Finding 1080659 (2023-003)

Finding 2023-003: U.S. Department of Housing and Urban Development, Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects (Section 223(f)/207) Statement of Condition: Surplus cash as of December 31, 2022 in the amount of $4,285 was not deposited into the Project's residual receipts account during the year ending December 31, 2023. Criteria: The Regulatory Agreement requires that surplus cash be deposited into the Project's residual receipts account within 90 days of year end. Effect: Noncompliance with HUD regulations. Cause: Management oversight. Context: A test to verify that the surplus cash as of December 31, 2022 was deposited into the residual receipts account within 90 days of year end was performed. The required deposit to the residual receipts of $4,285 was not deposited during the year ended December 31, 2023. Recommendation: We recommend that management review its policies and procedures in place to ensure that the residual receipts deposit is made per regulatory guidelines. Questioned Costs: $0 Views of Responsible Officials and Corrective Action Plan: Management agrees with the finding and acknowledges that surplus cash as of December 31, 2022 was not deposited into the Project's residual receipts account during the year ended December 31, 2023. Management will review its policies and procedures in place to ensure that the residual receipts deposit is made per regulatory guidelines.