Finding 1169538 (2025-001)

Finding reference number: 2025-001 Assistance Listing (Federal award identification number and year): Supportive Housing for Persons with Disabilities, Assistance Listing No. 14.181, 122-HD046-WDP-NP and 1997 Auditor non-compliance code: M – Security Deposits Finding resolution status: Resolved Universe population size: 12 months Sample size information: 4 months Statistically valid sample: N/A Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: N/A Statement of condition 2025-001: The Corporation did not maintain a cash account for residents' security deposits in an amount equal to or greater than the outstanding balance of the residents' security deposits liability at all times during the year ended June 30, 2025, and at June 30, 2025, the residents' security deposit cash account was underfunded by $1,193. Criteria: Pursuant to Section 7(f) of the Regulatory Agreement, residents' security deposits should be funded in a separate account in an amount which shall at all times equal or exceed the aggregate of all outstanding obligations. Effect: Failure to fund residents' security deposits could result in the inability of the Corporation to return security deposits to residents upon termination of the residents' leases Cause: Management did not adequately monitor the balance of the residents' security deposits cash account throughout the year. Recommendation: Management should ensure the residents' security deposits cash account is adequately funded and transfer funds from the Corporation's operating cash account to adequately fund the residents' security deposits cash account. Management's response: Management concurs with the finding and recommendation. Management transferred $1,345 to the security deposit cash account on September 19, 2025.