Finding Text
Monthly deposits to the reserve for replacements account was not increased in August 2022 as was required.
Criteria. In accordance with the OCAF rent increase that was effective August 1, 2022, the corporation was required to increase their monthly deposit to the reserve for replacements account.
Cause. Management was not aware that they were required to increase their monthly deposit amount.
Effect. The reserve for replacements account is underfunded $672 as of June 30, 2023.
Recommendation. We recommend that the reserve for replacements account be properly funded by making a transfer of $61.05 per month for August 1, 2022 through the month of funding. Care should be taken to ensure that the increase in the required deposit effective August 1, 2023 is also included in the transfer and that the monthly deposits thereafter be made in accordance with the new requirements.
Management Response. Management was not aware of its requirement to increase the monthly deposit to the reserve for replacements account. Management will fund the necessary monies to compensate for the lack of increase during fiscal year 2023. Management will also ensure the required increase beginning August 1, 2023, will be included in monthly deposits for fiscal year 2024.