Corrective Action Plans

Finding 1176384 (2025-001)

Material Weakness 2025

St. Sharbel's Maronite Housing Corporation Project No. 072-11136ref

IL

Internal Control / Segregation of Duties HUD Housing Programs

Jeff Cottingham, Management agent and Father Elia, sponsor of project, will be responsible for monitoring monthly financial results and accounting information as correction is not practical.

View Audit 390201

Finding 1176382 (2025-001)

Material Weakness 2025

Hanna City Home Association D/b/a Heritage Senior Homes

IL

Internal Control / Segregation of Duties HUD Housing Programs

Jeff Cottingham, Management agent and Wes Clanton, board president of project will be responsible for monitoring monthly financial results and accounting information as correction is not practical.

View Audit 390200

Finding 1176329 (2025-003)

Material Weakness 2025

Hall County Housing Authority

NE

Subrecipient Monitoring HUD Housing Programs Material Weakness § 200.302

Finding 2025-003 See response to finding 2025-001.

View Audit 390146

Finding 1175956 (2025-004)

Material Weakness 2025

Naf Senior Housing, Inc.

NE

Internal Control / Segregation of Duties Special Tests & Provisions Subrecipient Monitoring

Finding 2025-004: Reporting – Owner – Certified Submission Management Response Management agrees with the finding. REAC submission was late because year – end accounting records were not done in time. Corrective Action Plan 1. Establish a Closing Calendar and Compliance Calendar • Year-end data dead...

Finding 2025-004: Reporting – Owner – Certified Submission Management Response Management agrees with the finding. REAC submission was late because year – end accounting records were not done in time. Corrective Action Plan 1. Establish a Closing Calendar and Compliance Calendar • Year-end data deadlines • Dates for draft and final financials • REAC submission due date 2. Coordination with Fee Accountant • Schedule year-end preparation work earlier • Fee Accountant set a deadline for LHA to provide supporting documents IMPLEMENTATION TIMELINE: PRIOR TO NEXT FISCAL YEAR-END.

View Audit 389924

Finding 1175955 (2025-003)

Material Weakness 2025

Naf Senior Housing, Inc.

NE

Special Tests & Provisions HUD Housing Programs Material Weakness

Finding 2025-003 Replacement Reserves Management Response Management agrees with the finding. Excess deposits, incorrect posting of a reserve transfer and an unapproved withdrawal occurred due to inadequate oversight and incomplete reconciliation procedures. Corrective Action Plan 1. Deposit and Wit...

Finding 2025-003 Replacement Reserves Management Response Management agrees with the finding. Excess deposits, incorrect posting of a reserve transfer and an unapproved withdrawal occurred due to inadequate oversight and incomplete reconciliation procedures. Corrective Action Plan 1. Deposit and Withdrawal Controls • LHA has made an invoice for each month deposit • All withdrawals will be required written HUD approval and retention of documentation in a secured file 2. Monthly Reserve Account Verification • Review all deposit and withdrawal activity • Confirm no transfers were made to other program reserve accounts • Immediately request return of incorrectly transferred funds 3. HUD Follow-up • Contact HUD to determine required corrective steps for the unapproved withdrawal. IMPLEMENTATION TIMELINE: WITHIN 60 DAYS

View Audit 389924

Finding 1175937 (2025-001)

Material Weakness 2025

Lexington-Fayette Urban County Housing Authority

KY

HUD Housing Programs Internal Control / Segregation of Duties

Finding 2025-001 – Moving To Work Demonstration Tenant Files – Eligibility – Internal Control over Tenant Files – Noncompliance and Significant Deficiency Condition & Cause: The review of one hundred seventy-one (171) Moving To Work tenant files found that twenty-three (23) files were noncompliant, ...

