Finding Text
At June 30, 2023, the tenants' security deposit account was underfunded by $1,735.
Criteria. The "Consolidated Audit Guide for Audits of HUD Programs" states that "The balance in the account must at all times be at least equal to all outstanding obligations under the account for security deposits."
Cause. Management has not made the necessary transfer to fund the tenant security deposit account.
Effect. The complex is in violation of HUD requirements.
Recommendation. We recommend that funds be transferred to the tenants' security deposit account to adequately fund the liability to tenants as soon as possible.
Management Response. Management made the needed transfer on August 23, 2023, to reflect this adjustment. Necessary transfers will be made on a timelier basis in the future.