Finding 581364 (2023-002)

-
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2023-12-18

AI Summary

  • Core Issue: The Project underfunded the Replacement Reserve account by $1,225 due to delays in implementing approved monthly deposit increases.
  • Impacted Requirements: Timely monthly deposits to the Replacement Reserve account are mandated by HUD regulations.
  • Recommended Follow-Up: Ensure new procedures are in place for accurate monthly deposits and proper handling of unused funds to prevent future miscalculations.

Finding Text

FINDING No. 2023-002: Section 202 Supportive Housing for the Elderly, ALN 14.157 Finding Resolution Status: Unresolved. Information on Universe Population Size: All replacement reserve deposits for the year ended March 31, 2023. Sample Size Information: All replacement reserve deposits for the year ended March 31, 2023. Identification of Repeat Finding and Finding Reference Number: No. Criteria: As required by HUD regulation, timely monthly deposits must be made to the Replacement Reserve account. Statement of Condition: The Project underfunded the account by $1,225. Cause: The Project received approval for an increase to the monthly deposit into the replacement reserve account with an effective date of October 31, 2022. The Project did not implement the required monthly deposits into replacement reserve account in a timely manner. Effect or Potential Effect: Deficiently funded replacement reserve. Auditor Non-Compliance Code: N – Reserve for Replacement Deposits. Reporting Views of Responsible Officials: The Project agrees with the finding and the auditor’s recommendations will be adopted. Recommendation: The Project should implement procedures to ensure the correct amount is deposited into the replacement reserve account each month. Response Indicator: Agree. Completion Date: 03/31/2024 Response: Management deposited the correct amount into the replacement reserve account, however there was a miscalculation due to the unused portion of a pre-release 9250 being included in the calculation of required deposits. A new process has been put into place ensuring all unused 9250 funds are reimbursed and a proper description is used to identify the reimbursement vs. funding.

Categories

Cash Management HUD Housing Programs Reporting

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly - Capital Advance $2.70M
14.157 Supportive Housing for the Elderly - Project Rental Assistance Contract - (prac) $292,296