Audit 382311

FY End
2025-09-30
Total Expended
$2.25M
Findings
1
Programs
1
Year: 2025 Accepted: 2026-01-16
Auditor: EIDE BAILLY LLP

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
1169372 2025-003 Material Weakness Yes N

Programs

ALN Program Spent Major Findings
14.157 SUPPORTIVE HOUSING FOR THE ELDERLY $128,618 Yes 0

Contacts

Name Title Type
FAHCG8T22HG3 Jennifer Strickland Auditee
2183666740 Alexis Odden Auditor
No contacts on file

Notes to SEFA

The accompanying schedule of expenditures of federal awards (the schedule) includes the federal award activity of the Red Lake Senior Apartment Center, Inc. (the Organization) under programs of the federal government for the year ended September 30, 2025. The information 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 the Organization, it is not intended to and does not present the financial position or changes in net position of the Organization.
Expenditures reported in the schedule are reported 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. No federal financial assistance has been provided to a subrecipient.
The Organization does not draw for administrative costs and has not elected to use the 10% de minimis cost rate.
The balances and transactions related to the Section 202 Capital Advance, Assistance Listing Number 14.157, are included in Red Lake Senior Apartment Center, Inc.'s basic financial statements. The outstanding balance of the HUD 202 capital advance was $2,126,100 as of September 30, 2025.

Finding Details

Underfunding of Replacement Reserve Significant Deficiency in Internal Control over Compliance and an Immaterial Instance of Noncompliance Criteria - Management is required to monitor and increase the deposits as required by HUD. Condition - During our testing, we identified that the Organization did not increase the monthly deposit to the replacement reserve timely as well as missed one month. The replacement reserve was under funded by $1,555 as of September 30, 2025. Cause - The Organization's review and oversight of the changes in monthly deposits was not operating effectively to ensure that the correct amount was deposited. Effect - This could cause the replacement reserve to be underfunded and in noncompliance with the regulatory agreement. Recommendation - We recommend that management have in place controls to ensure that the required monthly deposits be updated timely. View of Reponsible Officials - Management agrees with this finding.