Audit 46166

FY End

2022-06-30

Total Expended

$5.71M

Findings

4

Programs

2

Organization: Mission Housing Developmnet Property Iv, Inc. (CA)

Year: 2022 Accepted: 2023-01-10

Auditor: Spiteri Narasky & Daley LLP

Organization Exclusion Status:

Checking exclusion status...

ID	Ref	Severity	Repeat	Requirement
43466	2022-001	-	-	N
43467	2022-001	-	-	N
619908	2022-001	-	-	N
619909	2022-001	-	-	N

ALN	Program	Spent	Major	Findings
14.218	Community Development Block Grants/entitlement Grants	$978,000	-	0
14.157	Supportive Housing for the Elderly	$223,220	Yes	1

Contacts

Name	Title	Type
DG3JAJNA2NU3	Sam Moss	Auditee
4158646432	Annette Spiteri	Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: NOTE A - BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards includes the federal award activity of Mission Housing Development Property IV, Inc., HUD Project No. 121-EE031-NP, and is presented on the accrual basis of accounting. 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 Mission Housing Development Property IV, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Mission Housing Development Property IV, Inc. NOTE B - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principals contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Mission Housing Development Property IV, Inc. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. SUPPORTIVE HOUSING FOR THE ELDERLY (14.157) - Balances outstanding at the end of the audit period were 4508500. COMMUNITY DEVELOPMENT BLOCK GRANTS/ENTITLEMENT GRANTS (14.218) - Balances outstanding at the end of the audit period were 978000.

Finding Details

Finding 2022-001

Finding # 2021-001 Federal Grantor: U.S. Department of Housing and Urban Development CFDA# / Program : 14.157- Supportive Housing for the Elderly Type of Finding: Federal Award Finding Finding Resolution Status: In Process Information on Universe Population Size: Project is required to make monthly deposits to the reserve for replacements of $2,198. Sample size: Tests were performed on the twelve required monthly deposits. Criteria: Project is required to make monthly deposits in the amount of $2,198 to the reserve for replacement as required by HUD. Statement of Condition: Reserve for replacement is underfunded by $4,396. Cause: Project only made ten months of deposits due to cash flow issues. Effect or Potential Effect: Project is not in compliance with HUD compliance requirements. Auditor Non-Compliance Code: N - Replacement Reserve Deposits Questioned Costs: $- Reporting Views of Responsible Officials: The project suffers with negative cash flow due to very small amount of monthly contract rents thus unable pay for the necessary operating expenses and unable to make required deposits into Replacement Reserves. We are working on requesting HUD to waive the funding requirements temporarily. Context: N/A Recommendation: We recommend the Project make the required deposit to the reserve for replacement account or request HUD approval to waive deposits until cashflow improves. Auditor's Summary of the Auditee's Comments on the Findings and Recommendations: The project suffers with negative cash flow due to very small amount of monthly contract rents thus unable pay for the necessary operating expenses and unable to make required deposits into Replacement Reserves. We are working on requesting HUD to waive the funding requirements temporarily. Response Indicator: Agree Completion Date: 6/30/2022 Response: We are working on requesting HUD to waive the funding requirements temporarily.

Finding 2022-001

Finding # 2021-001 Federal Grantor: U.S. Department of Housing and Urban Development CFDA# / Program : 14.157- Supportive Housing for the Elderly Type of Finding: Federal Award Finding Finding Resolution Status: In Process Information on Universe Population Size: Project is required to make monthly deposits to the reserve for replacements of $2,198. Sample size: Tests were performed on the twelve required monthly deposits. Criteria: Project is required to make monthly deposits in the amount of $2,198 to the reserve for replacement as required by HUD. Statement of Condition: Reserve for replacement is underfunded by $4,396. Cause: Project only made ten months of deposits due to cash flow issues. Effect or Potential Effect: Project is not in compliance with HUD compliance requirements. Auditor Non-Compliance Code: N - Replacement Reserve Deposits Questioned Costs: $- Reporting Views of Responsible Officials: The project suffers with negative cash flow due to very small amount of monthly contract rents thus unable pay for the necessary operating expenses and unable to make required deposits into Replacement Reserves. We are working on requesting HUD to waive the funding requirements temporarily. Context: N/A Recommendation: We recommend the Project make the required deposit to the reserve for replacement account or request HUD approval to waive deposits until cashflow improves. Auditor's Summary of the Auditee's Comments on the Findings and Recommendations: The project suffers with negative cash flow due to very small amount of monthly contract rents thus unable pay for the necessary operating expenses and unable to make required deposits into Replacement Reserves. We are working on requesting HUD to waive the funding requirements temporarily. Response Indicator: Agree Completion Date: 6/30/2022 Response: We are working on requesting HUD to waive the funding requirements temporarily.

