Finding 513838 (2024-001)

Findings and Questioned Costs – Major Federal Award Programs Audit U.S. Department of Housing & Urban Development Finding 2024-001 – Reserve for Replacements, Federal Asset Listing Number 14.181 Finding Resolution Status – Unresolved Information on Universe Population Size – N/A Sample Size Information – N/A Identification of Repeat Finding and Finding Reference Number – N/A Criteria - HUD requires monthly deposits to be made to the replacement reserve account on a timely basis. Statement of Condition - The replacement reserve account is underfunded in the amount of $777 for the year ended June 30, 2024. Cause - The Organization is experiencing cash flow shortages due to high vacancies. The management company is working to reduce vacancies to allow for a more stable cash flow to enable the Organization to make the required monthly deposits on a timely basis. Effect or Potential Effect - The Organization’s replacement reserve account is underfunded $777 at year end. Auditor Non-Compliance Code – N – Reserve for Replacements Deposits Questioned Costs – Zero Reporting views of Responsible Officials – agrees with finding. Recommendation - Deposit shortage should be funded as soon as possible. Auditor’s Summary of the Auditee’s Comments on the findings and Recommendations – The auditee’s comments appear to be accurate and consistent with the auditor finding. Response indicator – Agree Completion date - 6/30/2025 Response - Shortage will be funded prior to June 30, 2025.