Audit 35383

Finding reference number: #2022-001 CFDA title and number (Federal award identification number and year): Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects, CFDA No. 14.155 (122-35665, 122-35569V and 2004). Auditor non-compliance code: Q - Failure to make Mortgage Payments Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size information is not applicable to the finding. Statistically valid sample: N/A Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $319,688 Statement of Condition #2022-001 (CFDA 14.155): The Corporation did not make the required second mortgage payment of $319,688 in a timely manner based on the March 31, 2021, 2019, 2018, and 2017 audit reports. Criteria: As required under the Mortgage Restructuring Mortgage Note, a payment must be made on the second mortgage within 10 days after the financial statement due date of June 30. Effect: The Corporation did not comply with the Mortgage Restructuring Note. Cause: Management did not make a payment on the second mortgage in a timely manner after receiving the final audit report for each of the years March 31, 2021, March 31, 2019, March 31, 2018, and March 31, 2017. Recommendation: Management should make the delinquent payments on the second mortgage immediately. Completion Date: Outstanding Management Response: Management concurs with the finding and recommendation. The Corporation is working with HUD for a payment plan and anticipates making payments during the year ended March 31, 2023.

Finding reference number: #2022-001 CFDA title and number (Federal award identification number and year): Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects, CFDA No. 14.155 (122-35665, 122-35569V and 2004). Auditor non-compliance code: Q - Failure to make Mortgage Payments Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size information is not applicable to the finding. Statistically valid sample: N/A Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $319,688 Statement of Condition #2022-001 (CFDA 14.155): The Corporation did not make the required second mortgage payment of $319,688 in a timely manner based on the March 31, 2021, 2019, 2018, and 2017 audit reports. Criteria: As required under the Mortgage Restructuring Mortgage Note, a payment must be made on the second mortgage within 10 days after the financial statement due date of June 30. Effect: The Corporation did not comply with the Mortgage Restructuring Note. Cause: Management did not make a payment on the second mortgage in a timely manner after receiving the final audit report for each of the years March 31, 2021, March 31, 2019, March 31, 2018, and March 31, 2017. Recommendation: Management should make the delinquent payments on the second mortgage immediately. Completion Date: Outstanding Management Response: Management concurs with the finding and recommendation. The Corporation is working with HUD for a payment plan and anticipates making payments during the year ended March 31, 2023.