Audit 413640

Federal program information: Title: Supportive Housing for the Elderly (Section 202) CFDA Number: 14.157 Resolution Status: In Process Information on Universe Population Size: Population size is all transactions in the replacement reserve account (12 deposits and 1 withdrawal) for the year ended December 31, 2022. Sample Size Information : Tested 100% of transactions (12 deposits and 1 withdrawal). Identification of Repeat Finding and Finding Reference Number : Finding 2021-001 is of a similar nature to Finding 2022-001, but involved an incorrect transfer out of the replacement reserve. The incorrect transfer out was repaid during the year-ended December 31, 2022. Criteria: The Regulatory Agreement dated February 6, 2012 requires Pine Meadows to make a monthly deposit to the reserve fund for replacements that is maintained in a separate account. Disbursements from this fund are to be made only after receiving consent in writing from the Department of Housing and Urban Development (HUD). Statement of Condition: During the year-ended December 31, 2022 the August deposit to the Replacement Reserve account for $500 was not made. Cause: Management did not verify the monthly deposit was made for August. It appears that the deposit was made July 31, and was noted as the July deposit as opposed to August. This caused the deposit to be reversed. Recommendation: I recommend Pine Meadows on a monthly basis review the reserve accounts and verify deposits are made in accordance with their regulatory agreement, and that the $500 transfer to the replacement reserve be made expediently.