Finding 1216253 (2025-005)

Material Weakness Repeat Finding
Requirement
B
Questioned Costs
-
Year
2025
Accepted
2026-06-01

AI Summary

  • Core Issue: The property paid $5,752 in expenses for another entity, leading to a receivable recorded too late.
  • Impacted Requirements: Project funds must only cover expenses directly related to the property.
  • Recommended Follow-Up: Improve review processes to catch errors promptly and ensure compliance with fund usage.

Finding Text

Finding 2025-005: Compliance and significant deficiency for major program and significant deficiency for financial reporting Information on universe/ sample size: It was noted during testing that the property inadvertently paid for expenses that were related to another entity. Identification of repeat finding: Not a repeat finding. Condition: Non-entity related expenses paid for by the property. Although detected and corrected, it was not within a timely manner and resulted in a receivable at year end. Questioned costs: $5,752 Criteria: Project funds are to be used for expenses of the property. Effect: Cash balances are reduced for an expense that does not belong to the Organization and not paid back in a timely manner. Context: A receivable was recorded to reflect the amount due from a related party for an expense inadvertently paid by the Organization. Although this was caught it was not caught in a timely manner as the expense was paid 8 months prior to year end and the receivable was not recorded until year end. Cause: Lack of adequate and timely review. Recommendation: Revisit processes and procedures to ensure that controls are operating effectively to capture errors in an appropriate and timely manner.

Corrective Action Plan

Plan: Management acknowledges the finding regarding non-property related expenses that were inadvertently paid by the property. Prior to the audit, management identified the error internally and corrective action was already completed. Upon discovery, the amounts were immediately reviewed, reclassified, and recorded from the related entity. Although the expense was not identified within the desired timeframe, management’s internal review process ultimately detected the issue before the audit process began, demonstrating that management understands that project funds must only be used for property-related expenses and that these types of transactions are not permissible. Management has since reinforced internal review procedures to ensure expenses are properly allocated to the correct entity in a more timely manner going forward. Management believes the corrective actions already taken adequately address this matter and will help prevent similar occurrences in the future. Completion Date: 1/1/2026 Contact: Jackie Oliveira-Director of Affordable Housing

Categories

Reporting Significant Deficiency

Other Findings in this Audit

  • 1216243 2025-005
    Material Weakness Repeat
  • 1216244 2025-002
    Material Weakness Repeat
  • 1216245 2025-005
    Material Weakness Repeat
  • 1216246 2025-002
    Material Weakness Repeat
  • 1216247 2025-003
    Material Weakness Repeat
  • 1216248 2025-004
    Material Weakness Repeat
  • 1216249 2025-004
    Material Weakness Repeat
  • 1216250 2025-004
    Material Weakness Repeat
  • 1216251 2025-003
    Material Weakness Repeat
  • 1216252 2025-003
    Material Weakness Repeat
  • 1216254 2025-002
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.157 SUPPORTIVE HOUSING FOR THE ELDERLY $338,825