Finding Text
Finding reference number: 2024-001
Assistance Listing (Federal award identification number and year): Supportive Housing for Persons with Disabilities, Assistance Listing No. 14.181 (Project identification number 101-HD029, 2004)
Auditor non-compliance code: N – Reserve for Replacements Deposits
Finding resolution status: Cleared
Universe population size: The universe population size is not applicable to the finding.
Sample size information: The sample size information is not applicable to the finding.
Statistically valid sample: N/A
Name of Federal agency: Department of Housing and Urban Development
Pass-through entity: N/A
Questioned costs: $15,188
Statement of condition 2024-001: The Corporation did not make $7,284 of the total required reserve for replacement deposits during the year ended March 31, 2024. Additionally, the Corporation did not make the required reserve for replacements deposits of $6,943, $579, and $382 to correct the underfunded amount for the years ended March 31, 2023, 2022, and 2021, respectively.
Criteria: Section 26(c) of the PRAC requires monthly deposits into a separate reserve for replacements account.
Effect: The Corporation is not in compliance with the terms of the PRAC. At March 31, 2024, the reserve for replacements account is underfunded by $15,188.
Cause: Management did not make the required monthly reserve for replacements deposits.
Recommendation: Management should make all required deposits to the reserve for replacements fund. Management should transfer $15,188 from the operating account to the reserve for replacements fund.
Management's response: Agreed. Management concurs with the finding and the auditor's recommendation. The Corporation made additional deposits totaling $15,188 to the reserve for replacements fund on June 14, 2024 and July 9, 2024.