Finding 2025-001 – Moving To Work Demonstration Tenant Files – Eligibility – Internal Control over Tenant Files – Noncompliance and Significant Deficiency Condition & Cause: The review of one hundred seventy-one (171) Moving To Work tenant files found that twenty-three (23) files were noncompliant, representing 13.5% of our sample. Some files had multiple compliance issues. Findings: Income Miscalculations (8)/Missing Income and Deduction Verifications (2)/Missing EIV Reports (11) Corrective Action Plan: The first step in our corrective action plan is to increase staff training. In the past year we have had significant staff turnover at the Management Specialist position. The position responsible for the annual recertification process and rent calculations. We will establish a training curriculum that will provide initial and ongoing training for this position. The goal being to develop and continue to build the knowledge base of the specialist. Ensuring they are able to perform the functions of their job in a manner that is compliant and consistent with HUD and LHA regulations and policies. The second step in our corrective action plan is to improve our compliance monitoring process. This process consists of layers of compliance monitoring that will provide a 100% audit of all files within the calendar year. The structure for compliance monitoring will be as follows: • Peer Review- Another specialist in the office must review and sign off on the completed certification before it is processed electronically. • Management review-The Housing Manager will audit ten files per week in the office including all new move-in files. • Compliance review-The Compliance Coordinator will audit 40 files per week (ten files from each team) and also review all new move-in files at the end of each month. The compliance monitoring will include a review sheet that lists any issues found in the file and a deadline for the team to make the necessary corrections and resubmit the file to compliance. These measures will ensure that all tenant files are reviewed multiple times on an annual basis for compliance, while providing staff training and awareness by identifying issues and correcting them. In addition to training, the Director of Housing Operations will also develop a checklist that will be included with every recertification to ensure that all forms and verifications including the EIV are in each file. Each specialist will sign the checklist certifying their work. Persons Responsible: Director of Housing Operations - Dana Mason; Compliance Coordinator - Dana Tincher; Housing Managers - Renee Christian, Cathy Hall & Sumaya Rayan; Management Specialists - Virginia Auxier, Marlene Stevenson, Brittany Williamson, Giana Hall, Jennfer Loudermilk, Linda Gates, Tiffany Clark & Sherily Blackburn Anticipated Completion Date: June 30, 2026 Finding: Late Annual Reexaminations (3) Corrective Action Plan: LHA staff have implemented several measures to correct this finding. We have hired additional staff and redistributed units to evenly spread the caseload. In addition to these measures, we also implemented reporting that is more accurate and consistent to ensure recertifications are completed timely. LHA’s Strategic Initiatives and Resident Programs (SIRP) Manager will provide monthly reports on recertification status for each team. This report will show upcoming recertifications due within 120 days and any that are past due for each team. Each manager will ensure that any past due recert is completed immediately. Person Responsible: Director of Housing Operations - Dana Mason; Strategic Initiatives and Resident Programs Manager - Samantha Passalacqua; Housing Managers - Renee Christian, Cathy Hall & Sumaya Rayan Anticipated Completion Date: June 30, 2026 Finding: Files Missing support for unit inspections (4) Corrective Action Plan: LHA created a new position earlier this year to address this audit finding. In May the new Public Housing Inspector was hired to conduct annual unit inspections for all LHA owned units. The inspector will complete an NSPIRE inspection in all units independent from the management office. This will ensure that all of the units have annual inspection going forward. The inspection will be maintained electronically for easy access and storage. Person Responsible: Director of Housing Operations - Dana Mason; Compliance Coordinator - Dana Tincher; Public Housing Inspector - Alan Pike Anticipated Completion Date: June 30, 2026

View Audit 389905

Finding 1175838 (2025-001)

Material Weakness 2025

Queens B'nai B'rith Housing Development Fund Company INC

NY

HUD Housing Programs Cash Management

Recommendation: The Housing Company should create and fund the Residual Receipts account. Comments on the Finding and Each Recommendation: Management concurs with the finding and auditor's recommendation to fund the reserve account. Action Taken: The Housing Company funded the reserve account on Sep...

