Audit 354187

Condition - Management withdrew $42,926 of funds to purchase a vehicle from the reserve for replacements account with HUD approval, however, management subsequently acquired a loan to finance the vehicle purchase and used the reserve funds for other purposes. Criteria - Funds withdrawn from the reserve for replacements account are to be used for the purpose disclosed on the Funds Authorization form and loans taken out requires HUD approval. Effect - The Company was not in compliance with the above criteria. Cause - Funds withdrawn were not used for their intended purpose and management did not receive HUD’s approval for the vehicle loan. Statistical Sampling - The sample was not intended to be, and was not, a statistically valid sample. Recommendation - We recommend that the $42,926 of funds withdrawn be used to pay off the loan or to be returned to the reserve for replacement account. Management’s Reply - Management will use the $42,926 of funds withdrawn from the reserves for replacements to payoff the loan acquired for the vehicle as originally intended.

Condition - The Company has not submitted form SF-SAC to the Federal Audit Clearinghouse for the year ended March 31, 2024 within the required timeframe. Criteria - According to the Uniform Guidance compliance requirements, the audit package and the data collection form shall be submitted 30 days after receipt of the auditor’s report, or 9 months after the end of the fiscal year, whichever comes first. Effect - The Company was not in compliance with the above Uniform Guidance compliance requirement. Cause - Due to delays of audit documentation form management, the audit was not able to be completed within the required time frame. Repeat Finding - This is a repeat of finding 2023-002 from the prior year. Recommendation - We recommend that management submit the form SF-SAC as soon as possible for the year ended March 31, 2024. Management’s Reply - Management will submit the form SF-SAC to the Federal Audit Clearinghouse as soon as the audit is received for the year ended March 31, 2024.

Condition - Management withdrew $42,926 of funds to purchase a vehicle from the reserve for replacements account with HUD approval, however, management subsequently acquired a loan to finance the vehicle purchase and used the reserve funds for other purposes. Criteria - Funds withdrawn from the reserve for replacements account are to be used for the purpose disclosed on the Funds Authorization form and loans taken out requires HUD approval. Effect - The Company was not in compliance with the above criteria. Cause - Funds withdrawn were not used for their intended purpose and management did not receive HUD’s approval for the vehicle loan. Statistical Sampling - The sample was not intended to be, and was not, a statistically valid sample. Recommendation - We recommend that the $42,926 of funds withdrawn be used to pay off the loan or to be returned to the reserve for replacement account. Management’s Reply - Management will use the $42,926 of funds withdrawn from the reserves for replacements to payoff the loan acquired for the vehicle as originally intended.

Condition - The Company has not submitted form SF-SAC to the Federal Audit Clearinghouse for the year ended March 31, 2024 within the required timeframe. Criteria - According to the Uniform Guidance compliance requirements, the audit package and the data collection form shall be submitted 30 days after receipt of the auditor’s report, or 9 months after the end of the fiscal year, whichever comes first. Effect - The Company was not in compliance with the above Uniform Guidance compliance requirement. Cause - Due to delays of audit documentation form management, the audit was not able to be completed within the required time frame. Repeat Finding - This is a repeat of finding 2023-002 from the prior year. Recommendation - We recommend that management submit the form SF-SAC as soon as possible for the year ended March 31, 2024. Management’s Reply - Management will submit the form SF-SAC to the Federal Audit Clearinghouse as soon as the audit is received for the year ended March 31, 2024.