Finding Text
Finding #2022-005: Section 221(d)(4) HUD Insured Loan, CFDA 14.135 and Section 8 Housing Assistance Payments Program CDFA 14.195 Condition: The liability for several Projects security deposits exceeded the security deposit cash account at December 31, 2022. Criteria: The HUD regulatory agreement requires the Company to maintain the security deposit in a trust account separate from other funds in an amount which at all times equals or exceeds the outstanding security deposit obligation. Effect: The Projects are in violation of their HUD/HAP contracts. Questioned Cost: $9,897 Cause: Oversight Recommendation: We recommend the Company deposit all security deposits directly into the trust account for security deposits in an amount sufficient to cover the security deposit liability. Management Views: Management is in agreement with the finding and will deposit the deficient funds into the respective Projects security deposit accounts. Status: Cleared. The Projects have deposited a total of $9,897 into their respective security deposit accounts. The security deposit shortfall has been corrected.