Recommendation: The Housing Company should create and fund the Residual Receipts account. Comments on the Finding and Each Recommendation: Management concurs with the finding and auditor's recommendation to fund the reserve account. Action Taken: The Housing Company funded the reserve account on September 30, 2025.

View Audit 389804

Finding 1175820 (2025-001)

Material Weakness 2025

First Choice Health Centers, Inc.

NY

Special Tests & Provisions Subrecipient Monitoring Eligibility

The Center should establish a system of internal controls to ensure that all sliding fee discounts are properly calculated and supported based on family size and income. Repeat Finding No Action Taken Management has implemented enhanced internal controls to ensure sliding fee discounts are accuratel...

The Center should establish a system of internal controls to ensure that all sliding fee discounts are properly calculated and supported based on family size and income. Repeat Finding No Action Taken Management has implemented enhanced internal controls to ensure sliding fee discounts are accurately calculated and fully supported. The Center standardized income verification procedures, reinforced documentation requirements for family size and income, and updated its sliding fee eligibility checklist to ensure consistency. Supervisory review protocols were established to verify proper calculation and supporting documentation prior to approval. Additionally, staff received refresher training on sliding fee policy requirements to promote ongoing compliance. Management will conduct periodic internal audits to monitor adherence and ensure continued effectiveness of these controls. If the Cognizant or Oversight Agency for Audit has questions regarding this plan, please call: Sean Murphy, CFO at 860-610-6387.

View Audit 389772

Finding 1175766 (2025-002)

Material Weakness 2025

Our Lady of Guadalupe

CA

HUD Housing Programs Matching / Level of Effort / Earmarking

Management’s Response – Based on legal counsel’s advice, and that the lender has an approved Concept Meeting Proposal with HUD, we believe HUD has approved our efforts to pursue predevelopment activities to add 29 units on the existing parcel using available cash from operations, while seeking forma...

Management’s Response – Based on legal counsel’s advice, and that the lender has an approved Concept Meeting Proposal with HUD, we believe HUD has approved our efforts to pursue predevelopment activities to add 29 units on the existing parcel using available cash from operations, while seeking formal approval and ultimately loan proceeds from a HUD-insured supplemental loan under Section 241(a) of the National Housing Act. Once the new loan is approved, we intend to use a portion of the proceeds from the HUD-insured supplemental loan to repay the Project’s Operating Account for funds used to cover predevelopment costs.

View Audit 389682

Finding 1175584 (2025-001)

Material Weakness 2025

McDaniel College and Subsidiary

MD

Subrecipient Monitoring Cash Management Reporting

Finding 2025-001 Condition Significant Deficiency – Disbursement/Refund of Credit Balances - Title IV regulations (34 CFR 668.164(h)(1) require that Title IV credit balances on student accounts be paid directly to the student as soon as possible but no later than 14 days after the credit balance occ...

Finding 2025-001 Condition Significant Deficiency – Disbursement/Refund of Credit Balances - Title IV regulations (34 CFR 668.164(h)(1) require that Title IV credit balances on student accounts be paid directly to the student as soon as possible but no later than 14 days after the credit balance occurred. A student or parent may authorize the Institution to hold the credit balance to be applied to specified other nontuition fees, room and board charges as noted in the regulations at (34 CFR 668.165(b)). The credit balance generated in the accounts of 2 out of 25 students tested was not timely refunded to them based on the outlined criteria, leading to late refunds to those students (neither of which completed a voluntary hold authorization). The sample was not a statistically valid sample. The College's payment process cycle is not set up to process refunds as soon as possible, which caused delays in refunds being made to students, resulting in a violation of the 14-day maximum policy. Corrective Action Plan Corrective Action Planned: The College acknowledges the untimely disbursement of Title IV credit balance refunds. We concur that, for 2 of the 25 student accounts reviewed, Title IV credit balances were not refunded within the 14-day period required under 34 CFR 668.164(h)(1). We further acknowledge that no valid student or parent authorization to hold these credit balances was on file, and therefore the refunds should have been issued promptly. The College completed an internal review and determined that the delays resulted from the structure of the existing payment processing cycle. Although the College’s processes emphasize careful reconciliation and verification of student account activity, the timing of our refund cycle was not aligned with the regulatory requirement. To remediate this deficiency and ensure full compliance going forward, the College is implementing the following corrective action: Revision of Federal Funds Disbursement Policies: The College is revising its policy governing the drawdown and disbursement of federal funds to align the timing of Title IV activity with the academic add/drop period. This change will ensure greater predictability of credit balance creation and enhance monitoring capabilities. The College is committed to strengthening its internal controls to ensure sustained compliance with all Title IV cash management regulations. Name(s) of Contact Person(s) Responsible for Corrective Action: Pat Tyler, Bursar and Destiny Guerrero, Director of Financial Aid. Anticipated Completion Date: May 2026 – next semester starting date

