Corrective Action Plans

Finding 1229979 (2025-004)

Material Weakness 2025

MD

Allowable Costs / Cost Principles HUD Housing Programs § 200.430

Housing Voucher Cluster – FALN No. 14.871 & 14.879 – Allowable Costs, Payroll Disbursements - AB Recommendation: We recommend the Commission implement procedures to ensure payroll costs charged to the Housing Voucher Cluster are properly supported, accurately allocated, and reconciled to payroll rec...

Housing Voucher Cluster – FALN No. 14.871 & 14.879 – Allowable Costs, Payroll Disbursements - AB Recommendation: We recommend the Commission implement procedures to ensure payroll costs charged to the Housing Voucher Cluster are properly supported, accurately allocated, and reconciled to payroll records. Management should review and approve payroll allocations and investigate any variances to ensure compliance with 2 CFR 200.430. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. This error was caused by HCHC’s timekeeping and payroll system, ADP. The error resulted in overtime hours for certain employees being paid twice in one pay period. ADP has admitted to the error and reimbursed HCHC for the costs. In order to ensure that this type of error does not occur again, HCHC is taking a number of steps. Payroll and Overtime Reconciliation: Human Resources will print and review the overtime report for each payroll cycle and reconcile the overtime hours reflected on the report against the applicable employees’ payroll records/pay stubs. Any discrepancies identified during this review will be researched and addressed promptly. Time and Attendance System: The Commission is transitioning to a new time and attendance system that is better aligned with the Commission’s operational and payroll needs. The goal of this transition is to strengthen timekeeping controls, improve the accuracy of payroll information, and provide clearer documentation to support payroll processing and allocation. Employee Payroll Review and Reporting Procedures: The Commission is updating the Employee Handbook to provide employees with clear guidance on reviewing their pay and reporting potential payroll discrepancies. The updated guidance will outline the process employees should follow if they believe they have been overpaid, underpaid, or identify another discrepancy with their compensation. Name(s) of the contact person(s) responsible for corrective action: Ikea Smith, HR Manager and Bei Hua, CFO Planned completion date for corrective action plan: January 1, 2027.

View Audit 411205

Finding 1229977 (2025-003)

Material Weakness 2025

Howard County Housing Commission

MD

HUD Housing Programs Material Weakness Internal Control / Segregation of Duties

Housing Voucher Cluster – FALN No. 14.871 & 14.879 – HQS Failed Inspections - N Recommendation: We recommend that the Commission review their abatement procedures to ensure any unit that has not met the HQS standards is properly abated as well as review their procedures for enforcing correction of d...

Housing Voucher Cluster – FALN No. 14.871 & 14.879 – HQS Failed Inspections - N Recommendation: We recommend that the Commission review their abatement procedures to ensure any unit that has not met the HQS standards is properly abated as well as review their procedures for enforcing correction of deficiencies to tenants. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: HCHC believes that this finding was caused by the previous inspection company failing to properly communicate the results of its inspections. The new inspection companies are required to use the Commission’s Yardi software to schedule, perform and enter results. This will enhance the speed and accuracy of inspection reporting. In addition, the inspection companies are required to provide weekly reports that will be discussed and reviewed with the voucher team. Based on the results of the inspection the voucher team will be able to send abatement letters, warning letters, and/or proposed termination letters to ensure compliance with the inspection and abatement process. Name(s) of the contact person(s) responsible for corrective action: Crystal Gorham, Director of Rental Assistance Planned completion date for corrective action plan: All corrections should be reflected by December 2026.

View Audit 411205

Finding 1229975 (2025-002)

Material Weakness 2025

Howard County Housing Commission

MD

HUD Housing Programs Allowable Costs / Cost Principles Material Weakness

Housing Voucher Cluster – FALN No. 14.871 & 14.879 – HQS Inspections - N Recommendation: We recommend the Commission review its HQS inspection policies and procedures and discuss these standards with the third-party inspection company that it utilizes for these inspections to ensure all inspections ...

