Department of Housing and Urban Development Finding 2024-001 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria Management fee payments are limited to amounts determined in accordance with the terms of the management agreemen. Condition During the year ended September 30, 2024, the project paid management fees of $216 in excess of the amount approved by HUD. Cause Lack of management oversight caused management fees to be overpaid during the current year. Effect or Potential Effect The overpaid amount is an unauthorized distribution and therefore considered to be questioned costs. Questioned costs $216 Context The project paid $216 in management fees during the year ended September 30, 2024, exceeding the amount approved by HUD. This overpayment is considered an unauthorized distribution due to noncompliance with the management agreement terms and has been classified as a questioned cost. Identification as a Repeat Finding Not a repeat finding Recommendation The management company should reimburse the project for overpaid management fee in the amount of $216 and implement procedures to ensure that the management fee paid does not exceed the amount determined in accordance with the management agreement. Auditor Noncompliance Code: J - Unauthorized management fees Finding Resolution Status: In Process
Reporting Views of Responsible Officials Management will repay the property and update our procedures to correctly calculate management fees.
Department of Housing and Urban Development Finding 2024-002 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The regulatory agreement requires that the project make monthly deposits to its replacement reserve. Condition During the year ended September 30, 2024, the project did not make two required monthly deposits to
the replacement reserve in the amount of $5,464. The project is required to make monthly deposits to the reserve in the amount of $2,732 per month. Cause The project inadvertently deposited the funds into another entity's cash account. Effect or Potential Effect Failure to make monthly payments resulted in an underfunding the replacement reserve and a violation of the regulatory agreement. Questioned costs $5,464 Context The project failed to make required monthly deposits to the replacement reserve during the year ended September 30, 2024, resulting in an underfunding of $5,464. This constitutes a violation of the regulatory agreement. Identification as a Repeat Finding Not a repeat finding Recommendation Management should implement procedures to ensure the funds are deposited into the correct account and to ensure that the replacement reserve is funded in accordance with the terms of the regulatory agreement. Auditor Noncompliance Code: N - Reserve for replacements deposits Finding Resolution Status: In Process Reporting Views of Responsible Officials North TX A/C refunded a one-month deposit of $2,732 to the property on September 30, 2024. They will repay the remaining one-month deposit of $2,732, and these funds will be correctly deposited into the replacement reserve account.
Department of Housing and Urban Development Finding 2024-003 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The terms of the regulatory agreement and HUD handbook 4370.2 require repayments of related party loans to be limited to available surplus cash computed on a semi-annual or annual basis unless approved by HUD. As the Organization is a nonprofit and does not receive surplus cash, HUD approval for repayment was required. Condition During the year ended September 30, 2023, the Organization repaid affiliate advances totaling $23,000 made during the year ended September 30, 2022 without HUD approval. The advances were made as a result of delays in receipt of PRAC funds used for operations. Cause Delays in receiving the PRAC renewal funds resulted in the affiliate lending funds to the property to fund operations. Upon final receipt of PRAC funds, the affiliate was repaid a portion of the advances made. Procedures were not in place to ensure that repayment of related party advances were approved
by HUD. Effect or Potential Effect The repayment of $23,000 was technically an unauthorized distribution without HUD approval, and therefore considered to be a questioned cost. Questioned Costs $23,000 Context During the year ended September 30, 2023, the Organization repaid $23,000 in affiliate advances without obtaining required HUD approval. The advances were originally made to address delays in receiving PRAC funds for operational purposes. HUD approved repayment of $73,000 of the $96,000 advanced during fiscal year ended September 3, 2022. HUD has not indicated approval of the remaining $23,000. Identification as a Repeat Finding See prior year finding 2023-001 Recommendation Management should obtain HUD approval of repayment of these advances. In the future, management should request PRAC funding advances, if needed, from the replacement reserve or residual receipts reserve, or obtain HUD approval for repayment to Owner upon receipt of PRAC funds. Auditor Noncompliance Code: H - Unauthorized distribution of project assets Finding Resolution Status: In Process Reporting Views of Responsible Officials HUD approved the $75,000 repaid as a response to a 2022 finding. Management will seek evidence of HUD approval for the remaining $23,000 repaid.
