Finding 559919 (2024-001)

Significant Deficiency

Requirement

Questioned Costs

Year

2024

Accepted

2025-05-08

Audit: 355860

Organization: Winslow Gardens (RI)

Auditor: Aafcpas INC

AI Summary

Core Issue: The Organization failed to transfer $720,497 to a residual receipts account within the required 90 days after December 31, 2023.
Impacted Requirements: This noncompliance with HUD regulations could lead to financial penalties and affect the accuracy of financial reporting.
Recommended Follow-Up: Strengthen internal controls and oversight to ensure timely compliance with transfer requirements and ongoing communication with HUD.

Finding Text

Significant Deficiency: Finding 2024-001 Criteria: The U.S. Department of Housing and Urban Development (HUD) required that the Organization transfer surplus cash of $720,497 to a residual receipts account within 90 days after December 31, 2023. Condition: The Organization did not establish a residual receipts account and deposit the required funds within 90 days after December 31, 2023. Cause: The delay in completing the transfer was due to the Organization being in communications with HUD in consideration of refinancing their debt and, therefore, no longer having the residual receipt requirement. Effect: The failure to complete the transfer within the specified timeframe could result in noncompliance with regulatory requirements and potential financial penalties. Additionally, it may impact the Organization’s financial reporting accuracy and reliability. Recommendation: It is recommended that the Organization reviews and strengthens its internal controls and procedures to ensure timely transfers to the residual receipts account. This may include implementing additional oversight to ensure compliance with the established timelines. Management Response: Management is in agreement with this finding. Winslow Gardens is actively working with HUD to determine next steps for the residual receipts and a solution to the outstanding Flex Subsidy Loan.

Corrective Action Plan

March 20, 2025 Cognizant or Oversight Agency for Audit Winslow Gardens respectfully submits the following corrective action plan for the year ended December 31, 2024. Name and address of independent public accounting firm: AAFCPAS, Inc. 50 Washington Street Westborough, MA 01581 Audit period: December 31, 2024 The findings from the December 31, 2024 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS - FINANCIAL STATEMENT AUDIT FINDINGS NONE FINDINGS-FEDERAL AWARD PROGRAMS AUDITS SIGNIFICANT DEFICIENCY U.S. Department of Housing and Urban Development 2024-001 Operating Assistance for Troubled Multifamily Housing Projects-CFDA No. 14.164. Recommendation: It is recommended that the Organization review and strengthens its internal controls and procedures to ensure timely transfers to the residual receipts account. This may include implementing additional oversight to ensure compliance with the established timelines. Action Taken: Management is in agreement with this finding. Winslow Gardens is acitvely working with HUD to determine next steps for the residual receipts and a solution to the outstanding Flex Subsidy Loan. If the grantor has questions regarding this plan, please call Joseph Durand at 401-438-7210 Ext. 111 Sincerely yours, Joseph Durand, Chief Financial Officer

Other Findings in this Audit

1136361 2024-001

Significant Deficiency

Programs in Audit

ALN	Program Name	Expenditures
14.164	Operating Assisting for Troubled Multifamily Housing Projects	$1.65M