Housing Voucher Cluster – FALN No. 14.871 & 14.879 – HQS Inspections - N Recommendation: We recommend the Commission review its HQS inspection policies and procedures and discuss these standards with the third-party inspection company that it utilizes for these inspections to ensure all inspections are performed timely and that all necessary documentation is maintained for each inspection. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: HCHC’s third-part inspection company was not able to meet the terms of its contract or the HCVP requirements, partly due to staff turnover. As a result, HCHC terminated the contract as of the end of June, 2026, and hired two new contractors. HCHC has a third inspection company under contract to fill in when needed. Staff is providing the new contractors with a detailed SOP to ensure a mutual understanding of all necessary inspection actions. HCHC staff will meet with the inspection companies weekly to discuss progress, results and issues that arise during inspections. Name(s) of the contact person(s) responsible for corrective action: Crystal Gorham, Director of Rental Assistance Planned completion date for corrective action plan: in progress all correction should be reflected by December 2026.

View Audit 411205

Finding 1229973 (2025-001)

Material Weakness 2025

Howard County Housing Commission

MD

Eligibility HUD Housing Programs Significant Deficiency

Housing Voucher Cluster – FALN No. 14.871 & 14.879 – Eligibility - E Recommendation: We recommend that the Commission review its process for collecting third party income support to ensure that accurate data is used as part of the rent and HAP calculation. Explanation of disagreement with audit find...

Housing Voucher Cluster – FALN No. 14.871 & 14.879 – Eligibility - E Recommendation: We recommend that the Commission review its process for collecting third party income support to ensure that accurate data is used as part of the rent and HAP calculation. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: HCHC staff attended a NAHRO training that provided an in-depth review of programmatic changes. In the training the HUD hierarchy of collecting documents was reviewed while also referencing the Commission’s Administrative Plan. The voucher team meets at least monthly to discuss HCVP issues, tools, and solutions that both meet the needs of the participants and comply with HUD regulations. Name(s) of the contact person(s) responsible for corrective action: Crystal Gorham, Director of Rental Assistance Planned completion date for corrective action plan: September 2026.

View Audit 411205

Finding 1229824 (2025-002)

Material Weakness 2025

Ferndale Housing Commission

MI

HUD Housing Programs

Finding: 2025-001 and 2025-002 Federal Agency: Department of Housing and Urban Development Federal Program: Housing Choice Vouchers Audit Finding: Material Weakness Condition Identified: During the audit review of 40 participant files tested for compliance with eligibility, annual reevaluations, ten...

Finding: 2025-001 and 2025-002 Federal Agency: Department of Housing and Urban Development Federal Program: Housing Choice Vouchers Audit Finding: Material Weakness Condition Identified: During the audit review of 40 participant files tested for compliance with eligibility, annual reevaluations, tenant rent, utility allowances, and housing assistance payment requirements, the audit identified the following errors: o 15 files were not completed in a timely manner. o 1 file miscalculated the total tenant payment due to incorrect deductions applied. o 9 instances of misaligned utility responsibility across HAP Contract and Lease Agreement. Corrective Action Plan The Ferndale Housing Commission is committed to correcting all findings and ensuring accuracy in file completion, correct participant deductions, as well as correct utility responsibilities in the future. It is worth noting that the FHC was not made aware of the Zip-Code payment standards until 2026, although during a shortfall meeting held on August 25, 2025, the utility payment standards were mentioned and confirmed that they were pulled from the HUD SAFMR website, nothing regarding zip code payment standards were mentioned. Planned Corrective Actions The following actions have been implemented to ensure accuracy in reporting: All annual and interim rent certifications will be reviewed by management for accuracy prior to being accepted and submitted. o The zip code payment standards will be implemented after the HUD required mandatory one-year waiting period. The transition was explained in a letter sent to all HCV participants. o The Ferndale Housing Commission has repositioned staff to bring delinquent annual/interim reexaminations current. The restructuring was based on the strengths of the staff and has resulted in greatly reduced instances of delayed reexaminations. o All files will be reviewed for accuracy by management before submission to PIC to ensure correct uniformity and correct calculation of income, deductions, allowances, assets, payment standards, and utility responsibilities. Staff Training and Management Overview o The FHC has established mandatory weekly meetings to discuss file accuracy and ensure all staff follow the same rules, regulations, payment standards, deductions, allowances. o During the mandatory meetings, the HUD 50058 forms will be used as teaching tools and completed by hand by each staff member to ensure full understanding of the 50058 and accuracy in reporting responsibilities. o There have been monthly delayed annual recertification reports pulled and discussed with staff, with deadlines provided to bring all reports current. Strengthened Internal Controls The FHC has established checklists to be included in each file during reexamination. The checklists will list each procedure to be followed, as well as a list of mandatory documents that must be included in each file. Management will review each file prior to finalization until a noted consistency in reexamination has been reached, then periodical reviews will be implemented. Anticipated Date of Completion The corrective actions outlined have either been fully implemented or will be implemented by October 31, 2026.