View Audit 389412

Finding 1175481 (2025-001)

Material Weakness 2025

Center Township Elderly Housing, Inc.

PA

HUD Housing Programs

Management will update internal procedures to ensure that RFR deposits are recorded only when cash is transferred and will review the RFR account regularly to ensure compliance with HUD requirements.

View Audit 389276

Finding 1175445 (2025-002)

Material Weakness 2025

Round Rock Housing Authority

TX

HUD Housing Programs

During the time of the SEMAP submission the housing authority had an unexpected change of staff. This contributed to the agency overlooking the signing of the required board resolution to approve the SEMAP. To keep this from occurring again, RRHA will not submit the SEMAP certification to HUD until ...

During the time of the SEMAP submission the housing authority had an unexpected change of staff. This contributed to the agency overlooking the signing of the required board resolution to approve the SEMAP. To keep this from occurring again, RRHA will not submit the SEMAP certification to HUD until the resolution has been signed.

View Audit 389242

Finding 1175444 (2025-001)

Material Weakness 2025

Round Rock Housing Authority

TX

HUD Housing Programs Internal Control / Segregation of Duties Subrecipient Monitoring

At the time of the most recent independent audit by Smith Marion conducted in December 2025, it was found that RRHA was not completing voucher re-inspections within the required timeframe when an inspection failed. Health and safety inspections are required to be reinspected within 48 hours, and oth...

At the time of the most recent independent audit by Smith Marion conducted in December 2025, it was found that RRHA was not completing voucher re-inspections within the required timeframe when an inspection failed. Health and safety inspections are required to be reinspected within 48 hours, and other inspections must be completed within 30 days. In the past RRHA only had one inspector on staff who tracked all inspections. Due to an increase in portability vouchers a second caseworker was hired in 2025. However, a new system was not created to track both caseworker’s inspections. This resulted in RRHA overlooking timelines and not completing inspections in a timely manner as required. Part of this was also related to miscommunication between the two case workers. To ensure inspections are completed as required by HUD regulation, in the future, each caseworker/inspector is now required to schedule a follow-up inspection appointment at the same time as the failed inspection report is created. Additionally, a separate shared spreadsheet has been created to track failed inspection and verify that each one is being completed within the required time. With these new steps in place we can indicate if a failed inspection needs a 24-hour and/or a 30- day re-inspection and if a follow-up inspection has been already scheduled. RRHA also increased the scheduled time/ days from once a week to two days a week for inspection since we now have two HCV employees/ inspectors available. Effective immediately the process for inspection has been updated and both HCV employees are completing inspections.

View Audit 389242

Finding 1175441 (2025-001)

Material Weakness 2025

City of Sand Springs

OK

Procurement, Suspension & Debarment HUD Housing Programs Internal Control / Segregation of Duties

Finding 2025-001 Corrective Action Plan Condition: Various departments received invoices for goods purchased or services performed prior to receiving appropriate approvals per the City's purchasing policies. In conjunction with our fiscal year 2025 annual audit, please see the City's corrective acti...

