FAC Explorer

Audit 47487

FY End
2022-12-31
Total Expended
$2.52M
Findings
4
Programs
1
Organization: Sunray Communities, Inc. (TX)
Year: 2022 Accepted: 2023-07-04
Auditor: M Group LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
48826 2022-001 - Yes P
48827 2022-002 - - N
625268 2022-001 - Yes P
625269 2022-002 - - N

Programs

ALN Program Spent Major Findings
14.157 Supportive Housing for the Elderly $167,631 Yes 0

Contacts

Name Title Type
RA99MZKJ74Z8 Connie Quillen Auditee
9726433200 Michael Martin Auditor
No contacts on file

Notes to SEFA

Title: Note 4: Capital Advance Balance Accounting Policies: Note 1: Basis of Presentation: This schedule of expenditures of federal awards includes the federal award activity of Sunray Communities, Inc. under programs of the federal government for the year ended December 31, 2022. 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 Audits for Federal Awards (Uniform Guidance).Because the Schedule presents only a selected portion of the operations of Sunray Communities, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Sunray Communities, Inc. Note 2: Summary of Significant Accounting Policies: Expenditures reporting 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. De Minimis Rate Used: N Rate Explanation: Note 3: Indirect Cost Rate: Sunray Communities, Inc. has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. Sunray Communities, Inc's capital advance balance outstanding as of December 31, 2022, was $2,352,900 and is included in the federal expenditures presented in the schedule.

Finding Details

Finding 2022-001
Finding #2022-001: Section 202 Capital Advance, CFDA 14.157 Condition: The Project?s liability for security deposits exceeded the security cash account by $803 at December 31, 2022. Criteria: The HUD regulatory agreement requires the Company maintain the security deposit in a trust account separate from other funds in an amount which at all times equals or exceeds the outstanding security deposit obligation. Effect: The Company is in violation of the terms of the HUD Regulatory Agreement governing security deposits. Questioned Cost: $803 Cause: Oversight Recommendation: We recommend the Project deposit all tenant security deposits directly into the trust account for security deposits in an amount sufficient to cover the security deposit liability. Auditor?s Comment: During March 2023, the Company deposited $803 into the security deposit trust account. Security deposit shortfall is corrected. Finding 2022-001 cleared.
Finding 2022-002
Finding #2022-002: Section 202 Capital Advance, CFDA 14.157 Condition: The Company made 10 monthly deposits into the replacement reserve account. Criteria: The HUD regulatory agreement requires the Company to make 12 monthly deposits into the replacement reserve account. Effect: The Company is not in compliance with the HUD regulatory agreement. Questioned Cost: $2,400 Cause: Oversight Recommendation: The Company should closely monitor the deposits into the replacement reserves. Auditor?s Comment: We recommend the Company closely monitor the deposits into the replacement reserve to ensure compliance with its Regulatory Agreement. During March 2023, the Company transferred $2,400 to the replacement reserve. Finding 2022-002 cleared.
Finding 2022-001
Finding #2022-001: Section 202 Capital Advance, CFDA 14.157 Condition: The Project?s liability for security deposits exceeded the security cash account by $803 at December 31, 2022. Criteria: The HUD regulatory agreement requires the Company maintain the security deposit in a trust account separate from other funds in an amount which at all times equals or exceeds the outstanding security deposit obligation. Effect: The Company is in violation of the terms of the HUD Regulatory Agreement governing security deposits. Questioned Cost: $803 Cause: Oversight Recommendation: We recommend the Project deposit all tenant security deposits directly into the trust account for security deposits in an amount sufficient to cover the security deposit liability. Auditor?s Comment: During March 2023, the Company deposited $803 into the security deposit trust account. Security deposit shortfall is corrected. Finding 2022-001 cleared.
Finding 2022-002
Finding #2022-002: Section 202 Capital Advance, CFDA 14.157 Condition: The Company made 10 monthly deposits into the replacement reserve account. Criteria: The HUD regulatory agreement requires the Company to make 12 monthly deposits into the replacement reserve account. Effect: The Company is not in compliance with the HUD regulatory agreement. Questioned Cost: $2,400 Cause: Oversight Recommendation: The Company should closely monitor the deposits into the replacement reserves. Auditor?s Comment: We recommend the Company closely monitor the deposits into the replacement reserve to ensure compliance with its Regulatory Agreement. During March 2023, the Company transferred $2,400 to the replacement reserve. Finding 2022-002 cleared.