Finding Text
Federal agency: U.S. Department of Housing and Urban Development
Federal program title: Section 232 HUD-Insured Mortgage
Listing Number: 14.129
Pass-Through Agency: N/A
Pass-Through Number(s): N/A
Award Period: N/A
Type of Finding: Significant Deficiency in Internal Control over Compliance
Criteria or specific requirement: Management is required to maintain tenant security deposits in a separate bank account in an amount adequate to cover the security deposit liability.
Condition: The security deposit bank account balance was not adequate to cover the security deposit liability.
Questioned costs: None
Context: The security deposit bank account had a balance of $128,682 at December 31, 2023 which was less than the related security deposit liability which was $140,765.
Cause: The security deposit account was not adequately funded.
Effect: The security deposit account is inadequate to cover the security deposit liability.
Repeat Finding: N/A
Recommendation: Recommend management fund the security deposit account in an amount that is adequate to cover the security deposit liability.
Views of responsible officials: There is no disagreement with the audit finding. Management will fund the security deposit liability in an amount adequate to cover the security deposit liability.