FAC Explorer

Audit 397748

FY End
2025-12-31
Total Expended
$1.29M
Findings
2
Programs
2
Organization: Accessible Residences, Inc. 113-Hd003 (TX)
Year: 2025 Accepted: 2026-04-06
Auditor: SUTTON FROST CARY LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
1205927 2025-001 Material Weakness Yes N
1205928 2025-002 Material Weakness Yes N

Programs

ALN Program Spent Major Findings
14.181 SUPPORTIVE HOUSING FOR PERSONS WITH DISABILITIES $1.22M Yes 2
14.856 LOWER INCOME HOUSING ASSISTANCE PROGRAM SECTION 8 MODERATE REHABILITATION $70,711 Yes 0

Contacts

Name Title Type
YRCCBFWGJ4E7 Kim Robinson Auditee
8173326410 Deanna Frisby Auditor
No contacts on file

Notes to SEFA

The accompanying schedule of expenditures of federal awards (Schedule) includes the federal grant activity of Accessible Residences, Inc., HUD Project No. 113‐HD003 (Agency), and is presented on the accrual basis of accounting. The information in this Schedule 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 Agency, it is not intended to and does not present the financial position, changes in net assets or cash flows of the Agency.
Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. The Agency has elected not to use the ten percent de minimis indirect cost rate allowed under Uniform Guidance.
The amounts reported as Federal expenditures for the Section 811 Capital Advance reflect the balance of net assets with donor restrictions received from HUD in prior years, as of the beginning of the year ended December 31, 2025. These funds are restricted as to use until August 4, 2037. The capital advance does not bear interest and does not need to be repaid as long as the housing remains available for disabled persons for at least 40 years. The capital advance was recorded as grant revenue with donor restrictions rather than loans payable in the financial statements in a prior year, as it is the Agency’s intention to provide housing as stipulated by HUD for a period of at least 40 years. Due to the ongoing requirements of the Section 811 Capital Advance agreement, the balance of net assets with donor restrictions did not change during the year ended December 31, 2025. The balance of net assets with donor restrictions as of December 31, 2025 was $1,220,200.

Finding Details

Finding 2025-001
Finding No. 2025‐001: Special Tests and Provisions ‐ Material Weakness in internal controls over compliance and compliance finding Criteria: The Capital Advance Regulatory Agreement for the United States Housing and Urban Development (HUD) funded loan program requires that disbursements from the replacement reserve fund be made only after receiving consent in writing from HUD. Condition: The Agency did not get prior written approval from HUD when transferring funds out of the replacement reserve account. Cause: Funds were erroneously transferred to the management company to pay accrued management fees. Effect: The Agency is not in compliance with the Capital Advance Regulatory Agreement that governs the loan program. Questioned costs: $15,000 Recommendation: We recommend that management communicate with their oversight agency the required steps to remedy the noncompliance. We also recommend that going forward management obtains written prior approval from HUD before disbursing funds from the replacement reserve account. Management’s Response: See corrective action plan.
Finding 2025-002
Finding 2025‐002: Special Tests – Significant deficiency in internal controls over compliance and compliance finding. Supporting Housing for Persons with Disabilities (Section 811) ALN 14.181 Criteria: Section 200 of the Code of Federal Regulations requires recipients to implement robust internal controls to ensure compliance for utility allocations. Condition: During special tests testing for federal grants, 5 out of 25 utility reimbursements selected for testing had overallocated expenses. Cause: The Agency did not have a standard procedure in place to review the utility reimbursement allocations. Effect: Tenants’ monthly utilities were overcharged for the month. Questioned costs: None. Recommendation: Management should design and implement controls to ensure utility reimbursement allocations are accurate. Management’s response: See corrective action plan.