Finding 2025-001 Corrective Action Plan Condition: Various departments received invoices for goods purchased or services performed prior to receiving appropriate approvals per the City's purchasing policies. In conjunction with our fiscal year 2025 annual audit, please see the City's corrective action plan below: Staff authorized to submit and approve requisitions will be subject to further training on the City's purchasing process and procedures. Together with additional training, and new software tools, this process is expected to be improved. Expected completion date: 6/30/2026 Party Responsible: Arlena Barnes, Finance Director Contact Information: 918-246-2646 | arlena.barnes@sandspringsok.gov

View Audit 389227

Finding 1175247 (2025-004)

Material Weakness 2025

Bay Cove Human Services, Inc. & Affiliate

MA

Internal Control / Segregation of Duties Special Tests & Provisions Subrecipient Monitoring

Management acknowledges that certain internal controls did not operate effectively during the year ended June 30, 2025. Management is in the process of implementing additional controls to ensure a stable control environment that supports compliance with cash management and special tests and provisio...

Management acknowledges that certain internal controls did not operate effectively during the year ended June 30, 2025. Management is in the process of implementing additional controls to ensure a stable control environment that supports compliance with cash management and special tests and provisions requirements.

View Audit 388951

Finding 1175224 (2025-002)

Material Weakness 2025

Ide Center Apartments Ii, Inc. 042-Hd045

OH

Internal Control / Segregation of Duties HUD Housing Programs Material Weakness

Supportive Housing for Persons with Disabilities – Assistance Listing No. 14.181 Unadjusted Rental Rates Recommendation: Adjust rental rates immediately, and request adjustment on next HAP Voucher to begin repayment. Ensure proper training of employees, prepare the budget worksheet as soon as possib...

Supportive Housing for Persons with Disabilities – Assistance Listing No. 14.181 Unadjusted Rental Rates Recommendation: Adjust rental rates immediately, and request adjustment on next HAP Voucher to begin repayment. Ensure proper training of employees, prepare the budget worksheet as soon as possible and promptly read all correspondence for HUD and forward to management company. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Amounts will be adjusted over the next few HAP voucher to repay HUD and adjust rental rates on the next voucher. Name(s) of the contact person(s) responsible for corrective action: Stacy Lawson, CFO Planned completion date for corrective action plan: June 30, 2026

View Audit 388921

Finding 1175222 (2025-001)

Material Weakness 2025

Casa Santa Maria

CA

HUD Housing Programs

Management’s Response – Management acknowledges the error and agrees to the amount owed for the overpayment of property management fees and have updated their procedures to ensure future compliance. The Project was reimbursed for the overpayment as of the independent auditor’s report date.

View Audit 388916

Finding 1175181 (2025-001)

Material Weakness 2025

Housing Authority of the County of Howard, Arkansas

AR

HUD Housing Programs

Housing Authority of the County of Howard respectfully submits the following corrective action plan for the year ended June 30, 2025. Responsible Official: Mr. Ross Allen, Executive Director Name and address of independent public accounting firm: Miller & Rose, PA 1309 East Race Searcy, AR 72143 Aud...

