Identification as a Repeat Finding: Not a repeat finding
Finding:
The Organization did not obtain written documentation of tenant eligibility to reside in homes
financed with governmental loans that carry ongoing compliance requirements prior the tenant’s
move-in date.
Criteria:
Homes purchased through the use of loans that carry ongoing compliance requirements require that
tenant eligibility be determined prior to move-in.
Sample Size and Population:
Sample was 5 of 24 tenant move-ins during 2024. Errors were identified for 3 of the 5 tenants
tested.
Condition and Context:
Parkview tenants are referred by the Washington State Department of Social and Health Services
Developmental Disabilities Administration (DSHS DDA). DSHS DDA provides Parkview
documentation of the tenant’s eligibility to live in Parkview homes based on their disability. For 1
of the 5 tenants selected for testing, no letter from DSHS DDA was retained. For 2 of the 5 tenants
selected for testing who moved in during 2024, the documentation provided by DSHS DDA was
dated in 2025.
Effect:
Without documentation of eligibility, the Organization runs the risk of accepting an ineligible
tenant. Housing ineligible tenants exposes the Organization to the risk of the mortgages being
ineligible for forgiveness or title of the financed property transferring to the lender, which creates a
risk of misstatement in financial reporting. Cause:
The Organization processed more new tenants in 2024 than in prior years because of new units that
were completed during the year. The Organization and the supported living service provider were
moving quickly to lease up the properties when they were placed in service. The tenants were
referred by DSHS DDA, but the Organization did not ask the case manager to generate the letters at
the time of move in.
Recommendations:
Maintain a checklist of required documentation to have on hand at tenant move in.
Require a review of tenant files for completeness of documentation prior to tenant move in.
Questioned Costs:
None
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644
Identification as a Repeat Finding: Not a repeat
Finding:
Federal funds of $100,000 held for the restricted purpose of lending to qualified homeowners were
utilized for general operational activities. Criteria:
Cash draws from Federal funds may only be used for program purposes.
Sample Size and Population:
Not applicable
Condition and Context:
The Organization maintains a separate bank account for Federal funds that are returned when
homeowners that received federally funded downpayment assistance loans repay their mortgages.
During our review of 2024 bank account statements for this account, we noted a $100,000 transfer
from the account to the general operating account on October 10, 2024 that was returned to the
account on December 18, 2024. No supporting program expenditure documentation was available
for the interim use of cash as no loans of federal funds were made to homeowners in 2024.
Effect:
Federal cash was used for unallowable purposes, exposing the Organization to potential liability.
Cause:
Management approved a short-term inter-fund loan to cover unrestricted cash-flow needs. The
Organization lacks a written policy prohibiting temporary borrowing from federal accounts.
Additionally, we observed errors in recording cash transactions in the operating bank account that
preceded the date of the transfer. These transactions were not correctly identified and corrected in
the bank reconciliations prepared between March and December 2024. As a result, the cash
balances management used for decision making during this period were misstated by approximately
$12,000 - $44,000. Recommendations:
Remove management access to bank account used to hold Federal funds. Add board members to the
account used to hold Federal funds so that future withdrawals from the fund require the
authorization of a board member.
Adopt a written cash-management policy that prohibits inter-fund borrowing
Assign bank-reconciliation review to an independent accountant within 30 calendar days of monthend.
Questioned Costs:
$100,000
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644
Identification as a Repeat Finding: Not a repeat
Finding:
Federal funds of $100,000 held for the restricted purpose of lending to qualified homeowners were
utilized for general operational activities. Criteria:
Cash draws from Federal funds may only be used for program purposes.
Sample Size and Population:
Not applicable
Condition and Context:
The Organization maintains a separate bank account for Federal funds that are returned when
homeowners that received federally funded downpayment assistance loans repay their mortgages.
During our review of 2024 bank account statements for this account, we noted a $100,000 transfer
from the account to the general operating account on October 10, 2024 that was returned to the
account on December 18, 2024. No supporting program expenditure documentation was available
for the interim use of cash as no loans of federal funds were made to homeowners in 2024.
