FAC Explorer

Audit 714

FY End
2023-01-31
Total Expended
$913,381
Findings
2
Programs
2
Organization: Emerson Center, Inc. (KY)
Year: 2023 Accepted: 2023-10-17
Auditor: Hicks & Associates CPAS

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
340 2023-001 - - N
576782 2023-001 - - N

Programs

ALN Program Spent Major Findings
14.195 Section 8 Housing Assistance Payments $653,865 Yes 1
14.164 Section 201 Flexible Subsidy Assistance Program $259,516 - 0

Contacts

Name Title Type
NTZ1NXPQSR24 Jean Peyton Auditee
8592253334 David W Hicks Auditor
No contacts on file

Notes to SEFA

Title: Loan Outstanding Balance Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards includes the federal grant activity of Emerson Center, Inc., HUD Project No. 083-44801, and is presented on the accrual basis of accounting. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. De Minimis Rate Used: N Rate Explanation: The Project has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. Section 201 Flexible Subsidy Assistance Program loan balance as of January 31, 2023 was $184,475.

Finding Details

Finding 2023-001
2023-001 Residual Receipts Deposits CONDITION: Residual receipts deposit was not deposited into an interest-bearing bank account. CRITERIA: The Project is required to deposit residual receipts with the mortgagee, or other HUD-approved depository, in an interest-bearing bank account. EFFECT: The Project is not in compliance with award requirements. CONTEXT: Surplus cash at January 31, 2022 was appropriately deposited into a HUD-approved account. However, the Project failed to deposit the funds into an interest-bearing account. CAUSE: The Project was unaware that the funds needed to be deposited into an interest-bearing account. RECOMMENDATION: The Project should contact the bank and transfer the funds into a HUD-approved interest-bearing account. In addition, the account should not be subject to monthly service charges or fees. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: Management acknowledges the finding and has contacted the bank to make the appropriate changes. As of May 2, 2023, the bank has confirmed that fees will no longer be charged to the account and the process of transitioning to an interest-bearing account is in-process. 2023-001 Residual Receipts Deposits CONDITION: Residual receipts deposit was not deposited into an interest-bearing bank account. CRITERIA: The Project is required to deposit residual receipts with the mortgagee, or other HUD-approved depository, in an interest-bearing bank account. EFFECT: The Project is not in compliance with award requirements. CONTEXT: Surplus cash at January 31, 2022 was appropriately deposited into a HUD-approved account. However, the Project failed to deposit the funds into an interest-bearing account. CAUSE: The Project was unaware that the funds needed to be deposited into an interest-bearing account. RECOMMENDATION: The Project should contact the bank and transfer the funds into a HUD-approved interest-bearing account. In addition, the account should not be subject to monthly service charges or fees. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: Management acknowledges the finding and has contacted the bank to make the appropriate changes. As of May 2, 2023, the bank has confirmed that fees will no longer be charged to the account and the process of transitioning to an interest-bearing account is in-process.
Finding 2023-001
2023-001 Residual Receipts Deposits CONDITION: Residual receipts deposit was not deposited into an interest-bearing bank account. CRITERIA: The Project is required to deposit residual receipts with the mortgagee, or other HUD-approved depository, in an interest-bearing bank account. EFFECT: The Project is not in compliance with award requirements. CONTEXT: Surplus cash at January 31, 2022 was appropriately deposited into a HUD-approved account. However, the Project failed to deposit the funds into an interest-bearing account. CAUSE: The Project was unaware that the funds needed to be deposited into an interest-bearing account. RECOMMENDATION: The Project should contact the bank and transfer the funds into a HUD-approved interest-bearing account. In addition, the account should not be subject to monthly service charges or fees. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: Management acknowledges the finding and has contacted the bank to make the appropriate changes. As of May 2, 2023, the bank has confirmed that fees will no longer be charged to the account and the process of transitioning to an interest-bearing account is in-process. 2023-001 Residual Receipts Deposits CONDITION: Residual receipts deposit was not deposited into an interest-bearing bank account. CRITERIA: The Project is required to deposit residual receipts with the mortgagee, or other HUD-approved depository, in an interest-bearing bank account. EFFECT: The Project is not in compliance with award requirements. CONTEXT: Surplus cash at January 31, 2022 was appropriately deposited into a HUD-approved account. However, the Project failed to deposit the funds into an interest-bearing account. CAUSE: The Project was unaware that the funds needed to be deposited into an interest-bearing account. RECOMMENDATION: The Project should contact the bank and transfer the funds into a HUD-approved interest-bearing account. In addition, the account should not be subject to monthly service charges or fees. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS: Management acknowledges the finding and has contacted the bank to make the appropriate changes. As of May 2, 2023, the bank has confirmed that fees will no longer be charged to the account and the process of transitioning to an interest-bearing account is in-process.