Finding 524101 (2024-001)

Significant Deficiency Repeat Finding
Requirement
L
Questioned Costs
-
Year
2024
Accepted
2025-02-20

AI Summary

  • Core Issue: Related party transactions are not communicated or recorded on time, leading to inaccurate financial reports.
  • Impacted Requirements: Proper maintenance of accounting records is not being followed, resulting in misstatements and unrecorded transactions.
  • Recommended Follow-Up: Management should ensure timely communication and reconciliation of related party transactions to improve accuracy and agreement between accounting records.

Finding Text

CORRECTIVE ACTION NOT STARTED OR IN PROCESS Finding Number 2024-001: Federal Program: CFDA 14.181 – Section 811 Capital Advance Type: Financial Statement Statement of Condition: Related party transactions are not always communicated and recorded in a timely manner. Criteria: Accounting records not properly maintained. Effect: Misstated financial reports result from inaccurate accounting records, inaccurate surplus cash calculations. Unrecorded transactions. Cause: Transactions processed on behalf of the Project by related parties are not always timely communicated to the management agent creating delay in recording, causing differences and reconciling items between management agent and Project owner accounting records. Recommendation: Management needs to ensure accounting transactions affecting related parties are communicated in a timely manner to ensure accuracy and agreement between the entities. Management’s Response: Management concurs with the auditor’s finding that the Project’s related parties should communicate and reconcile accounting transactions in a timely manner. Communications and reconciliation will begin immediately.

Corrective Action Plan

Management needs to ensure accounting transactions affecting related parties are communicated in a timely manner to ensure accuracy and agreement between the entities.

Categories

HUD Housing Programs

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
14.181 Supportive Housing for Persons with Disabilities $1.37M
14.195 Project-Based Rental Assistance (pbra) $104,020