Finding Text
S3800-010 Finding Reference Number: 2023-01
S3800-011 Title and CFDA Number of Federal Program: "Section 8 Housing Project-Based Cluster 14.182 Mortgage Insurance rental Housing 14.134"
S3800-015 Type of Finding: Federal Award Finding
S3800-016 Finding Resolution Status Resolved
S3800-017 Information on Universe Population Size: N/A
S3800-018 Sample Size Information: N/A
S3800-019 Identification of Repeat Finding and Finding Reference Number: N/A
S3800-020 Criteria: Per HUD guidance, non-profit entity project owners/agents are required to submit audited or unaudited financial statements within 90 days after the end of the fiscal year. If an unaudited submission is filed, the audited submission is due 9 months after the end of the fiscal year. This requirement ensures HUD can monitor the financial health and compliance of the projects it insures or subsidizes.
S3800-030 Statement of Condition: The Project failed to submit financial statements for the year ended December 31, 2022 to HUD within the required timeframe. The financial statements were due March 31, 2023, but were not submitted until May 11, 2023, resulting in a delay.
S3800-032 Cause: Records were not completed sufficiently to submit the REAC report in a timely manner.
S3800-033 Effect or Potential Effect: The failure to submit the financial statements on time places the project in non-compliance with HUD's financial reporting requirements. This non-compliance may result in administrative actions by HUD, including potential sanctions, future funding or renewal of contracts.
S3800-035 Auditor Non-Compliance Code: Z - Other
S3800-037 FHA/Contract Number: 085-11073
S3800-040 Questioned Costs: $--
S3800-045 Reporting Views of Responsible Officials: Management acknowledges the finding and is taking corrective actions to address the issue. The Project is seeking to hire additional staff and is committed to ensuring future financial statements are submitted in accordance with HUD requirements.
S3800-050 Context: For the year ended December 31, 2022, the Project did not file the REAC report with HUD by the filing deadline.
S3800-080 Recommendation: We recommend that the Project implement enhanced internal controls and procedures including establishing timelines for financial reporting, emphasizing key dates and deadlines to prevent late filing is in the future.