FAC Explorer

Audit 46043

FY End
2022-06-30
Total Expended
$10.65M
Findings
2
Programs
2
Organization: Advanced Living Inc.'s Schwenckfeld Manor (PA)
Year: 2022 Accepted: 2023-01-03
Auditor: Eisneramper LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
48055 2022-001 Significant Deficiency - P
624497 2022-001 Significant Deficiency - P

Programs

ALN Program Spent Major Findings
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $8.26M Yes 1
14.195 Section 8 Housing Assistance Payments Program $2.39M Yes 0

Contacts

Name Title Type
HRNEMCRL5LE7 Randy James Auditee
2153620227 Michael Mostochuk Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: Expenditures reported on the accompanying Schedule of Expenditures of Federal Awards are reported using 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. MORTGAGE INSURANCE FOR THE PURCHASE OR REFINANCING OF EXISTING MULTIFAMILY HOUSING PROJECTS (14.155) - Balances outstanding at the end of the audit period were 8113495.

Finding Details

Finding 2022-001
Criteria: In accordance with regulatory agreements under the HUD Consolidated Audit Guide, only expenditures related to the Project can be allocated to the Project. Condition: The payroll charged to the Project for certain employees for the fiscal year ended June 30, 2022 was not in accordance with the Project?s allocation policy. Effect: Advanced Living Inc.?s Schwenckfeld Manor may lose its federal assistance if expenditures are made that are not related to the Project. Cause: Advanced Living Inc.?s Schwenckfeld Manor's management monitoring did not work effectively to ensure proper recordkeeping. Questioned Costs: Misallocated payroll and related taxes and benefits in the amount of $4,099 needed to be reallocated to the Project for the fiscal year ended June 30, 2022. The amounts were determined by totaling the wages and related taxes and benefits that were charged to the management company in error. Recommendation: The Project should more closely monitor its payroll allocations during the year to ensure that the Project is charged in accordance with its allocation policy. Management's Response: Management agrees with the comment and has already corrected the issue prior to the audit report date via a proposed journal entry. Management has also committed to more thorough monitoring of its payroll allocations each payroll period during the year to ensure allocations are made in accordance with the Project?s policy.
Finding 2022-001
Criteria: In accordance with regulatory agreements under the HUD Consolidated Audit Guide, only expenditures related to the Project can be allocated to the Project. Condition: The payroll charged to the Project for certain employees for the fiscal year ended June 30, 2022 was not in accordance with the Project?s allocation policy. Effect: Advanced Living Inc.?s Schwenckfeld Manor may lose its federal assistance if expenditures are made that are not related to the Project. Cause: Advanced Living Inc.?s Schwenckfeld Manor's management monitoring did not work effectively to ensure proper recordkeeping. Questioned Costs: Misallocated payroll and related taxes and benefits in the amount of $4,099 needed to be reallocated to the Project for the fiscal year ended June 30, 2022. The amounts were determined by totaling the wages and related taxes and benefits that were charged to the management company in error. Recommendation: The Project should more closely monitor its payroll allocations during the year to ensure that the Project is charged in accordance with its allocation policy. Management's Response: Management agrees with the comment and has already corrected the issue prior to the audit report date via a proposed journal entry. Management has also committed to more thorough monitoring of its payroll allocations each payroll period during the year to ensure allocations are made in accordance with the Project?s policy.