View Audit 411099

Finding 1229823 (2025-001)

Material Weakness 2025

Ferndale Housing Commission

MI

HUD Housing Programs Eligibility

Finding: 2025-001 and 2025-002 Federal Agency: Department of Housing and Urban Development Federal Program: Housing Choice Vouchers Audit Finding: Material Weakness Condition Identified: During the audit review of 40 participant files tested for compliance with eligibility, annual reevaluations, ten...

Finding: 2025-001 and 2025-002 Federal Agency: Department of Housing and Urban Development Federal Program: Housing Choice Vouchers Audit Finding: Material Weakness Condition Identified: During the audit review of 40 participant files tested for compliance with eligibility, annual reevaluations, tenant rent, utility allowances, and housing assistance payment requirements, the audit identified the following errors: o 15 files were not completed in a timely manner. o 1 file miscalculated the total tenant payment due to incorrect deductions applied. o 9 instances of misaligned utility responsibility across HAP Contract and Lease Agreement. Corrective Action Plan The Ferndale Housing Commission is committed to correcting all findings and ensuring accuracy in file completion, correct participant deductions, as well as correct utility responsibilities in the future. It is worth noting that the FHC was not made aware of the Zip-Code payment standards until 2026, although during a shortfall meeting held on August 25, 2025, the utility payment standards were mentioned and confirmed that they were pulled from the HUD SAFMR website, nothing regarding zip code payment standards were mentioned. Planned Corrective Actions The following actions have been implemented to ensure accuracy in reporting: All annual and interim rent certifications will be reviewed by management for accuracy prior to being accepted and submitted. o The zip code payment standards will be implemented after the HUD required mandatory one-year waiting period. The transition was explained in a letter sent to all HCV participants. o The Ferndale Housing Commission has repositioned staff to bring delinquent annual/interim reexaminations current. The restructuring was based on the strengths of the staff and has resulted in greatly reduced instances of delayed reexaminations. o All files will be reviewed for accuracy by management before submission to PIC to ensure correct uniformity and correct calculation of income, deductions, allowances, assets, payment standards, and utility responsibilities. Staff Training and Management Overview o The FHC has established mandatory weekly meetings to discuss file accuracy and ensure all staff follow the same rules, regulations, payment standards, deductions, allowances. o During the mandatory meetings, the HUD 50058 forms will be used as teaching tools and completed by hand by each staff member to ensure full understanding of the 50058 and accuracy in reporting responsibilities. o There have been monthly delayed annual recertification reports pulled and discussed with staff, with deadlines provided to bring all reports current. Strengthened Internal Controls The FHC has established checklists to be included in each file during reexamination. The checklists will list each procedure to be followed, as well as a list of mandatory documents that must be included in each file. Management will review each file prior to finalization until a noted consistency in reexamination has been reached, then periodical reviews will be implemented. Anticipated Date of Completion The corrective actions outlined have either been fully implemented or will be implemented by October 31, 2026.

