Finding 596375 (2022-001)

Significant Deficiency Repeat Finding
Requirement
N
Questioned Costs
$1
Year
2022
Accepted
2023-03-29

AI Summary

  • Core Issue: The owner failed to transfer remaining project funds to a federally insured residual receipts account within the required 60 days after the fiscal year ended.
  • Impacted Requirements: This is a repeat finding, violating HUD's regulations under Title 24 CFR Section 891.400(e).
  • Recommended Follow-Up: Implement procedures to ensure timely transfers of surplus cash funds to comply with HUD requirements.

Finding Text

Finding 2022-001 Federal Agency: U.S. Department of Housing and Urban Development Federal Program: Section 811 Supportive Housing for Persons with Disabilities CFDA: # 14.181 Compliance Requirement: Special Tests and Provisions ? Residual Receipts Account Type of Finding: Significant Deficiency in Internal Controls over Compliance Repeat Finding: This is a repeat finding. Criteria: In accordance with Title 24 CFR Section 891.400(e), any remaining project funds in the project funds account (including earned interest) following the expiration of the fiscal year shall be deposited in a Federally-insured residual receipts account within 60 days following the end of the fiscal year. Statement of Condition: The owner did not remit the remaining project funds in the project funds account to a federally insured residual receipts account within 60 days of the expiration of the fiscal year. Cause: The owner transferred the project?s surplus cash funds within 90 days instead of 60 days following year-end. Effect or Potential Effect: The owner is not in compliance with the HUD requirements related to the residual receipts account. Failure to transfer surplus cash from the operating account could result in the residual receipts account not being properly funded within 60 days following the end of the fiscal year as required by HUD. Questioned Costs: $6,562 Recommendation: We recommend the owner implement procedures to ensure the project?s surplus cash funds be transferred to a federally insured residual receipts account within 60 days following year-end. Reporting Views of Responsible Officials: Management agrees with the finding and will implement procedures to ensure the project?s surplus cash funds are transferred to a federally insured residual receipts account within 60 days following year-end.

Categories

Questioned Costs HUD Housing Programs Reporting Significant Deficiency Internal Control / Segregation of Duties Special Tests & Provisions

Other Findings in this Audit

  • 19932 2022-001
    Significant Deficiency Repeat
  • 19933 2022-001
    Significant Deficiency Repeat
  • 596374 2022-001
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
14.181 Supportive Housing for Persons with Disabilities $1.45M