Finding 2022-001

Finding # 2021-001 Federal Grantor: U.S. Department of Housing and Urban Development CFDA# / Program : 14.157- Supportive Housing for the Elderly Type of Finding: Federal Award Finding Finding Resolution Status: In Process Information on Universe Population Size: Project is required to make monthly deposits to the reserve for replacements of $2,198. Sample size: Tests were performed on the twelve required monthly deposits. Criteria: Project is required to make monthly deposits in the amount of $2,198 to the reserve for replacement as required by HUD. Statement of Condition: Reserve for replacement is underfunded by $4,396. Cause: Project only made ten months of deposits due to cash flow issues. Effect or Potential Effect: Project is not in compliance with HUD compliance requirements. Auditor Non-Compliance Code: N - Replacement Reserve Deposits Questioned Costs: $- Reporting Views of Responsible Officials: The project suffers with negative cash flow due to very small amount of monthly contract rents thus unable pay for the necessary operating expenses and unable to make required deposits into Replacement Reserves. We are working on requesting HUD to waive the funding requirements temporarily. Context: N/A Recommendation: We recommend the Project make the required deposit to the reserve for replacement account or request HUD approval to waive deposits until cashflow improves. Auditor's Summary of the Auditee's Comments on the Findings and Recommendations: The project suffers with negative cash flow due to very small amount of monthly contract rents thus unable pay for the necessary operating expenses and unable to make required deposits into Replacement Reserves. We are working on requesting HUD to waive the funding requirements temporarily. Response Indicator: Agree Completion Date: 6/30/2022 Response: We are working on requesting HUD to waive the funding requirements temporarily.

Finding 2022-001

Finding # 2021-001 Federal Grantor: U.S. Department of Housing and Urban Development CFDA# / Program : 14.157- Supportive Housing for the Elderly Type of Finding: Federal Award Finding Finding Resolution Status: In Process Information on Universe Population Size: Project is required to make monthly deposits to the reserve for replacements of $2,198. Sample size: Tests were performed on the twelve required monthly deposits. Criteria: Project is required to make monthly deposits in the amount of $2,198 to the reserve for replacement as required by HUD. Statement of Condition: Reserve for replacement is underfunded by $4,396. Cause: Project only made ten months of deposits due to cash flow issues. Effect or Potential Effect: Project is not in compliance with HUD compliance requirements. Auditor Non-Compliance Code: N - Replacement Reserve Deposits Questioned Costs: $- Reporting Views of Responsible Officials: The project suffers with negative cash flow due to very small amount of monthly contract rents thus unable pay for the necessary operating expenses and unable to make required deposits into Replacement Reserves. We are working on requesting HUD to waive the funding requirements temporarily. Context: N/A Recommendation: We recommend the Project make the required deposit to the reserve for replacement account or request HUD approval to waive deposits until cashflow improves. Auditor's Summary of the Auditee's Comments on the Findings and Recommendations: The project suffers with negative cash flow due to very small amount of monthly contract rents thus unable pay for the necessary operating expenses and unable to make required deposits into Replacement Reserves. We are working on requesting HUD to waive the funding requirements temporarily. Response Indicator: Agree Completion Date: 6/30/2022 Response: We are working on requesting HUD to waive the funding requirements temporarily.