Finding Text
Finding #2023-001: Section 202 Capital Advance, Assistance Listing 14.157
Condition: The Company made additional deposits into the replacement reserve
account that exceeded the required monthly deposit requirements.
Criteria: The HUD regulatory agreement requires the Company to 12 monthly
deposits into the replacement reserve account.
Effect: Replacement reserve account is overfunded and is in violation of its
Regulatory Agreement. Funds may not be available for operating costs.
Questioned Cost: $770
Repeat Finding: Yes
Cause: Oversight
Recommendation: We recommend the Company deposit the required monthly deposits into
the replacement reserve account and follow the terms of the regulatory
agreement.
Auditor’s Comment:
Management will closely monitor the monthly deposits into the
replacement reserve.