Audit 392453

Condition - The reserve for replacements account was underfunded by $58,800. Criteria - The regulatory agreement with HUD requires St. Clare Apartments Housing Development Fund Company, Inc. to deposit monthly deposits of $4,200 into the reserve for replacements account. Effect - The Company is not in compliance with regulatory agreement with HUD. Cause - St. Clare Apartments Housing Development Fund Company, Inc. did not have sufficient cash flow to make the required monthly deposits to the reserve for replacements. Statistical Sampling - The sample was not intended to be, and was not, a statistically valid sample. Questioned Costs - None identified. Repeat finding - This is a repeat of finding 2023-001 from the prior year. Recommendation - We recommend that St. Clare Apartments Housing Development Fund Company, Inc. make a deposit of $58,800 to the reserve for replacements account as soon as possible. Management’s Response - Management understands HUD’s reserve for replacements required deposit requirements and will deposit the $58,800 as soon as cash flow allows.

Condition - The Company did not submit audited submissions to REAC and the local field office within nine months after the end of the fiscal year. Criteria - In accordance with HUD’s Uniform Financial Reporting Standards (UFRS) rule and 24 CFR Part 5, Subpart H, companies are required to submit audited submissions to REAC and the local field office, no later than nine months after the end of the company’s fiscal year. Effect - The Company is not in compliance with financial reporting requirements. Cause - The Company did not submit an audited submission to REAC and the local field office because the audit was not complete by the due date. Statistical Sampling - The sample was not intended to be, and was not, a statistically valid sample. Questioned Costs - None identified. Repeat finding - This is a repeat of finding 2023-002 from the prior year. Recommendation - The Company should submit an audited submission to REAC and the local field office as soon as the audit is complete. Management’s Response - The Company will work to engage its auditors to perform the December 31, 2025 audit in March of 2026 and complete the audited submission within 90 days after the end of the fiscal year. The current year audited submission will be complete and filed upon completion of this audit.

Condition - The Company did not file the Data Collection form by the due date. Criteria - The Data Collection form is required to be submitted within the earlier of 30 days after receipt of the auditor’s reports or nine months after the end of the audit period. It was due on September 30, 2025. Effect - The Company is not in compliance with the Uniform Guidance. Cause - The Company did not file the Data Collection form by the required due date as the audit was still in progress. Statistical Sampling - The sample was not intended to be, and was not, a statistically valid sample. Questioned Costs - None identified. Repeat finding - This is a repeat of finding 2023-003 from the prior year. Recommendation - The Company should file the Data Collection form as soon as the audit is complete. Management’s Response - The Company will work to engage its auditors to perform the December 31, 2025 audit in March of 2026 and complete the data collection form to the Federal Clearinghouse by the required due date. The current year data collection form will be completed and filed upon completion of this audit.