Audit 38453

FY End

2022-06-30

Total Expended

$1.81M

Findings

2

Programs

2

Organization: Flagstaff Housing Corporation - Clark Homes (AZ)

Year: 2022 Accepted: 2023-02-09

Auditor: Cla

Organization Exclusion Status:

Checking exclusion status...

ID	Ref	Severity	Repeat	Requirement
44031	2022-001	-	-	P
620473	2022-001	-	-	P

ALN	Program	Spent	Major	Findings
14.195	Section 8 Housing Assistance Payments Program	$1.03M	Yes	0
14.135	Mortgage Insurance_rental and Cooperative Housing for Moderate Income Families and Elderly, Market Interest Rate	$787,332	Yes	1

Contacts

Name	Title	Type
CG7SE4V1PQY5	Kurt Aldinger	Auditee
9282132736	Chad D. Kunze, CPA	Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: BASIS OF PRESENTATIONThe accompanying schedule of expenditures of federal awards (the Schedule) includes thefederal award activity of Flagstaff Housing Corporation - Clark Homes under programs ofthe federal government for the year ended June 30, 2022. The information in this Scheduleis presented in accordance with the requirements of 2 CFR Part 200, UniformAdministrative Requirements, Cost Principles, and Audit Requirements for Federal Awards(Uniform Guidance). Because the Schedule presents only a selected portion of theoperations of Flagstaff Housing Corporation - Clark Homes, it is not intended to and doesnot present the financial position, changes in net assets, or cash flows of Flagstaff HousingCorporation - Clark Homes. De Minimis Rate Used: N Rate Explanation: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESExpenditures reported on the Schedule are reported on the accrual basis of accounting.Such expenditures are recognized following, as applicable, either the cost principles inOMB Circular A-122, Cost Principles for Non-Profit Organizations, or the cost principlescontained in Title 2 U.S. Code of Federal Regulations Part 200, Uniform AdministrativeRequirements, Cost Principles, and Audit Requirements for Federal Awards, whereincertain types of expenditures are not allowable or are limited as to reimbursement.Negative amounts shown on the Schedule represent adjustments or credits made in thenormal course of business to amounts reported as expenditures in prior years. FlagstaffHousing Corporation - Clark Homes has not elected to use the 10-percent de minimisindirect cost rate as allowed under the Uniform Guidance. MORTGAGE INSURANCE_RENTAL AND COOPERATIVE HOUSING FOR MODERATE INCOME FAMILIES AND ELDERLY, MARKET INTEREST RATE (14.135) - Balances outstanding at the end of the audit period were 531128.

Finding Details

Finding 2022-001

2022-001 Federal agency: U.S. Department of Housing and Urban Development Federal program: Section 221(d)(3) Insured Mortgage Federal Assistance Listing: 14.135 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria of specific requirement: Surplus cash must be calculated and deposited as defined in the Regulatory Agreement. Surplus cash deposit was underfunded. Condition: The Project did not deposit the full amount of its Surplus Cash position at June 30, 2021. Deposit was underfunded as calculated and required by regulatory agreement. Calculation was $71,914 and $56,029 was deposited. Questions costs: $15,885 Context: Reporting requirements were tested for instances of noncompliance. Cause: Oversight Effect: Residual receipts reserve balance was less than required by regulatory agreement. Recommendation: We recommend that Project Management compute surplus cash on an annual basis and make full deposit within 90 days as required by regulatory agreement.

Finding 2022-001

2022-001 Federal agency: U.S. Department of Housing and Urban Development Federal program: Section 221(d)(3) Insured Mortgage Federal Assistance Listing: 14.135 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria of specific requirement: Surplus cash must be calculated and deposited as defined in the Regulatory Agreement. Surplus cash deposit was underfunded. Condition: The Project did not deposit the full amount of its Surplus Cash position at June 30, 2021. Deposit was underfunded as calculated and required by regulatory agreement. Calculation was $71,914 and $56,029 was deposited. Questions costs: $15,885 Context: Reporting requirements were tested for instances of noncompliance. Cause: Oversight Effect: Residual receipts reserve balance was less than required by regulatory agreement. Recommendation: We recommend that Project Management compute surplus cash on an annual basis and make full deposit within 90 days as required by regulatory agreement.