Finding 951103 (2023-002)

Finding Type ‑ Immaterial noncompliance with major program requirements Title and Assistance Listing Number of Federal Program ‑ U.S. Department of Housing and Urban Development ‑ Mortgage Insurance for the Purchase or Refinance of Existing Multifamily Housing Projects (ALN #14.155) Finding Resolution Status ‑ Resolved Information on Universe and Population Size ‑ Tenant move‑outs during the year ended June 30, 2023 Sample Size Information ‑ Two samples were selected from a total of eight move‑outs during the year. Identification of Repeat Finding and Finding Reference Number ‑ N/A Criteria ‑ HUD requires the Organization to refund the security deposit to tenants within 30 days of the move out. Statement of Condition ‑ The Organization failed to refund the security deposit to a tenant within 30 days of the tenant's move‑out date. Cause ‑ The Organization failed to monitor the deposit refund requirements for the security deposits as specified by the Regulatory Agreement. Effect or Potential Effect ‑ The tenant did not receive the security deposit refund until 41 days after the move‑out date. Auditor Noncompliance Code ‑ M ‑ Security deposits Reporting Views of Responsible Officials ‑ Management is aware of the requirement to refund the security deposit within 30 days of a tenant's move‑ out date and agrees there should be a timely reconciliation control implemented. Recommendation ‑ The Organization should implement internal controls to properly refund any tenant's security deposit within 30 days of the move‑out. Response Indicator ‑ Agree Completion Date ‑ December 22, 2022 Response ‑ Management acknowledges noncompliance in the current fiscal year and returned the security deposit to the tenant on December 22, 2022, 41 days after the tenant's move‑out date.