation may be providing incorrect information to HUD for reimbursements. Cause The Corporation noted a change in employees performing the tasks as well as oversight errors. Repeat Finding This is not a repeat finding. Recommendation We recommend the Corporation review its quality control process over reimbursement requests and vacant unit reporting to HUD. Views of Responsible Officials The Corporation is aware of the issue and has taken subsequent steps to ensure internal procedures are followed as established.
Finding 2024-001
Special Tests and Provisions: Housing Quality Standards – Significant Deficiency Federal Program Project Based Rental Assistance 14.195 Grant Award No. MN460010054 Federal Award Year 2024 Criteria The PHA or owner must provide housing that is decent, safe, and sanitary. To achieve this end, the PHA or owner must perform housing quality inspections at the time of initial occupancy and at least annually thereafter to ensure that the units are decent, safe, and sanitary (24 CFR sections 880.612, 881.601, 882.516, 882.808(n), 883.701, 884.217, 886.123, and 886.323). Condition During our review of six tenant files, we noted the Corporation did not follow up on one failed inspection in a timely manner. It was noted as of the date of the auditor’s testing, no follow up or corrective action had occurred on the failed inspection. Context We reviewed a sample of 6 of the Corporation's 52 outstanding tenant files for Housing Quality Standards requirements. Questioned Costs N/A Effect Inspected units may not have met Housing Quality Standards, which could result in housing assistance payments being made for units that were not up to the Housing Quality Standards. Cause The Corporation noted a change in software caused confusion as to whether the failed inspection had been corrected or not. Repeat Finding This is a repeat finding of 2023-001. Recommendation We recommend the Corporation review its quality control process over inspections. Views of Responsible Officials The Corporation is aware of the issue and has taken subsequent steps to ensure compliance with the requirement.
Finding 2024-001
Special Tests and Provisions: Housing Quality Standards – Significant Deficiency Federal Program Project Based Rental Assistance 14.195 Grant Award No. MN460010054 Federal Award Year 2024 Criteria The PHA or owner must provide housing that is decent, safe, and sanitary. To achieve this end, the PHA or owner must perform housing quality inspections at the time of initial occupancy and at least annually thereafter to ensure that the units are decent, safe, and sanitary (24 CFR sections 880.612, 881.601, 882.516, 882.808(n), 883.701, 884.217, 886.123, and 886.323). Condition During our review of six tenant files, we noted the Corporation did not follow up on one failed inspection in a timely manner. It was noted as of the date of the auditor’s testing, no follow up or corrective action had occurred on the failed inspection. Context We reviewed a sample of 6 of the Corporation's 52 outstanding tenant files for Housing Quality Standards requirements. Questioned Costs N/A Effect Inspected units may not have met Housing Quality Standards, which could result in housing assistance payments being made for units that were not up to the Housing Quality Standards. Cause The Corporation noted a change in software caused confusion as to whether the failed inspection had been corrected or not. Repeat Finding This is a repeat finding of 2023-001. Recommendation We recommend the Corporation review its quality control process over inspections. Views of Responsible Officials The Corporation is aware of the issue and has taken subsequent steps to ensure compliance with the requirement.
Finding 2024-002
Special Tests and Provisions: Vacant Units – Significant Deficiency Federal Program Project Based Rental Assistance 14.195 Grant Award No. MN460010054 Federal Award Year 2024 Criteria Perform procedures to obtain an understanding of internal control sufficient to plan the audit to support a low assessed level of control risk for the vacant unit requirements. Condition During our review of the documents sent to HUD monthly, it was noted that no signature was included on the document to signify who performed the procedures. The Corporations control procedures note this as a control process. This document contained tenant HAP reimbursement request information as well as vacant unit information. Context We reviewed 2 months of documents submitted to HUD for tenant HAP reimbursements and vacancy data for proper control procedures. Questioned Costs N/A Effect The Corporation may be providing incorrect information to HUD for reimbursements. Cause The Corporation noted a change in employees performing the tasks as well as oversight errors. Repeat Finding This is not a repeat finding. Recommendation We recommend the Corporation review its quality control process over reimbursement requests and vacant unit reporting to HUD. Views of Responsible Officials The Corporation is aware of the issue and has taken subsequent steps to ensure internal procedures are followed as established.
Finding 2024-002
Special Tests and Provisions: Vacant Units – Significant Deficiency Federal Program Project Based Rental Assistance 14.195 Grant Award No. MN460010054 Federal Award Year 2024 Criteria Perform procedures to obtain an understanding of internal control sufficient to plan the audit to support a low assessed level of control risk for the vacant unit requirements. Condition During our review of the documents sent to HUD monthly, it was noted that no signature was included on the document to signify who performed the procedures. The Corporations control procedures note this as a control process. This document contained tenant HAP reimbursement request information as well as vacant unit information. Context We reviewed 2 months of documents submitted to HUD for tenant HAP reimbursements and vacancy data for proper control procedures. Questioned Costs N/A Effect The Corporation may be providing incorrect information to HUD for reimbursements. Cause The Corporation noted a change in employees performing the tasks as well as oversight errors. Repeat Finding This is not a repeat finding. Recommendation We recommend the Corporation review its quality control process over reimbursement requests and vacant unit reporting to HUD. Views of Responsible Officials The Corporation is aware of the issue and has taken subsequent steps to ensure internal procedures are followed as established.