FAC Explorer

Audit 46701

FY End
2022-05-31
Total Expended
$4.37M
Findings
2
Programs
2
Organization: Appleway Court 202 (WA)
Year: 2022 Accepted: 2022-10-17
Auditor: Dingus Zarecor & Associates PLLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
44444 2022-001 - - N
620886 2022-001 - - N

Programs

ALN Program Spent Major Findings
14.157 Supportive Housing for the Elderly $4.26M Yes 1
14.195 Section 8 Housing Assistance Payments Program $112,163 - 0

Contacts

Name Title Type
QJL4JBR6Q1X7 Jim Maxwell Auditee
5095636658 Shaun Johnson Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: Expenditures reported on the Schedule arereported on the accrual basis of accounting. Such expenditures are recognized following the costprinciples contained in the Uniform Guidance, wherein certain types of expenditures are notallowable or are limited as to reimbursement. The Organization has not elected to use the 10percent 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. Nonmonetary assistance in the form of a loan guarantee is included in theaccompanying schedule of expenditures of federal awards. The related loan balance was$4,255,410 at May 31, 2022.
Title: Basis of presentation Accounting Policies: Expenditures reported on the Schedule arereported on the accrual basis of accounting. Such expenditures are recognized following the costprinciples contained in the Uniform Guidance, wherein certain types of expenditures are notallowable or are limited as to reimbursement. The Organization has not elected to use the 10percent 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. The accompanying schedule of expenditures of federal awards (theSchedule) includes the federal award activity of Appleway Court 202 (the Organization), HUDProject No. 171-EE027, under programs of the federal government for the year ended May 31,2022. The information in this Schedule is presented in accordance with the requirements of Title 2U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, CostPrinciples, and Audit Requirements for Federal Awards (Uniform Guidance). Because theSchedule presents only a selected portion of the operations of the Organization, it is not intendedto, and does not, represent the financial position, changes in net assets, or cash flows of theOrganization.

Finding Details

Finding 2022-001
2022-001 Deposits in excess of FDIC insured limits Federal Agency United States Department of Housing and Urban Development CFDA 14.157 ? Supportive Housing for the Elderly (Section 202) Award Numbers 171-EE027 Criteria [X] Compliance Finding [ ] Significant Deficiency [ ] Material Weakness The loan program requires all bank deposits be deposited into accounts insured by the FDIC and the Organization must obtain insurance for any amounts in excess of the $250,000 FDIC limit or split deposits between banks to maintain coverage over all bank deposits. Condition Total bank deposits at May 31, 2022, maintained at one bank exceeded the FDIC insurance limit by approximately $45,000. Context This finding appears to be an isolated problem. Cause Cash amounts over the FDIC insured limits of $250,000 were not split between banks to maintain coverage and the organization did not obtain collateral coverage for amounts over the FDIC limit. Effect The Organization is out of compliance with the HUD loan program requirements and amounts over FDIC insured limits may be at risk. Recommendation We recommend the Organization split cash deposits between multiple banks or work with their current bank to ensure amounts in excess of the FDIC limits are fully insured and collateralized. Views of responsible officials and planned corrective actions Management agrees with this finding. Appleway Court 202 will review the current deposit situation and related FDIC coverage and split cash deposits between multiple banks or work with our current bank to ensure that amounts in excess of FDIC limits are fully insured and collateralized.
Finding 2022-001
2022-001 Deposits in excess of FDIC insured limits Federal Agency United States Department of Housing and Urban Development CFDA 14.157 ? Supportive Housing for the Elderly (Section 202) Award Numbers 171-EE027 Criteria [X] Compliance Finding [ ] Significant Deficiency [ ] Material Weakness The loan program requires all bank deposits be deposited into accounts insured by the FDIC and the Organization must obtain insurance for any amounts in excess of the $250,000 FDIC limit or split deposits between banks to maintain coverage over all bank deposits. Condition Total bank deposits at May 31, 2022, maintained at one bank exceeded the FDIC insurance limit by approximately $45,000. Context This finding appears to be an isolated problem. Cause Cash amounts over the FDIC insured limits of $250,000 were not split between banks to maintain coverage and the organization did not obtain collateral coverage for amounts over the FDIC limit. Effect The Organization is out of compliance with the HUD loan program requirements and amounts over FDIC insured limits may be at risk. Recommendation We recommend the Organization split cash deposits between multiple banks or work with their current bank to ensure amounts in excess of the FDIC limits are fully insured and collateralized. Views of responsible officials and planned corrective actions Management agrees with this finding. Appleway Court 202 will review the current deposit situation and related FDIC coverage and split cash deposits between multiple banks or work with our current bank to ensure that amounts in excess of FDIC limits are fully insured and collateralized.