Finding 1168850 (2025-001)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
-
Year
2025
Accepted
2026-01-13
Audit: 381206
Organization: Ahepa 78 Phase Iv, Inc. (IN)

AI Summary

  • Core Issue: The organization advanced $15,000 to a related party without obtaining required HUD approval.
  • Impacted Requirements: This action violates the Regulatory Agreement with HUD, which mandates approval for cash advances to related parties.
  • Recommended Follow-Up: Management should enhance internal controls and ensure HUD approval is obtained for any future cash advances.

Finding Text

S3800-010 Finding reference number 2024-001, 2025-001 S3800-011 Title and AL number of federal program Supportive Housing for the Elderly #14.157 S3800-015 Type of finding Federal Award Finding S3800-016 Finding resolution status Unresolved S3800-017 Information on universe population Not applicable S3800-018 Sample information Not applicable S3800-019 Identification of repeat finding and finding reference number Not applicable S3800-020 Criteria The Regulatory Agreement between HUD and the owner stipulates that HUD approval is required for cash advances to a related party. S3800-030 Statement of condition The Organization made an advance to a related party, AHEPA 78 Phase III, Inc., without HUD S3800-032 Cause Cash needs of the related party non-profit HUD project. S3800-033 Effect or potential effect Cash may be unavailable to meet reasonable and necessary obligations of the project S3800-035 Auditor non-compliance code G - Unauthorized loans from project funds S3800-040 Questioned costs $15,000 S3800-037 Property associated with the finding 073-EE075 S3800-038 Questioned costs $15,000 S3800-045 Reporting views of responsible officials Management agrees S3800-050 Context Not applicable S3800-080 Recommendation Management should monitor internal controls and receive HUD approval. S3800-090 Auditors' Summary of the Auditee's Comments on the Findings and Recommendations Management concurs S3800-130 Response indicator Agree S3800-140 Anticipated Completion Date 12/31/2025 S3800-150 Response The management agent will repay the funds on behalf of the related party housing project until that property has funds available, pending HUD approval.

Corrective Action Plan

The management agent will repay the funds on behalf of the related party housing project until that property has funds available, pending HUD approval.

Categories

HUD Housing Programs Reporting Matching / Level of Effort / Earmarking

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly - Section 202 HUD Capital Advance $3.78M
14.157 Supportive Housing for the Elderly - Project Rental Assistance Contract $280,561