Finding 497593 (2024-001)

Significant Deficiency
Requirement
P
Questioned Costs
$1
Year
2024
Accepted
2024-09-23

AI Summary

  • Core Issue: The resident security deposit account lacked sufficient funds to cover deposits as of May 31, 2024.
  • Impacted Requirements: Compliance with Section 12 of the Regulatory Agreement, which mandates that security deposits be maintained in a separate, adequately funded account.
  • Recommended Follow-Up: Management should conduct monthly reconciliations and ensure timely transfers from the operating account to maintain proper funding for the security deposit account.

Finding Text

Finding reference number: 2024-001 Assistance Listing (Federal award identification number and year): Supportive Housing for the Elderly, Assistance Listing No. 14.157 (Project identification number 061-EH142 and 1987) Auditor non-compliance code: M - Security Deposits Finding resolution status: Resolved Universe population size: N/A Sample size information: N/A Statistically valid sample: No Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $223 Statement of condition 2024-001: The resident security deposit account did not have adequate funds to cover the security deposits collected at May 31, 2024. Criteria: Pursuant to Section 12 of the Regulatory Agreement, resident security deposits are required to be funded in a separate account in an amount which shall at all times equal or exceed the aggregate of all outstanding obligations. Effect: Failure to fund the security deposit account could result in the inability of the Corporation to return security deposits to residents upon termination of a resident's lease. Cause: The resident security deposit account did not have adequate funds to cover the security deposits collected at May 31, 2024 due to a security deposit being deposited to the operating account during the year ended May 31, 2024 but not transferred to the security deposit account. Recommendation: Management should reconcile the security deposit listing on a monthly basis and transfer funds from the operating cash account to ensure the resident security deposit account is adequately funded and collect the security deposit at the time of resident move-in. Management's response: Agree. On July 22, 2024, Management transferred $223 from the operating cash account to fully fund the security deposit account.

Corrective Action Plan

Finding 2024-001: The resident security deposit account did not have adequate funds to cover the security deposits collected at May 31, 2024. Comments on the Finding and Each Recommendation: Management should reconcile the security deposit listing on a monthly basis and transfer funds from the operating cash account to ensure the resident security deposit account is adequately funded. Action(s) taken or planned on the finding: Agree. On July 22, 2024, Management transferred $223 from the operating cash account to fully fund the security deposit account.

Categories

Questioned Costs Subrecipient Monitoring

Other Findings in this Audit

  • 497594 2024-002
    Significant Deficiency
  • 1074035 2024-001
    Significant Deficiency
  • 1074036 2024-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $518,598
14.195 Project Based Rental Assistance (pbra) $269,647