Finding Text
FINDING No. 2023-002: Section 202 Supportive Housing for the Elderly, ALN 14.157
Finding Resolution Status: Unresolved.
Information on Universe
Population Size:
All replacement reserve deposits for the year ended March 31,
2023.
Sample Size Information: All replacement reserve deposits for the year ended March 31,
2023.
Identification of Repeat Finding
and Finding Reference Number: No.
Criteria: As required by HUD regulation, timely monthly deposits must be
made to the Replacement Reserve account.
Statement of Condition: The Project underfunded the account by $1,225.
Cause: The Project received approval for an increase to the monthly
deposit into the replacement reserve account with an effective
date of October 31, 2022. The Project did not implement the
required monthly deposits into replacement reserve account in a
timely manner.
Effect or Potential Effect: Deficiently funded replacement reserve.
Auditor Non-Compliance Code: N – Reserve for Replacement Deposits. 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 ensure the correct
amount is deposited into the replacement reserve account each
month.
Response Indicator: Agree.
Completion Date:
03/31/2024
Response: Management deposited the correct amount into the replacement
reserve account, however there was a miscalculation due to the
unused portion of a pre-release 9250 being included in the
calculation of required deposits. A new process has been put
into place ensuring all unused 9250 funds are reimbursed and a
proper description is used to identify the reimbursement vs.
funding.