Finding 1240729 (2026-001)

FINDING No. 2026-001: Section 202 Supportive Housing for the Elderly, ALN 14.157 Finding Resolution Status: Unresolved. Information on Universe Population Size: Replacement reserve account. Sample Size Information: Replacement reserve withdrawals. Identification of Repeat Finding and Finding Reference Number: No. Criteria: In accordance with HUD regulations, the Project should only request advances on form HUD-9250 based upon approved quotes or invoices. Statement of Condition: The Project requested $14,757 based on a quote and subsequently requested the same amount once the work was completed, based on invoiced amounts. The additional approved withdrawal was not returned to the replacement reserve account once the error was identified. Cause: The Project did not track requests for replacement reserve withdrawals closely, resulting in erroneously requesting the same amount twice. Effect or Potential Effect: Potential unauthorized use of Project funds. Auditor Non-Compliance Code: N – Reserve for Replacements Deposits Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations will be adopted. Recommendation: The Project should return the excess withdrawal of $14,757 to the replacement reserve account. Response Indicator: Agree. Completion Date: 3/31/2027 Response: Staff training has been provided to ensure proper procedures are followed. Staff will monitor quote vs invoice withdrawals to ensure there are no duplications.