Finding 20473 (2022-003)

-
Requirement
N
Questioned Costs
$1
Year
2022
Accepted
2023-03-27
Audit: 26498
Organization: Morning Calm Apt (WA)

AI Summary

  • Core Issue: Unauthorized withdrawal of $4,400 from the residual receipts account, violating HUD regulations.
  • Impacted Requirements: All withdrawals from the residual receipts account require pre-approval from HUD.
  • Recommended Follow-Up: Implement a monitoring process to ensure future withdrawals are made from the correct accounts as per HUD guidelines.

Finding Text

S3800-010 Finding Reference Number: 2022-003 S3800-011 Title and Assistance Listing Number of Federal Program: 14.157 Supportive Housing for the Elderly S3800-015 Type of Finding: Federal Program Finding (FP) S3800-016 Finding Resolution Status: IN PROCESS S3800-017 Information on Universe Population Size: N/A - Sampling not performed S3800-018 Sample Size Information: N/A - Sampling not performed S3800-019 Identification of Repeat Finding and Finding Reference Number: N/A S3800-020 Criteria: The HUD regulatory agreement requires pre-approval for all withdrawals from the residual receipts account. S3800-030 Statement of Condition: Management made an unauthorized withdrawal of $4,400 from the residual receipts account. S3800-032 Cause: Management received HUD approval to withdraw $5,817 from the replacement reserve account, but mistakenly withdrew funds from the residual receipts account by mistake. S3800-033 Effect or Potential Effect: The residual receipts account is underfunded by $4,400. S3800-035 Auditor Non-Compliance Code: C ? Unauthorized withdrawals from residual receipts account S3800-040 Questioned Costs: $4,400 Details ? Questioned Costs by Property S3800-037 FHA/Contract Number: 127-EE017 S3800-038 Questioned Costs: $4,400 S3800-045 Reporting Views of Responsible Officials: Senior management has discussed the unauthorized transfer with the Project Accountant and will transfer $4,400 from the replacement reserve to the residual receipts reserve. All future withdrawals will be made as directed and approved by HUD. S3800-050 Context: Management received HUD approval to withdraw $5,817 from the replacement reserve account, but mistakenly withdrew funds from the residual receipts account. S3800-080 Recommendation: Management should institute a monitoring process to review approved HUD 9250?s ensuring that all withdrawals are made from the proper account. S3800-090 Auditor?s Summary of the Auditee?s Comments on the Findings and Recommendations: Management agrees with the finding, and has taken corrective actions which include communication with the Project Accountant and Regional Manager about ensuring withdrawals are made from the proper account and will transfer $4,400 from the replacement reserve account to the residual receipts account. S3800-0130 Response Indicator: Agree (A) S3800-0140 Completion Date: March 24, 2023 S3800-0150 Response: Management agrees with the finding and plans to take corrective actions which include communication with the Project Accountant and Regional Manager about withdrawals, and will transfer $4,400 from the replacement reserve account to the residual receipts account.

Corrective Action Plan

Department of Housing and Urban Development Auditee identification number: 127-EE017 Name of audit firm: Squires Maddux & Company, PLLC Period covered by the audit: Year Ended June 30, 2022 Prepared by: S3800-160: Contact Person First Name: Marc S3800-170: Contact Person Middle Initial: S3800-180: Contact Person Last Name: Busch Contact Email Address: marc.busch@coastmgt.com The finding from the June 30, 2022 schedule of findings and question costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section A of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDING NO. 2022-003 Recommendation: Management should institute a monitoring process to review approved HUD 9250?s ensuring that all withdrawals are made from the proper account. S3800-130: Response Indicator: Agree. S3800-140: Completion Date: March 24, 2023 S3800-150: Action Taken: Management agrees with the finding and plans to take corrective actions which include communication with the Project Accountant and Regional Manager about withdrawals, and will transfer $4,400 from the replacement reserve account to the residual receipts account..

Categories

Questioned Costs HUD Housing Programs Subrecipient Monitoring Cash Management Reporting

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $104,749