Finding Text
2022-001 Federal agency: U.S. Department of Housing and Urban Development Federal program: Section 221(d)(3) Insured Mortgage Federal Assistance Listing: 14.135 Award Period: 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance Criteria of specific requirement: Surplus cash must be calculated and deposited as defined in the Regulatory Agreement. Surplus cash deposit was underfunded. Condition: The Project did not deposit the full amount of its Surplus Cash position at June 30, 2021. Deposit was underfunded as calculated and required by regulatory agreement. Calculation was $71,914 and $56,029 was deposited. Questions costs: $15,885 Context: Reporting requirements were tested for instances of noncompliance. Cause: Oversight Effect: Residual receipts reserve balance was less than required by regulatory agreement. Recommendation: We recommend that Project Management compute surplus cash on an annual basis and make full deposit within 90 days as required by regulatory agreement.