Finding 1135511 (2024-001)

Significant Deficiency
Requirement
N
Questioned Costs
$1
Year
2024
Accepted
2025-05-02

AI Summary

  • Core Issue: The Corporation failed to make required monthly deposits to the reserve for replacements, resulting in a shortfall of $6,060.
  • Impacted Requirements: This non-compliance violates the Regulatory Agreement with HUD, specifically item 10(b), which mandates regular deposits.
  • Recommended Follow-Up: Ensure ongoing compliance by monitoring monthly deposits to the reserve and confirm that the $6,060 has been transferred from the operating account.

Finding Text

Assistance Listing (Federal award identification number and year): Supportive Housing for the Elderly (Assistance Listing No. 14.157, 2003) Auditor non-compliance code: N – Reserve for Replacements Deposits Finding resolution status: Resolved Universe population size: 12 months of deposits to the reserve for replacement Sample size information: 12 months of deposits to the reserve for replacement Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $6,060 Statement of condition #2024-001: During the year ended September 30, 2024, the Corporation did not make the HUD required number of deposits to the reserve for replacements. Criteria: Pursuant to item 10(b) of the Regulatory Agreement (form HUD-92466), the Corporation shall make monthly deposits into a separate reserve for replacements account. Effect: The Corporation is not in compliance with the terms of the Regulatory Agreement. The reserve for replacements account is underfunded by $6,060 at September 30, 2024. Cause: The prior management agent did not make regular monthly deposits during the year ended September 30, 2024. Due to the proximity of the change in agents to year end, this lack of deposits was not noticed until the year end had already passed. Recommendation: Management should transfer $6,060 from the operating account to the reserve for replacements account. Management's response: Management concurs with the finding and recommendation. Management deposited $6,060 into the replacement reserve on December 18, 2024, and has begun making monthly deposits to the reserve to ensure compliance.

Categories

Questioned Costs Subrecipient Monitoring HUD Housing Programs

Other Findings in this Audit

  • 559069 2024-001
    Significant Deficiency
  • 559070 2024-001
    Significant Deficiency
  • 1135512 2024-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $49,337