Finding 570694 (2023-004)

Material Weakness
Requirement
A
Questioned Costs
$1
Year
2023
Accepted
2025-07-08

AI Summary

  • Core Issue: The Partnership distributed $28,619 beyond its available surplus cash, violating the Regulatory Agreement.
  • Impacted Requirements: Distributions must only come from surplus cash to ensure operational funds are maintained.
  • Recommended Follow-Up: Management should adhere to the guideline of limiting distributions to surplus cash moving forward.

Finding Text

Finding reference number: #2023-004 Assistance Listing title and number (Federal award identification number and year): Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects, Assistance Listing No. 14.155 Identification numbers Property Year of award 101-11323 1221 Pearl 2022 Auditor non-compliance code: A – Activities Allowed or Unallowed Finding resolution status: Cleared Universe population size: The universe population size is not applicable to the finding. Finding reference number: #2023-004 (continued) Sample size information: The sample size information is not applicable to the finding. Statistically valid sample: N/A Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $28,619 Repeat Finding: No Statement of Condition #2023-004: During the year ended March 31, 2023, the Partnership made distributions of $28,619 in excess of surplus cash. Criteria: Pursuant to the Regulatory Agreement, the Partnership shall not make, or receive and retain, any distribution of assets or any income of any kind of the project except surplus cash. Effect: The payment of the distribution without surplus cash could result in the Partnership not having enough funds to cover operations. Cause: Management distributed an amount greater than the total of the surplus cash amount. Recommendation: Management should limit the payment of distributions to surplus cash. Completion Date: March 31, 2023 Management Response: Agreed. Management will limit future distributions to surplus cash. Surplus cash is positive at March 31, 2023, no further action is needed.

Corrective Action Plan

Statement of Condition #2023-004: During the year ended March 31, 2023, the Partnership made distributions of $40,398 in excess of surplus cash. Recommendation: Management should limit the payment of distributions to surplus cash. Action(s) taken or planned on the finding: Agreed. Management will limit future distributions to surplus cash.

Categories

Questioned Costs Procurement, Suspension & Debarment Subrecipient Monitoring HUD Housing Programs

Other Findings in this Audit

  • 570685 2023-001
    Material Weakness Repeat
  • 570686 2023-002
    Material Weakness
  • 570687 2023-003
    Significant Deficiency Repeat
  • 570688 2023-006
    Material Weakness
  • 570689 2023-007
    Significant Deficiency
  • 570690 2023-001
    Material Weakness Repeat
  • 570691 2023-002
    Material Weakness
  • 570692 2023-006
    Material Weakness
  • 570693 2023-007
    Significant Deficiency
  • 570695 2023-005
    Significant Deficiency Repeat
  • 570696 2023-006
    Material Weakness
  • 570697 2023-007
    Significant Deficiency
  • 570698 2023-008
    Significant Deficiency
  • 570699 2023-006
    Material Weakness
  • 570700 2023-007
    Significant Deficiency
  • 570701 2023-006
    Material Weakness
  • 570702 2023-007
    Significant Deficiency
  • 570703 2023-006
    Material Weakness
  • 570704 2023-007
    Significant Deficiency
  • 1147127 2023-001
    Material Weakness Repeat
  • 1147128 2023-002
    Material Weakness
  • 1147129 2023-003
    Significant Deficiency Repeat
  • 1147130 2023-006
    Material Weakness
  • 1147131 2023-007
    Significant Deficiency
  • 1147132 2023-001
    Material Weakness Repeat
  • 1147133 2023-002
    Material Weakness
  • 1147134 2023-006
    Material Weakness
  • 1147135 2023-007
    Significant Deficiency
  • 1147136 2023-004
    Material Weakness
  • 1147137 2023-005
    Significant Deficiency Repeat
  • 1147138 2023-006
    Material Weakness
  • 1147139 2023-007
    Significant Deficiency
  • 1147140 2023-008
    Significant Deficiency
  • 1147141 2023-006
    Material Weakness
  • 1147142 2023-007
    Significant Deficiency
  • 1147143 2023-006
    Material Weakness
  • 1147144 2023-007
    Significant Deficiency
  • 1147145 2023-006
    Material Weakness
  • 1147146 2023-007
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $1.94M
14.239 Home Investment Partnerships Program $592,026
14.195 Section 8 Housing Assistance Payments Program $66,763
14.191 Multifamily Housing Service Coordinators $58,741