Finding Text
Criteria - In accordance with the Section 811 Capital Advance Program Regulatory Agreement, residual receipts shall be under the control of HUD and shall be disbursed only at the discretion of HUD for such a purpose as it may determine to be necessary or appropriate. Condition - During the year end December 31, 2022, the Company made an unauthorized transfer of $5,000 from the residual receipts account. Cause - The Company never received or failed to retain proper approval - authorizing the withdrawal. Effect - The Company's residual receipts account was understated at December 31, 2022 and reimbursement is required. Questioned Costs - None identified. Recommendation - Management should be aware of HUD requirements and deposit $5,000 into the residual receipts accounts as soon as possible. Management's Response - Management understands HUD's residual receipts requirement and will deposit $5,000 by December 31, 2023.