FAC Explorer

Audit 362961

FY End
2024-12-31
Total Expended
$4.49M
Findings
4
Programs
3
Organization: Fowler Christian Apartments Iii, Inc. (TX)
Year: 2024 Accepted: 2025-07-24
Auditor: Clifton Larson Allen

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
571911 2024-001 Significant Deficiency - N
571912 2024-002 Significant Deficiency - L
1148353 2024-001 Significant Deficiency - N
1148354 2024-002 Significant Deficiency - L

Programs

ALN Program Spent Major Findings
14.195 Project-Based Rental Assistance (pbra) $382,390 - 0
14.239 Home Investment Partnerships Program $175,000 - 0
14.157 Supportive Housing for the Elderly $172,477 Yes 0

Contacts

Name Title Type
EVAFLE3DUF64 Alex Lueth Auditee
2145151326 Tiffany Harrison Auditor
No contacts on file

Notes to SEFA

Title: GENERAL Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) presents the activity of all federal financial assistance programs of Fowler Christian Apartments III, Inc. (the Organization). The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance). Since the schedule presents only a select portion of the activities of the Organization, it is not intended to and does not present the financial position, changes in net assets or cash flows of the Organization.The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, where in certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Organization has elected not to use the 10 percent de minims indirect cost rate as allowed under the Uniform Guidance. The accompanying Schedule of Expenditures of Federal Awards (the Schedule) presents the activity of all federal financial assistance programs of Fowler Christian Apartments III, Inc. (the Organization). The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance). Since the schedule presents only a select portion of the activities of the Organization, it is not intended to and does not present the financial position, changes in net assets or cash flows of the Organization.
Title: BASIS OF ACCOUNTING Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) presents the activity of all federal financial assistance programs of Fowler Christian Apartments III, Inc. (the Organization). The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance). Since the schedule presents only a select portion of the activities of the Organization, it is not intended to and does not present the financial position, changes in net assets or cash flows of the Organization.The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, where in certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Organization has elected not to use the 10 percent de minims indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, where in certain types of expenditures are not allowable or are limited as to reimbursement. The Organization has elected not to use the 10 percent de minims indirect cost rate as allowed under the Uniform Guidance.

Finding Details

Finding 2024-001
Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Section 202 Capital Advance and Project Rental Assistance Contract ALN: 14.157 Award Period: 2024 Type of Finding: Significant Deficiency Criteria or specific requirement: According to the Regulatory Agreement, “mortgagor will establish and maintain a reserve fund for replacements in a separate account in a bank…concurrently with the effective commencement of rental assistance payments under the Project Rental Assistance Contract, the Mortgagor will deposit an amount…per month unless a different date or amount is approved in writing by HUD”. Condition: The Organization did not make all required deposits into the Reserve for Replacements bank account in a timely manner. Questioned costs: $3,752 Cause: A process control to ensure the automatic transfer of deposits from the operating account to the replacements reserve on a monthly basis was not in place. Effect: Deposits for three of the twelve months of the year were not made timely. Therefore, the Organization is not in compliance with the Regulatory Agreement. Recommendation: We recommend management implement a control to ensure the monthly transfer is completed automatically and in accordance with the Regulatory Agreement. Views of responsible officials: The Organization agrees with the finding and the recommendation will be implemented. Controls implemented include scheduling of automatic transfers to our reserve for replacement savings account as well as updating our treasury standard operating procedures to ensure funds are available for the transfer. Condition status: Resolved. Repeat Finding: No.
Finding 2024-002
Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Section 202 Capital Advance and Project Rental Assistance Contract ALN: 14.157 Award Period: 2024 Type of Finding: Significant Deficiency Condition: The Organization did not submit a budget related to their project rental assistance contract. Criteria: An annual budget must be submitted to HUD for project rental assistance contracts. Questioned costs: None Context: During reporting testing, it was determined that budgets had not been submitted to HUD on a timely basis, as required. Effect: The annual budget was not submitted to HUD on a timely basis, as required. Cause: The Organization was not able to submit an annual budget to HUD prior to the submission deadline. Recommendation: We recommend the annual budget is submitted to HUD on a timely basis, as required. Views of Responsible Officials: A process will be put into place to ensure annual budgets will be submitted timely. Repeat Finding: No
Finding 2024-001
Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Section 202 Capital Advance and Project Rental Assistance Contract ALN: 14.157 Award Period: 2024 Type of Finding: Significant Deficiency Criteria or specific requirement: According to the Regulatory Agreement, “mortgagor will establish and maintain a reserve fund for replacements in a separate account in a bank…concurrently with the effective commencement of rental assistance payments under the Project Rental Assistance Contract, the Mortgagor will deposit an amount…per month unless a different date or amount is approved in writing by HUD”. Condition: The Organization did not make all required deposits into the Reserve for Replacements bank account in a timely manner. Questioned costs: $3,752 Cause: A process control to ensure the automatic transfer of deposits from the operating account to the replacements reserve on a monthly basis was not in place. Effect: Deposits for three of the twelve months of the year were not made timely. Therefore, the Organization is not in compliance with the Regulatory Agreement. Recommendation: We recommend management implement a control to ensure the monthly transfer is completed automatically and in accordance with the Regulatory Agreement. Views of responsible officials: The Organization agrees with the finding and the recommendation will be implemented. Controls implemented include scheduling of automatic transfers to our reserve for replacement savings account as well as updating our treasury standard operating procedures to ensure funds are available for the transfer. Condition status: Resolved. Repeat Finding: No.
Finding 2024-002
Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Section 202 Capital Advance and Project Rental Assistance Contract ALN: 14.157 Award Period: 2024 Type of Finding: Significant Deficiency Condition: The Organization did not submit a budget related to their project rental assistance contract. Criteria: An annual budget must be submitted to HUD for project rental assistance contracts. Questioned costs: None Context: During reporting testing, it was determined that budgets had not been submitted to HUD on a timely basis, as required. Effect: The annual budget was not submitted to HUD on a timely basis, as required. Cause: The Organization was not able to submit an annual budget to HUD prior to the submission deadline. Recommendation: We recommend the annual budget is submitted to HUD on a timely basis, as required. Views of Responsible Officials: A process will be put into place to ensure annual budgets will be submitted timely. Repeat Finding: No