Finding Text
S3800-010 Finding Reference Number – 2024-002
S3800-011 Title and CFDA Number of Federal Program –
Section 202 Supportive Housing for the Elderly, Capital Advance and Project Rental Assistance Contract, ALN 14.157
S3800-015 Type of Finding – Federal Award Finding; Other Matters
S3800-016 Finding Resolution Status – Resolved
S3800-017 Information on Universe Population Size – N/A
S3800-018 Sample Size Information – N/A
S3800-019 Identification of Repeat Finding and Finding Reference Number – N/A
S3800-020 Criteria –
Per the regulatory agreement Section 5(a) for a Project under the ALN 14.157, the Project is required to establish and maintain a reserve fund for replacements in a separate account. In addition, the Corporation is required to deposit an amount equal to $470.72 per month unless a different date or amount is approved in writing by HUD.
S3800-030 Statement of Condition –
During the year ended September 30, 2024, the Corporation underfunded the reserve for replacements by $33.
S3800-032 Cause –
During the year ended September 30, 2024, the individual in charge of making the deposits retired and there was turnover when filling the position. As a result, the new A/P Clerk deposited the incorrect amount into the account for September 2024, in error.
S3800-033 Effect or Potential Effect –
There are less funds available for capital repairs and improvements.
S3800-035 Auditor Non-Compliance Code – N (Reserve for Replacement Deposits)
S3800-037 FHA/Contract Number – 171-EE015
S3800-038 Questioned Costs – $0
S3800-040 Questioned Costs – $0
S3800-045 Reporting Views of Responsible Officials –
Sessions Village 202 is in agreement with the findings, and the recommendations have been implemented.
S3800-050 Context –
In August 2024, no deposit was made into the account. When the correction was made in September 2024, the deposit amount was changed in error for September 2024 from $470.42 to $437.09 due to a notice from the bank management received for a related party.
S3800-080 Recommendation –
We recommend Sessions Village 202 deposit the underfunded amount into the account.
Also, we recommend management of Sessions Village 202 review their internal controls over the reserve for replacements deposit process with the necessary individuals involved in the process to ensure the appropriate deposits are made going forward.
S3800-090 Auditor’s Summary of Auditee Comments on the Findings and Recommendations –
In November, 2024, the amount was deposited into the account.
The Accountant at Sessions Village 202 will review the process and procedures in place with the new A/P Clerk, and implement controls to ensure the appropriate deposits are made going forward.
S3800-130 Response Indicator – Agree
S3800-140 Completion Date – November 30, 2024
S3800-150 Response –
In November, 2024, the amount was deposited into the account.
The Accountant at Sessions Village 202 will review the process and procedures in place with the new A/P Clerk, and implement controls to ensure the appropriate deposits are made going forward.