FAC Explorer

Finding 1513 (2023-001)

- Repeat Finding
Requirement
C
Questioned Costs
$1
Year
2023
Accepted
2023-11-09
Audit: 2793
Organization: Kalona Valley Apartments, Inc. (IA)
Auditor: Forge Financial & Management Consulting

AI Summary

  • Issue: Monthly transfers to the replacement reserve fund were not made due to insufficient funds.
  • Trend: Delinquent transfers totaled $32,163 over two years, with $4,997 for 2022 and $27,166 for 2023.
  • Follow-up: Review operating account management to ensure future compliance with the Regulatory Agreement.

Finding Text

Required monthly transfers to the replacement reserve fund as required by the Regulatory Agreement with USDA were not made during the year due to lack of funds available in the operating account. Deliquent transfers for the year ended August 31, 2022 were $4,997, and $27,166 for the year ended August 31, 2023 (total $32,163).

Corrective Action Plan

The Organization entered into a Servicing Workout Plan (SWOP) dated in May 2023 with a term from September 1, 2023 through August 31, 2025. The USDA approved a rent increase to aid cash flow. During the SWOP, extra payments of $1,000 per month will be deposited into the reserve account (total transfers of $3,716.66 per month). Capital improvements during the SWOP will be paid out of the reserve account.

Categories

Questioned Costs

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
10.427 Rural Rental Assistance Payments $69,519
10.415 Rural Rental Housing Loans $52,702