Audit 49447

FY End
2022-09-30
Total Expended
$4.46M
Findings
8
Programs
1
Year: 2022 Accepted: 2023-02-27
Auditor: Cohnreznick LLP

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
46543 2022-001 Material Weakness - E
46544 2022-002 Significant Deficiency - N
46545 2022-001 Material Weakness - E
46546 2022-002 Significant Deficiency - N
622985 2022-001 Material Weakness - E
622986 2022-002 Significant Deficiency - N
622987 2022-001 Material Weakness - E
622988 2022-002 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
14.157 Supportive Housing for the Elderly $4.40M Yes 2

Contacts

Name Title Type
ZJNCXC145VH5 Major Philip Swyers Auditee
4047286700 Amy Blocker Auditor
No contacts on file

Notes to SEFA

Title: Note - Basis of Presentation Accounting Policies: Note B - Summary of significant accounting policiesExpenditures reported on the Schedule are reported on the accrual basis of accounting. Suchexpenditures are recognized following, as applicable, the cost principles contained in the UniformGuidance. Catherine Booth Garden Apartments has elected not to use the 10-percent de minimisindirect cost rate allowed under 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 includes the federal grant activity ofCatherine Booth Garden Apartments, HUD Project No. 113-EE005-NP-WAH, under programs ofthe federal government as of January 12, 2022 (day before sale). The information in this Scheduleis presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for FederalAwards ("Uniform Guidance"). Because the Schedule presents only a selected portion of theoperations of Catherine Booth Garden Apartments, it is not intended to and does not present thefinancial position, changes in net assets, or cash flows of Catherine Booth Garden Apartments.
Title: Note C - U.S. Department of Housing and Urban Development capital advance p Accounting Policies: Note B - Summary of significant accounting policiesExpenditures reported on the Schedule are reported on the accrual basis of accounting. Suchexpenditures are recognized following, as applicable, the cost principles contained in the UniformGuidance. Catherine Booth Garden Apartments has elected not to use the 10-percent de minimisindirect cost rate allowed under Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Development capital advance under Section 202 of the National Housing Act. The capital advancebalance outstanding at the beginning of the year is included in the federal expenditures presentedin the Schedule. Catherine Booth Garden Apartments received no additional loans or capitaladvances during the year. The balance of the capital advance outstanding at January 12, 2022 (daybefore sale) consists of:AL Number Program Name Balance atJanuary 12,2022 (day beforesale)14.157 Section 202 Capital Advance $4,401,547

