Audit 407778

Material Weakness – Reporting Criteria The Uniform Guidance requires that all entities that expend in excess of $750,000 to file audited financial statements and Data Collection Form within 9 months of year-end. (2 CFR Section 200.512). Entities are required to submit timely GAAP-based audited financial information to HUD’s Financial Assessment Subsystem within 90 days of year end. (24 CFR Section 5.801(c)(2) and HUD Handbook 4065.1 REV-1, paragraph 2-1 (D)(1)(b)). Condition The Project’s December 31, 2024 audited financial statements were not filed with the Federal Audit Clearinghouse within nine months of year-end. The audited financial statements were not reported to HUD’s Financial Assessment Subsystem within 90 days of year end. Cause Turnover in staffing and lack of oversight led to information not being ready for audit in a timely manner. Questioned Costs Not Applicable. Effect The Project could have had federal funding delayed or reduced. Repeat Finding This is not a repeat finding. Recommendation We recommend the Project review its internal control policies and procedures to ensure timely reporting. Response The Project agrees with the finding and will implement controls to ensure timely reporting for future submissions.

Significant Deficiency – Eligibility Criteria The Project is responsible for establishing and maintaining effective internal controls to ensure tenant files are complete, accurate, and maintained in accordance with applicable program requirements. Effective internal controls include periodic monitoring and supervisory review of tenant files. Condition During our testing, we noted that the Project did not have documentation to show they performed periodic reviews of tenant files throughout the year. Cause Turnover in staffing and lack of oversight led to no documentation of periodic reviews. Questioned Costs Not Applicable. Effect Without documentation of periodic tenant file reviews, the Project cannot demonstrate that adequate monitoring of controls are operating effectively and could lead to errors being made and not caught timely. Repeat Finding This is not a repeat finding. Recommendation We recommend the Project implement formal procedures requiring documentation evidencing the completion of periodic reviews be maintained. Response The Project agrees with the finding and will implement controls to ensure proper documentation of periodic reviews of tenant files.