Finding 39931 (2022-002)

FINDING No. 2022-002: Section 202 Supportive Housing for the Elderly, CFDA 14.157 Finding Resolution Status: Unresolved. Information on Universe Population Size: All management fee expenses. Sample Size Information: All management fee expenses. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD. The Project shall only use funds as specified in the Regulatory Agreement and owes the management company fees at the rate specified in the Project Owner?s/Management Agent?s Certification (Form HUD-9839-B). Statement of Condition: The Project has been overcharged management fees, resulting in an unauthorized loan to the Management Company. Cause: The Project did not comply with HUD regulations as it relates to the condition listed above. Effect or Potential Effect: The Project has made an unauthorized loan to the management company as a result of overpaying management fees of $2,972. Auditor Non-Compliance Code: J ? Unauthorized Management Fees. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor?s recommendations will be adopted. Recommendation: The Project should implement procedures to monitor the calculation of management fees. Response Indicator: Agree. Completion Date: 3/31/2023 Response: Going forward there will be a monthly analysis of management fees.