Finding 1166947 (2023-005)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2025-12-29

AI Summary

  • Core Issue: The Corporation failed to submit the annual financial report to HUD by the March 30, 2023 deadline.
  • Impacted Requirements: This noncompliance with the Regulatory Agreement could lead to monetary penalties and default on the mortgage.
  • Recommended Follow-Up: Management should ensure timely submission of annual financial reports to HUD moving forward.

Finding Text

Finding 2023-005 - U.S. Department of Housing and Urban Development, Mortgage Insurance Rental and Cooperative Housing for Moderate Income Families and Elderly, Market Interest Rate, ALN #14.135 Statement of Condition: The Corporation did not submit the annual financial report to HUD for the year ended December 31, 2022 by the required deadline. Criteria: The Regulatory Agreement requires the Corporation to submit to HUD the annual financial report within 90 days following the end of each fiscal year. Effect: Noncompliance with Regulatory Agreement, monetary penalties and default under the note and mortgage. Cause: Limited available cash flow. Context: A test was performed to review the prior year submission of the annual financial report to HUD was submitted to HUD within 90 days following the end of the prior fiscal year. For the year ended December 31, 2022, the annual financial report to HUD was submitted on April 18, 2024, which is after the due date of March 30, 2023. Questioned Costs: N/A Recommendation: We recommend management ensure that the annual financial reports to HUD are submitted by the required due dates. Views of Responsible Officials and Corrective Action Plan: Management acknowledges the annual financial report to HUD for the year ended December 31, 2022 was submitted late. The project was unable to pay the prior audit fees timely due to limited available cash flow causing a delay in the audits. Management will work to improve cash flow for timely payment of the required annual audits.

Corrective Action Plan

Mount Sinai Foundation, Incorporated 703 Blue Street Fayetteville, North Carolina 28301 CORRECTIVE ACTION PLAN December 3, 2025 U.S. Department of Housing and Urban Development Five Points Plaza Building 40 Marietta Street Atlanta, Georgia 30303 Mount Sinai Foundation, Incorporated respectfully submits the following Corrective Action Plan for the year ended December 31, 2023. Bernard Robinson & Company, L.L.P. 1501 Highwoods Blvd., Suite 300 Post Office Box 19608 Greensboro, North Carolina 27419-9608 The findings for the year ended December 31, 2023 Schedule of Findings and Questioned Costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS - Financial Statement Audit and Federal Award Program Audits Finding 2023-005 - U.S. Department of Housing and Urban Development, Mortgage Insurance Rental and Cooperative Housing for Moderate Income Families and Elderly, Market Interest Rate (Sections 221d(3) and (4) Multifamily - Market Rate Housing), CFDA #14.135 Recommendation: That management ensure that the annual financial reports to HUD are submitted by the required due dates. Action Taken: We agree with Finding 2023-005 and the recommendation described in the accompanying schedule of findings and questioned costs. The project was unable to pay the prior audit fees timely due to limited available cash flow causing a delay in the audits. Management will work to improve cash flow for timely payment of the required annual audits. Sincerely yours, Shannon Pow President Remnant Management, Inc. Managing Agent effective October 1, 2024

Categories

HUD Housing Programs

Other Findings in this Audit

  • 1166943 2023-001
    Material Weakness Repeat
  • 1166944 2023-002
    Material Weakness Repeat
  • 1166945 2023-003
    Material Weakness Repeat
  • 1166946 2023-004
    Material Weakness Repeat
  • 1166948 2023-006
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.135 MORTGAGE INSURANCE_RENTAL AND COOPERATIVE HOUSING FOR MODERATE INCOME FAMILIES AND ELDERLY, MARKET INTEREST RATE $7.06M
14.182 SECTION 8 NEW CONSTRUCTION AND SUBSTANTIAL REHABILITATION $743,218