Housing Authority of the County of Howard respectfully submits the following corrective action plan for the year ended June 30, 2025. Responsible Official: Mr. Ross Allen, Executive Director Name and address of independent public accounting firm: Miller & Rose, PA 1309 East Race Searcy, AR 72143 Audit period: Year ended June 30, 2025 Oversight Agency: U.S. Department of Housing and Urban Development The finding from June 30, 2025, audit is discussed below. The finding is numbered to correspond to the auditing findings disclosed in Sections B and C of the Schedule of Findings and Questioned Costs. C. FINDINGS AND QUESTIONED COSTS-MAJOR FEDERAL AWARD PROGRAMS AUDIT 2025-01 Family file Deficiencies 14.850 Public and Indian Housing Program Criteria and Criteria: The Authority’s purpose for existence is to provide decent, safe, and affordable housing to low-income persons. As such, the Authority prepares a file for each admitted family, which contains information necessary to determine eligibility for assistance and calculations of rent to be charged to eligible families. HUD regulations prescribe the content of these family files. These requirements consist of the following: Criteria: Our review of 23 family files revealed the following: a. As a condition of admission or continued occupancy, the tenant and other family members provide necessary information, documentation, and releases for the PHA to verify income eligibility. b. For both family income examinations and reexaminations, obtain and document in the family file third party verification of (1) reported family annual income; (2) the value of assets; (3) expenses related to deductions from annual income; and (4) other factors that affect the determination of adjusted income or income-based rent. c. Determine income eligibility and calculate the tenant’s rent payment in accordance with HUD regulations. d. Select tenants from the public housing waiting list in accordance with the PHA’s tenant selection policies. Context: Our review of 23 family files revealed the following: a. One file with a delinquent annual reexamination. b. One file lacked verification of childcare deduction. c. Two files contained rent calculation errors. Effect: Delays in performing annual reexaminations may result in under charging the tenant rent and thus understating dwelling rental income. Deduction for medical expenses and childcare could be overstated without proper verification and could result in an incorrect rental charge to the tenant. Rental calculation errors may result in an incorrect rent charge to the tenant, Recommendation: The Authority should ensure all tenant reexaminations are performed timely. Verification of medical and childcare deductions should be documented with appropriate documentation. The Authority should ensure the proper verified income is used in calculation of rent charges to the tenant. Response: We have modified policies and procedures to ensure all re-examinations are performed timely, appropriate deductions are documented and rental charges are calculated correctly. Views of Responsible Officials and Planned Corrective Actions: We will review tenant’s files for the deficiencies identified above and implement new internal control procedures to correct these conditions. We anticipate a complete resolution of this type of error by February 29, 2026.

View Audit 388792

Finding 1175155 (2025-001)

Material Weakness 2025

Vna Apartments, Inc.

WI

HUD Housing Programs Internal Control / Segregation of Duties

Financial Reporting – The Organization has evaluated the cost/benefit of outsourcing the task of preparing the financial statements to an external accountant. However, management of the Organization has obtained the necessary skills, knowledge, and experience to accept responsibility for the Organiz...

Financial Reporting – The Organization has evaluated the cost/benefit of outsourcing the task of preparing the financial statements to an external accountant. However, management of the Organization has obtained the necessary skills, knowledge, and experience to accept responsibility for the Organization’s financial statements prepared by the external accountant. Responsible Official – Vicki McAuliffe, CFO Anticipated Completion Date – This finding will not completely resolve itself given the cost/benefit basis the Organization continues to make.

View Audit 388771

Finding 1175154 (2025-001)

Material Weakness 2025

Breakthrough Phase Iii, Inc.

TN

HUD Housing Programs

Breakthrough Phase III, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2025. Purkey, Carter, Compton, Swann, & Carter, PLLC P.O. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2024 – June 30, 2025 The findings from the schedule of findings and q...

Breakthrough Phase III, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2025. Purkey, Carter, Compton, Swann, & Carter, PLLC P.O. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2024 – June 30, 2025 The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section A of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDINGS – FINANCIAL STATEMENT AUDIT None FINDINGS – FEDERAL AWARD PROGRAMS AUDITS FINDING NO. 2025-001: Ineffective operation of internal controls by management Management did not conduct recertifications of the Project’s tenants during the fiscal year under audit. Criteria: According to HUD Handbook 4350.3, owners must conduct a recertification of family income and composition at least annually by the tenant’s recertification anniversary date. Owners then must recompute the tenants’ rents and assistance payments, if applicable, based on the information gathered. If a new recertification is not submitted within 15 months of the previous year’s recertification anniversary date, HUD will terminate assistance payments. Cause of Condition: Management did not have systems in place to ensure tenant files and recertification documentation were completed in accordance with HUD requirements. Recommendation: Auditor recommends management review HUD Handbook 4350.3 and put proper internal controls in place to ensure tenant files are in compliance with HUD and kept in accordance with HUD requirements. Action Taken: The Board is working closely with Breakthrough Corporation to ensure the Project is complying with HUD requirements and will ensure personnel complete HUD-related training. The Board is also considering contracting with a management agent to manage the Project. If the U.S. Department of Housing and Urban Development has questions regarding this plan, please contact Antonio Luna at 865-247-0065. Sincerely yours, Antonio Luna Financial Controller Breakthrough Corporation