Effect:
Federal cash was used for unallowable purposes, exposing the Organization to potential liability.
Cause:
Management approved a short-term inter-fund loan to cover unrestricted cash-flow needs. The
Organization lacks a written policy prohibiting temporary borrowing from federal accounts.
Additionally, we observed errors in recording cash transactions in the operating bank account that
preceded the date of the transfer. These transactions were not correctly identified and corrected in
the bank reconciliations prepared between March and December 2024. As a result, the cash
balances management used for decision making during this period were misstated by approximately
$12,000 - $44,000. Recommendations:
Remove management access to bank account used to hold Federal funds. Add board members to the
account used to hold Federal funds so that future withdrawals from the fund require the
authorization of a board member.
Adopt a written cash-management policy that prohibits inter-fund borrowing
Assign bank-reconciliation review to an independent accountant within 30 calendar days of monthend.
Questioned Costs:
$100,000
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644
Identification as a Repeat Finding: Not a repeat
Finding:
Federal funds of $100,000 held for the restricted purpose of lending to qualified homeowners were
utilized for general operational activities. Criteria:
Cash draws from Federal funds may only be used for program purposes.
Sample Size and Population:
Not applicable
Condition and Context:
The Organization maintains a separate bank account for Federal funds that are returned when
homeowners that received federally funded downpayment assistance loans repay their mortgages.
During our review of 2024 bank account statements for this account, we noted a $100,000 transfer
from the account to the general operating account on October 10, 2024 that was returned to the
account on December 18, 2024. No supporting program expenditure documentation was available
for the interim use of cash as no loans of federal funds were made to homeowners in 2024.
Effect:
Federal cash was used for unallowable purposes, exposing the Organization to potential liability.
Cause:
Management approved a short-term inter-fund loan to cover unrestricted cash-flow needs. The
Organization lacks a written policy prohibiting temporary borrowing from federal accounts.
Additionally, we observed errors in recording cash transactions in the operating bank account that
preceded the date of the transfer. These transactions were not correctly identified and corrected in
the bank reconciliations prepared between March and December 2024. As a result, the cash
balances management used for decision making during this period were misstated by approximately
$12,000 - $44,000. Recommendations:
Remove management access to bank account used to hold Federal funds. Add board members to the
account used to hold Federal funds so that future withdrawals from the fund require the
authorization of a board member.
Adopt a written cash-management policy that prohibits inter-fund borrowing
Assign bank-reconciliation review to an independent accountant within 30 calendar days of monthend.
Questioned Costs:
$100,000
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644
Identification as a Repeat Finding: No
Finding:
The Organization omitted the COVID-19 Economic Injury Disaster Assistance Loan (EIDL) from
the initial draft of the SEFA presented to auditors.
Criteria:
2 CFR 200.502 requires the auditee to report federal awards expended under loan programs
including the balance of loans from previous years at the beginning of the audit period for which the
Federal Government imposes continuing compliance requirements. The EIDL loan requires annual
reporting to the Small Business Administration (SBA) as noted in prior year Finding 2023-002.
Sample Size and Population:
Not applicable
Condition and Context:
The EIDL loan totaling $584,853 was omitted from the draft SEFA provided to auditors on May 15,
2025.
Effect:
Exclusion understated total federal awards by 8%, changing the preliminary major-program
determination and potentially reducing audit coverage below the required 40% threshold. Cause:
The Organization did not identify ongoing compliance requirements associated with the EIDL loan.
Management relied on SBA guidance that addresses PPP loans and other SBA programs but do not
mention COVID-19 Relief EIDL programs, indicating a training gap in award-specific
requirements.
Recommendations:
We recommend the Organization review loan agreements and program specific guidance for
continuing compliance requirements before removing federal loans from the SEFA.