Department of Housing and Urban Development Finding 2024-004 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The terms of regulatory agreement prohibit loans from project assets without HUD approval. Condition During the year ended September 30, 2024, cash intended for deposit into the replacement reserve account in the amount of $2,732 was deposited into another entity's bank account. Cause An administrative oversight in the deposit of receipts caused the amount to be deposited into an
incorrect bank account. Effect or Potential Effect The project funds deposited to another entity's cash account are considered to be questioned costs. Questioned costs
$2,732 Context During the year ended September 30, 2024, $2,732 in project funds was incorrectly deposited into another entity's bank account, contrary to the terms of the regulatory agreement. Identification as a Repeat Finding Not a repeat finding Recommendations 2024-4-a The project's replacement reserve account should be reimbursed for this amount. 2024-4-b The management company should implement procedures to ensure that cash intended for the project remain in the custody of the project. Auditor Noncompliance Code: G - Unauthorized loans from project assets Finding Resolution Status: In Process Reporting Views of Responsible Officials North TX A/C repaid one deposit on September 30, 2024 and will repay the remaining one-month deposit to the property. These funds will be correctly deposited into the replacement reserve account.
Department of Housing and Urban Development Finding 2024-001 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria Management fee payments are limited to amounts determined in accordance with the terms of the management agreemen. Condition During the year ended September 30, 2024, the project paid management fees of $216 in excess of the amount approved by HUD. Cause Lack of management oversight caused management fees to be overpaid during the current year. Effect or Potential Effect The overpaid amount is an unauthorized distribution and therefore considered to be questioned costs. Questioned costs $216 Context The project paid $216 in management fees during the year ended September 30, 2024, exceeding the amount approved by HUD. This overpayment is considered an unauthorized distribution due to noncompliance with the management agreement terms and has been classified as a questioned cost. Identification as a Repeat Finding Not a repeat finding Recommendation The management company should reimburse the project for overpaid management fee in the amount of $216 and implement procedures to ensure that the management fee paid does not exceed the amount determined in accordance with the management agreement. Auditor Noncompliance Code: J - Unauthorized management fees Finding Resolution Status: In Process
Reporting Views of Responsible Officials Management will repay the property and update our procedures to correctly calculate management fees.
Department of Housing and Urban Development Finding 2024-002 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The regulatory agreement requires that the project make monthly deposits to its replacement reserve. Condition During the year ended September 30, 2024, the project did not make two required monthly deposits to
the replacement reserve in the amount of $5,464. The project is required to make monthly deposits to the reserve in the amount of $2,732 per month. Cause The project inadvertently deposited the funds into another entity's cash account. Effect or Potential Effect Failure to make monthly payments resulted in an underfunding the replacement reserve and a violation of the regulatory agreement. Questioned costs $5,464 Context The project failed to make required monthly deposits to the replacement reserve during the year ended September 30, 2024, resulting in an underfunding of $5,464. This constitutes a violation of the regulatory agreement. Identification as a Repeat Finding Not a repeat finding Recommendation Management should implement procedures to ensure the funds are deposited into the correct account and to ensure that the replacement reserve is funded in accordance with the terms of the regulatory agreement. Auditor Noncompliance Code: N - Reserve for replacements deposits Finding Resolution Status: In Process Reporting Views of Responsible Officials North TX A/C refunded a one-month deposit of $2,732 to the property on September 30, 2024. They will repay the remaining one-month deposit of $2,732, and these funds will be correctly deposited into the replacement reserve account.