View Audit 388759

Finding 1175153 (2025-001)

Material Weakness 2025

Breakthrough Phase Ii, Inc.

TN

HUD Housing Programs

CORRECTIVE ACTION PLAN Breakthrough Phase II, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2025. Purkey, Carter, Compton, Swann, & Carter, PLLC P.O. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2024 – June 30, 2025 The findings from the sche...

CORRECTIVE ACTION PLAN Breakthrough Phase II, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2025. Purkey, Carter, Compton, Swann, & Carter, PLLC P.O. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2024 – June 30, 2025 The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section A of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDINGS – FINANCIAL STATEMENT AUDIT None FINDINGS – FEDERAL AWARD PROGRAMS AUDITS FINDING NO. 2025-001: Ineffective operation of internal controls by management Management did not conduct recertifications of the Project’s tenants during the fiscal year under audit. Criteria: According to HUD Handbook 4350.3, owners must conduct a recertification of family income and composition at least annually by the tenant’s recertification anniversary date. Owners then must recompute the tenants’ rents and assistance payments, if applicable, based on the information gathered. If a new recertification is not submitted within 15 months of the previous year’s recertification anniversary date, HUD will terminate assistance payments. Cause of Condition: Management did not have systems in place to ensure tenant files and recertification documentation were completed in accordance with HUD requirements. Recommendation: Auditor recommends management review HUD Handbook 4350.3 and put proper internal controls in place to ensure tenant files are in compliance with HUD and kept in accordance with HUD requirements. Action Taken: The Board is working closely with Breakthrough Corporation to ensure the Project is complying with HUD requirements and will ensure personnel complete HUD-related training. The Board is also considering contracting with a management agent to manage the Project. If the U.S. Department of Housing and Urban Development has questions regarding this plan, please contact Antonio Luna at 865-247-0065. Sincerely yours, Antonio Luna Financial Controller Breakthrough Corporation

View Audit 388758

Finding 1175152 (2025-001)

Material Weakness 2025

Breakthrough Phase I, Inc.

TN

HUD Housing Programs

CORRECTIVE ACTION PLAN Breakthrough Phase I, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2025. Purkey, Carter, Compton, Swann, & Carter, PLLC P.O. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2024 – June 30, 2025 The findings from the sched...

CORRECTIVE ACTION PLAN Breakthrough Phase I, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2025. Purkey, Carter, Compton, Swann, & Carter, PLLC P.O. Box 727 Morristown, Tennessee 37815 Audit period: July 1, 2024 – June 30, 2025 The findings from the schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section A of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDINGS – FINANCIAL STATEMENT AUDIT None FINDINGS – FEDERAL AWARD PROGRAMS AUDITS FINDING NO. 2025-001: Ineffective operation of internal controls by management Management did not conduct recertifications of the Project’s tenants during the fiscal year under audit. Criteria: According to HUD Handbook 4350.3, owners must conduct a recertification of family income and composition at least annually by the tenant’s recertification anniversary date. Owners then must recompute the tenants’ rents and assistance payments, if applicable, based on the information gathered. If a new recertification is not submitted within 15 months of the previous year’s recertification anniversary date, HUD will terminate assistance payments. Cause of Condition: Management did not have systems in place to ensure tenant files and recertification documentation were completed in accordance with HUD requirements. Recommendation: Auditor recommends management review HUD Handbook 4350.3 and put proper internal controls in place to ensure tenant files are in compliance with HUD and kept in accordance with HUD requirements. Action Taken: The Board is working closely with Breakthrough Corporation to ensure the Project is complying with HUD requirements and will ensure personnel complete HUD-related training. The Board is also considering contracting with a management agent to manage the Project. If the U.S. Department of Housing and Urban Development has questions regarding this plan, please contact Antonio Luna at 865-247-0065. Sincerely yours, Antonio Luna Financial Controller Breakthrough Corporation

