Finding Text
Statement of Condition
The Corporation did not make enough cash transfers during the year to fully fund the replacement reserve account. As a result, the replacement reserve account was underfunded by $30,528 at December 31, 2024.
Criteria
The Corporation is required to fund the replacement reserve in accordance with RD requirements and agreements.
Effect
The Corporation is out of compliance with RD regulations.
Cause
The underfunding of the replacement reserve cash account was the result of an inadvertent bookkeeping oversight.
Recommendation
We recommend the Corporation makes the required monthly deposits to the replacement reserve cash account and transfer $30,528 to the replacement reserve cash account.
Reporting Views of Responsible Officials
Management is aware that the replacement reserve account needs to have deposits made during the year to comply with RD regulations and will transfer $30,528 to the replacement reserve cash account.