Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Deposits required by HUD were not made during fiscal year 2024 to the reserve fund.
Condition: During the 2024 audit, we noted that the Project had not deposited the amounts required by HUD to be deposited monthly in the reserve fund for all of fiscal year 2024.
Questioned Costs: $8,580 in reserve fund deposits not made.
Context: Through audit compliance testing procedures, three months of bank reconciliations were tested and identified that the required monthly deposit was not made. Through further inquiry and review it was identified that all 12 deposits of fiscal year 2024 were not made and recorded as a liability.
Cause: Due to cash constraints caused by rental income delays the Project was unable to make the deposits.
Effect: The Project did not make sufficient deposits.
Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-001.
Recommendation: We recommend the Project make all fiscal year 2024 deposits as soon as funds allow.
Views of Responsible Officials: There is no disagreement with the audit finding. Management has received the delayed rental income payments and is working to make the back deposits.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Approved expenditures of federal awards without proper control completed.
Condition: During the 2024 audit, we noted that the Project approved expenditures of federal awards without proper review.
Questioned Costs: None.
Context: Invoice tested found to not be reviewed and approved per documented control procedure.
Cause: Due to change in management company during 2024.
Effect: The Project did properly review expenditures of federal awards.
Repeat Finding: None.
Recommendation: We recommend enforcing control procedures over expenditures of federal awards.
Views of Responsible Officials: There is no disagreement with the audit finding. During 2024, a new management company was hired as of July 1, 2024 and has implemented and enforced proper controls over expenditures of federal awards.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Reserve for replacement funds were not maintained in a separate bank account.
Condition: During the 2024 audit, we noted that the reserve for replacement bank account was closed and deposited into the operating bank account.
Questioned Costs: None.
Context: Bank reconciliations tested identified no separate bank account for the reserve for replacement account.
Cause: Due to change in management company during 2024.
Effect: The Project did not properly segregate the reserve for replacement funds increasing the potential for funds to be spent without approval from HUD.
Repeat Finding: None.
Recommendation: We recommend withdrawing the reserve for replacement funds and opening a separate bank account.
Views of Responsible Officials: We agree with the above recommendation. During 2025, the funds were withdrawn from the operating account and deposited into a separate bank account.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Unauthorized disbursements from the reserve fund were made.
Condition: During the 2023 audit, we noted that the Project had made unauthorized withdrawals from the reserve fund.
Questioned Costs: $6,011 in unauthorized withdrawals were made.
Context: Through audit compliance testing procedures, it was identified there were no withdrawals made during fiscal year 2023 authorized by HUD, however, through additional procedures over the reserve, there were three withdrawals identified.
Cause: Due to cash constraints caused by rental income delays the Project was required to make withdrawals to continue operations.
Effect: The Project did not make authorized withdrawals.
Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-002.
Recommendation: We recommend the Project return the withdrawn funds back to the reserve funds when the funds allow.
Views of Responsible Officials: There is no disagreement with the audit finding. Management has received the delayed rental income payments and is working to return the funds.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Deposits required by HUD were not made during fiscal year 2024 to the reserve fund.
Condition: During the 2024 audit, we noted that the Project had not deposited the amounts required by HUD to be deposited monthly in the reserve fund for all of fiscal year 2024.
Questioned Costs: $8,580 in reserve fund deposits not made.
Context: Through audit compliance testing procedures, three months of bank reconciliations were tested and identified that the required monthly deposit was not made. Through further inquiry and review it was identified that all 12 deposits of fiscal year 2024 were not made and recorded as a liability.
Cause: Due to cash constraints caused by rental income delays the Project was unable to make the deposits.
Effect: The Project did not make sufficient deposits.
Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-001.
Recommendation: We recommend the Project make all fiscal year 2024 deposits as soon as funds allow.
Views of Responsible Officials: There is no disagreement with the audit finding. Management has received the delayed rental income payments and is working to make the back deposits.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Approved expenditures of federal awards without proper control completed.
Condition: During the 2024 audit, we noted that the Project approved expenditures of federal awards without proper review.
Questioned Costs: None.
Context: Invoice tested found to not be reviewed and approved per documented control procedure.
