FAC Explorer

Audit 49965

FY End
2022-12-31
Total Expended
$2.42M
Findings
4
Programs
1
Organization: Venture Care Housing Development Fund Co, INC (NY)
Year: 2022 Accepted: 2023-07-11
Auditor: Forvis LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
46698 2022-002 Significant Deficiency Yes N
46699 2022-003 Significant Deficiency - AB
623140 2022-002 Significant Deficiency Yes N
623141 2022-003 Significant Deficiency - AB

Programs

ALN Program Spent Major Findings
14.181 Supportive Housing for Persons with Disabilities $2.42M Yes 2

Contacts

Name Title Type
YNDBM47JW6D1 Celia Solomita Auditee
8455074070 Allan Blum Auditor
No contacts on file

Notes to SEFA

Title: Federal Loan Programs Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Venture Care Housing Development Fund Co., Inc. (VCHDFC) 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 Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of VCHDFC, it is not intended to and does not present the financial position, changes in net assets, or cash flows of VCHDFC. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The federal loan program listed below is administered directly by VCHDFC and the balances and transactions relating to this program are included in VCHDFCs basic financial statements. Loans outstanding at the beginning of the year and loans made during the year are included in the federal expenditures presented in the Schedule. The balance of the loan outstanding at December 31, 2022 consists of: Assistance Listing Number 14.181 Program Name Supportive Housing for Persons with Disabilities (Section 811) Capital Advance at December 31, 2021 $2,275,800
Title: Summary of Significant Accounting Policies Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Venture Care Housing Development Fund Co., Inc. (VCHDFC) 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 Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of VCHDFC, it is not intended to and does not present the financial position, changes in net assets, or cash flows of VCHDFC. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. 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. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years.

Finding Details

Finding 2022-002
Information on the federal program ? 14.181 Supporting Housing for Persons with Disabilities (Section 811), U.S. Department of Housing and Urban Development (HUD). Criteria or specific requirement ? Special Tests and Provisions ? Replacement Reserves ? HUD requires monthly deposits into replacement reserve account per 24 CFR ? 891.405(b). Condition ? VCHDFC did not make the required monthly deposits on a monthly basis. Questioned costs ? None. Context ? Replacement reserve account was analyzed at year-end. Effect ? Replacement reserve account was not properly funded on a monthly basis. Cause ? VCHDFC did not have proper oversight regarding making appropriate monthly payments into replacement reserve account. Identification as a repeat finding, if applicable: A repeat finding see 2021-001. Recommendation ? We recommend that VCHDFC establish proper internal controls in order to properly fund the replacement reserve account on a monthly basis. Views of responsible officials and planned corrective actions ? Please see the attached corrective action plan as submitted by management. VCHDFC agrees with the finding.
Finding 2022-003
Information on the federal program ? 14.181 Supporting Housing for Persons with Disabilities (Section 811), U.S. Department of Housing and Urban Development (HUD). Criteria or specific requirement - Activities allowable or unallowed and Allowable Costs / Cost Principles. In accordance with 2 CFR 200.303, the entity must establish and maintain effective internal control over financial awards to evaluate and monitor compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Questioned costs ? None. Context - A sample of 40 invoices were selected from the 305 expenses incurred during the year to test if there was review of the purchase requisition or invoice in accordance with VCHDFC's policy. 28 of the invoices had no approval documented on the purchase requisition or invoice to indicate review that the expenses were appropriate under the federal program. In addition, management was unable to provide the invoice or purchase requisition for 8 of items selected for testing. The sample was not a statistically valid sample. Effect ? Formal approval was not noted on a sample of invoices paid and backup documentation was not maintained for all items paid. Cause ? VCHDFC did not have a process in place to review utilities invoices and invoices from vendors with contracted agreements and did not have controls in place to ensure other invoices were formally signed off prior to payment. The approval is a final review of all documentation prior to signing the actual check for payment. There was a changeover of management agents and invoices could not be located. Identification as a repeat finding, if applicable: Not applicable. Recommendation ? We recommend that VCHDFC establish proper internal controls in order to properly indicate approval on invoices prior to payment and maintain documentation for the items paid. Views of responsible officials and planned corrective actions ? Please see the attached corrective action plan as submitted by management. VCHDFC agrees with the finding.
Finding 2022-002
Information on the federal program ? 14.181 Supporting Housing for Persons with Disabilities (Section 811), U.S. Department of Housing and Urban Development (HUD). Criteria or specific requirement ? Special Tests and Provisions ? Replacement Reserves ? HUD requires monthly deposits into replacement reserve account per 24 CFR ? 891.405(b). Condition ? VCHDFC did not make the required monthly deposits on a monthly basis. Questioned costs ? None. Context ? Replacement reserve account was analyzed at year-end. Effect ? Replacement reserve account was not properly funded on a monthly basis. Cause ? VCHDFC did not have proper oversight regarding making appropriate monthly payments into replacement reserve account. Identification as a repeat finding, if applicable: A repeat finding see 2021-001. Recommendation ? We recommend that VCHDFC establish proper internal controls in order to properly fund the replacement reserve account on a monthly basis. Views of responsible officials and planned corrective actions ? Please see the attached corrective action plan as submitted by management. VCHDFC agrees with the finding.
Finding 2022-003
Information on the federal program ? 14.181 Supporting Housing for Persons with Disabilities (Section 811), U.S. Department of Housing and Urban Development (HUD). Criteria or specific requirement - Activities allowable or unallowed and Allowable Costs / Cost Principles. In accordance with 2 CFR 200.303, the entity must establish and maintain effective internal control over financial awards to evaluate and monitor compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Questioned costs ? None. Context - A sample of 40 invoices were selected from the 305 expenses incurred during the year to test if there was review of the purchase requisition or invoice in accordance with VCHDFC's policy. 28 of the invoices had no approval documented on the purchase requisition or invoice to indicate review that the expenses were appropriate under the federal program. In addition, management was unable to provide the invoice or purchase requisition for 8 of items selected for testing. The sample was not a statistically valid sample. Effect ? Formal approval was not noted on a sample of invoices paid and backup documentation was not maintained for all items paid. Cause ? VCHDFC did not have a process in place to review utilities invoices and invoices from vendors with contracted agreements and did not have controls in place to ensure other invoices were formally signed off prior to payment. The approval is a final review of all documentation prior to signing the actual check for payment. There was a changeover of management agents and invoices could not be located. Identification as a repeat finding, if applicable: Not applicable. Recommendation ? We recommend that VCHDFC establish proper internal controls in order to properly indicate approval on invoices prior to payment and maintain documentation for the items paid. Views of responsible officials and planned corrective actions ? Please see the attached corrective action plan as submitted by management. VCHDFC agrees with the finding.