FAC Explorer

Audit 354277

FY End
2024-09-30
Total Expended
$2.27M
Findings
2
Programs
1
Organization: Alpha Warren Housing Corporation (OH)
Year: 2024 Accepted: 2025-04-23
Auditor: Hwa Alliance of CPA Firms INC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
555669 2024-001 Significant Deficiency - E
1132111 2024-001 Significant Deficiency - E

Programs

ALN Program Spent Major Findings
14.157 Supportive Housing for the Elderly $155,584 Yes 0

Contacts

Name Title Type
T3TJEK5M8ZA3 Robin McClung Auditee
3303768787 John R Wright Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditure reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), wherein certain types of expenditure are not allowable or are limited as to reimbursement. Pass-through entity identifying number are presented where available. De Minimis Rate Used: N Rate Explanation: The entity has elected not to use 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of Warren Housing for the Elderly, Project No. 042-EE023 under programs of the federal government for the year ended September 30, 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 Project.
Title: Summary of Significant Accounting Policies Accounting Policies: Expenditure reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), wherein certain types of expenditure are not allowable or are limited as to reimbursement. Pass-through entity identifying number are presented where available. De Minimis Rate Used: N Rate Explanation: The entity has elected not to use 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. Expenditure reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), wherein certain types of expenditure are not allowable or are limited as to reimbursement. Pass-through entity identifying number are presented where available.
Title: Indirect Cost Rate Election Accounting Policies: Expenditure reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), wherein certain types of expenditure are not allowable or are limited as to reimbursement. Pass-through entity identifying number are presented where available. De Minimis Rate Used: N Rate Explanation: The entity has elected not to use 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The entity has elected not to use 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.
Title: Capital Advance Accounting Policies: Expenditure reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), wherein certain types of expenditure are not allowable or are limited as to reimbursement. Pass-through entity identifying number are presented where available. De Minimis Rate Used: N Rate Explanation: The entity has elected not to use 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. As required by HUD, the schedule of expenditures of federal awards (SEFA) includes a capital advance that was provided and used on May 16, 1995, by the Project. The capital advance has continuing compliance requirements, therefore considered as an annual expenditure. The value of the expenditure is the total amount advanced and utilized by the Project. The capital advance agreement requires the owner to maintain the project for 40 years.

