Finding 528132 (2024-001)

Other Matter Compliance Federal Award ID Not Available, 2024, Federal program: U.S. Department of Housing and Urban Development, ALN 14.181 Supportive Housing for Persons with Disabilities Criteria: Any surplus funds in the project funds account (including earned interest) at the end of the fiscal year shall be deposited in a federally insured account within 60 days following the end of the fiscal year. Withdrawals from this account may be made only for project purposes and with the approval of HUD (24 CFR section 891.400(e). Condition: During our test work, we noted that each HUD location has a segregated residual receipts account for which the surplus cash at fiscal year-end is to be deposited. Three HUD locations had surplus cash amounts at June 30, 2024. However, management did not transfer the surplus cash into the applicable residual receipt accounts until greater than 60 days after year-end. Questioned Costs: None Context: At June 30, 2024, there were three HUD location identified as having surplus cash. The total amount of surplus cash for those locations was $16,243. The surplus cash was transferred to the segregated residual receipts accounts, however not within 60 days after year-end. Effect: Surplus cash as of June 30, 2024 remained in the project funds accounts for greater than 60 days after fiscal year-end. Cause: The project fund accounts for each HUD location are interest-bearing, therefore the requirement to transfer surplus cash into a segregated account within 60 days after year-end was overlooked. Recommendation: We recommend that management perform its surplus cash calculations in a timely manner and make any required transfers within 60 days after fiscal year-end. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the finding. See Corrective Action Plan.