FAC Explorer

Audit 48488

FY End
2022-06-30
Total Expended
$1.19M
Findings
2
Programs
1
Organization: Rivendell Homes, Inc. (MD)
Year: 2022 Accepted: 2022-10-16
Auditor: Handwerger Cardgena Funkhouser and Lurman P A

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
45350 2022-001 Material Weakness - N
621792 2022-001 Material Weakness - N

Programs

ALN Program Spent Major Findings
14.181 Supportive Housing for Persons with Disabilities $1.19M Yes 1

Contacts

Name Title Type
SF2SK39YJVJ7 Patti Appel Auditee
4106536190 Kimberly Mustard Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of Rivendell Homes, Inc., HUD Project No. 052-HD054, under a program of the federal government for the year ended June 30, 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, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Organization, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Organization. Expenditures 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Organization has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. SUPPORTIVE HOUSING FOR PERSONS WITH DISABILITIES (14.181) - Balances outstanding at the end of the audit period were 1132900. The Organization received a capital advance from the U.S. Department of Housing and Urban Development. The loan balance outstanding at the beginning of the year is included in the federal expenditures in the Schedule. TheOrganization received no additional loans and made no payments during the year.
Title: PASS THROUGH FUNDS Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of Rivendell Homes, Inc., HUD Project No. 052-HD054, under a program of the federal government for the year ended June 30, 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, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Organization, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Organization. Expenditures 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Organization has elected not to use the 10 percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Organization has no funds that pass through any other agency or organization.

Finding Details

Finding 2022-001
S3800-010 Finding Reference Number: 2022-001 S3800-011 Title and CFDA Number of Federal Program: Supportive Housing for Persons with Disabilities - 14.181 S3800-015 Type of Finding: Federal Award Finding S3800-016 Finding Resolution Status: In Process S3800-020 Criteria: Project funds must be used for the operation of the Project. S3800-030 Statement of Condition Project funds were used to pay a related party. The related party, in turn, paid the operating expenses of the Project. S3800-032 Cause: For ease of administration, common vendors were paid by the related party. S3800-033 Effect: The payments made to the related party could be disallowed. S3800-035 Auditor Non-Compliance Code: H - Unauthorized distribution of project assets S3800-040 Questioned Costs: $32,912 S3800-045 Reporting View of Responsible Officials: The Organization agrees with the finding. The auditor's recommendations, as well as the local HUD field office's recommendations, are in the process of being implemented. S3800-050 Context: Review of the detail in the account provided evidence that project funds were paid to the related party. Personnel were forthcoming with this practice and did not interpret it as non-compliance. S3800-080 Recommendation: In conjunction with the Organization's local HUD field office, it was determined that the related party should invoice the Organization for project expenses on a monthly basis. In turn, the Organization should pay the invoice amount on a monthly basis. S3800-090 Auditor's Summary of the Auditee's Comments on the Findings and Recommendations: The Organization continues to track the monthly activity in the due to Prologue, Inc. account. They are in agreement, that they need to resume payments to Prologue, Inc. in order to have an account balance that does not exceed one month's expenses. S3800-130 Response Indicator: Agree S3800-140 Completion Date: September 30, 2022 S3800-150 Response: The auditee is committed to correcting the finding.
Finding 2022-001
S3800-010 Finding Reference Number: 2022-001 S3800-011 Title and CFDA Number of Federal Program: Supportive Housing for Persons with Disabilities - 14.181 S3800-015 Type of Finding: Federal Award Finding S3800-016 Finding Resolution Status: In Process S3800-020 Criteria: Project funds must be used for the operation of the Project. S3800-030 Statement of Condition Project funds were used to pay a related party. The related party, in turn, paid the operating expenses of the Project. S3800-032 Cause: For ease of administration, common vendors were paid by the related party. S3800-033 Effect: The payments made to the related party could be disallowed. S3800-035 Auditor Non-Compliance Code: H - Unauthorized distribution of project assets S3800-040 Questioned Costs: $32,912 S3800-045 Reporting View of Responsible Officials: The Organization agrees with the finding. The auditor's recommendations, as well as the local HUD field office's recommendations, are in the process of being implemented. S3800-050 Context: Review of the detail in the account provided evidence that project funds were paid to the related party. Personnel were forthcoming with this practice and did not interpret it as non-compliance. S3800-080 Recommendation: In conjunction with the Organization's local HUD field office, it was determined that the related party should invoice the Organization for project expenses on a monthly basis. In turn, the Organization should pay the invoice amount on a monthly basis. S3800-090 Auditor's Summary of the Auditee's Comments on the Findings and Recommendations: The Organization continues to track the monthly activity in the due to Prologue, Inc. account. They are in agreement, that they need to resume payments to Prologue, Inc. in order to have an account balance that does not exceed one month's expenses. S3800-130 Response Indicator: Agree S3800-140 Completion Date: September 30, 2022 S3800-150 Response: The auditee is committed to correcting the finding.