FAC Explorer

Audit 41992

FY End
2022-12-31
Total Expended
$3.48M
Findings
8
Programs
1
Organization: Shiloh Manor, Inc. (CT)
Year: 2022 Accepted: 2023-09-25
Auditor: Cohnreznick LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
47607 2022-001 Significant Deficiency Yes N
47608 2022-002 Significant Deficiency Yes A
47609 2022-001 Significant Deficiency Yes N
47610 2022-002 Significant Deficiency Yes A
624049 2022-001 Significant Deficiency Yes N
624050 2022-002 Significant Deficiency Yes A
624051 2022-001 Significant Deficiency Yes N
624052 2022-002 Significant Deficiency Yes A

Programs

ALN Program Spent Major Findings
14.157 Supportive Housing for the Elderly $3.29M Yes 2

Contacts

Name Title Type
FRL7B3YLRVJ6 Kimalee Williams Auditee
8605285000 Patricia E. McGowan Auditor
No contacts on file

Notes to SEFA

Title: U.S. Department of Housing and Urban Development loan program Accounting Policies: The accompanying schedule of expenditures of federal awards ("Schedule") includes the federal award activity of Shiloh Manor, Inc., HUD Project No. 017-EE012, under programs of the federal government for the year ended December 31, 2022. 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 Shiloh Manor, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Shiloh Manor, Inc. De Minimis Rate Used: N Rate Explanation: 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. Shiloh Manor, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. Shiloh Manor, Inc. has received a U.S. Department of Housing and Urban Development capital advance under Section 202 of the National Housing Act. The balance outstanding at the beginning of the year is included in the federal expenditures presented in the Schedule. Shiloh Manor, Inc. received no additional advances during the year. The balance of the outstanding advance at December 31, 2022 consists of the following: federal assistance Listing Number: 14.157; Program Name: Section 202 Capital Advance; Outstanding Balance at December 31, 2022: 43,286,743
Title: Subrecipients Accounting Policies: The accompanying schedule of expenditures of federal awards ("Schedule") includes the federal award activity of Shiloh Manor, Inc., HUD Project No. 017-EE012, under programs of the federal government for the year ended December 31, 2022. 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 Shiloh Manor, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Shiloh Manor, Inc. De Minimis Rate Used: N Rate Explanation: 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. Shiloh Manor, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. There are no payments to subrecipients in any of the federal awards programs during the year ended December 31, 2022.

