Finding 1169728 (2025-001)

Material Weakness Repeat Finding
Requirement
B
Questioned Costs
-
Year
2025
Accepted
2026-01-20

AI Summary

  • Core Issue: The Project's replacement reserve cash balance was underfunded by $30 as of September 30, 2025.
  • Impacted Requirements: The Project withdrew more funds from the replacement reserve account than allowed due to a misinterpretation of an invoice.
  • Recommended Follow-Up: The Project should deposit $30 into the replacement reserve account to correct the underfunding.

Finding Text

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT FINDING 2025-001: SECTION 223(a)(7), ASSISTANCE LISTING NUMBER 14.155 Condition: The Project's replacement reserve cash balance was underfunded at September 30, 2025. Criteria: The Project withdrew more funds from the replacement reserve account during the year than it should have. Effect: The replacement reserve cash balance was $30 less than it should be at September 30, 2025. Context: Activity in the replacement reserve account for the year ended September 30, 2025 was tested. No sample was tested. Questioned Costs - $30; Cause: The Project misinterpreted an amount on an invoice when requesting a replacement reserve withdrawal. Recommendation: The Project should deposit $30 into the replacement reserve account. Views of Responsible Officials and Planned Corrective Actions: The Project agrees with the finding. Management will deposit $30 into the replacement reserve account. Total-Department of Housing and Urban Development - $30; Non-compliance code - A

Corrective Action Plan

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT NHHI - Mankato Barrier Free Housing Corporation respectfully submits the following corrective action plans for the year ended September 30, 2025 Name and address of independent public accounting firm:Baker Meinz & Associates, LTD. 1000 Shelard Parkway, Suite 110 Minneapolis, MN 55426 Audit Period: September 30, 2025 The findings from the September 30, 2025 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section A of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDINGS - FINANCIAL STATEMENT AUDIT - NONE; FINDINGS - FEDERAL AWARD PROGRAMS AUDIT DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT FINDING 2025-001: SECTION 223(a)(7), ASSISTANCE LISTING NUMBER 14.155 Condition: The Project withdrew more funds from the replacement reserve account during the year than it should have. Recommendation: The Project should deposit $30 into the replacement reserve account. Action Taken: The Project agrees with the finding. Management deposited $30 into the replacement reserve account during November, 2025.

Categories

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Other Findings in this Audit

  • 1169729 2025-002
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.155 MORTGAGE INSURANCE FOR THE PURCHASE OR REFINANCING OF EXISTING MULTIFAMILY HOUSING PROJECTS $1.94M
14.195 PROJECT-BASED RENTAL ASSISTANCE (PBRA) $346,376