Finding Text
Criteria The regulatory agreement requires that the Project make monthly deposits to its replacement reserve. Condition During the year ended June 30 2025, the Project did timely not make the required monthly deposits to the replacement reserve in the amount of $5,617. Cause The actual transfer of cash from the operating account to the replacement reserve account is not initiated timely. Effect or Potential Effect Failure to make monthly payments resulted in an underfunding the replacement reserve and a violation of the regulatory agreement. Questioned Costs $5,617 Identification as a Repeat Finding This finding is not a repeat finding. Recommendation Management should ensure deposits to the replacement reserve are made at monthly. Auditor Noncompliance Code: N. Reserve for replacements deposits Views of Responsible Officials Management agrees with the findings and recommendations, will transfer the replacement reserve funds. Monthly deposits will be completed in accordance with HUD going forward to ensure all terms and conditions are met. Finding Resolution Status: In process