FAC Explorer

Audit 357808

FY End
2024-12-31
Total Expended
$1.13M
Findings
4
Programs
2
Organization: Highland House, Inc. 023-Eh-276 (MA)
Year: 2024 Accepted: 2025-06-02
Auditor: Burkhart Pizzanelli PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
562207 2024-001 - - C
562208 2024-002 Significant Deficiency - C
1138649 2024-001 - - C
1138650 2024-002 Significant Deficiency - C

Programs

ALN Program Spent Major Findings
14.195 Section 8 Housing Assistance Payments $608,858 - 0
14.157 Supportive Housing for the Elderly (section 202) Direct Loan $522,445 Yes 2

Contacts

Name Title Type
LPKJCXR7USV4 Bryan Joyce Auditee
4135254321 Julie Quink Auditor
No contacts on file

Notes to SEFA

Title: BASIS OF PRESENTATION Accounting Policies: The schedule of expenditures of federal awards is prepared 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. The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Project did not pass-through any federal funds to a subrecipient in 2024. De Minimis Rate Used: N Rate Explanation: The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards includes the federal grant activity of Highland House, Inc., HUD Project No. 023-EH-276. 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 Highland House, Inc., HUD Project No. 023-EH-276, it is not intended to and does not present the financial position, change in net assets, or cash flows of Highland House, Inc., HUD Project No. 023-EH-276.
Title: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: The schedule of expenditures of federal awards is prepared 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. The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Project did not pass-through any federal funds to a subrecipient in 2024. De Minimis Rate Used: N Rate Explanation: The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The schedule of expenditures of federal awards is prepared 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. The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Project did not pass-through any federal funds to a subrecipient in 2024.
Title: Department of Housing and Urban Development Loan Program Accounting Policies: The schedule of expenditures of federal awards is prepared 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. The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Project did not pass-through any federal funds to a subrecipient in 2024. De Minimis Rate Used: N Rate Explanation: The Project has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. The Section 202 Direct Loan is presented as of January 1, 2024. The Section 202 Direct Loan balance as of December 31, 2024 was $373,619.

Finding Details

Finding 2024-001
FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-001: Major Program: Section 202 Supportive Housing for the Elderly, Federal Assistance Listing Number 14.157 STATEMENT OF CONDITION One of the Project’s bank balances exceeds the Federal Deposit Insurance Corporation (FDIC) limit of $250,000. CRITERIA HUD requires the Project’s bank balances to not exceed the $250,000 FDIC limit due to the risk of loss in the event the bank was to fail. EFFECT OF CONDITION The Project’s accounts with Community Bank totaled over the FDIC limit at December 31, 2024. CONTEXT Bank balances were reviewed to ensure the Project is properly managing bank account limits and exposure. Balances at one bank were over the $250,000 limit. CAUSE OF CONDITION The Project’s bank accounts at one bank exceeded the FDIC limit at December 31, 2024. RECOMMENDATION The auditor recommends ensuring all bank account balances at each bank remain below the FDIC limit. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS The Project will be monitoring bank accounts more frequently throughout the year to ensure bank balances do not exceed the FDIC limits.
Finding 2024-002
FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT (CONTINUED) Department of Housing and Urban Development Finding, 2024-002: Major Program: Section 202 Supportive Housing for the Elderly, Federal Assistance Listing Number 14.157 STATEMENT OF CONDITION The surplus cash calculated for the year ended December 31, 2024, is required to be deposited by the Project within 60 days after year end. CRITERIA The HUD Audit Guide considers this to be an unauthorized use of project funds. EFFECT OF CONDITION The Project deposited $19,419 of the calculated surplus cash of $26,602 on February 27, 2025. The calculated difference between the amount deposited and the calculated surplus cash is $7,183, which was not deposited into the residual receipts account by February 28, 2025. CONTEXT The Project’s surplus cash amount was calculated for the year ended December 31, 2024. The surplus cash analysis was performed on February 27, 2025, to determine the amount required to be deposited by February 28, 2025. CAUSE OF CONDITION The Project calculated surplus cash of $19,419 for the year ended December 31, 2024, and deposited it within the required 60 days after year end. The Project did not calculate the correct surplus cash amount for the year ended December 31, 2024, due to late accounting adjustments. RECOMMENDATION The auditor recommends depositing surplus cash of $7,183 into the residual receipts account. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS Management has deposited the surplus cash amount of $7,183 into the residual receipts account on March 31, 2025.
Finding 2024-001
FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-001: Major Program: Section 202 Supportive Housing for the Elderly, Federal Assistance Listing Number 14.157 STATEMENT OF CONDITION One of the Project’s bank balances exceeds the Federal Deposit Insurance Corporation (FDIC) limit of $250,000. CRITERIA HUD requires the Project’s bank balances to not exceed the $250,000 FDIC limit due to the risk of loss in the event the bank was to fail. EFFECT OF CONDITION The Project’s accounts with Community Bank totaled over the FDIC limit at December 31, 2024. CONTEXT Bank balances were reviewed to ensure the Project is properly managing bank account limits and exposure. Balances at one bank were over the $250,000 limit. CAUSE OF CONDITION The Project’s bank accounts at one bank exceeded the FDIC limit at December 31, 2024. RECOMMENDATION The auditor recommends ensuring all bank account balances at each bank remain below the FDIC limit. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS The Project will be monitoring bank accounts more frequently throughout the year to ensure bank balances do not exceed the FDIC limits.
Finding 2024-002
FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT (CONTINUED) Department of Housing and Urban Development Finding, 2024-002: Major Program: Section 202 Supportive Housing for the Elderly, Federal Assistance Listing Number 14.157 STATEMENT OF CONDITION The surplus cash calculated for the year ended December 31, 2024, is required to be deposited by the Project within 60 days after year end. CRITERIA The HUD Audit Guide considers this to be an unauthorized use of project funds. EFFECT OF CONDITION The Project deposited $19,419 of the calculated surplus cash of $26,602 on February 27, 2025. The calculated difference between the amount deposited and the calculated surplus cash is $7,183, which was not deposited into the residual receipts account by February 28, 2025. CONTEXT The Project’s surplus cash amount was calculated for the year ended December 31, 2024. The surplus cash analysis was performed on February 27, 2025, to determine the amount required to be deposited by February 28, 2025. CAUSE OF CONDITION The Project calculated surplus cash of $19,419 for the year ended December 31, 2024, and deposited it within the required 60 days after year end. The Project did not calculate the correct surplus cash amount for the year ended December 31, 2024, due to late accounting adjustments. RECOMMENDATION The auditor recommends depositing surplus cash of $7,183 into the residual receipts account. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS Management has deposited the surplus cash amount of $7,183 into the residual receipts account on March 31, 2025.