Finding 45257 (2022-001)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
-
Year
2022
Accepted
2022-10-20
Audit: 47027
Organization: Roncalli Apartments, Inc. (ME)
Auditor: Otis Atwell

AI Summary

  • Core Issue: The required deposit to the residual receipts account for fiscal year 2019 has not been made, leading to an underfunding of $38,308.
  • Impacted Requirements: The Corporation must deposit surplus cash into the residual receipts account, which has been repeatedly missed since 2019.
  • Recommended Follow-Up: Management should continue working with HUD for a solution or proceed with making the necessary deposit.

Finding Text

Section III - Federal Award Findings and Questioned Costs Finding Number: 2022-001 Information on Universe and Population Size: N/A Sample Size Information: N/A Questioned Costs: None. Condition: The residual receipts deposit required in fiscal year 2019 has not been made. Criteria: The Corporation is required to deposit surplus cash into a residual receipts account. Cause: The project had insufficient cash in 2019, 2020, 2021, and 2022 to make the required deposit. During 2022, management consulted with HUD for a resolution. No resolution was obtained prior to June 30, 2022. Effect: The residual receipts account is underfunded by $38,308. Repeat Finding: Yes, reported as 2019-001 for the year ended June 30, 2019, as 2020-001 for the year ended June 30, 2020, and as 2021-001 for the year ended June 30, 2021. Recommendation: We recommend that management consult with their HUD representative for a remedy or make the required deposit. Reporting Views of Responsible Officials: We have contacted our HUD representative and we are working on an acceptable solution.

Corrective Action Plan

Name of Auditee: Roncalli Apartments, Inc. HUD Auditee Identification Number: 024-EE085 Name of Audit Firm: Otis Atwell Period Covered by the Audit: For the Year Ended June 30, 2022 A. Current Findings on the Schedule of Findings, Questioned Costs, and Recommendations: 1. Finding 2022-001: a. Comments on the Finding: We concur that the required deposit of surplus cash to the residual receipts account that was to be made in FY 2019 was not made in either FY 2019, FY 2020, FY 2021, or FY 2022, resulting in underfunding of the residual receipts account of $38,308. b. Action Taken or Planned on the Finding: The project had insufficient cash to make the required deposit. Management is in consultation with the HUD representative for an acceptable solution with anticipated resolution by October 31, 2022. B. Status of Corrective Actions on Findings Reported in the Prior Audit Schedule of Findings, Questioned Costs, and Recommendations: 1. Finding 2021-001: The project had insufficient cash to make the required deposit. Contact Person: Mike Pease, Executive Director, DBH Management, Inc.

Categories

HUD Housing Programs Cash Management Reporting

Other Findings in this Audit

  • 45258 2022-001
    Material Weakness Repeat
  • 621699 2022-001
    Material Weakness Repeat
  • 621700 2022-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $117,981