Finding Details

Finding 2022-001
Statement of Condition During the year ended December 31, 2022, no deposits were made into the reserve for replacement. Management had not repaid $40,239 due to reserve for replacement. Additionally, during 2022, the property transferred $9,000 of reserve for replacement funds to operations to fund payroll and operating payables. Criteria In accordance with HUD Handbook 4571.3, Section 202 Supportive Housing for the Elderly, HUD projects are required to maintain monthly deposits to the reserve for replacement. Funds may only be used with the approval of HUD. Currently, the property is required to make monthly deposits of $5,500 to the replacement reserve. Questioned Costs None. Effect Shiloh Manor, Inc. is not in compliance with the requirement to fund the reserve for replacement monthly. Context On December 31, 2017, HUD had approved a loan to operations from the reserve for replacement of $40,239 to be repaid upon receipt of the past due subsidy. When the past due subsidy was received the property was unable to repay the loan because of an unexpected increase in vacancies as a result of tenant turnover. During 2022, the property transferred $9,000 of reserve for replacement funds to operations to fund payroll and operating payables; the funds have not been reimbursed as of December 31, 2022. The monthly payments of $5,500 into the reserve for replacement could not be resumed due to poor cash flow. Cause Inadequate cash flow to fund operations and required reserve for replacement funding. Identification as a Repeat Finding Finding No. 2018-002, 2019-004, 2020-001 and 2021-001 Recommendation Management should contact HUD to address the delinquent amounts. Auditor Noncompliance Code: N - Reserve for replacement deposits. Finding Resolution Status: In process. Reporting Views of Responsible Officials and Planned Corrective Action Management is in communication with HUD to address the finding. However, management is not able to commit to any type of repayment plan on 2017 and 2022 loans until the property is in a positive operating cash flow position. Management will transfer $9,000 in 2023 to reimburse reserve for replacement for 2022 payroll funding withdrawal.
Finding 2022-002
Statement of Condition During the year ended December 31, 2021, the project overpaid payroll expenses in the amount of $3,594 from project cash without HUD approval. During 2022, only partial payment was refunded to the project. The amount due to project as of December 31, 2022 is $2,212. Criteria In accordance with HUD Handbook 4571.3, Section 202 Supportive Housing for the Elderly, loans are not permitted to be made from project cash without prior authorization from HUD. Questioned Costs $3,594 Effect The payment of $3,594 is unauthorized loans and therefore considered to be questioned costs. Context During 2021, the property overpaid holiday bonus to one employee. The bonus was $300 but the property paid $3,894, resulting in payroll bonus overpayment of $3,594. Cause Procedures were not in place to ensure that cash disbursements of projects funds were limited to project operating costs. Identification as a Repeat Finding Finding No. 2021-002 Recommendation Management should immediately reimburse the amount due to the project and establish procedures to ensure payments of this nature are not made in the future. Auditor Noncompliance Code: G - Unauthorized loans from project assets. Finding Resolution Status: Completed. Reporting Views of Responsible Officials and Planned Corrective Action The employee began repayment of the overpaid payroll in May 2022 as a payroll deduction and the funds were fully reimbursed back to the project in 2023.
Finding 2022-001
Statement of Condition During the year ended December 31, 2022, no deposits were made into the reserve for replacement. Management had not repaid $40,239 due to reserve for replacement. Additionally, during 2022, the property transferred $9,000 of reserve for replacement funds to operations to fund payroll and operating payables. Criteria In accordance with HUD Handbook 4571.3, Section 202 Supportive Housing for the Elderly, HUD projects are required to maintain monthly deposits to the reserve for replacement. Funds may only be used with the approval of HUD. Currently, the property is required to make monthly deposits of $5,500 to the replacement reserve. Questioned Costs None. Effect Shiloh Manor, Inc. is not in compliance with the requirement to fund the reserve for replacement monthly. Context On December 31, 2017, HUD had approved a loan to operations from the reserve for replacement of $40,239 to be repaid upon receipt of the past due subsidy. When the past due subsidy was received the property was unable to repay the loan because of an unexpected increase in vacancies as a result of tenant turnover. During 2022, the property transferred $9,000 of reserve for replacement funds to operations to fund payroll and operating payables; the funds have not been reimbursed as of December 31, 2022. The monthly payments of $5,500 into the reserve for replacement could not be resumed due to poor cash flow. Cause Inadequate cash flow to fund operations and required reserve for replacement funding. Identification as a Repeat Finding Finding No. 2018-002, 2019-004, 2020-001 and 2021-001 Recommendation Management should contact HUD to address the delinquent amounts. Auditor Noncompliance Code: N - Reserve for replacement deposits. Finding Resolution Status: In process. Reporting Views of Responsible Officials and Planned Corrective Action Management is in communication with HUD to address the finding. However, management is not able to commit to any type of repayment plan on 2017 and 2022 loans until the property is in a positive operating cash flow position. Management will transfer $9,000 in 2023 to reimburse reserve for replacement for 2022 payroll funding withdrawal.
Finding 2022-002
Statement of Condition During the year ended December 31, 2021, the project overpaid payroll expenses in the amount of $3,594 from project cash without HUD approval. During 2022, only partial payment was refunded to the project. The amount due to project as of December 31, 2022 is $2,212. Criteria In accordance with HUD Handbook 4571.3, Section 202 Supportive Housing for the Elderly, loans are not permitted to be made from project cash without prior authorization from HUD. Questioned Costs $3,594 Effect The payment of $3,594 is unauthorized loans and therefore considered to be questioned costs. Context During 2021, the property overpaid holiday bonus to one employee. The bonus was $300 but the property paid $3,894, resulting in payroll bonus overpayment of $3,594. Cause Procedures were not in place to ensure that cash disbursements of projects funds were limited to project operating costs. Identification as a Repeat Finding Finding No. 2021-002 Recommendation Management should immediately reimburse the amount due to the project and establish procedures to ensure payments of this nature are not made in the future. Auditor Noncompliance Code: G - Unauthorized loans from project assets. Finding Resolution Status: Completed. Reporting Views of Responsible Officials and Planned Corrective Action The employee began repayment of the overpaid payroll in May 2022 as a payroll deduction and the funds were fully reimbursed back to the project in 2023.
