Finding Text
Finding #2022-001: Section 202 Capital Advance, CFDA 14.157 Condition: The Company made additional deposits into the replacement reserve account that exceeded the required monthly deposit requirements. Criteria: The HUD regulatory agreement requires the Company to 12 monthly deposits into the replacement reserve account. Effect: Replacement reserve account is overfunded and is in violation of its Regulatory Agreement. Funds may not be available for operating costs. Questioned Cost: $9,018 Cause: Oversight Recommendation: We recommend the Company deposit the required monthly deposits into the replacement reserve account and follow the terms of the regulatory agreement. Auditor?s Comment: Client intends to request a waiver from HUD to suspend monthly deposits for one year.