Finding Text
Criteria
Audits of financial statements of HUD projects are required to deposit security deposit funds received from tenants in a separate bank account, apart from all other funds of the Project.
Condition
The security deposits received for 2 tenants were not deposited or transferred to the security deposit bank account.
Cause
The security deposits were deposited into the operating account and the funds were not transferred to the security deposit account.
Questioned Costs
None noted.
Effect
The non-profit Organization is noncompliant with the requirements of HUD.
Recommendation
The non-profit Organization should transfer the funds from the operating account to the security deposit account.
Views of Responsible Official and Planned Corrective Action
Management agrees with the finding.