Questioned Costs:
None
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644
Identification as a Repeat Finding: Not a repeat finding
Finding:
The Organization did not obtain written documentation of tenant eligibility to reside in homes
financed with governmental loans that carry ongoing compliance requirements prior the tenant’s
move-in date.
Criteria:
Homes purchased through the use of loans that carry ongoing compliance requirements require that
tenant eligibility be determined prior to move-in.
Sample Size and Population:
Sample was 5 of 24 tenant move-ins during 2024. Errors were identified for 3 of the 5 tenants
tested.
Condition and Context:
Parkview tenants are referred by the Washington State Department of Social and Health Services
Developmental Disabilities Administration (DSHS DDA). DSHS DDA provides Parkview
documentation of the tenant’s eligibility to live in Parkview homes based on their disability. For 1
of the 5 tenants selected for testing, no letter from DSHS DDA was retained. For 2 of the 5 tenants
selected for testing who moved in during 2024, the documentation provided by DSHS DDA was
dated in 2025.
Effect:
Without documentation of eligibility, the Organization runs the risk of accepting an ineligible
tenant. Housing ineligible tenants exposes the Organization to the risk of the mortgages being
ineligible for forgiveness or title of the financed property transferring to the lender, which creates a
risk of misstatement in financial reporting. Cause:
The Organization processed more new tenants in 2024 than in prior years because of new units that
were completed during the year. The Organization and the supported living service provider were
moving quickly to lease up the properties when they were placed in service. The tenants were
referred by DSHS DDA, but the Organization did not ask the case manager to generate the letters at
the time of move in.
Recommendations:
Maintain a checklist of required documentation to have on hand at tenant move in.
Require a review of tenant files for completeness of documentation prior to tenant move in.
Questioned Costs:
None
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644
Identification as a Repeat Finding: Not a repeat
Finding:
Federal funds of $100,000 held for the restricted purpose of lending to qualified homeowners were
utilized for general operational activities. Criteria:
Cash draws from Federal funds may only be used for program purposes.
Sample Size and Population:
Not applicable
Condition and Context:
The Organization maintains a separate bank account for Federal funds that are returned when
homeowners that received federally funded downpayment assistance loans repay their mortgages.
During our review of 2024 bank account statements for this account, we noted a $100,000 transfer
from the account to the general operating account on October 10, 2024 that was returned to the
account on December 18, 2024. No supporting program expenditure documentation was available
for the interim use of cash as no loans of federal funds were made to homeowners in 2024.
Effect:
Federal cash was used for unallowable purposes, exposing the Organization to potential liability.
Cause:
Management approved a short-term inter-fund loan to cover unrestricted cash-flow needs. The
Organization lacks a written policy prohibiting temporary borrowing from federal accounts.
Additionally, we observed errors in recording cash transactions in the operating bank account that
preceded the date of the transfer. These transactions were not correctly identified and corrected in
the bank reconciliations prepared between March and December 2024. As a result, the cash
balances management used for decision making during this period were misstated by approximately
$12,000 - $44,000. Recommendations:
Remove management access to bank account used to hold Federal funds. Add board members to the
account used to hold Federal funds so that future withdrawals from the fund require the
authorization of a board member.
Adopt a written cash-management policy that prohibits inter-fund borrowing
Assign bank-reconciliation review to an independent accountant within 30 calendar days of monthend.
Questioned Costs:
$100,000
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644
Identification as a Repeat Finding: Not a repeat
Finding:
Federal funds of $100,000 held for the restricted purpose of lending to qualified homeowners were
utilized for general operational activities. Criteria:
Cash draws from Federal funds may only be used for program purposes.
Sample Size and Population:
Not applicable
Condition and Context:
The Organization maintains a separate bank account for Federal funds that are returned when
homeowners that received federally funded downpayment assistance loans repay their mortgages.
During our review of 2024 bank account statements for this account, we noted a $100,000 transfer
from the account to the general operating account on October 10, 2024 that was returned to the
account on December 18, 2024. No supporting program expenditure documentation was available
for the interim use of cash as no loans of federal funds were made to homeowners in 2024.
