Finding 610570 (2022-001)

Significant Deficiency
Requirement
N
Questioned Costs
-
Year
2022
Accepted
2022-11-03

AI Summary

  • Core Issue: The Corporation failed to make a required second mortgage payment of $319,688 on time, violating the Mortgage Restructuring Note.
  • Impacted Requirements: Payments must be made within 10 days after the financial statement due date of June 30, as outlined in the audit reports from 2017 to 2021.
  • Recommended Follow-Up: Management should immediately make the overdue payments and is currently working with HUD on a payment plan.

Finding Text

Finding reference number: #2022-001 CFDA title and number (Federal award identification number and year): Mortgage Insurance for the Purchase or Refinancing of Existing Multifamily Housing Projects, CFDA No. 14.155 (122-35665, 122-35569V and 2004). Auditor non-compliance code: Q - Failure to make Mortgage Payments Universe population size: The universe population size is not applicable to the finding. Sample size information: The sample size information is not applicable to the finding. Statistically valid sample: N/A Name of Federal agency: U.S. Department of Housing and Urban Development Pass-through entity: N/A Questioned costs: $319,688 Statement of Condition #2022-001 (CFDA 14.155): The Corporation did not make the required second mortgage payment of $319,688 in a timely manner based on the March 31, 2021, 2019, 2018, and 2017 audit reports. Criteria: As required under the Mortgage Restructuring Mortgage Note, a payment must be made on the second mortgage within 10 days after the financial statement due date of June 30. Effect: The Corporation did not comply with the Mortgage Restructuring Note. Cause: Management did not make a payment on the second mortgage in a timely manner after receiving the final audit report for each of the years March 31, 2021, March 31, 2019, March 31, 2018, and March 31, 2017. Recommendation: Management should make the delinquent payments on the second mortgage immediately. Completion Date: Outstanding Management Response: Management concurs with the finding and recommendation. The Corporation is working with HUD for a payment plan and anticipates making payments during the year ended March 31, 2023.

Categories

HUD Housing Programs Procurement, Suspension & Debarment Subrecipient Monitoring

Other Findings in this Audit

  • 34128 2022-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.155 Mortgage Insurance for the Purchase Or Refinancing of Existing Multifamily Housing Projects $794,257
14.195 Section 8 Housing Assistance Payments Program $165,323