Finding Text
Finding reference number: #2022-006 Assistance Listing title and number (Federal award identification number and year): Section 8 Housing Assistance Payments, Assistance Listing No. 14.195 Identification numbers Property Year of award Questioned costs CO99T881008 REDI VI 2016 15,026 Auditor non-compliance code: N - Special Tests and Provisions. Finding resolution status: Outstanding Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size information is not applicable to the finding. Statistically valid sample: N/A Name of federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $15,026 Repeat Finding: No Statement of condition #2022-006 (Assistance Listing No. 14.195): During the year ended March 31, 2022, $15,000 was withdrawn from the reserve for replacement account without HUD approval. Additionally, the Corporation was charged a $26 early withdrawal penalty in connection to the withdrawal which was withdrawn without HUD approval. Criteria: The regulations at 24 CFR Part 880.601 and 24 CFR Part 880.602 authorizes the Secretary of HUD to effectively monitor withdrawals from the reserve for replacements fund. Disbursements must be pre-approved by HUD prior to being withdrawn from the reserve for replacements fund. Effect or potential effect: The Corporation is not in compliance with the terms of the HAP Contracts. At March 31, 2022, the reserve for replacements accounts are underfunded by $15,026. Cause: The Agent inadvertently withdrew from the reserve for replacements. Recommendation: The Agent should only withdraw funds from the reserve for replacements fund after receiving approval from HUD. The Agent should reimburse the reserve for replacements fund or not withdrawal future HUD approved withdrawals. Completion date: March 31, 2023 Management response: Agreed. The Agent concurs with the finding and the auditor's recommendation. The Corporation will reimburse the reserve for replacements account or not withdrawal future HUD approved withdrawals.