Cause: Due to change in management company during 2024.
Effect: The Project did properly review expenditures of federal awards.
Repeat Finding: None.
Recommendation: We recommend enforcing control procedures over expenditures of federal awards.
Views of Responsible Officials: There is no disagreement with the audit finding. During 2024, a new management company was hired as of July 1, 2024 and has implemented and enforced proper controls over expenditures of federal awards.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Reserve for replacement funds were not maintained in a separate bank account.
Condition: During the 2024 audit, we noted that the reserve for replacement bank account was closed and deposited into the operating bank account.
Questioned Costs: None.
Context: Bank reconciliations tested identified no separate bank account for the reserve for replacement account.
Cause: Due to change in management company during 2024.
Effect: The Project did not properly segregate the reserve for replacement funds increasing the potential for funds to be spent without approval from HUD.
Repeat Finding: None.
Recommendation: We recommend withdrawing the reserve for replacement funds and opening a separate bank account.
Views of Responsible Officials: We agree with the above recommendation. During 2025, the funds were withdrawn from the operating account and deposited into a separate bank account.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Unauthorized disbursements from the reserve fund were made.
Condition: During the 2023 audit, we noted that the Project had made unauthorized withdrawals from the reserve fund.
Questioned Costs: $6,011 in unauthorized withdrawals were made.
Context: Through audit compliance testing procedures, it was identified there were no withdrawals made during fiscal year 2023 authorized by HUD, however, through additional procedures over the reserve, there were three withdrawals identified.
Cause: Due to cash constraints caused by rental income delays the Project was required to make withdrawals to continue operations.
Effect: The Project did not make authorized withdrawals.
Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-002.
Recommendation: We recommend the Project return the withdrawn funds back to the reserve funds when the funds allow.
Views of Responsible Officials: There is no disagreement with the audit finding. Management has received the delayed rental income payments and is working to return the funds.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Deposits required by HUD were not made during fiscal year 2024 to the reserve fund.
Condition: During the 2024 audit, we noted that the Project had not deposited the amounts required by HUD to be deposited monthly in the reserve fund for all of fiscal year 2024.
Questioned Costs: $8,580 in reserve fund deposits not made.
Context: Through audit compliance testing procedures, three months of bank reconciliations were tested and identified that the required monthly deposit was not made. Through further inquiry and review it was identified that all 12 deposits of fiscal year 2024 were not made and recorded as a liability.
Cause: Due to cash constraints caused by rental income delays the Project was unable to make the deposits.
Effect: The Project did not make sufficient deposits.
Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-001.
Recommendation: We recommend the Project make all fiscal year 2024 deposits as soon as funds allow.
Views of Responsible Officials: There is no disagreement with the audit finding. Management has received the delayed rental income payments and is working to make the back deposits.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Approved expenditures of federal awards without proper control completed.
Condition: During the 2024 audit, we noted that the Project approved expenditures of federal awards without proper review.
Questioned Costs: None.
Context: Invoice tested found to not be reviewed and approved per documented control procedure.
Cause: Due to change in management company during 2024.
Effect: The Project did properly review expenditures of federal awards.
Repeat Finding: None.
Recommendation: We recommend enforcing control procedures over expenditures of federal awards.
Views of Responsible Officials: There is no disagreement with the audit finding. During 2024, a new management company was hired as of July 1, 2024 and has implemented and enforced proper controls over expenditures of federal awards.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Reserve for replacement funds were not maintained in a separate bank account.
Condition: During the 2024 audit, we noted that the reserve for replacement bank account was closed and deposited into the operating bank account.
Questioned Costs: None.
Context: Bank reconciliations tested identified no separate bank account for the reserve for replacement account.
Cause: Due to change in management company during 2024.
Effect: The Project did not properly segregate the reserve for replacement funds increasing the potential for funds to be spent without approval from HUD.
Repeat Finding: None.
Recommendation: We recommend withdrawing the reserve for replacement funds and opening a separate bank account.
Views of Responsible Officials: We agree with the above recommendation. During 2025, the funds were withdrawn from the operating account and deposited into a separate bank account.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Unauthorized disbursements from the reserve fund were made.
