FAC Explorer

Audit 57142

FY End
2022-02-28
Total Expended
$976,862
Findings
2
Programs
1
Organization: Wpc Housing Corp. Danford Hall Apartments (MO)
Year: 2022 Accepted: 2023-01-09
Auditor: Welch and Associates LLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
61418 2022-001 Material Weakness Yes N
637860 2022-001 Material Weakness Yes N

Programs

ALN Program Spent Major Findings
14.135 Mortgage Insurance_rental and Cooperative Housing for Moderate Income Families and Elderly, Market Interest Rate $976,862 Yes 1

Contacts

Name Title Type
SDJ5AHKLF2N6 Tamara Wallace Auditee
8162334250 Brian Welch Auditor
No contacts on file

Notes to SEFA

Title: Loan/loan guarantee outstanding balances Accounting Policies: Expenditures reported on the Schedule are reported on the GAAP 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. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. MORTGAGE INSURANCE_RENTAL AND COOPERATIVE HOUSING FOR MODERATE INCOME FAMILIES AND ELDERLY, MARKET INTEREST RATE (14.135) - Balances outstanding at the end of the audit period were 944966.
Title: BASIS OF PRESENTATION Accounting Policies: Expenditures reported on the Schedule are reported on the GAAP 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. 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 (the Schedule) includes the federal award activity of WPC Housing Corporation (the Organization) under programs of the federal government for the year ended February 28, 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 Requirement, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of 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.

Finding Details

Finding 2022-001
S3800-010: Finding Reference Number 2022-001 Program Information S3800-011: Major Federal Program AL # 14.135: Mortgage Insurance for Rental and Cooperative Housing Section 221(d)(4) Federal Agency: U.S. Department of Housing and Urban Development Federal Award Identification Number and Year: N/A Pass-through Entity: None COVID-19 Identification: N/A Type of Compliance Finding: N - Special Tests and Provisions S3800-015: Type of Finding Federal Awards and Financial Reporting Finding S3800-016: Finding Resolution Status In-process S3800-017: Information on Universe Population Size N/A S3800-018: Sample Size Information N/A S3800-019: Repeat Finding Number 2021-001 S3800-020: Criteria The regulatory agreement requires that the Organization?s books and records are maintained in accordance with GAAP. S3800-030: Statement of Condition During our audit of the Organization?s fiscal year ended February 28, 2022 federal award program, we noted that management was not reconciling the aged tenant accounts receivable subsidiary ledger to the general ledger. Also, escrow accounts including reserve for replacement were not reconciled to the lender statement. The liabilities were also not accurately recorded at year-end. Management was not able to provide supporting documentation for payroll records. S3800-032: Cause The Organization?s books are maintained in QuickBooks, whereas tenant rental transactions are recorded at a detailed level in a different software and the detail information is not reconciled to the general ledger. Management was not reconciling other general ledger balances to supporting documentation. Management?s monthly closing process is inadequate. S3800-033: Effect or Potential Effect The Organization is not in compliance with requirements to maintain books and records according to GAAP. S3800-035: Auditor Non-Compliance Code S ? Internal Control Deficiencies S3800-040: Questioned Costs None S3800-045: Reporting Views of Responsible Officials Management agreed with auditor?s finding. S3800-050: Context Management was not reconciling the financial statements to source documents, including reports from the software used to process tenant rental activities and payroll records. S3800-080: Recommendation As part of the month-end closing process, management should ensure that the accounts reconcile to source documents, including reports from the software used to process tenant rental activities and payroll records. S3800-090: Auditor?s Summary of the Auditee?s Comments on the Findings and Recommendations Concur S3800-130: Response Indicator Agree S3800-140: Completion Date September 30, 2022 S3800-150: Response See Corrective Action Plan
Finding 2022-001
S3800-010: Finding Reference Number 2022-001 Program Information S3800-011: Major Federal Program AL # 14.135: Mortgage Insurance for Rental and Cooperative Housing Section 221(d)(4) Federal Agency: U.S. Department of Housing and Urban Development Federal Award Identification Number and Year: N/A Pass-through Entity: None COVID-19 Identification: N/A Type of Compliance Finding: N - Special Tests and Provisions S3800-015: Type of Finding Federal Awards and Financial Reporting Finding S3800-016: Finding Resolution Status In-process S3800-017: Information on Universe Population Size N/A S3800-018: Sample Size Information N/A S3800-019: Repeat Finding Number 2021-001 S3800-020: Criteria The regulatory agreement requires that the Organization?s books and records are maintained in accordance with GAAP. S3800-030: Statement of Condition During our audit of the Organization?s fiscal year ended February 28, 2022 federal award program, we noted that management was not reconciling the aged tenant accounts receivable subsidiary ledger to the general ledger. Also, escrow accounts including reserve for replacement were not reconciled to the lender statement. The liabilities were also not accurately recorded at year-end. Management was not able to provide supporting documentation for payroll records. S3800-032: Cause The Organization?s books are maintained in QuickBooks, whereas tenant rental transactions are recorded at a detailed level in a different software and the detail information is not reconciled to the general ledger. Management was not reconciling other general ledger balances to supporting documentation. Management?s monthly closing process is inadequate. S3800-033: Effect or Potential Effect The Organization is not in compliance with requirements to maintain books and records according to GAAP. S3800-035: Auditor Non-Compliance Code S ? Internal Control Deficiencies S3800-040: Questioned Costs None S3800-045: Reporting Views of Responsible Officials Management agreed with auditor?s finding. S3800-050: Context Management was not reconciling the financial statements to source documents, including reports from the software used to process tenant rental activities and payroll records. S3800-080: Recommendation As part of the month-end closing process, management should ensure that the accounts reconcile to source documents, including reports from the software used to process tenant rental activities and payroll records. S3800-090: Auditor?s Summary of the Auditee?s Comments on the Findings and Recommendations Concur S3800-130: Response Indicator Agree S3800-140: Completion Date September 30, 2022 S3800-150: Response See Corrective Action Plan