Finding 1057384 (2022-001)

Finding #22-01 Replacement Reserve Condition: Monthly deposits to the Replacement Reserve were not made from September-December 2022 unit after year end. 4 monthly deposits of $3,000 totaling $12,000 for 2022 were not paid to the replacement reserve in 2022. Criteria: The Project is required to fund the Replacement Reserve per the regulatory agreement. Effect: Under funding of the Replacement Reserve. Cause: Management believes the approved suspension of the Replacement Reserve for the prior October 1, 2022 through September 30, 2023 would be continued for another year. Recommendation: Obtain an additional one year suspension or continue funding the Replacement Reserve. Auditor's Summary of the Auditees Comments on Findings and Recommendation Date: Deposit all past due Replacement Reserve required deposits if HUD approval of suspension is not received. Completion Date: Resolved Response: Management deposited the Replacement Reserve funding in February 2023. Response: Management deposited the Replacement Reserve funding in February 2023.