Finding Text
Finding 2025-001 Escrow Deposits Information on federal program Section 202 Supportive Housing for the Elderly Federal Assistance Listing Number 14.157. Questioned costs $0 Criteria The Organization is required to make deposits into an escrow account to fund tax and insurance payments for the fiscal year. Condition The Organization’s escrow cash account did not have adequate deposits as of June 30, 2025. Cause The Organization had inadequate cash on hand to fund the escrow account. Effect The Organization may not be able to pay for their taxes and insurance for the upcoming year. Recommendation Management should budget for monthly tax and insurance escrow deposits and request a rent increase to prevent future shortfalls in escrow cash. Views of Management Management concurs. Auditors’ summary of the auditee’s comments on the findings and recommendations Management will request a rent increase and make deposits to the escrow account sufficient to cover future tax and insurance costs.