Finding Text
Finding 2023-002:
Federal Awards Major Program
Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects (Section 207/223(f)) (CFDA# 14.155): Significant Deficiency
Allowable costs/cost principles
Finding Resolution Status:
Resolved
Questioned Costs:
$47,837
Information on Universe and Population Size:
Not Applicable
Sample Size Information:
Not Applicable
Noncompliance Information:
The Project disbursed $47,837 of legal costs that were not operating expenses for the project.
Statement of Condition:
The Project disbursed $47,837 of legal costs that were not operating expenses for the project.
Criteria:
The Regulatory Agreement (HUD-92466 version 11/2002, section 13(g)) restricts withdrawal of cash of the Project to payments for reasonable expenses incident to the operation and maintenance of the project.
Cause:
The Project paid legal fees pertaining to the sale that were billed to the Project prior to the sale and release from the Regulatory Agreement.
Effect or Potential Effect:
The Project disbursed $47,837 of legal costs that were not operating expenses for the project.
Auditor Non-Compliance Code:
Z - Other
Recommendations:
The Project should ensure that expenses pertaining to the sale of the property should be paid from entity non-project accounts.
Reporting Views of Responsible Officials:
Management concurs with this finding and the current management agent has ensured that $47,837 was reimbursed from entity non-project funds.
Auditor's Summary of the Auditee's Comments on the Findings and Recommendations:
Management concured and has ensured that $47,837 was reimbursed from entity non-project funds.
Completion Date:
February 8, 2024
Response:
Management concurs with this finding and the current management agent has ensured that $47,837 was reimbursed from entity non-project funds.
Actions Taken or Planned on the Finding:
The funds were reimbursed from entity non-project funds.
Contact Person:
Moshe Eichler