View Audit 411099

Finding 1229771 (2025-002)

Material Weakness 2025

Senior Citizens Housing Development Corporation of Washington

FL

Allowable Costs / Cost Principles HUD Housing Programs Reporting

FINDING No. 2025-002: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Housing Projects, ALN 14.155 Recommendation: Management should take corrective measures to prevent further escrow disbursements for exempt taxes and should obtain timely refunds for amounts that w...

FINDING No. 2025-002: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Housing Projects, ALN 14.155 Recommendation: Management should take corrective measures to prevent further escrow disbursements for exempt taxes and should obtain timely refunds for amounts that were incorrectly disbursed. Action Taken: Management has properly filed the real estate exemption forms with the District of Columbia in prior years. When real estate funds were improperly withdrawn by the mortgage company and/or its tax vendor, management promptly identified the issue and recorded a journal entry (debit accounts receivable, credit escrow deposit) to recognize the receivable. Beginning in 2024 and continuing through 2025, management made multiple attempts to follow up with the mortgage company representatives to request the refund. Management has taken proactive and persistent steps to pursue resolution. As of early 2026, the refund has been successfully received. Management also expects that the mortgage company will no longer withdraw real estate tax payments for the property going forward. Based on the above, management believes appropriate controls were in place and effectively operated, as evidenced by the timely identification of the issue and the actions taken to remediate it. If the Oversight Agency for Audit has questions regarding the plan, please call Irene Phillips at 954-835-9200. Sincerely yours, Irene Phillips, CFO Irene Phillips CFO

View Audit 411038

Finding 1229770 (2025-001)

Material Weakness 2025

Senior Citizens Housing Development Corporation of Washington

FL

HUD Housing Programs Reporting

Oversight Agency for Audit, Senior Citizens Housing Development Corporation of Washington respectfully submits the following corrective action plan for the year ended December 31, 2025. Name and address of independent public accounting firm: Bellows Associates, P.A., 5401 N University Drive, Suite 2...

Oversight Agency for Audit, Senior Citizens Housing Development Corporation of Washington respectfully submits the following corrective action plan for the year ended December 31, 2025. Name and address of independent public accounting firm: Bellows Associates, P.A., 5401 N University Drive, Suite 201, Coral Springs, Florida 33067. Audit period: January 1, 2025 through December 31, 2025 The findings from the December 31, 2025 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers in the schedule. SECTION III - FINDINGS AND QUESTIONED COSTS – MAJOR FEDERAL AWARD PROGRAMS AUDIT FINDING No. 2025-001: Section 207/223(f) Mortgage Insurance for the Refinancing of Existing Multifamily Housing Projects, ALN 14.155 Recommendation: Management should submit a form HUD-9250 to withdraw the excess deposits and implement procedures to ensure the correct amounts are deposited into the replacement reserve account each month. Action Taken: The Project will submit a form HUD-9250 to withdraw the excess replacement reserve deposits as recommended. In addition, management will strengthen its review procedures to ensure that replacement reserve deposits are made in the correct HUD-approved amounts and that all reserve account adjustments are addressed on a timely basis.

View Audit 411038

Finding 1229760 (2025-001)

Material Weakness 2025

Athens Metropolitan Housing Authority

OH

HUD Housing Programs

Finding Number: 2025-001 Planned Corrective Action: The Housing Authority has contracted with the Nelrod Company a national technical consulting firm specializing in Federal Assisted Housing Programs to perform our rent reasonableness determinations. All files moving forward will have a rent reasona...

Finding Number: 2025-001 Planned Corrective Action: The Housing Authority has contracted with the Nelrod Company a national technical consulting firm specializing in Federal Assisted Housing Programs to perform our rent reasonableness determinations. All files moving forward will have a rent reasonableness determination. Anticipated Completion Date: 9/3/2026 Responsible Contact Person: Zackary Dye, Executive Director

View Audit 410994

Finding 1229750 (2025-003)

Material Weakness 2025

VILLAGE COOPERATIVE OF BROOMFIELD

MN

HUD Housing Programs Special Tests & Provisions Significant Deficiency

The Cooperative will make deposits to the general operating reserve to meet the HUD regulatory agreement. In September 2025, the Cooperative entered into a management agreement with Paramark Real Estate Services to manage the Cooperative. The management agent will implemement a process to ensure dep...