Department of Housing and Urban Development Finding 2024-003 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The terms of the regulatory agreement and HUD handbook 4370.2 require repayments of related party loans to be limited to available surplus cash computed on a semi-annual or annual basis unless approved by HUD. As the Organization is a nonprofit and does not receive surplus cash, HUD approval for repayment was required. Condition During the year ended September 30, 2023, the Organization repaid affiliate advances totaling $23,000 made during the year ended September 30, 2022 without HUD approval. The advances were made as a result of delays in receipt of PRAC funds used for operations. Cause Delays in receiving the PRAC renewal funds resulted in the affiliate lending funds to the property to fund operations. Upon final receipt of PRAC funds, the affiliate was repaid a portion of the advances made. Procedures were not in place to ensure that repayment of related party advances were approved
by HUD. Effect or Potential Effect The repayment of $23,000 was technically an unauthorized distribution without HUD approval, and therefore considered to be a questioned cost. Questioned Costs $23,000 Context During the year ended September 30, 2023, the Organization repaid $23,000 in affiliate advances without obtaining required HUD approval. The advances were originally made to address delays in receiving PRAC funds for operational purposes. HUD approved repayment of $73,000 of the $96,000 advanced during fiscal year ended September 3, 2022. HUD has not indicated approval of the remaining $23,000. Identification as a Repeat Finding See prior year finding 2023-001 Recommendation Management should obtain HUD approval of repayment of these advances. In the future, management should request PRAC funding advances, if needed, from the replacement reserve or residual receipts reserve, or obtain HUD approval for repayment to Owner upon receipt of PRAC funds. Auditor Noncompliance Code: H - Unauthorized distribution of project assets Finding Resolution Status: In Process Reporting Views of Responsible Officials HUD approved the $75,000 repaid as a response to a 2022 finding. Management will seek evidence of HUD approval for the remaining $23,000 repaid.
Department of Housing and Urban Development Finding 2024-004 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The terms of regulatory agreement prohibit loans from project assets without HUD approval. Condition During the year ended September 30, 2024, cash intended for deposit into the replacement reserve account in the amount of $2,732 was deposited into another entity's bank account. Cause An administrative oversight in the deposit of receipts caused the amount to be deposited into an
incorrect bank account. Effect or Potential Effect The project funds deposited to another entity's cash account are considered to be questioned costs. Questioned costs
$2,732 Context During the year ended September 30, 2024, $2,732 in project funds was incorrectly deposited into another entity's bank account, contrary to the terms of the regulatory agreement. Identification as a Repeat Finding Not a repeat finding Recommendations 2024-4-a The project's replacement reserve account should be reimbursed for this amount. 2024-4-b The management company should implement procedures to ensure that cash intended for the project remain in the custody of the project. Auditor Noncompliance Code: G - Unauthorized loans from project assets Finding Resolution Status: In Process Reporting Views of Responsible Officials North TX A/C repaid one deposit on September 30, 2024 and will repay the remaining one-month deposit to the property. These funds will be correctly deposited into the replacement reserve account.
Department of Housing and Urban Development Finding 2024-001 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria Management fee payments are limited to amounts determined in accordance with the terms of the management agreemen. Condition During the year ended September 30, 2024, the project paid management fees of $216 in excess of the amount approved by HUD. Cause Lack of management oversight caused management fees to be overpaid during the current year. Effect or Potential Effect The overpaid amount is an unauthorized distribution and therefore considered to be questioned costs. Questioned costs $216 Context The project paid $216 in management fees during the year ended September 30, 2024, exceeding the amount approved by HUD. This overpayment is considered an unauthorized distribution due to noncompliance with the management agreement terms and has been classified as a questioned cost. Identification as a Repeat Finding Not a repeat finding Recommendation The management company should reimburse the project for overpaid management fee in the amount of $216 and implement procedures to ensure that the management fee paid does not exceed the amount determined in accordance with the management agreement. Auditor Noncompliance Code: J - Unauthorized management fees Finding Resolution Status: In Process
Reporting Views of Responsible Officials Management will repay the property and update our procedures to correctly calculate management fees.
Department of Housing and Urban Development Finding 2024-002 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The regulatory agreement requires that the project make monthly deposits to its replacement reserve. Condition During the year ended September 30, 2024, the project did not make two required monthly deposits to
the replacement reserve in the amount of $5,464. The project is required to make monthly deposits to the reserve in the amount of $2,732 per month. Cause The project inadvertently deposited the funds into another entity's cash account. Effect or Potential Effect Failure to make monthly payments resulted in an underfunding the replacement reserve and a violation of the regulatory agreement. Questioned costs $5,464 Context The project failed to make required monthly deposits to the replacement reserve during the year ended September 30, 2024, resulting in an underfunding of $5,464. This constitutes a violation of the regulatory agreement. Identification as a Repeat Finding Not a repeat finding Recommendation Management should implement procedures to ensure the funds are deposited into the correct account and to ensure that the replacement reserve is funded in accordance with the terms of the regulatory agreement. Auditor Noncompliance Code: N - Reserve for replacements deposits Finding Resolution Status: In Process Reporting Views of Responsible Officials North TX A/C refunded a one-month deposit of $2,732 to the property on September 30, 2024. They will repay the remaining one-month deposit of $2,732, and these funds will be correctly deposited into the replacement reserve account.
