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Finding 2025–001 – Significant Deficiency – Cash Management – Residual receipts deposits not made timely Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Project-Based Rental assistance – Section 8 Project-based Cluster Federal Award Identification Number and Year: MA06T831033-25Z, MA06T791016-25Z. Program year is 2025. Assistance Listing Number: 14.195 Criteria In accordance with §880.601(e), Use of Project Funds, any remaining project funds must be deposited with the mortgagee or other HUD-approved depository in an interest-bearing residual receipts account. In accordance with HUD, residual receipts reserve deposits should be made within 90 days of year end. Condition During the year ended June 30, 2025, management did not make the required residual receipts reserve deposit in the amount of $34,811, within 90 days of June 30, 2024 as required by HUD. The residual receipts amount was deposited in October 2025. Cause Controls are not in place to ensure that required residual receipts reserve deposits are made timely. Effect The Corporation is not in compliance with the requirements of the Regulatory Agreement. Questioned Costs Not applicable. Context All deposits that were required to be made to the residual receipts account during the year ended June 30, 2025, were not made timely. These delinquent deposits represent 100% of the population. Identification as Repeat Finding This finding is not a repeat finding. Recommendation Management should establish internal controls and procedures to ensure that required residual receipts reserve deposits are made timely. Views of Responsible Officials Management acknowledges that certain internal controls did not operate effectively during year ended June 30, 2025. We have since implemented controls to ensure the residual receipts required deposits are timely made within 90 days of year end.