Finding 21415 (2022-001)

Significant Deficiency
Requirement
N
Questioned Costs
$1
Year
2022
Accepted
2023-04-04

AI Summary

  • Core Issue: The Corporation over withdrew $18,000 from the replacement reserve account, violating HUD compliance requirements.
  • Impacted Requirements: Disbursements from the replacement reserve must be approved by HUD, and the Corporation failed to adhere to this by withdrawing funds that were already disbursed.
  • Recommended Follow-Up: Ensure the $18,000 is repaid to the replacement reserve account, which has already been done, and implement new procedures to prevent future compliance issues.

Finding Text

Finding 2022-001: Considered a significant deficiency in internal control over compliance. Federal Program: Supportive Housing for the Elderly (Section 202) ALN #: 14.157 Federal agency: U.S. Department of Housing and Urban Development (HUD) Criteria: In order to comply with U.S. Department of Housing and Urban Development requirements, disbursements form the replacement reserve account must be approved by HUD. Condition: During 2022, the Corporation disbursed $18,000 from the replacement reserve that had already been previously withdrawn from the account. As a result, the Corporation will be required pay back the disbursement with a deposit to the replacement reserve account in the amount of $18,000. Questioned costs: $18,000 Cause: On July 9, 2021, the Corporation received a $33,000 approval from HUD for a fire protection system project. During 2022, upon completion of the project, the Corporation withdrew the $33,000 that was previously approved. On November 23, 2022, the Corporation received a $19,609.96 withdrawal approval from HUD, however, $18,000 of this approved amount related to the previously approved and disbursed fire protection system project. Effect: The Corporation over withdrew the replacement reserve account by $18,000. Recommendation: The Corporation should pay back the $18,000 with a deposit to the replacement reserve account. Corporation?s Response: The Corporation concurs with the facts of this finding, has already paid back the $18,000 to the replacement reserve account during 2023, and is implementing procedures to prevent this in the future.

Corrective Action Plan

Trinity Manor Senior Non-Profit Corporation respectfully submits the following corrective action plan for the year ended December 31, 2022. Auditor: Maner Costerisan 2425 E. Grand River Avenue, Suite 1 Lansing, MI 48912 Audit Period: Year ended December 31, 2022 Corporation Contact Person: Shannon Hilbrecht, Accounting Manager at the Management Agent The findings from the December 31, 2022 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the number assigned in the schedule. Finding ? Federal Award Findings and Questioned Costs Finding 2022-001: Considered a significant deficiency in internal control over compliance. Recommendation: The Corporation should pay back the $18,000 with a deposit to the replacement reserve account. Action to be Taken: The Corporation concurs with the facts of this finding, has already paid back the $18,000 to the replacement reserve account during 2023, and is implementing procedures to prevent this in the future.

Categories

Questioned Costs HUD Housing Programs Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

  • 21416 2022-001
    Significant Deficiency
  • 597857 2022-001
    Significant Deficiency
  • 597858 2022-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $112,148