Department of Housing and Urban Development Finding 2024-003 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The terms of the regulatory agreement and HUD handbook 4370.2 require repayments of related party loans to be limited to available surplus cash computed on a semi-annual or annual basis unless approved by HUD. As the Organization is a nonprofit and does not receive surplus cash, HUD approval for repayment was required. Condition During the year ended September 30, 2023, the Organization repaid affiliate advances totaling $23,000 made during the year ended September 30, 2022 without HUD approval. The advances were made as a result of delays in receipt of PRAC funds used for operations. Cause Delays in receiving the PRAC renewal funds resulted in the affiliate lending funds to the property to fund operations. Upon final receipt of PRAC funds, the affiliate was repaid a portion of the advances made. Procedures were not in place to ensure that repayment of related party advances were approved
by HUD. Effect or Potential Effect The repayment of $23,000 was technically an unauthorized distribution without HUD approval, and therefore considered to be a questioned cost. Questioned Costs $23,000 Context During the year ended September 30, 2023, the Organization repaid $23,000 in affiliate advances without obtaining required HUD approval. The advances were originally made to address delays in receiving PRAC funds for operational purposes. HUD approved repayment of $73,000 of the $96,000 advanced during fiscal year ended September 3, 2022. HUD has not indicated approval of the remaining $23,000. Identification as a Repeat Finding See prior year finding 2023-001 Recommendation Management should obtain HUD approval of repayment of these advances. In the future, management should request PRAC funding advances, if needed, from the replacement reserve or residual receipts reserve, or obtain HUD approval for repayment to Owner upon receipt of PRAC funds. Auditor Noncompliance Code: H - Unauthorized distribution of project assets Finding Resolution Status: In Process Reporting Views of Responsible Officials HUD approved the $75,000 repaid as a response to a 2022 finding. Management will seek evidence of HUD approval for the remaining $23,000 repaid.
Department of Housing and Urban Development Finding 2024-004 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The terms of regulatory agreement prohibit loans from project assets without HUD approval. Condition During the year ended September 30, 2024, cash intended for deposit into the replacement reserve account in the amount of $2,732 was deposited into another entity's bank account. Cause An administrative oversight in the deposit of receipts caused the amount to be deposited into an
incorrect bank account. Effect or Potential Effect The project funds deposited to another entity's cash account are considered to be questioned costs. Questioned costs
$2,732 Context During the year ended September 30, 2024, $2,732 in project funds was incorrectly deposited into another entity's bank account, contrary to the terms of the regulatory agreement. Identification as a Repeat Finding Not a repeat finding Recommendations 2024-4-a The project's replacement reserve account should be reimbursed for this amount. 2024-4-b The management company should implement procedures to ensure that cash intended for the project remain in the custody of the project. Auditor Noncompliance Code: G - Unauthorized loans from project assets Finding Resolution Status: In Process Reporting Views of Responsible Officials North TX A/C repaid one deposit on September 30, 2024 and will repay the remaining one-month deposit to the property. These funds will be correctly deposited into the replacement reserve account.
Department of Housing and Urban Development Finding 2024-001 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria Management fee payments are limited to amounts determined in accordance with the terms of the management agreemen. Condition During the year ended September 30, 2024, the project paid management fees of $216 in excess of the amount approved by HUD. Cause Lack of management oversight caused management fees to be overpaid during the current year. Effect or Potential Effect The overpaid amount is an unauthorized distribution and therefore considered to be questioned costs. Questioned costs $216 Context The project paid $216 in management fees during the year ended September 30, 2024, exceeding the amount approved by HUD. This overpayment is considered an unauthorized distribution due to noncompliance with the management agreement terms and has been classified as a questioned cost. Identification as a Repeat Finding Not a repeat finding Recommendation The management company should reimburse the project for overpaid management fee in the amount of $216 and implement procedures to ensure that the management fee paid does not exceed the amount determined in accordance with the management agreement. Auditor Noncompliance Code: J - Unauthorized management fees Finding Resolution Status: In Process
Reporting Views of Responsible Officials Management will repay the property and update our procedures to correctly calculate management fees.
