Finding 1227152 (2025-001)

FINDING No. 2025-001: Section 202 Supportive Housing for the Elderly, ALN 14.157 Finding Resolution Status: Unresolved. Information on Universe Population Size: Expenses. Sample Size Information: Management fees. Identification of Repeat Finding and Finding Reference Number: No. Criteria: The Project shall only owe the management company fees at the rate specified in the Project Owner’s/Management Agent’s Certification (form HUD-9839-B). Statement of Condition: As a result of an expired form HUD-9839-B, the Project has been overcharged management fees, resulting in an unauthorized loan to the management company. Cause: Form HUD-9839-B expired and the management company kept charging the Project. Effect or Potential Effect: The Project has made an unauthorized loan to the management company as a result of overpaying management fees of $3,422 and over accruing management fees of $13,688. Auditor Non-Compliance Code: J – Unauthorized Management Fees. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendation will be adopted. Recommendation: The Project should implement procedures to monitor the expiration of all contracts to ensure timely preparation and approval. Additionally, the Project should obtain reimbursement for any amounts paid subsequent to the expiration of form HUD-9839-B. Response Indicator: Agree. Completion Date: 12/31/2026 Response: Management is in the process of renewing all management certifications and will provide the accountant extra training to monitor and not charge fees for expired certifications.