Audit 408072

FY End

2026-03-31

Total Expended

$4.78M

Findings

1

Programs

2

Organization: Rutherford Senior Housing CORP (NJ)

Year: 2026 Accepted: 2026-07-28

Auditor: GELTRUDE & COMPANY LLC

Organization Exclusion Status:

Checking exclusion status...

ID	Ref	Severity	Repeat	Requirement
1224848	2026-001	Material Weakness	Yes	A

ALN	Program	Spent	Major	Findings
14.157	SUPPORTIVE HOUSING FOR THE ELDERLY	$3.95M	Yes	1
14.195	PROJECT-BASED RENTAL ASSISTANCE (PBRA)	$826,635	Yes	0

Contacts

Name	Title	Type
MKX2EPJ8EAW4	Steven Cirillo	Auditee
2016664477	Michael Carlon	Auditor
No contacts on file

Notes to SEFA

The accompanying schedule of expenditures of federal awards includes the federal award activity of Rutherford Senior Housing Corp. (the “Project”), HUD project No. 031-EH224, 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 Project, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Project.

Expenditures reported on 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 reimbursement. Rutherford Senior Housing Corp. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance.

The Project did not provide state awards to any subrecipients.

The Project previously had a U.S. Department of Housing and Urban Development (“HUD”) direct loan under Section 202 of the National Housing Act outstanding at the beginning of the year, which was included in the federal expenditures presented in the Schedule. During the year, the Project received loan proceeds of $4,197,900 from the HUD direct loan refinanced through a loan security agreement with Dwight Capital. At March 31, 2026, the outstanding loan balance consisted of ALN 14.157, HUD Section 207 Insured Loan, in the amount of $4,197,900.

Finding Details

Finding 2026-001

Finding 2026-001 Material Weakness in Internal Control over Compliance U.S. Department of Housing and Urban Development 14.157 Section 207 Insured Loan Criteria: Improper administration of applicant wait list procedures. Criteria: In accordance with 24 CFR § 5.655 requirements, HUD/federal award requirements, and the Project’s established policies and procedures, the Project is required to administer applicant wait lists in a consistent, fair, and properly documented manner. Applicants should be processed in accordance with established eligibility and wait list procedures, and any exceptions or adjustments should be supported, approved, and documented. Condition: During our audit, we were made aware of an allegation that the former project manager allowed certain applicants to bypass the established wait list process. Cause: Management oversight over wait list administration was not sufficient to prevent or timely detect unauthorized adjustments or exceptions to the established process. Effect or Potential Effect: Improper administration of the wait list could result in applicants being treated inconsistently, eligible applicants being bypassed, unsupported tenant selection decisions, and potential noncompliance with federal award requirements or other applicable regulatory requirements. Identification of Repeat Finding: No prior-year finding Recommendation: Management should strengthen internal controls over applicant wait list administration. This should include limiting access to modify the wait list, requiring supervisory review and approval of any wait list changes or exceptions, maintaining documentation to support applicant selection and movement on the wait list, and periodically reviewing wait list activity for unusual or unsupported changes. Management should also consider performing a review of prior wait list activity to determine whether any applicants were improperly advanced or bypassed and whether further corrective action is necessary. Views of Responsible Officials and Planned Corrective Action: Management has reviewed the audit finding and acknowledges the allegation related to improper administration of the applicant wait list. The former project manager is no longer with the Project, and management responsibilities have been reassigned. Management plans to review wait list procedures, strengthen oversight and documentation requirements, and implement additional controls to ensure applicants are processed in accordance with established policies and applicable program requirements.