Finding 1169730 (2025-001)

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

AI Summary

  • Core Issue: The Project overpaid management fees due to incorrect calculations by the management company.
  • Impacted Requirements: Management fees must be calculated using the correct formula to ensure accurate expense reporting.
  • Recommended Follow-up: The management company should repay the $382 overpayment to the Project promptly.

Finding Text

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT FINDING 2025-001: SECTION 223 (f), ASSISTANCE LISTING NUMBER 14.155 Condition: The Project overpaid management fees to the management company. Criteria: The management company should calculate management fees using the correct formula. Effect: The Project's management fee expense is overstated. Context: The management fee for the year was tested for accuracy. The test determined that the inputs used in the calculation were incorrect. The details and results of the sample are as follows: Population - $32,085; Sample - $32,085; Not in Compliance - $382; Questioned Costs - $382; Cause: The management company did not compute the management fee correctly. Recommendation: The management company should repay the $382 to the Project. Views of Responsible Officials and Planned Corrective Actions: The Project agrees with the finding. The management company will repay the overpaid management fees as soon as possible. Questioned Costs - Department of Housing and Urban Development - $382; Non-compliance code - J

Corrective Action Plan

DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT NHHI - St. Paul 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 finding from the September 30, 2025 schedule of findings and questioned costs is discussed below. The finding is numbered consistently with the number 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 (f), ASSISTANCE LISTING NUMBER 14.155 Condition: The Project overpaid management fees to the management company. Recommendation: The management company should repay the $382 to the Project. Action Taken: The Project agrees with the finding. The management company repaid the overpaid management fees in November, 2025. If the Department of Housing and Urban Development has questions regarding this plan, please call Michael Thomas at 651-639-9799.

Categories

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Programs in Audit

ALN Program Name Expenditures
14.155 MORTGAGE INSURANCE FOR THE PURCHASE OR REFINANCING OF EXISTING MULTIFAMILY HOUSING PROJECTS $1.48M
14.195 PROJECT-BASED RENTAL ASSISTANCE (PBRA) $330,898