Department of Housing and Urban Development Finding 2024-002 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The regulatory agreement requires that the project make monthly deposits to its replacement reserve. Condition During the year ended September 30, 2024, the project did not make two required monthly deposits to
the replacement reserve in the amount of $5,464. The project is required to make monthly deposits to the reserve in the amount of $2,732 per month. Cause The project inadvertently deposited the funds into another entity's cash account. Effect or Potential Effect Failure to make monthly payments resulted in an underfunding the replacement reserve and a violation of the regulatory agreement. Questioned costs $5,464 Context The project failed to make required monthly deposits to the replacement reserve during the year ended September 30, 2024, resulting in an underfunding of $5,464. This constitutes a violation of the regulatory agreement. Identification as a Repeat Finding Not a repeat finding Recommendation Management should implement procedures to ensure the funds are deposited into the correct account and to ensure that the replacement reserve is funded in accordance with the terms of the regulatory agreement. Auditor Noncompliance Code: N - Reserve for replacements deposits Finding Resolution Status: In Process Reporting Views of Responsible Officials North TX A/C refunded a one-month deposit of $2,732 to the property on September 30, 2024. They will repay the remaining one-month deposit of $2,732, and these funds will be correctly deposited into the replacement reserve account.
Department of Housing and Urban Development Finding 2024-003 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The terms of the regulatory agreement and HUD handbook 4370.2 require repayments of related party loans to be limited to available surplus cash computed on a semi-annual or annual basis unless approved by HUD. As the Organization is a nonprofit and does not receive surplus cash, HUD approval for repayment was required. Condition During the year ended September 30, 2023, the Organization repaid affiliate advances totaling $23,000 made during the year ended September 30, 2022 without HUD approval. The advances were made as a result of delays in receipt of PRAC funds used for operations. Cause Delays in receiving the PRAC renewal funds resulted in the affiliate lending funds to the property to fund operations. Upon final receipt of PRAC funds, the affiliate was repaid a portion of the advances made. Procedures were not in place to ensure that repayment of related party advances were approved
by HUD. Effect or Potential Effect The repayment of $23,000 was technically an unauthorized distribution without HUD approval, and therefore considered to be a questioned cost. Questioned Costs $23,000 Context During the year ended September 30, 2023, the Organization repaid $23,000 in affiliate advances without obtaining required HUD approval. The advances were originally made to address delays in receiving PRAC funds for operational purposes. HUD approved repayment of $73,000 of the $96,000 advanced during fiscal year ended September 3, 2022. HUD has not indicated approval of the remaining $23,000. Identification as a Repeat Finding See prior year finding 2023-001 Recommendation Management should obtain HUD approval of repayment of these advances. In the future, management should request PRAC funding advances, if needed, from the replacement reserve or residual receipts reserve, or obtain HUD approval for repayment to Owner upon receipt of PRAC funds. Auditor Noncompliance Code: H - Unauthorized distribution of project assets Finding Resolution Status: In Process Reporting Views of Responsible Officials HUD approved the $75,000 repaid as a response to a 2022 finding. Management will seek evidence of HUD approval for the remaining $23,000 repaid.
Department of Housing and Urban Development Finding 2024-004 Section 202 Supportive Housing for the Elderly, AL 14.157 Criteria The terms of regulatory agreement prohibit loans from project assets without HUD approval. Condition During the year ended September 30, 2024, cash intended for deposit into the replacement reserve account in the amount of $2,732 was deposited into another entity's bank account. Cause An administrative oversight in the deposit of receipts caused the amount to be deposited into an
incorrect bank account. Effect or Potential Effect The project funds deposited to another entity's cash account are considered to be questioned costs. Questioned costs
$2,732 Context During the year ended September 30, 2024, $2,732 in project funds was incorrectly deposited into another entity's bank account, contrary to the terms of the regulatory agreement. Identification as a Repeat Finding Not a repeat finding Recommendations 2024-4-a The project's replacement reserve account should be reimbursed for this amount. 2024-4-b The management company should implement procedures to ensure that cash intended for the project remain in the custody of the project. Auditor Noncompliance Code: G - Unauthorized loans from project assets Finding Resolution Status: In Process Reporting Views of Responsible Officials North TX A/C repaid one deposit on September 30, 2024 and will repay the remaining one-month deposit to the property. These funds will be correctly deposited into the replacement reserve account.