The Cooperative will make deposits to the general operating reserve to meet the HUD regulatory agreement. In September 2025, the Cooperative entered into a management agreement with Paramark Real Estate Services to manage the Cooperative. The management agent will implemement a process to ensure deposits are made as required by the regulatory agreement.

View Audit 410977

Finding 1229749 (2025-002)

Material Weakness 2025

VILLAGE COOPERATIVE OF BROOMFIELD

MN

HUD Housing Programs Special Tests & Provisions Significant Deficiency

The Cooperative will obtain appropriate approvals for withdrawls exceeding 20% of the general operating reserve to meet the HUD regulatory agreement. In September 2025, the Cooperative entered into a management agreement with Paramark Real Estate Services to manage the Cooperative. The management ag...

The Cooperative will obtain appropriate approvals for withdrawls exceeding 20% of the general operating reserve to meet the HUD regulatory agreement. In September 2025, the Cooperative entered into a management agreement with Paramark Real Estate Services to manage the Cooperative. The management agent will implement a process to ensure approvals are obtained as required by the regulatory agreement.

View Audit 410977

Finding 1229732 (2025-002)

Material Weakness 2025

Somerset Care, Inc.

PA

Procurement, Suspension & Debarment HUD Housing Programs Reporting § 200.512

A master schedule has been crated to identify all critical due dates for regulatory requirements. An internal log is maintained to identify all due dates on critical reporting timelines and regulatory requirements.

View Audit 410926

Finding 1229731 (2025-001)

Material Weakness 2025

Somerset Care, Inc.

PA

Allowable Costs / Cost Principles Procurement, Suspension & Debarment HUD Housing Programs

We will review the findings with the community and review the internal controls together and go over the importance of following the internal controls. Meet with the community and review internal controls.

View Audit 410926

Finding 1229728 (2025-003)

Material Weakness 2025

Housing Authority of the City of Newark

NJ

HUD Housing Programs

Authority's Response and Planned Corrective Action: The Authority accepts the recommendation of the auditor. The Authority will increase oversight in the Housing Voucher Cluster to ensure that established internal control policies are being followed on a timely basis. Crystal Coleman, Contract Admin...

Authority's Response and Planned Corrective Action: The Authority accepts the recommendation of the auditor. The Authority will increase oversight in the Housing Voucher Cluster to ensure that established internal control policies are being followed on a timely basis. Crystal Coleman, Contract Administrator HCV Program, is responsible for implementing this corrective action by December 31, 2026.

View Audit 410921

Finding 1229727 (2025-002)

Material Weakness 2025

Housing Authority of the City of Newark

NJ

HUD Housing Programs Eligibility Special Tests & Provisions

Authority's Response and Planned Corrective Action: The Authority accepts the recommendation of the auditor. The Authority will increase oversight in the Housing Voucher Cluster to ensure that established internal control policies are being followed on a timely basis. Crystal Coleman, Contract Admin...

Authority's Response and Planned Corrective Action: The Authority accepts the recommendation of the auditor. The Authority will increase oversight in the Housing Voucher Cluster to ensure that established internal control policies are being followed on a timely basis. Crystal Coleman, Contract Administrator HCV Program, is responsible for implementing this corrective action by December 31, 2026.

View Audit 410921

Finding 1229679 (2025-002)

Material Weakness 2025

Mermentau Elderly Housing Corporation Dba Riverbend Apartments

FL

HUD Housing Programs Reporting

FINDING NO. 2025-002: Section 202 Supportive Housing for the Elderly, ALN 14.157 Recommendation: The Project should implement procedures to comply with all applicable HUD regulations and ensure the annual utility allowance analysis is performed with supporting documentation retained. Action Taken: S...