View Audit 388756

Finding 1175151 (2025-007)

Material Weakness 2025

City of Albuquerque

NM

Subrecipient Monitoring Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties § 200.303 § 200.306

The City concurs with the finding. The City will update Continuum of Care procedures related to subrecipient monitoring, in-kind contribution documentation, match tracking and reporting, and grant closeout review to strengthen compliance and oversight. Additionally, the City will provide additional ...

The City concurs with the finding. The City will update Continuum of Care procedures related to subrecipient monitoring, in-kind contribution documentation, match tracking and reporting, and grant closeout review to strengthen compliance and oversight. Additionally, the City will provide additional grants training and a list of subject matter experts within each department that can work with auditors during the single audit.

View Audit 388755

Finding 1175084 (2025-001)

Material Weakness 2025

Crystal Run Owner Corporation V

NY

HUD Housing Programs Reporting

CORRECTIVE ACTION PLAN FOR THE YEAR ENDED JUNE 30, 2025 U.S. Department of Housing and Urban Development Crystal Run Owner Corporation V (the Organization), HUD Project No. 012-HD091 respectfully submits the following corrective action plan for the year ended June 30, 2025. Name and address of indep...

CORRECTIVE ACTION PLAN FOR THE YEAR ENDED JUNE 30, 2025 U.S. Department of Housing and Urban Development Crystal Run Owner Corporation V (the Organization), HUD Project No. 012-HD091 respectfully submits the following corrective action plan for the year ended June 30, 2025. Name and address of independent public accounting firm: Bonadio & Co., LLP, 432 North Franklin Street #60, Syracuse, New York 13204 Audit period: July 1, 2024 – June 30, 2025 The findings from the 2025 schedule of findings and questioned costs are discussed below. Findings are numbered consistently with the number assigned in the schedule. FINDINGS – FINANCIAL STATEMENT AUDIT None FINDINGS – FEDERAL AWARD PROGRAM AUDIT Finding 2025-001: Supportive Housing for Persons with Disabilities, Federal Assistance Listing Number 14.181 Recommendation: We recommend that new procedures be implemented to ensure move-outs are timely reported. Action Taken: Management is in the process of implementing a new move-out notification workflow. Name of Contact Person Responsible for Corrective Action: Audra Coon, Director of Finance, (845) 695-2554. Anticipated Completion Date: May 2026

View Audit 388708

Finding 1175083 (2025-002)

Material Weakness 2025

Crystal Run Owner Corporation

NY

HUD Housing Programs Reporting

Finding 2025-002: Supportive Housing for Persons with Disabilities, Federal Assistance Listing Number 14.181 Recommendation: We recommend that new procedures be implemented to ensure move-outs are timely reported. Action Taken: Management is in the process of implementing a new move-out notification...

Finding 2025-002: Supportive Housing for Persons with Disabilities, Federal Assistance Listing Number 14.181 Recommendation: We recommend that new procedures be implemented to ensure move-outs are timely reported. Action Taken: Management is in the process of implementing a new move-out notification workflow. Name of Contact Person Responsible for Corrective Action: Audra Coon, Director of Finance, (845) 695-2554. Anticipated Completion Date: May 2026

View Audit 388706

Corrective Action Plans

Filters