Finding Text
Criteria In accordance with the regulatory agreement, residual receipts reserve deposits should be made within 90 days of year end. Condition During the year ended June 30, 2022, management did not make the required residual receipts reserve deposit in the amount of $107,888 within 90 days of year end, as required by the HUD regulatory agreement. The residual receipts amount was deposited on October 5, 2021. Cause Controls are not in place to ensure that required residual receipts reserve deposits are made timely. Effect or Potential Effect The Organization is not in compliance with the requirements of the regulatory agreement. Questioned Costs None Context There error was made in the surplus cash required to be deposited within 90 days of year end. Recommendation Management should establish internal controls and procedures to ensure that required residual receipts reserve deposits are made timely. Auditor Noncompliance Code: B - Failure to make required residual receipts deposits Views of Responsible Officials and Planned Corrective Actions While the residual receipts reserve deposit was made within 3 business days of receipt of the final audit, it exceeded the HUD 90-day requirement. In the future, management will calculate and make an estimated deposit so that the deposit can be made timely and then make any necessary adjustment once the final audit has been issued.