FINDING NO. 2025-002: Section 202 Supportive Housing for the Elderly, ALN 14.157 Recommendation: The Project should implement procedures to comply with all applicable HUD regulations and ensure the annual utility allowance analysis is performed with supporting documentation retained. Action Taken: Staff training has been provided to ensure that annual reviews of the tenant utility allowances are performed. If the audit Oversight Agency has questions regarding these plans, please call Irene Phillips at 954-835-9200. Sincerely yours, Irene Phillips Irene Phillips CFO

View Audit 410874

Finding 1229678 (2025-001)

Material Weakness 2025

Mermentau Elderly Housing Corporation Dba Riverbend Apartments

FL

HUD Housing Programs Reporting

Oversight Agency for Audit, Mermentau Elderly Housing Corporation respectfully submits the following corrective action plan for the year ended December 31, 2025. Name and address of independent public accounting firm: Bellows Associates, P.A., 5401 N University Drive, Suite 201 Coral Springs, Florid...

Oversight Agency for Audit, Mermentau Elderly Housing Corporation respectfully submits the following corrective action plan for the year ended December 31, 2025. Name and address of independent public accounting firm: Bellows Associates, P.A., 5401 N University Drive, Suite 201 Coral Springs, Florida 33067 Audit period: January 1, 2025 through December 31, 2025 The findings from the December 31, 2025 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. SECTION III - FINDINGS AND QUESTIONED COSTS – MAJOR FEDERAL AWARD PROGRAMS AUDIT FINDING NO. 2025-001: Section 202 Supportive Housing for the Elderly, ALN 14.157 Recommendation: The Project should make sufficient monthly deposits to the escrow account in a timely manner. Action Taken: We are researching the underfunding and will ensure the escrow accounts are fully funded on a monthly basis. New procedures have been implemented to review the deposits each month to ensure amounts are proper.

View Audit 410874

Finding 1229270 (2025-003)

Material Weakness 2025

Project Support Housing II

CO

HUD Housing Programs Subrecipient Monitoring Cash Management

Management has corrected this required deposit (on 4/21/2026). Management has assigned responsibility to a designated individual for monitoring residual receipts requirements and deadlines and banking restrictions. Required deposits to the Residual Account will be addressed and made whole within the...

Management has corrected this required deposit (on 4/21/2026). Management has assigned responsibility to a designated individual for monitoring residual receipts requirements and deadlines and banking restrictions. Required deposits to the Residual Account will be addressed and made whole within the full picture of the need to stabilize the project’s financial issues. Provide staff training on HUD regulatory requirements related to restricted accounts.

View Audit 410749

Finding 1229269 (2025-002)

Material Weakness 2025

Project Support Housing II

CO

HUD Housing Programs Internal Control / Segregation of Duties Cash Management

Management concurs with the auditor’s recommendations. The Organization experienced an extreme legal issue with one tenant that drained the checking account above the usual expenses in 2024 and 2025 plus lowered the revenue for the unit until the Organization could successfully evict the tenant from...

Management concurs with the auditor’s recommendations. The Organization experienced an extreme legal issue with one tenant that drained the checking account above the usual expenses in 2024 and 2025 plus lowered the revenue for the unit until the Organization could successfully evict the tenant from the property. This was an unusually aggressive and unethical tenant that used the system to inflict continuous financial hardships on the Organization. To remedy this situation, management noted there are no pending legal issues at this time or outstanding attorney charges and will: Submit proper documentation to HUD to request retroactive approval of transfer with HUD Funds Authorization. Management will be in contact with HUD on how to resolve the unauthorized transfer covering the extreme legal issue. This action will be addressed within the full picture of the need to stabilize the project’s physical and financial issues to ensure that the organization continues to function effectively. Implement internal controls to ensure that all future withdrawals from restricted account receive required HUD authorization prior to disbursement and banking restrictions. Provide staff training on HUD regulatory requirements related to restricted accounts.

