Finding Text
Finding reference number: 2024-001
CFDA title and number (Federal award identification number and year): Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects, CFDA 14.155 (Project identification number 054-11077 and 2008)
Auditor non-compliance code: H – Unauthorized distribution of project assets
Finding resolution status: Open
Universe population size: The universe population is not applicable to the finding.
Sample size information: The sample size information is not applicable to the finding.
Noncompliance information: See statement of condition 2024-001 for noncompliance information.
Statistically valid sample: No
Name of Federal agency: U.S. Department of Housing and Urban Development
Questioned costs: $1,088
Statement of Condition 2024-001: During the year ended June 30, 2024, the Corporation paid entity expenses of $1,088 out of operating activities.
Criteria: Pursuant to Regulatory Agreement, the Corporation shall not make, or receive and retain, any distribution of assets or any income of any kind of the Property, as any surplus cash is required to be deposited into residual receipts account.
Effect or potential effect: The Corporation is not in compliance with the Regulatory Agreement, and the cash position is understated by $1,088 at June 30, 2024.
Cause: During the year ended June 30, 2024, the Corporation paid entity legal expenses of $1,088 out of operating activities.
Recommendation: The Corporation should consider surplus cash restrictions and ensure terms of the Regulatory Agreement are followed. The management agent should request $1,088 from the residual receipts account.
Reporting views of responsible officials: Agree. Management agrees with the finding and concurs with auditor's recommendation. The management agent will request funds from the residual receipts account.