Finding reference number: #2025-001 Assistance Listing (federal award identification number and year): Supportive Housing for the Elderly (Assistance Listing No. 14.157, 2011) Auditor non-compliance code: Z – Other Finding resolution status: Cleared Universe population size: The universe population size is not applicable to the finding. Statistically valid sample: Not applicable Name of federal agency: Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $-0- Was the sampling statistically valid: N/A Statement of condition of #2025-001: For the year ended December 31, 2024, the Corporation did not submit the Data Collection Form to the Federal Audit Clearinghouse in the time period required by Uniform Guidance. Criteria: Pursuant to the Uniform Guidance, the Corporation is required to submit the Data Collection Form to the Federal Audit Clearinghouse within the earlier of 30 calendar days after receipt of the auditor's report or 9 months after the entity's fiscal year end. Effect or potential effect: The Corporation is not in compliance with the Uniform Guidance Section 200.512. Cause: Due to administrative delays, the 2024 audit report was not issued until December 18, 2025. Recommendation: The Corporation should submit the Data Collection Form to the Federal Audit Clearinghouse within the required time period. Reporting response: Management concurs. The 2024 Data Collection Form could not be filed by the September 30, 2025 due date because the 2024 audited financial statements were not issued until December 18, 2025. The Form was submitted to the Federal Audit Clearinghouse on September 18, 2026. Responsible contact: Holly Sweis, Intrepid Professional Group, on behalf of the Board of Directors.
Finding reference number: #2025-002 Assistance Listing (federal award identification number and year): Supportive Housing for the Elderly (Assistance Listing No. 14.157, 2011) Auditor non-compliance code: M – Security Deposits Finding resolution status: Cleared Universe population size: 12 months Statistically valid sample: 3 months Name of federal agency: Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $105 Was the sampling statistically valid: Yes Statement of condition of #2025-002: The Corporation did not maintain resident security deposits in an amount equal or greater than resident security deposits liabilities at all times during the year ended December 31, 2025. At December 31, 2025, the resident security deposit account was underfunded by $105. Criteria: Pursuant to the Regulatory Agreement, residents' security deposits should be funded in an amount which shall at all times equal or exceed the aggregate of all outstanding obligations. Effect or potential effect: Failure to fund resident security deposits could result in the inability of the Corporation to return security deposits to resident upon the termination of the resident's lease. Cause: The residual shortfall carried from the prior year was not fully eliminated by December 31, 2025. Recommendation: Management should ensure the security deposit account is adequately funded and transfer funds, if necessary, from the operating account to adequately fund the security deposit account. Reporting response: Management concurs. The shortfall was reduced from $557 at December 31, 2024 to $105 at December 31, 2025. The Corporation transferred $105 from the operating account to the resident security deposit account on September 17, 2026, fully funding the account. The security deposit account is reconciled to the tenant deposit ledger monthly as part of the close, and any variance is transferred in the same month.
Finding reference number: #2025-003 Assistance Listing (federal award identification number and year): Supportive Housing for the Elderly (Assistance Listing No. 14.157, 2011) Auditor non-compliance code: N – Reserve for Replacements Deposits Finding resolution status: Cleared Universe population size: 12 months Statistically valid sample: 12 months Name of federal agency: Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $24,400 Was the sampling statistically valid: Yes Statement of condition of #2025-003: During the year ended December 31, 2025, the Corporation failed to make the required deposits to the reserve for replacement account. The Corporation made two months of required deposits and the repayment of the withdrawal from 2024 totaling $21,834. The Corporation did not make deposits totaling $24,400 for the current year. Criteria: Pursuant to the Regulatory Agreement, the Corporation is required to make monthly deposits into a separate reserve for replacement account. Effect or potential effect: The Corporation is not in compliance with the terms of the Regulatory Agreement. At December 31, 2025, the reserve for replacements account is underfunded by $24,400. Cause: Due to operating cash flow shortages, the required monthly deposits to the reserve for replacement are not being made. Recommendation: Management should transfer $24,400 into the reserve for replacement from the operating cash account. Reporting response: Management concurs that monthly deposits totaling $24,400 were not made during 2025. During the same year the Corporation deposited $21,834 to the reserve, consisting of two monthly deposits totaling $4,880 and the $16,954 repayment of the 2024 withdrawal, bringing the reserve balance to $327,507 at December 31, 2025. The missed deposits resulted from operating cash shortfalls: revenue under the PRAC contract was flat while payroll, payroll taxes, and insurance costs increased substantially in 2025. On September 17, 2026, the Corporation deposited $24,400 into the reserve for replacements, fully funding the delinquent 2025 deposits, and monthly deposits for 2026 are current. The Corporation is also submitting a budget-based rent adjustment request under the PRAC to restore positive operating cash flow.