Finding Text
Finding 2022-001: Section 811
Criteria: Tenant security deposit liability exceeds tenant security deposit cash, with evidence of fund
commingling and absence of activity during the fiscal year.
Statement of Condition: Tenant security deposit liability exceeds available tenant security deposit cash.
Cause: Lack of segregation and proper oversight of tenant security deposit funds.
Effect or Potential Effect: Increased risk of financial inaccuracies and regulatory non-compliance.
Recommendation: Implement strict segregation of tenant security deposit funds, conduct regular
reconciliations, and establish regular record-keeping practices.
Management’s Response: We will reconcile our security deposit cash and security liability contra
accounts to ensure that cash exceeds the liability.