Effect:
Federal cash was used for unallowable purposes, exposing the Organization to potential liability.
Cause:
Management approved a short-term inter-fund loan to cover unrestricted cash-flow needs. The
Organization lacks a written policy prohibiting temporary borrowing from federal accounts.
Additionally, we observed errors in recording cash transactions in the operating bank account that
preceded the date of the transfer. These transactions were not correctly identified and corrected in
the bank reconciliations prepared between March and December 2024. As a result, the cash
balances management used for decision making during this period were misstated by approximately
$12,000 - $44,000. Recommendations:
Remove management access to bank account used to hold Federal funds. Add board members to the
account used to hold Federal funds so that future withdrawals from the fund require the
authorization of a board member.
Adopt a written cash-management policy that prohibits inter-fund borrowing
Assign bank-reconciliation review to an independent accountant within 30 calendar days of monthend.
Questioned Costs:
$100,000
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644
Identification as a Repeat Finding: Not a repeat
Finding:
Federal funds of $100,000 held for the restricted purpose of lending to qualified homeowners were
utilized for general operational activities. Criteria:
Cash draws from Federal funds may only be used for program purposes.
Sample Size and Population:
Not applicable
Condition and Context:
The Organization maintains a separate bank account for Federal funds that are returned when
homeowners that received federally funded downpayment assistance loans repay their mortgages.
During our review of 2024 bank account statements for this account, we noted a $100,000 transfer
from the account to the general operating account on October 10, 2024 that was returned to the
account on December 18, 2024. No supporting program expenditure documentation was available
for the interim use of cash as no loans of federal funds were made to homeowners in 2024.
Effect:
Federal cash was used for unallowable purposes, exposing the Organization to potential liability.
Cause:
Management approved a short-term inter-fund loan to cover unrestricted cash-flow needs. The
Organization lacks a written policy prohibiting temporary borrowing from federal accounts.
Additionally, we observed errors in recording cash transactions in the operating bank account that
preceded the date of the transfer. These transactions were not correctly identified and corrected in
the bank reconciliations prepared between March and December 2024. As a result, the cash
balances management used for decision making during this period were misstated by approximately
$12,000 - $44,000. Recommendations:
Remove management access to bank account used to hold Federal funds. Add board members to the
account used to hold Federal funds so that future withdrawals from the fund require the
authorization of a board member.
Adopt a written cash-management policy that prohibits inter-fund borrowing
Assign bank-reconciliation review to an independent accountant within 30 calendar days of monthend.
Questioned Costs:
$100,000
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644
Identification as a Repeat Finding: No
Finding:
The Organization omitted the COVID-19 Economic Injury Disaster Assistance Loan (EIDL) from
the initial draft of the SEFA presented to auditors.
Criteria:
2 CFR 200.502 requires the auditee to report federal awards expended under loan programs
including the balance of loans from previous years at the beginning of the audit period for which the
Federal Government imposes continuing compliance requirements. The EIDL loan requires annual
reporting to the Small Business Administration (SBA) as noted in prior year Finding 2023-002.
Sample Size and Population:
Not applicable
Condition and Context:
The EIDL loan totaling $584,853 was omitted from the draft SEFA provided to auditors on May 15,
2025.
Effect:
Exclusion understated total federal awards by 8%, changing the preliminary major-program
determination and potentially reducing audit coverage below the required 40% threshold. Cause:
The Organization did not identify ongoing compliance requirements associated with the EIDL loan.
Management relied on SBA guidance that addresses PPP loans and other SBA programs but do not
mention COVID-19 Relief EIDL programs, indicating a training gap in award-specific
requirements.
Recommendations:
We recommend the Organization review loan agreements and program specific guidance for
continuing compliance requirements before removing federal loans from the SEFA.
Questioned Costs:
None
Management Response:
Management response is reported in the “Corrective Action Plan” at the end of this report.
Contact Person:
Marc Cote, Executive Director 206-542-6644