FAC Explorer

Finding 369962 (2023-001)

- Repeat Finding
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2024-02-21
Audit: 291428
Organization: The Pavilion Housing Development Fund Corporation (NY)
Auditor: Withumsmith+brown PC

AI Summary

  • Core Issue: The non-profit Organization failed to make required deposits into the replacement reserve account as mandated by the regulatory agreement.
  • Impacted Requirements: A total of $54,061 was due for deposit, including delinquent amounts from previous years.
  • Recommended Follow-up: Management should make the necessary deposits promptly and monitor reserve account activity monthly to ensure compliance.

Finding Text

Criteria The non-profit Organization as mortgagor, in accordance with the regulatory agreement, is required to maintain a reserve for replacements. The required minimum monthly deposit into this account is $2,079. Additionally, the non-profit Organization is required to deposit all prior year required delinquent deposits. For the year ended September 30, 2023, a total of $54,061 was to be deposited into the replacement reserve account, which consists of $49,904 for 2023 deposits and 2022 deposits, plus $4,157 for 2021 delinquent deposits; however, no deposits were made into the replacement reserve account. Condition The non-profit Organization did not make all required deposits into the replacement reserve account per the regulatory agreement. Cause Due to limited cash flow management was unable to fulfill all required deposits. Questioned Costs None noted. Context When performing our audit, we noted the non-profit Organization did not make all required deposits in the current year. Effect The non-profit Organization did not make the deposits into the replacement reserve account as required by the HUD agreement. Repeat Finding Repeat Finding of 2022-001 and 2021-001. Recommendation We recommend management make the required deposit as soon as possible and review the activity in the reserve accounts monthly to determine that deposits are being made as required. Views of Responsible Official and Planned Corrective Action Management concurs with the audit finding. Management will transfer the funds as soon as cash flow permits.

Corrective Action Plan

Name of auditee: The Pavilion Housing Development Fund Corporation HUD auditee identification number: 012-EE247 Name of audit firm: WithumSmith+Brown, PC Period covered by the audit: Year Ended September 30, 2023 CAP prepared by: Name: Brother Ronald Giannone Position: Executive Director Telephone: 646-996-4234 1. Current Findings on the Schedule of Findings, and Questioned Costs a. Finding 2023-001. Delinquent deposits into the replacement reserve account. i. Comments on the Finding and Each Recommendation: Management concurs with the finding and the auditor’s recommendation to transfer the funds to the replacement reserve account. ii. Actions Taken on the Finding: Management will transfer the funds as soon as cash flow permits. 2. Status of Corrective Actions on Findings Reported in the Prior Audit Schedule of Findings, and Questioned Costs. a. Finding 2022-001. Delinquent deposits into the replacement reserve account. Required deposit in the amount of $29,109 was not made. Finding still open. Management will transfer the funds as soon as cash flow permits.

Categories

HUD Housing Programs

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $471,000