Finding 1138650 (2024-002)

FINDINGS - MAJOR FEDERAL AWARD PROGRAM AUDIT (CONTINUED) Department of Housing and Urban Development Finding, 2024-002: Major Program: Section 202 Supportive Housing for the Elderly, Federal Assistance Listing Number 14.157 STATEMENT OF CONDITION The surplus cash calculated for the year ended December 31, 2024, is required to be deposited by the Project within 60 days after year end. CRITERIA The HUD Audit Guide considers this to be an unauthorized use of project funds. EFFECT OF CONDITION The Project deposited $19,419 of the calculated surplus cash of $26,602 on February 27, 2025. The calculated difference between the amount deposited and the calculated surplus cash is $7,183, which was not deposited into the residual receipts account by February 28, 2025. CONTEXT The Project’s surplus cash amount was calculated for the year ended December 31, 2024. The surplus cash analysis was performed on February 27, 2025, to determine the amount required to be deposited by February 28, 2025. CAUSE OF CONDITION The Project calculated surplus cash of $19,419 for the year ended December 31, 2024, and deposited it within the required 60 days after year end. The Project did not calculate the correct surplus cash amount for the year ended December 31, 2024, due to late accounting adjustments. RECOMMENDATION The auditor recommends depositing surplus cash of $7,183 into the residual receipts account. VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED CORRECTIVE ACTIONS Management has deposited the surplus cash amount of $7,183 into the residual receipts account on March 31, 2025.