Audit 357820

FY End
2024-12-31
Total Expended
$5.20M
Findings
2
Programs
2
Year: 2024 Accepted: 2025-06-02

Organization Exclusion Status:

Checking exclusion status...

Findings

ID Ref Severity Repeat Requirement
562213 2024-001 - - E
1138655 2024-001 - - E

Programs

Contacts

Name Title Type
JC5MAGJ32DW7 Bryan Joyce Auditee
4135254321 Julie Quink Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances 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 did not pass-through any federal funds to a subrecipient in 2024. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Section 202 Capital Advance is presented as of January 1, 2024. The Section 202 Capital Advance balance as of December 31, 2024 was $4,812,100.
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 did not pass-through any federal funds to a subrecipient in 2024. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying schedule of expenditures of federal awards includes the federal grant activity of Falcon Housing Corporation, HUD Project No. 023-EE-122. 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 Falcon Housing Corporation, HUD Project No. 023-EE-122, it is not intended to and does not present the financial position, change in net assets, or cash flows of Falcon Housing Corporation, HUD Project No. 023-EE-122.
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 did not pass-through any federal funds to a subrecipient in 2024. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. 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

Finding Details

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-001: Major Program: Supportive Housing for the Elderly (Section 202 Capital Advance - Accumulated Balance), Federal Assistance Listing Number 14.157 STATEMENT OF CONDITION One tenant file, out of six files reviewed, was for a tenant who moved in during the year and management did not properly generate the Enterprise Income Verification (EIV) report timely. CRITERIA HUD Handbook 4350.3 Revision 1 for HUD Subsidized Multifamily Housing Programs requires owners to review the EIV report within 90 days after transmission of the move in certification to the Tenant Rental Assistance Certification System (TRACS). EFFECT OF CONDITION The EIV report for the tenant moved in was not generated until after the 90-day period specified by HUD. CONTEXT During audit fieldwork, six files from a statistically valid sample were examined for compliance with tenant eligibility criteria. Of the six tenant files examined, one tenant was a new move in. The tenant’s file did not contain the EIV verified in the required 90-day timeframe. CAUSE OF CONDITION The procedures to ensure compliance over HUD tenant compliance, including EIV verification, were not followed timely. RECOMMENDATION The auditor recommends ensuring all current and new staff are trained on tenants’ 90-day EIV reports and ensuring they are generated within the required time period to verify tenant information promptly and help reduce errors in subsidy payments. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS The Project will be monitoring use of the EIV system for move ins and recertifications.
FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT Department of Housing and Urban Development Finding, 2024-001: Major Program: Supportive Housing for the Elderly (Section 202 Capital Advance - Accumulated Balance), Federal Assistance Listing Number 14.157 STATEMENT OF CONDITION One tenant file, out of six files reviewed, was for a tenant who moved in during the year and management did not properly generate the Enterprise Income Verification (EIV) report timely. CRITERIA HUD Handbook 4350.3 Revision 1 for HUD Subsidized Multifamily Housing Programs requires owners to review the EIV report within 90 days after transmission of the move in certification to the Tenant Rental Assistance Certification System (TRACS). EFFECT OF CONDITION The EIV report for the tenant moved in was not generated until after the 90-day period specified by HUD. CONTEXT During audit fieldwork, six files from a statistically valid sample were examined for compliance with tenant eligibility criteria. Of the six tenant files examined, one tenant was a new move in. The tenant’s file did not contain the EIV verified in the required 90-day timeframe. CAUSE OF CONDITION The procedures to ensure compliance over HUD tenant compliance, including EIV verification, were not followed timely. RECOMMENDATION The auditor recommends ensuring all current and new staff are trained on tenants’ 90-day EIV reports and ensuring they are generated within the required time period to verify tenant information promptly and help reduce errors in subsidy payments. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS The Project will be monitoring use of the EIV system for move ins and recertifications.