Finding 1081233 (2024-002)

U.S. Department of Housing and Urban Development Federal Financial Assistance Listing #14.157 Supportive Housing for the Elderly (Section 202) Project Rental Assistance Contract Number: ND99S091001 Project Number: 094-EE008-NP-WAH Special Tests and Provisions: Residual Receipts Reserve Immaterial Instance of Non-Compliance Criteria – Pursuant to the regulatory agreement, the Organization is to make annual deposits of surplus cash, based on the HUD surplus cash calculation to the residual receipts reserve. Condition – Due to insufficient cash flow, the Organization did not make the required deposit to the residual receipt reserve in the current year. Cause – The deposit was not made due to the Organization not having adequate cash flow to make the deposit. Effect – The residual receipts account has not been properly funded, resulting in noncompliance with the HUD regulatory agreement. Questioned Costs - $3,388 Context/Sampling – Not applicable. Repeat Finding from Prior Year(s) – No Recommendation – It is the responsibility of management to make the required deposits based on the HUD surplus cash calculation. Approval from HUD should be obtained for all withdrawals prior to being taken. Views of Responsible Officials – Management agrees with the finding.