FAC Explorer

Finding 41425 (2022-001)

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Requirement
P
Questioned Costs
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Year
2022
Accepted
2023-05-30
Audit: 37646
Organization: Wesleyan Homes II of Troy, Inc. (NC)
Auditor: Bernard Robinson & Company LLP

AI Summary

  • Core Issue: The Corporation had over $35,000 in funds exceeding FDIC insurance limits as of December 31, 2022.
  • Impacted Requirements: This violates USDA Handbook guidelines, which require funds to be within insured limits or secured with collateral.
  • Recommended Follow-Up: Management should regularly monitor cash balances to ensure compliance and consider moving excess funds or obtaining collateral agreements.

Finding Text

Finding 2022-001 Statement of Condition: At December 31, 2022, the Corporation had $35,882.42 of funds maintained in an institution that were in excess of FDIC insured limits. Criteria: USDA Handbook 2-3560, Chapter 4, states that bank account funds maintained in an institution may not exceed the limited established for Federal deposit insurance. If funds exceed the amount covered by Federal Deposit insurance, the Corporation must obtain a collateral pledge from the institution to cover all funds or move funds to an institution that will insure the funds. Cause of Condition: Management did not transfer funds to separate financial institutions in a timely manner to provide for continuous FDIC insurance coverage. Effect of Condition: Noncompliance with USDA RD requirements and risk of loss of the Corporations' funds. Recommendation: The Corporation should continuously monitor cash balances to ensure that funds are always covered by FDIC insurance limits, collateral agreements are obtained, or funds are invested in government securities. Questioned Costs: $0 Information based on Universe and Population Size: The finding noted above was not a result of sampling. Sample Size Information: The finding noted above was not a result of sampling. Noncompliance Information: The finding noted above was not a result of sampling. Reporting Views of Responsible Officials: Management agrees with the above finding and is in the process of transferring funds to provide adequate FDIC insurance coverage for the reserve for replacements account. Management will re-evaluate its policies and procedures to determine any necessary changes.

Corrective Action Plan

Wesleyan Homes II of Troy Greensboro, North Carolina CORRECTIVE ACTION PLAN March 31, 2023 Federal Audit Clearinghouse 1201 East 10th Street Jeffersonville, Indiana 47132 Wesleyan Homes II of Troy (the "Corporation"), respectfully submits the following Corrective Action Plan for the year ended December 31, 2022. Bernard Robinson & Company, L.L.P. 1501 Highwoods Blvd., Suite 300 Greensboro, North Carolina 27410 Audit period: Year ended December 31, 2022 The finding from the December 31, 2022 Schedule of Findings and Questioned Costs is discussed below. The finding is numbered consistently with the number assigned in the schedule. Findings and Questioned Costs: Finding 2022-001: Section III - Findings and questioned costs relating to the major programs which are required to be reported as defined by the Uniform Guidance [2 CFR 200.516(a)]: Recommendation: The Corporation should continuously monitor cash balances to ensure that funds are always covered by FDIC insurance limits, collateral agreements are obtained, or funds are invested in government securities. Reporting Views of Responsible Officials: Management agrees with the above finding and is in the process of transferring funds to provide adequate FDIC insurance coverage for all funds. Management will re-evaluate its policies and procedures to determine any necessary changes. If you have questions regarding this plan, please call Hona Moore at 336-544-2300. Sincerely yours, Hona Moore Partnership Property Management

Categories

Reporting

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
10.415 Rural Rental Housing Loans $944,546
10.427 Rural Rental Assistance Payments $120,683