Finding 526998 (2024-001)

Significant Deficiency
Requirement
B
Questioned Costs
-
Year
2024
Accepted
2025-03-14

AI Summary

  • Core Issue: The organization failed to deposit $93,641 into the residual receipts reserve within the required 90 days after year-end.
  • Impacted Requirements: This noncompliance with HUD regulations indicates a lack of effective internal controls.
  • Recommended Follow-Up: Management should implement new procedures to ensure timely deposits moving forward.

Finding Text

Federal Award Findings and Questioned Costs Finding No. 2024-1; Section 202, Assistance Listing 14.157 – Significant Deficiency Name of Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name and Assistance Listing Number: Supportive Housing for the Elderly Section 202 Direct Loan and Project Rental Assistance Contract; 14.157 Federal Award Identification Number and Year: 012-EE287 2024 Condition During the year ended June 30, 2024, management did not make the required residual receipts reserve deposit in the amount of $93,641 within 90 days of year end, as required by HUD. The residual receipts amount as of February 26, 2025, the Organization has not yet deposited the amount into the Residual Receipts reserve. Criteria Residual receipts reserve deposits should be made within 90 days of year end. Cause Controls are not in place to ensure that required residual receipts reserve deposits are made timely. Effect or Potential Effect The Organization is not in compliance with the requirements of the regulatory agreement. Recommendation Management should establish internal controls and procedures to ensure that required residual receipts reserve deposits are made timely. Auditor's Noncompliance Code: B - Failure to make required residual receipts deposits Reporting Views of Responsible Officials The $93,461 of residual receipts noted in the 2023 audit and cited as a finding in the 2024 report was deposited into the residual receipt account on January 10, 2025. Our new Controller has established procedures to ensure that that the proceeds stemming from the retroactive budgetbased rent increase are used for their intended purpose prior to the end of the fiscal year that they are received. Status In process

Categories

HUD Housing Programs Student Financial Aid Cash Management Reporting Significant Deficiency Internal Control / Segregation of Duties Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 526997 2024-001
    Significant Deficiency
  • 1103439 2024-001
    Significant Deficiency
  • 1103440 2024-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $991,062