Finding Text
Finding reference number: 2024-001
Assistance Listing (Federal award identification number and year): Section 202 Supportive
Housing for the Elderly (Project identification number 044-EE057 and 2001)
Auditor non-compliance code: N- Reserve for Replacements Deposits
Finding resolution status: Outstanding
Universe population size: The universal population size is not applicable to the finding.
Sample size information: The sample size information is not applicable to the finding.
Statistically valid sample: N/A
Name of Federal agency: U.S. Department of Housing and Urban Development
Pass-through entity: N/A
Questioned costs: $14,357
Statement of condition 2024-001: At June 30, 2024, deposits to the reserve for replacements
account of $14,357 had not been made.
Criteria: Pursuant to the regulatory agreement, the Property is required to make monthly deposits
to the reserve for replacements fund as required by HUD. At June 30, 2024, $14,357 of the required
deposits had not been made.
Effect: The Corporation is not in compliance with the regulatory agreement. The reserve for
replacements is underfunded by $14,357 at June 30, 2024.
Cause: The Corporation did not make the required deposits to the reserve for replacements in order
to manage the Property's operating cash flow.
Recommendation: Management should transfer $14,357 to the reserve for replacements.
Management's response: Agree. Management will transfer $14,357 to the reserve for replacements
once the Property has sufficient operating cash to make the required transfer.