Finding 592392 (2022-001)

Significant Deficiency
Requirement
N
Questioned Costs
-
Year
2022
Accepted
2023-04-23
Audit: 20279
Organization: Rainbow Heights, Inc. (GA)
Auditor: Aprio LLP

AI Summary

  • Core Issue: The fidelity bond coverage is below the required amount of two months' gross potential rent or $50,000.
  • Impacted Requirements: This noncompliance with HUD regulations could lead to potential penalties.
  • Recommended Follow-Up: Management should increase the bond coverage by 12/31/2023 to meet compliance standards.

Finding Text

Finding Reference Number: 2022-01 Title and CFDA Number of Federal Program: Section 202 Capital Advance and PRAC, 14.157 Type of Finding: Federal Award Finding Finding Resolution Status: In Process Information on Universe Population Size: 0 Sample Size Information: 0 Identification of Repeat Finding and Finding Reference Number: Not applicable Criteria: Fidelity bond policy should provide coverage totaling two months gross potential rent or $50,000, whichever is higher. Statement of Condition: During the year ended December 31, 2022, the Company's fidelity bond was less than the required amount of two months gross potential income or $50,000. Cause: Oversight by management. Effect or Potential Effect: Noncompliant with HUD regulations. Auditor Non-Compliance Code: Z - Other Questioned Costs: $0 Reportable Views of Responsible Officials: Management is in agreement with the finding and has started the process to increase to increase the policy coverage amount. Context: Not applicable Recommendation: The Company should increase the policy to be in compliance with HUD regulations. Response Indicator: Agree Completion Date: 12/31/2023

Categories

HUD Housing Programs Internal Control / Segregation of Duties

Other Findings in this Audit

  • 15949 2022-001
    Significant Deficiency
  • 15950 2022-001
    Significant Deficiency
  • 592391 2022-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $239,123