Finding 369441 (2023-001)

Material Weakness Repeat Finding

Requirement

Questioned Costs

Year

2023

Accepted

2024-02-15

Audit: 290628

Organization: Rose Arc Housing, Inc. (RI)

Auditor: Otrando Porcaro & Associates LTD

AI Summary

Answer: The project did not make the required monthly deposits to the replacement reserve account.
Trend: This is a repeat finding, indicating ongoing non-compliance with HUD requirements.
List: Follow up by ensuring monthly deposits are made as required and review procedures to prevent future violations.

Finding Text

Criteria: Replacement reserve deposits should be made monthly in an amount determined by HUD. Condition: During the year ended June 30, 2023, one of the twelve deposits were made to the replacement reserve account. Cause: The project failed to make the required deposits to the replacement reserve. Effect or potential effect: The project is in violation of HUD replacement reserve procedures. Questioned costs: None. Perspective: One deposit of $1,000 was made in July 2022. No other deposits were made in the remaining eleven months in the audit period. Repeat finding: Yes.

Corrective Action Plan

Comments on Finding and Recommendation: The Corporation acknowledges that the deposits were not made and agrees with the recommendation. The reason there were no additional deposits, other than the $1,000 in July 2022, was because the subsidy funds were not received starting October 2022. Actions Taken or Planned: The Corporation plans to make the required reserve deposits for the year ended June 30, 2024.

Other Findings in this Audit

945883 2023-001

Material Weakness Repeat

Programs in Audit

ALN	Program Name	Expenditures
14.181	Supportive Housing for Persons with Disabilities	$775,700