Finding Text
Finding No. 2023-002; Section 202 Supportive Housing for the Elderly, Assistance Listing
14.157
Criteria
Excess residual receipts funds should be remitted to HUD upon receipt of HUD approval.
Condition
The management received HUD approval to remit excess residual receipts funds in the amount
of $2,794, on June 8, 2022. The funds have not been remitted to HUD as of June 30, 2023.
Cause
Controls were not in place to ensure that excess residual receipts funds were timely remitted.
Effect or Potential Effect
The Organization is not in compliance with the requirements of the Consolidated Appropriations
Act of 2016, governing Residual Receipts for PRAC program.
Questioned Costs
$2,794
Identification as a Repeat Finding
This is not a repeat finding.
Recommendation
Management should establish internal controls and procedures to ensure that excess residual
receipts reserve funds are remitted timely.
Auditor Noncompliance Code: B - Failure to make required residual receipts deposits.
Finding Resolution Status: Resolved.
Views of Responsible Officials
The inspection was conducted under previous management. The Franklin Johnston Group took
over July 1st, 2023. When the Franklin Johnston Group took over, the new management were
unable to get in contact with HUD for months to receive confirmation wiring instructions. HUD
requires residual receipts to be remitted and deposited no later than the termination/renewal
date. The Franklin Johnston Group just received confirmation wiring instructions as of January
2024. Funds of $2,794 are now paid as of January of 2024. The Franklin Johnston Group will
ensure that moving forward all residual receipts are to be remitted and expedited in a timely
matter.