Audit 39275

FY End
2022-05-31
Total Expended
$10.31M
Findings
2
Programs
3
Organization: Houston Heights Towers (TX)
Year: 2022 Accepted: 2022-10-13

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
44654 2022-001 - - N
621096 2022-001 - - N

Programs

ALN Program Spent Major Findings
14.239 Home Investment Partnerships Program $6.50M Yes 1
14.218 Community Development Block Grants/entitlement Grants $3.50M Yes 0
14.195 Section 8 Housing Assistance Payments Program $311,824 Yes 0

Contacts

Name Title Type
D1YXYTMXD9G5 Linda Holder Auditee
7135269470 Nancy MacK Auditor
No contacts on file

Notes to SEFA

Title: Grants Accounting Policies: BASIS OF PRESENTATION - The accompanying schedule of expenditures of federal awards includes the federal grant activity of Houston Heights Tower, HUD No. 114-44098. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CRT) 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 Houston Heights Tower, it is not intended to and does not present the financial position, changes in net assets or cash flows of Houston Heights Tower. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - 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 reimbursements. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Project has received grants under the Community Development Block Grant and HOME Improvement Partnership Grant programs. The grant balances at the beginning of the year are included in the federal expenditures presented in the schedule. The Project received no additional grant funds during the year. The grants are reported as net assets with donor restrictions in the statement of financial position.

Finding Details

Schedule reference number 2022-001 Title and AL Number of Federal Program: Home Improvement Partnership Grant (AL 14.239) Type of finding: Federal Award Resolution Status: In process. Population size: N/A Sample size: N/A Repeat finding: No. Criteria: The regulatory agreement stipulates that a monthly deposit be made to the Reserve for Replacement Account. Statement of Condition: The monthly deposit of $4,646 to the Reserve for Replacement account was not done for July 2021. Cause: Since the mortgage was refinanced in late June, management thought there was no need to make the July deposit. Effect or Potential Effect: The Reserve for Replacement account may have a shortfall of $4,646. Auditor Non-Compliance Code: N. Questioned costs: N/A. Reporting views of responsible officials: Management thought there was no need to make the deposit in July due to the refinancing. Contract Number: 114-44098. Context: The shortfall was noticed at the time of performing the audit. Recommendation: Management should make an additional deposit to make up the shortfall when funds become available. Auditors' summary of auditee's comment: They are in agreement. Proposed completion date: May 31, 2023. Response: Management agrees with the finding and will make an additional deposit to the Reserve for Replacement account when the funds become available.
Schedule reference number 2022-001 Title and AL Number of Federal Program: Home Improvement Partnership Grant (AL 14.239) Type of finding: Federal Award Resolution Status: In process. Population size: N/A Sample size: N/A Repeat finding: No. Criteria: The regulatory agreement stipulates that a monthly deposit be made to the Reserve for Replacement Account. Statement of Condition: The monthly deposit of $4,646 to the Reserve for Replacement account was not done for July 2021. Cause: Since the mortgage was refinanced in late June, management thought there was no need to make the July deposit. Effect or Potential Effect: The Reserve for Replacement account may have a shortfall of $4,646. Auditor Non-Compliance Code: N. Questioned costs: N/A. Reporting views of responsible officials: Management thought there was no need to make the deposit in July due to the refinancing. Contract Number: 114-44098. Context: The shortfall was noticed at the time of performing the audit. Recommendation: Management should make an additional deposit to make up the shortfall when funds become available. Auditors' summary of auditee's comment: They are in agreement. Proposed completion date: May 31, 2023. Response: Management agrees with the finding and will make an additional deposit to the Reserve for Replacement account when the funds become available.