Finding 58467 (2022-002)

-
Requirement
N
Questioned Costs
-
Year
2022
Accepted
2023-03-29

AI Summary

  • Core Issue: Security deposits were not returned within the required 30 days after tenant move-out.
  • Impacted Requirement: Compliance with Section 223(f) HUD Insured Mortgage regulations regarding timely refunds.
  • Recommended Follow-Up: Ensure management maintains communication and processes to meet the 30-day refund requirement moving forward.

Finding Text

Section 223(f) HUD Insured Mortgage ? CFDA 14.155 (Special Tests and Provisions) Conditions and Criteria: The Corporation is required to refund all security deposits within 30 days of tenant move out. The Corporation did return the security deposit in the correct amount; however, it was not returned within 30 days of the tenant move out date. Effect: Security deposit was not returned timely. Cause: This occurred due to an oversight at the Corporation. Auditor?s Recommendation: Communication with management to return security deposit once a tenant has left. Management?s Response: Management has implemented steps to ensure that future security deposit refunds are made within the 30-day requirement.

Corrective Action Plan

Identifying Number: Section 223(F), HUD Insured Mortgage - CFDA 14.155 (Special Tests and Provisions) Finding: 2022-02: In conjunction with our audit in accordance with the requirements established by the U.S. Department of Housing and Urban Development, tenant security deposits are required to be returned within 30 days of the tenant's move-out date. However, in performing procedures to ascertain the accuracy of the return of security deposits, we noted the security deposit returned to one tenant was more than 30 days after move-out. We recommend that security deposits be returned within 30 days of the tenant's move-out date. Corrective Action Taken or Planned Management has implemented steps to ensure that future security deposit refunds are made within the 30 day requirement.

Categories

Special Tests & Provisions HUD Housing Programs Internal Control / Segregation of Duties

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $824,048
14.195 Section 8 Housing Assistance Payments Program $248,917
14.191 Multifamily Housing Service Coordinators $36,403