View Audit 410749

Finding 1229267 (2025-001)

Material Weakness 2025

Housing Authority of the City of Athens, Alabama

AL

Cash Management HUD Housing Programs Material Weakness

Corrective Action Plan: The Housing Authority concurs with the auditor's recommendation. The outstanding inter-entity balance has been identified as a legacy balance associated with the RAD conversion and the transfer of assets and liabilities to Athens Housing Management, LLC. Management's review a...

Corrective Action Plan: The Housing Authority concurs with the auditor's recommendation. The outstanding inter-entity balance has been identified as a legacy balance associated with the RAD conversion and the transfer of assets and liabilities to Athens Housing Management, LLC. Management's review and reconciliation of the balance are in progress. Before recording any final disposition, the Authority will determine the balance's origin, funding source, supporting documentation, legal obligation, and collectability, including whether federally restricted or RAD/PBRA project funds are involved. The Board of Commissioners may authorize the accounting disposition of the balance, subject to the Authority's governing documents and applicable law; however, a Board vote alone will not be treated as authority to forgive or extinguish a federally restricted or project-level receivable. The Authority will complete the following process: 1. Complete and document the reconciliation and proposed accounting treatment in both entities' records, with management and legal review, and provide the supporting documentation to the Authority's auditor. 2. Determine whether the balance is subject to the RAD closing documents, HAP Contract, RAD Use Agreement, Surplus Cash requirements, or other Federal restrictions. If so, submit the reconciliation, proposed entries, supporting documentation, and draft resolutions to the appropriate HUD Field Office or Multifamily Account Executive and obtain written direction or concurrence, as applicable. 3.Present conditional resolutions to the governing boards of the Housing Authority and Athens Housing Management, LLC, as applicable, authorizing the Chief Executive Officer to record the disposition only after all required HUD approvals or concurrences have been received. 4. Record corresponding entries in both entities, retain the complete reconciliation and approval package, and disclose the final resolution to the auditor. This process is consistent with 2 CFR §§ 200.302 and 200.303, which require accurate, supported financial records, accountability for Federal funds and assets, and documented internal controls. It also recognizes the RAD Notice requirements governing Surplus Cash and related-party advances. Going forward, inter-entity balances will be reconciled monthly, reviewed by management, and any unresolved items will be reported to the Chief Executive Officer as part of the monthly financial review.

View Audit 410746

Finding 1229227 (2025-002)

Material Weakness 2025

City of South Bend

IN

Internal Control / Segregation of Duties Special Tests & Provisions Subrecipient Monitoring § 200.303

Finding 2025-002 Information on the federal program: Subject: Home Investment Partnerships Program – Internal Controls Federal Agency: Department of Housing and Urban Development Federal Program: Home Investment Partnerships Program Assistance Listing Number: 14.239 Pass-Through Entity: N/A - Direct...

Finding 2025-002 Information on the federal program: Subject: Home Investment Partnerships Program – Internal Controls Federal Agency: Department of Housing and Urban Development Federal Program: Home Investment Partnerships Program Assistance Listing Number: 14.239 Pass-Through Entity: N/A - Direct Grant Compliance Requirement: Special Tests and Provisions – Maximum Per Unit Subsidy Audit Findings: Material Weakness Condition: The Consortium did not have a documented review control in place to ensure the per-unit subsidy calculation was prepared and calculated accurately. There was no documented proof of segregation of duties. Context: In a sample of two, the following instances were noted: • For the first selection, the per-unit subsidy information was entered into the HUD system (IDIS) during the project close out. There is no evidence of segregation of duties over the preparation and review of IDIS inputs. • For the second selection, the calculation was prepared by a former employee in 2025 and did not have sign off by the preparer or reviewer. A secondary review with evidence of sign off was performed subsequent to the audit period in 2026. Views of Responsible Officials: We concur with the finding. Description of Corrective Action Plan: Management will implement a system of internal controls to ensure the required per unit subsidy calculations are prepared, reviewed, and maintained. Responsible Party and Timeline for Completion: The Consortium Director (or their designee) and the Federal Grant Administrator are responsible for implementation. The Consortium has implemented additional controls effective September 2026.