Finding Details

Finding 2024-001
2024-001 Incomplete Transfer of Waitlist Information: Internal Control Weakness Impacting HUD Compliance Program Name/Assistance Listing Title: Supportive Elderly Housing - Section 202 Federal Assistance Listing No: 14.157 Federal Agency: U.S. Department of Housing and Urban Development Type of Finding: Federal Award Finding Compliance Requirements: Eligibility Population Size and Sample Size Information: Out of total 37 tenants, 5 samples were selected. Criteria: HUD regulations states the following: a. 24 CFR 891.410 (a). Owners shall maintain a written, chronological waiting list showing the name, race, gender, ethnicity, and date of each person applying for the program. b. HUD Occupancy Handbook 4350.3 REV-1 (Chapter 4: Waiting List and Tenant Selection): Owners must develop a method to maintain documentation of the waiting list composition, application status, and actions taken. c. Compliance Supplement May 2024 : Owners must document that participants selected from the waitlist met the preference criteria and were selected according to the admission policies in the administrative plan. (24 CFR section 891.410) d. 24 CFR 982.204: Except for special admissions, participants must be selected from the PHA waiting list. The PHA must select participants from the waiting list in accordance with admission policies in the PHA Administrative Plan. The PHA must maintain information that permits the PHA to select participants from the waiting list in accordance with the PHA admission policies. The waiting list must contain the following information for each applicant listed: (1) Applicant name; (2) Family unit size (number of bedrooms for which family qualifies under PHA occupancy standards); (3) Date and time of application; (4) Qualification for any local preference; (5) Racial or ethnic designation of the head of household. Condition: During eligibility testing, we were unable to verify compliance with HUD regulations requiring selection from the waiting list in accordance with the administrative plan (24 CFR section 891.410 and 24 CFR 982.204). The waitlist application dates generated from the Project’s software reflect the initial data load from RealPage to Fortress and did not include essential waitlist notes. This lack of documentation prevented us from verifying that tenant selection adhered to HUD requirements and selected from waiting list in correct order. Cause of Condition: The issue occurred due to an incomplete data transfer during the migration from RealPage to Fortress. Internal controls over the data migration process were insufficient to ensure that all required information, such as waitlist notes, was successfully transferred. Potential Effect of Condition:  Noncompliance with HUD regulations for maintaining an accurate and chronological waitlist.  Inability to demonstrate compliance with tenant selection requirements, which may result in findings of noncompliance, questioned costs, or penalties.  Increased risk of unfair or improper tenant selection due to incomplete records. Questioned Costs: No questioned costs are identified at this time, as the issue primarily concerns documentation and internal controls rather than direct financial mismanagement. Reporting Views of Responsible Officials: The Organization agrees with the findings and recommendations and will adhere to the corrective action plan. Context: The incomplete waitlist data impacts all units under the project where tenant selection relies on the waitlist. This issue arose during the migration from RealPage to Fortress and was discovered during eligibility testing for compliance with HUD regulations. Recommendation:  Implement a process to review and verify the accuracy and completeness of data during system migrations, including waitlist information and notes.  Reconstruct missing waitlist data by reviewing available source records, if feasible.  Develop and document a written policy for waitlist maintenance and data integrity to ensure ongoing compliance with HUD regulations. Management Response: Management is currently conducting a comprehensive review of the process to ensure alignment with compliance requirements and identify areas for improvement.
Finding 2024-001
2024-001 Incomplete Transfer of Waitlist Information: Internal Control Weakness Impacting HUD Compliance Program Name/Assistance Listing Title: Supportive Elderly Housing - Section 202 Federal Assistance Listing No: 14.157 Federal Agency: U.S. Department of Housing and Urban Development Type of Finding: Federal Award Finding Compliance Requirements: Eligibility Population Size and Sample Size Information: Out of total 37 tenants, 5 samples were selected. Criteria: HUD regulations states the following: a. 24 CFR 891.410 (a). Owners shall maintain a written, chronological waiting list showing the name, race, gender, ethnicity, and date of each person applying for the program. b. HUD Occupancy Handbook 4350.3 REV-1 (Chapter 4: Waiting List and Tenant Selection): Owners must develop a method to maintain documentation of the waiting list composition, application status, and actions taken. c. Compliance Supplement May 2024 : Owners must document that participants selected from the waitlist met the preference criteria and were selected according to the admission policies in the administrative plan. (24 CFR section 891.410) d. 24 CFR 982.204: Except for special admissions, participants must be selected from the PHA waiting list. The PHA must select participants from the waiting list in accordance with admission policies in the PHA Administrative Plan. The PHA must maintain information that permits the PHA to select participants from the waiting list in accordance with the PHA admission policies. The waiting list must contain the following information for each applicant listed: (1) Applicant name; (2) Family unit size (number of bedrooms for which family qualifies under PHA occupancy standards); (3) Date and time of application; (4) Qualification for any local preference; (5) Racial or ethnic designation of the head of household. Condition: During eligibility testing, we were unable to verify compliance with HUD regulations requiring selection from the waiting list in accordance with the administrative plan (24 CFR section 891.410 and 24 CFR 982.204). The waitlist application dates generated from the Project’s software reflect the initial data load from RealPage to Fortress and did not include essential waitlist notes. This lack of documentation prevented us from verifying that tenant selection adhered to HUD requirements and selected from waiting list in correct order. Cause of Condition: The issue occurred due to an incomplete data transfer during the migration from RealPage to Fortress. Internal controls over the data migration process were insufficient to ensure that all required information, such as waitlist notes, was successfully transferred. Potential Effect of Condition:  Noncompliance with HUD regulations for maintaining an accurate and chronological waitlist.  Inability to demonstrate compliance with tenant selection requirements, which may result in findings of noncompliance, questioned costs, or penalties.  Increased risk of unfair or improper tenant selection due to incomplete records. Questioned Costs: No questioned costs are identified at this time, as the issue primarily concerns documentation and internal controls rather than direct financial mismanagement. Reporting Views of Responsible Officials: The Organization agrees with the findings and recommendations and will adhere to the corrective action plan. Context: The incomplete waitlist data impacts all units under the project where tenant selection relies on the waitlist. This issue arose during the migration from RealPage to Fortress and was discovered during eligibility testing for compliance with HUD regulations. Recommendation:  Implement a process to review and verify the accuracy and completeness of data during system migrations, including waitlist information and notes.  Reconstruct missing waitlist data by reviewing available source records, if feasible.  Develop and document a written policy for waitlist maintenance and data integrity to ensure ongoing compliance with HUD regulations. Management Response: Management is currently conducting a comprehensive review of the process to ensure alignment with compliance requirements and identify areas for improvement.