Finding 2022-001
Statement of Condition During the year ended December 31, 2022, no deposits were made into the reserve for replacement. Management had not repaid $40,239 due to reserve for replacement. Additionally, during 2022, the property transferred $9,000 of reserve for replacement funds to operations to fund payroll and operating payables. Criteria In accordance with HUD Handbook 4571.3, Section 202 Supportive Housing for the Elderly, HUD projects are required to maintain monthly deposits to the reserve for replacement. Funds may only be used with the approval of HUD. Currently, the property is required to make monthly deposits of $5,500 to the replacement reserve. Questioned Costs None. Effect Shiloh Manor, Inc. is not in compliance with the requirement to fund the reserve for replacement monthly. Context On December 31, 2017, HUD had approved a loan to operations from the reserve for replacement of $40,239 to be repaid upon receipt of the past due subsidy. When the past due subsidy was received the property was unable to repay the loan because of an unexpected increase in vacancies as a result of tenant turnover. During 2022, the property transferred $9,000 of reserve for replacement funds to operations to fund payroll and operating payables; the funds have not been reimbursed as of December 31, 2022. The monthly payments of $5,500 into the reserve for replacement could not be resumed due to poor cash flow. Cause Inadequate cash flow to fund operations and required reserve for replacement funding. Identification as a Repeat Finding Finding No. 2018-002, 2019-004, 2020-001 and 2021-001 Recommendation Management should contact HUD to address the delinquent amounts. Auditor Noncompliance Code: N - Reserve for replacement deposits. Finding Resolution Status: In process. Reporting Views of Responsible Officials and Planned Corrective Action Management is in communication with HUD to address the finding. However, management is not able to commit to any type of repayment plan on 2017 and 2022 loans until the property is in a positive operating cash flow position. Management will transfer $9,000 in 2023 to reimburse reserve for replacement for 2022 payroll funding withdrawal.
Finding 2022-002
Statement of Condition During the year ended December 31, 2021, the project overpaid payroll expenses in the amount of $3,594 from project cash without HUD approval. During 2022, only partial payment was refunded to the project. The amount due to project as of December 31, 2022 is $2,212. Criteria In accordance with HUD Handbook 4571.3, Section 202 Supportive Housing for the Elderly, loans are not permitted to be made from project cash without prior authorization from HUD. Questioned Costs $3,594 Effect The payment of $3,594 is unauthorized loans and therefore considered to be questioned costs. Context During 2021, the property overpaid holiday bonus to one employee. The bonus was $300 but the property paid $3,894, resulting in payroll bonus overpayment of $3,594. Cause Procedures were not in place to ensure that cash disbursements of projects funds were limited to project operating costs. Identification as a Repeat Finding Finding No. 2021-002 Recommendation Management should immediately reimburse the amount due to the project and establish procedures to ensure payments of this nature are not made in the future. Auditor Noncompliance Code: G - Unauthorized loans from project assets. Finding Resolution Status: Completed. Reporting Views of Responsible Officials and Planned Corrective Action The employee began repayment of the overpaid payroll in May 2022 as a payroll deduction and the funds were fully reimbursed back to the project in 2023.
Finding 2022-001
Statement of Condition During the year ended December 31, 2022, no deposits were made into the reserve for replacement. Management had not repaid $40,239 due to reserve for replacement. Additionally, during 2022, the property transferred $9,000 of reserve for replacement funds to operations to fund payroll and operating payables. Criteria In accordance with HUD Handbook 4571.3, Section 202 Supportive Housing for the Elderly, HUD projects are required to maintain monthly deposits to the reserve for replacement. Funds may only be used with the approval of HUD. Currently, the property is required to make monthly deposits of $5,500 to the replacement reserve. Questioned Costs None. Effect Shiloh Manor, Inc. is not in compliance with the requirement to fund the reserve for replacement monthly. Context On December 31, 2017, HUD had approved a loan to operations from the reserve for replacement of $40,239 to be repaid upon receipt of the past due subsidy. When the past due subsidy was received the property was unable to repay the loan because of an unexpected increase in vacancies as a result of tenant turnover. During 2022, the property transferred $9,000 of reserve for replacement funds to operations to fund payroll and operating payables; the funds have not been reimbursed as of December 31, 2022. The monthly payments of $5,500 into the reserve for replacement could not be resumed due to poor cash flow. Cause Inadequate cash flow to fund operations and required reserve for replacement funding. Identification as a Repeat Finding Finding No. 2018-002, 2019-004, 2020-001 and 2021-001 Recommendation Management should contact HUD to address the delinquent amounts. Auditor Noncompliance Code: N - Reserve for replacement deposits. Finding Resolution Status: In process. Reporting Views of Responsible Officials and Planned Corrective Action Management is in communication with HUD to address the finding. However, management is not able to commit to any type of repayment plan on 2017 and 2022 loans until the property is in a positive operating cash flow position. Management will transfer $9,000 in 2023 to reimburse reserve for replacement for 2022 payroll funding withdrawal.
Finding 2022-002
Statement of Condition During the year ended December 31, 2021, the project overpaid payroll expenses in the amount of $3,594 from project cash without HUD approval. During 2022, only partial payment was refunded to the project. The amount due to project as of December 31, 2022 is $2,212. Criteria In accordance with HUD Handbook 4571.3, Section 202 Supportive Housing for the Elderly, loans are not permitted to be made from project cash without prior authorization from HUD. Questioned Costs $3,594 Effect The payment of $3,594 is unauthorized loans and therefore considered to be questioned costs. Context During 2021, the property overpaid holiday bonus to one employee. The bonus was $300 but the property paid $3,894, resulting in payroll bonus overpayment of $3,594. Cause Procedures were not in place to ensure that cash disbursements of projects funds were limited to project operating costs. Identification as a Repeat Finding Finding No. 2021-002 Recommendation Management should immediately reimburse the amount due to the project and establish procedures to ensure payments of this nature are not made in the future. Auditor Noncompliance Code: G - Unauthorized loans from project assets. Finding Resolution Status: Completed. Reporting Views of Responsible Officials and Planned Corrective Action The employee began repayment of the overpaid payroll in May 2022 as a payroll deduction and the funds were fully reimbursed back to the project in 2023.