Finding 51062 (2022-001)

Finding Type - Immaterial noncompliance with major program requirements Title and Assistance Listing Number of Federal Program - 14.157 - U.S. Department of Housing and Urban Development: Supportive Housing for the Elderly Finding Resolution Status - Resolved Information on Universe and Population Size - The population includes all required deposits to the replacement reserve for fiscal year 2022. Sample Size Information - N/A Identification of Repeat Finding and Finding Reference Number - N/A - Not a repeat finding Criteria - The Corporation should have made 12 monthly deposits of $1,589 into the reserve for replacements account, as required by the Regulatory Agreement. Statement of Condition - The Corporation failed to make the required reserve for replacements deposits in the current fiscal year. Cause - The Corporation failed to monitor the cash requirements of the reserve for replacement account specified by the Regulatory Agreement. Effect or Potential Effect - The replacement reserve account was underfunded in the current fiscal year by $1,589. Auditor Noncompliance Code - N - Reserve for replacements deposits Reporting Views of Responsible Officials - Management agrees with the finding as reported. Context - During testing of required deposits to the reserve for replacement account, it was noted that the Corporation made only 11 of the required 12 monthly deposits of $1,589 during fiscal year 2022. Recommendation - All required deposits should be made in accordance with the Regulatory Agreement. Auditor's Summary of the Auditee's Comments on the Findings and Recommendations - Management should make the required reserve for replacements deposits in the current fiscal year. Response Indicator - Agree Completion Date - July 20, 2022 Response - Management acknowledges noncompliance in the current fiscal year and has taken measures to improve internal controls over compliance. The missing deposit was made on July 20, 2022.