CORRECTIVE ACTION PLAN YEAR ENDED JUNE 30, 2023 ...
CORRECTIVE ACTION PLAN YEAR ENDED JUNE 30, 2023 HANAC, Inc. and Affiliates (HANAC) respectfully submits the following corrective action plan for the year ended June 30, 2023.
CohnReznick LLP
1301 Avenue of the Americas New York, NY 10019
Audit Period: June 30, 2023
The finding from the June 30, 2023 consolidated and combined schedule of findings and questioned costs is discussed below. The finding is numbered consistently with the numbers assigned in the schedule.
FINDINGS – FINANCIAL STATEMENT AUDIT
None reported.
FINDINGS – FEDERAL AWARD PROGRAMS AUDITS
Material Weakness
FINDING 2023-001 Eligibility
U.S. Department of Housing and Urban Development
14.157 Supportive Housing for the Elderly
Section 202 Loan
Condition:
In connection with the audit, it was noted that of the eight lease files tested four files did not have timely recertification of tenants and Enterprise Income Verification system documentation was performed later than the required recertification date. Additionally, one file did not contain the signed application or the background check.
Recommendation:
Management should establish procedures and monitor compliance with those procedures to insure that tenant security deposits are correctly recorded, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs.
Action Taken: Management agrees with recommendation and has begun to implement the following: - A checklist form will be completed for every certification and signed off once file is approved.
- An AR form will be created for the move in, transfer and move out process which is to be attached with proof of payment. Once completed it is to be sent to senior staff for review. Under this new management, we already have set in place policies and procedures under the governance of HUD and the tenant selection plan to ensure compliance and due diligence is taking place. Any new staff will be HUD trained.
- The file setup format and recertification updates will be monitored on a monthly basis.
- EIV are being run according to the frequency provisions related to the type of reports we are annually required to complete as per HUD. Annual inspections are being schedule as per Annual Recertifications are being processed.
- Bi-weekly meetings will be in place to discuss the results collected with a tracking log on the progress of the project.
- Trainings will be scheduled to keep on top of HUD updates/compliance procedures; Yardi software trainings; and in-house trainings covering compliance with the files and Yardi 50059 module. Expected completion date: January 2024
If any cognizant or oversight agency has questions regarding this plan, please call Lola Maroulis, Chief Financial Officer at 212-840-8005, extension 111.
Sincerely yours, Lola Maroulis, Chief Financial Officer