Finding Text
Criteria: Pursuant to the Regulatory Agreement, the Company should ensure that tenant security deposit liability is fully funded at all times during the year.
Statement of Condition: The tenant security deposit liability exceeded the security deposit account by $2,386 as of April 30, 2023.
Cause: The Company had a cash shortfall at year end and was unable to fully fund the tenant security deposit liability, as required by the Regulatory Agreement.
Effect: The Company was not in compliance with the Regulatory Agreement relative to the required funding of the tenant security deposit liability.
Auditor’s Non-Compliance Code: M - Owners must ensure tenant security deposit liability is fully funded by security deposit trust cash account at all times during the year.
Amount of Questioned Costs: $0
Reporting Views of Responsible Officials: The Company will make the delinquent deposit subsequent to year end.
Context: This was not a sampling audit procedure.
Recommendation: Make the required delinquent deposit to the security deposit trust cash account and ensure that the tenant security deposit liability is fully funded by the trust cash account at all times, as required by the Regulatory Agreement.
Auditor’s Summary of Auditee’s Comments on the Findings and Recommendations: Auditee agreed with auditor’s findings.
Response Indicator: Accepted
Completion Date: July 17, 2023
Response: Management deposited $2,386 to the security deposit trust cash account on July 17, 2023.
Contact Person: Tim Paino