Audit 43548

Finding Type - Immaterial noncompliance with major program requirements Title and Assistance Listing Number of Federal Program - 14.157 - U. S. Department of Housing and Urban Development: Supportive Housing for the Elderly Finding Resolution Status - Resolved Information on Universe and Population Size - The population includes all required deposits to the replacement reserve for fiscal year 2022. Sample Size Information - N/ A Identification of Repeat Finding and Finding Reference Number - N/ A Criteria - The Corporation should have made 12 monthly deposits of $ 1,250 into the reserve for replacements account, as required by the Regulatory Agreement. Statement of Condition - The Corporation failed to make the required reserve for replacements deposits in the current fiscal year. Cause - The Corporation failed to monitor the cash requirements of the reserve for replacement account specified by the Regulatory Agreement. Effect or Potential Effect - The replacement reserve account was underfunded in the current fiscal year by $ 1,250. Auditor Noncompliance Code - N - Reserve for replacements deposits Reporting Views of Responsible Officials - Management agrees with the finding as reported. Context - During testing of required deposits to the reserve for replacement account, it was noted that the Corporation made only 11 of the required 12 monthly deposits of $ 1,250 during fiscal year 2022. Recommendation - All required deposits should be made in accordance with the Regulatory Agreement. Auditor's Summary of the Auditee's Comments on the Findings and Recommendations - Management should make the required reserve for replacements deposits in the current fiscal year. Response Indicator ? Agree Completion Date - July 20,2022 Response - Management acknowledges noncompliance in the current fiscal year and has taken measures to improve internal controls over compliance. The missing deposit was made on July 20,2022.

Finding Type: - Immaterial noncompliance with major program requirements - Significant deficiency in internal control over compliance Title and Assistance Listing Number of Federal Program - 14.157 - U.S. Department of Housing and Urban Development: Supportive Housing for the Elderly Finding Resolution Status - In progress Information on Universe and Population Size - Population includes prior year surplus cash to be deposited into the residual receipts account. Sample Size Information - N/A Identification of Repeat Finding and Finding Reference Number - N/A Criteria - The Corporation should deposit surplus cash within the time frame specified in the FRAG Guide. Statement of Condition - The Corporation used surplus cash calculated at June 30, 2021 to make a payment on a residual receipts note without prior approval from HUD. Cause - The Corporation failed to understand the terms of its residual receipts note, as the note requires surplus cash be deposited into the residual receipts account, and approval from HUD is required to make payments on the note from residual receipts. Effect or Potential Effect - The residual receipts account was not funded in accordance with the FRAG Guide. Auditor Noncompliance Code - B - Failure to make required residual receipt deposits Reporting Views of Responsible Officials - Management agrees with the finding as reported. Context - During testing of the residual receipts account, it was noted that the property did not make the prior year surplus cash deposit, as required by HUD. Recommendation - Surplus cash deposit amounts must be deposited within the specified time frame required by the FRAG Guide. Auditor's Summary of the Auditee's Comments on the Findings and Recommendations - Management should deposit surplus cash within the time frame required by the FRAG Guide. Response Indicator - Agree Completion Date - June 30, 2023 Response - Management acknowledges noncompliance in the current fiscal year and has taken measures to improve internal controls over compliance. Management plans to deposit the surplus cash amount of $22,809 into residual receipts during the year ending June 30, 2023.

Finding Type - Immaterial noncompliance with major program requirements Title and Assistance Listing Number of Federal Program - 14.157 - U. S. Department of Housing and Urban Development: Supportive Housing for the Elderly Finding Resolution Status - Resolved Information on Universe and Population Size - The population includes all required deposits to the replacement reserve for fiscal year 2022. Sample Size Information - N/ A Identification of Repeat Finding and Finding Reference Number - N/ A Criteria - The Corporation should have made 12 monthly deposits of $ 1,250 into the reserve for replacements account, as required by the Regulatory Agreement. Statement of Condition - The Corporation failed to make the required reserve for replacements deposits in the current fiscal year. Cause - The Corporation failed to monitor the cash requirements of the reserve for replacement account specified by the Regulatory Agreement. Effect or Potential Effect - The replacement reserve account was underfunded in the current fiscal year by $ 1,250. Auditor Noncompliance Code - N - Reserve for replacements deposits Reporting Views of Responsible Officials - Management agrees with the finding as reported. Context - During testing of required deposits to the reserve for replacement account, it was noted that the Corporation made only 11 of the required 12 monthly deposits of $ 1,250 during fiscal year 2022. Recommendation - All required deposits should be made in accordance with the Regulatory Agreement. Auditor's Summary of the Auditee's Comments on the Findings and Recommendations - Management should make the required reserve for replacements deposits in the current fiscal year. Response Indicator ? Agree Completion Date - July 20,2022 Response - Management acknowledges noncompliance in the current fiscal year and has taken measures to improve internal controls over compliance. The missing deposit was made on July 20,2022.

Finding Type: - Immaterial noncompliance with major program requirements - Significant deficiency in internal control over compliance Title and Assistance Listing Number of Federal Program - 14.157 - U.S. Department of Housing and Urban Development: Supportive Housing for the Elderly Finding Resolution Status - In progress Information on Universe and Population Size - Population includes prior year surplus cash to be deposited into the residual receipts account. Sample Size Information - N/A Identification of Repeat Finding and Finding Reference Number - N/A Criteria - The Corporation should deposit surplus cash within the time frame specified in the FRAG Guide. Statement of Condition - The Corporation used surplus cash calculated at June 30, 2021 to make a payment on a residual receipts note without prior approval from HUD. Cause - The Corporation failed to understand the terms of its residual receipts note, as the note requires surplus cash be deposited into the residual receipts account, and approval from HUD is required to make payments on the note from residual receipts. Effect or Potential Effect - The residual receipts account was not funded in accordance with the FRAG Guide. Auditor Noncompliance Code - B - Failure to make required residual receipt deposits Reporting Views of Responsible Officials - Management agrees with the finding as reported. Context - During testing of the residual receipts account, it was noted that the property did not make the prior year surplus cash deposit, as required by HUD. Recommendation - Surplus cash deposit amounts must be deposited within the specified time frame required by the FRAG Guide. Auditor's Summary of the Auditee's Comments on the Findings and Recommendations - Management should deposit surplus cash within the time frame required by the FRAG Guide. Response Indicator - Agree Completion Date - June 30, 2023 Response - Management acknowledges noncompliance in the current fiscal year and has taken measures to improve internal controls over compliance. Management plans to deposit the surplus cash amount of $22,809 into residual receipts during the year ending June 30, 2023.