Finding 393680 (2023-002)

AL# 10.415 U.S. Department of Agriculture - Rural Development Questioned Cost: $14,048 Criteria: Deposits to the reserve account were not made in accordance with the requirements of the program. Condition - Owners, as required, shall establish a reserve for replacement account and make deposits in accordance with RD requirements, usually the loan agreement or other similar business agreement. Cause – There was a change in staffing and the new staff were not aware of the requirement for monthly deposits. Effects – The Project’s replacement reserve was underfunded for the year. Auditor’s Recommendation – Reserve deposits should be made timely. New staff should be trained on requirements for Rural Development Programs. View of Responsible Officials – Management agrees with the finding and has implemented a corrective action plan.