View Audit 410728

Finding 1229215 (2025-001)

Material Weakness 2025

Housing Authority of the City of Vancouver

WA

Subrecipient Monitoring HUD Housing Programs Reporting

Federal Award Agency: Department of Housing and Urban Development Name of Contact Person: Jennifer Carter, Voucher Programs Director Corrective Action: In order to ensure all units are properly scheduled for inspection within the required period; Vancouver Housing Authority will continue to pull mon...

Federal Award Agency: Department of Housing and Urban Development Name of Contact Person: Jennifer Carter, Voucher Programs Director Corrective Action: In order to ensure all units are properly scheduled for inspection within the required period; Vancouver Housing Authority will continue to pull monthly reports for inspections due. VHA will continue to schedule inspections for tenant-based voucher households every 18 months to ensure we meet the two-year period and will continue to run reports for “missed” inspections that do not have a completed inspection within the expected time period. VHA staff have implemented additional reporting to review the assigned inspection schedule on active units at least annually. VHA has updated internal compliance process to review inspection and unit specific requirements during a PBV to tenant-based property conversion. Date of Planned Corrective Action: The above process has been completed.

View Audit 410719

Finding 1229202 (2025-003)

Material Weakness 2025

Pike County

MO

Subrecipient Monitoring Reporting HUD Housing Programs § 200.510

The County Clerk has implemented a program to ensure knowledge and awareness of all federal monies being expended. The County Treasurer will set up accounts within our financial software to account for all transactions.

View Audit 410698

Finding 1229131 (2025-002)

Material Weakness 2025

Over the Rainbow Ass'n & Subsidiaries

IL

HUD Housing Programs

For the Rockford Supportive Housing Facility - FINDING 2025-002: SECTION 811, ASSISTANCE LISTING NUMBER 14.181 TENANT FILE DID NOT CONTAIN A MOVE-IN INSPECTION REPORT Condition: One of the tenant files tested did not contain a move-in inspection report. Recommendation: The Project should obtain a co...

For the Rockford Supportive Housing Facility - FINDING 2025-002: SECTION 811, ASSISTANCE LISTING NUMBER 14.181 TENANT FILE DID NOT CONTAIN A MOVE-IN INSPECTION REPORT Condition: One of the tenant files tested did not contain a move-in inspection report. Recommendation: The Project should obtain a copy of the move-in inspection report, if possible. If the report cannot be located, the Project should document the file stating that an inspection was performed but the report has been misplaced. Action Taken: The Project agrees with the finding and will document the file accordingly. If the Department of Housing and Urban Development has questions regarding these plans, please call Les Russo at 847-424-5601.

View Audit 410652

Finding 1229130 (2025-001)

Material Weakness 2025

Over the Rainbow Ass'n & Subsidiaries

IL

HUD Housing Programs Matching / Level of Effort / Earmarking

Over the Rainbow Association and Subsidiaries respectfully submits the following corrective action plans for the year ended December 31, 2025. Name and address of independent public accounting firm: Baker Meinz & Associates, Ltd. 1000 Shelard Parkway, Suite 110 Minneapolis, MN 55426 Audit period: De...

Over the Rainbow Association and Subsidiaries respectfully submits the following corrective action plans for the year ended December 31, 2025. Name and address of independent public accounting firm: Baker Meinz & Associates, Ltd. 1000 Shelard Parkway, Suite 110 Minneapolis, MN 55426 Audit period: December 31, 2025 The findings from the December 31, 2025 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 AUDIT DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT For the Hill Housing Facility - FINDING 2025-001: SECTION 8, ASSISTANCE LISTING NUMBER 14.195 SPONSOR LOAN PAYMENT WITHOUT HUD APPROVAL Condition: The Project repaid a portion of the sponsor loan without obtaining HUD approval. Recommendation: The Project should obtain HUD approval for the repayment of the sponsor loan. Action Taken: The Project agrees with the finding. The Sponsor will contact HUD to obtain permission to retain the unauthorized sponsor loan payments.

View Audit 410652

Corrective Action Plans

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