Finding Text
Finding Type:
- Immaterial noncompliance with major program requirements
- Significant deficiency in internal control over compliance
Title and Assistance Listing Number of Federal Program - U.S. Department of Housing and Urban Development - Section 232 Mortgage Insurance; 14.129
Finding Resolution Status - Resolved
Information on Universe and Population Size - Required deposits to the replacement reserve account.
Sample Size Information - N/A
Identification of Repeat Finding and Finding Reference Number - N/A
Criteria - The Corporation should have made 12 monthly deposits totaling $78,577 into the replacement reserve 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 as specified by the regulatory agreement.
Effect or Potential Effect - The replacement reserve account was underfunded in the current fiscal year by $4,688.
Auditor Noncompliance Code - N - Reserve for replacements deposits
Reporting Views of Responsible Officials - Management agrees with the finding as reported.
Context - During our audit procedures performed over replacement reserve deposits, it was noted that the replacement reserve account was underfunded by $4,688 based on the minimum deposit amount required by the regulatory agreement.
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 underfunded amount of $4,688 deposit to the replacement reserve account as soon as possible.
Response Indicator - Agree
Completion Date - November 13, 2024
Response - Management acknowledges noncompliance in the current fiscal year and has taken measures to improve internal controls over compliance. Management deposited $4,688 into the replacement reserve account on November 13, 2024