Finding Details

Department of Housing and Urban Development Finding 2022-001 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition During the procedures applied to a sample of eight tenant lease files, we noted three instances where the project was unable to provide the 50059 for the current year recertification. Criteria Management is responsible for determining tenant eligibility and maintaining lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Effect Noncompliance with HUD guidelines could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Cause The project failed to follow the policies and procedures which have been established for proper tenant file maintenance and determining tenant eligibility in accordance with HUD guidelines, due to the property sale. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R. Section 8 program administration (REAC); E - Eligibility (UG) Finding Resolution Status: Unresolved Reporting Views of Responsible Officials Management agrees with the finding. The property was sold subsequent to audit period end and current management agent did not provide the requested documents.
Department of Housing and Urban Development Finding 2022-002 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition During the procedures applied to a sample of one tenant lease file, Management was unable to provide evidence of timely refund to tenant of security deposit. Criteria In accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs, within 30 days after the move-out date (or shorter time if required by state and/or local laws), management must either: refund the full security deposit plus accrued interest to a tenant that does not owe any amounts under the lease; or provide the tenant with an itemized list of any unpaid rent, damages to the unit, and an estimated cost for repair, along with a statement of the tenant's rights under state and local laws. Effect Management may have failed to comply with the HUD occupancy requirement to timely refund the tenant security deposits or to provide the tenant with a list of charges. Cause The project failed to follow the policies and procedures which have been established for proper tenant file maintenance documentation of timely refund of security deposits to tenants in accordance with HUD guidelines, due to the property sale. Recommendation Management should establish procedures and monitor compliance with those procedures to insure that tenant security deposits are refunded timely and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: M. Security deposits (REAC); N - Special Tests and Provisions (UG) Finding Resolution Status: Unresolved Reporting Views of Responsible Officials Management agrees with the finding. The property was sold subsequent to audit period end and current management agent did not provide the requested documents.
Department of Housing and Urban Development Finding 2022-001 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition During the procedures applied to a sample of eight tenant lease files, we noted three instances where the project was unable to provide the 50059 for the current year recertification. Criteria Management is responsible for determining tenant eligibility and maintaining lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Effect Noncompliance with HUD guidelines could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Cause The project failed to follow the policies and procedures which have been established for proper tenant file maintenance and determining tenant eligibility in accordance with HUD guidelines, due to the property sale. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R. Section 8 program administration (REAC); E - Eligibility (UG) Finding Resolution Status: Unresolved Reporting Views of Responsible Officials Management agrees with the finding. The property was sold subsequent to audit period end and current management agent did not provide the requested documents.
Department of Housing and Urban Development Finding 2022-002 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition During the procedures applied to a sample of one tenant lease file, Management was unable to provide evidence of timely refund to tenant of security deposit. Criteria In accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs, within 30 days after the move-out date (or shorter time if required by state and/or local laws), management must either: refund the full security deposit plus accrued interest to a tenant that does not owe any amounts under the lease; or provide the tenant with an itemized list of any unpaid rent, damages to the unit, and an estimated cost for repair, along with a statement of the tenant's rights under state and local laws. Effect Management may have failed to comply with the HUD occupancy requirement to timely refund the tenant security deposits or to provide the tenant with a list of charges. Cause The project failed to follow the policies and procedures which have been established for proper tenant file maintenance documentation of timely refund of security deposits to tenants in accordance with HUD guidelines, due to the property sale. Recommendation Management should establish procedures and monitor compliance with those procedures to insure that tenant security deposits are refunded timely and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: M. Security deposits (REAC); N - Special Tests and Provisions (UG) Finding Resolution Status: Unresolved Reporting Views of Responsible Officials Management agrees with the finding. The property was sold subsequent to audit period end and current management agent did not provide the requested documents.
Department of Housing and Urban Development Finding 2022-001 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition During the procedures applied to a sample of eight tenant lease files, we noted three instances where the project was unable to provide the 50059 for the current year recertification. Criteria Management is responsible for determining tenant eligibility and maintaining lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Effect Noncompliance with HUD guidelines could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Cause The project failed to follow the policies and procedures which have been established for proper tenant file maintenance and determining tenant eligibility in accordance with HUD guidelines, due to the property sale. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R. Section 8 program administration (REAC); E - Eligibility (UG) Finding Resolution Status: Unresolved Reporting Views of Responsible Officials Management agrees with the finding. The property was sold subsequent to audit period end and current management agent did not provide the requested documents.
Department of Housing and Urban Development Finding 2022-002 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition During the procedures applied to a sample of one tenant lease file, Management was unable to provide evidence of timely refund to tenant of security deposit. Criteria In accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs, within 30 days after the move-out date (or shorter time if required by state and/or local laws), management must either: refund the full security deposit plus accrued interest to a tenant that does not owe any amounts under the lease; or provide the tenant with an itemized list of any unpaid rent, damages to the unit, and an estimated cost for repair, along with a statement of the tenant's rights under state and local laws. Effect Management may have failed to comply with the HUD occupancy requirement to timely refund the tenant security deposits or to provide the tenant with a list of charges. Cause The project failed to follow the policies and procedures which have been established for proper tenant file maintenance documentation of timely refund of security deposits to tenants in accordance with HUD guidelines, due to the property sale. Recommendation Management should establish procedures and monitor compliance with those procedures to insure that tenant security deposits are refunded timely and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: M. Security deposits (REAC); N - Special Tests and Provisions (UG) Finding Resolution Status: Unresolved Reporting Views of Responsible Officials Management agrees with the finding. The property was sold subsequent to audit period end and current management agent did not provide the requested documents.
Department of Housing and Urban Development Finding 2022-001 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition During the procedures applied to a sample of eight tenant lease files, we noted three instances where the project was unable to provide the 50059 for the current year recertification. Criteria Management is responsible for determining tenant eligibility and maintaining lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Effect Noncompliance with HUD guidelines could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Cause The project failed to follow the policies and procedures which have been established for proper tenant file maintenance and determining tenant eligibility in accordance with HUD guidelines, due to the property sale. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R. Section 8 program administration (REAC); E - Eligibility (UG) Finding Resolution Status: Unresolved Reporting Views of Responsible Officials Management agrees with the finding. The property was sold subsequent to audit period end and current management agent did not provide the requested documents.
Department of Housing and Urban Development Finding 2022-002 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition During the procedures applied to a sample of one tenant lease file, Management was unable to provide evidence of timely refund to tenant of security deposit. Criteria In accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs, within 30 days after the move-out date (or shorter time if required by state and/or local laws), management must either: refund the full security deposit plus accrued interest to a tenant that does not owe any amounts under the lease; or provide the tenant with an itemized list of any unpaid rent, damages to the unit, and an estimated cost for repair, along with a statement of the tenant's rights under state and local laws. Effect Management may have failed to comply with the HUD occupancy requirement to timely refund the tenant security deposits or to provide the tenant with a list of charges. Cause The project failed to follow the policies and procedures which have been established for proper tenant file maintenance documentation of timely refund of security deposits to tenants in accordance with HUD guidelines, due to the property sale. Recommendation Management should establish procedures and monitor compliance with those procedures to insure that tenant security deposits are refunded timely and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: M. Security deposits (REAC); N - Special Tests and Provisions (UG) Finding Resolution Status: Unresolved Reporting Views of Responsible Officials Management agrees with the finding. The property was sold subsequent to audit period end and current management agent did not provide the requested documents.