FAC Explorer

Audit 45776

FY End
2022-06-30
Total Expended
$1.14M
Findings
2
Programs
2
Organization: Building Dreams, Inc. (KY)
Year: 2022 Accepted: 2022-11-02
Auditor: Deming Malone Livesay & Ostroff

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
39336 2022-001 Material Weakness Yes E
615778 2022-001 Material Weakness Yes E

Programs

ALN Program Spent Major Findings
14.181 Supportive Housing for Persons with Disabilities $712,825 Yes 1
14.239 Home Investment Partnerships Program $426,995 Yes 0

Contacts

Name Title Type
K2H4ZJHTG7H4 Jenifer Frommeyer Auditee
5024594647 Melinda Heck Auditor
No contacts on file

Notes to SEFA

Accounting Policies: Note 1.Basis of PresentationThe accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Building Dreams, Inc., under programs of the federal government for the year ended June 30, 2022. The information in this Schedule is presented in accordance with the requirements of the 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 Building Dreams, Inc., it is not intended to and does not present the financial position, changes in net assets or cash flows of Building Dreams, Inc.Note 2.Summary of Significant Accounting PoliciesExpenditures 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. Building Dreams, Inc. has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance.Note 3.SubrecipientsBuilding Dreams, Inc. provided no federal funding to subrecipients for the year ended June 30, 2022. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate.

Finding Details

Finding 2022-001
Finding 2022-001: FALN 14.181 ? Supportive Housing for Persons with Disabilities Criteria: The Project?s tenant files are required to be maintained in accordance with HUD guidelines to ensure accurate calculations of tenant rent and rental subsidy. Statement of Condition: Certain tenant rent calculated on the Form 50059 and reported to HUD is inaccurate due to tenant files not being maintained in accordance with HUD guidelines. Cause of Condition: The Project?s internal controls to ensure tenant files are complete and that the calculation of tenant rent is accurate were not effective. Effect of Condition: Of the two (out of eight) tenant files sampled for the Project, we noted discrepancies in one tenant file between the information reported on the Form 50059 and the information in the file for the income and medical expenses to be reported for the tenant. This resulted in the tenant overpaying their share of the monthly rent by $125 per month. Identification of Repeat Finding: This finding is a repeat of finding 2021-001 noted in the audit for the year ended June 30, 2021. Recommendation: The design of the current controls should be reviewed to ensure tenant files are complete and accurate. The information in the files should support the data used in preparing the Form 50059 and calculating the corresponding tenant?s share of the rent. In addition, management should review all files and report any discrepancies to HUD in a timely manner. Views of Responsible Officials: Management agrees with the findings and will implement procedures to ensure tenant files are maintained in accordance with HUD guidelines.
Finding 2022-001
Finding 2022-001: FALN 14.181 ? Supportive Housing for Persons with Disabilities Criteria: The Project?s tenant files are required to be maintained in accordance with HUD guidelines to ensure accurate calculations of tenant rent and rental subsidy. Statement of Condition: Certain tenant rent calculated on the Form 50059 and reported to HUD is inaccurate due to tenant files not being maintained in accordance with HUD guidelines. Cause of Condition: The Project?s internal controls to ensure tenant files are complete and that the calculation of tenant rent is accurate were not effective. Effect of Condition: Of the two (out of eight) tenant files sampled for the Project, we noted discrepancies in one tenant file between the information reported on the Form 50059 and the information in the file for the income and medical expenses to be reported for the tenant. This resulted in the tenant overpaying their share of the monthly rent by $125 per month. Identification of Repeat Finding: This finding is a repeat of finding 2021-001 noted in the audit for the year ended June 30, 2021. Recommendation: The design of the current controls should be reviewed to ensure tenant files are complete and accurate. The information in the files should support the data used in preparing the Form 50059 and calculating the corresponding tenant?s share of the rent. In addition, management should review all files and report any discrepancies to HUD in a timely manner. Views of Responsible Officials: Management agrees with the findings and will implement procedures to ensure tenant files are maintained in accordance with HUD guidelines.