Finding 584555 (2023-002)

#2023-002 FINDING: Residual Receipts Reserves and Tenant Security Deposits Federal Programs Affected: Section 8 Subsidy ALN #14.181 Compliance Requirements: Special Tests and Provisions Questioned Costs: None Condition and Cause: During our engagement, we noted deposits of residual receipts reserves were not made within 60 days of year-end as required by U.S. Department of Housing and Urban Development. We also noted a security deposit for a tenant was never collected. Criteria and Effect: U.S. Department of Housing and Urban Development requires the Organization to make deposits to the residual receipts reserves within 60 days of year-end and collect security deposits from tenants. Repeat Finding from Prior Year: Yes Recommendation We recommend the Organization develop an internal control to track compliance with Section 8 compliance requirements including submitting required deposits to the residual receipts reserve accounts. Response/Correction Action Plan: Management is in agreement with the finding. See Correction Action Plan.