Condition: During the 2023 audit, we noted that the Project had made unauthorized withdrawals from the reserve fund.
Questioned Costs: $6,011 in unauthorized withdrawals were made.
Context: Through audit compliance testing procedures, it was identified there were no withdrawals made during fiscal year 2023 authorized by HUD, however, through additional procedures over the reserve, there were three withdrawals identified.
Cause: Due to cash constraints caused by rental income delays the Project was required to make withdrawals to continue operations.
Effect: The Project did not make authorized withdrawals.
Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-002.
Recommendation: We recommend the Project return the withdrawn funds back to the reserve funds when the funds allow.
Views of Responsible Officials: There is no disagreement with the audit finding. Management has received the delayed rental income payments and is working to return the funds.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Deposits required by HUD were not made during fiscal year 2024 to the reserve fund.
Condition: During the 2024 audit, we noted that the Project had not deposited the amounts required by HUD to be deposited monthly in the reserve fund for all of fiscal year 2024.
Questioned Costs: $8,580 in reserve fund deposits not made.
Context: Through audit compliance testing procedures, three months of bank reconciliations were tested and identified that the required monthly deposit was not made. Through further inquiry and review it was identified that all 12 deposits of fiscal year 2024 were not made and recorded as a liability.
Cause: Due to cash constraints caused by rental income delays the Project was unable to make the deposits.
Effect: The Project did not make sufficient deposits.
Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-001.
Recommendation: We recommend the Project make all fiscal year 2024 deposits as soon as funds allow.
Views of Responsible Officials: There is no disagreement with the audit finding. Management has received the delayed rental income payments and is working to make the back deposits.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Approved expenditures of federal awards without proper control completed.
Condition: During the 2024 audit, we noted that the Project approved expenditures of federal awards without proper review.
Questioned Costs: None.
Context: Invoice tested found to not be reviewed and approved per documented control procedure.
Cause: Due to change in management company during 2024.
Effect: The Project did properly review expenditures of federal awards.
Repeat Finding: None.
Recommendation: We recommend enforcing control procedures over expenditures of federal awards.
Views of Responsible Officials: There is no disagreement with the audit finding. During 2024, a new management company was hired as of July 1, 2024 and has implemented and enforced proper controls over expenditures of federal awards.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Reserve for replacement funds were not maintained in a separate bank account.
Condition: During the 2024 audit, we noted that the reserve for replacement bank account was closed and deposited into the operating bank account.
Questioned Costs: None.
Context: Bank reconciliations tested identified no separate bank account for the reserve for replacement account.
Cause: Due to change in management company during 2024.
Effect: The Project did not properly segregate the reserve for replacement funds increasing the potential for funds to be spent without approval from HUD.
Repeat Finding: None.
Recommendation: We recommend withdrawing the reserve for replacement funds and opening a separate bank account.
Views of Responsible Officials: We agree with the above recommendation. During 2025, the funds were withdrawn from the operating account and deposited into a separate bank account.
Federal Agency: U.S. Department of Housing and Urban Development (HUD)
Federal Program Name: Supportive Housing for Persons with Disabilities (Section 811)
Assistance Listing Number: 14.181
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or Specific Requirement: Unauthorized disbursements from the reserve fund were made.
Condition: During the 2023 audit, we noted that the Project had made unauthorized withdrawals from the reserve fund.
Questioned Costs: $6,011 in unauthorized withdrawals were made.
Context: Through audit compliance testing procedures, it was identified there were no withdrawals made during fiscal year 2023 authorized by HUD, however, through additional procedures over the reserve, there were three withdrawals identified.
Cause: Due to cash constraints caused by rental income delays the Project was required to make withdrawals to continue operations.
Effect: The Project did not make authorized withdrawals.
Repeat Finding: The finding is a repeat of a finding in the immediately prior year. Prior year finding number was 2023-002.
Recommendation: We recommend the Project return the withdrawn funds back to the reserve funds when the funds allow.
Views of Responsible Officials: There is no disagreement with the audit finding. Management has received the delayed rental income payments and is working to return the funds.