Finding Text
S3800-010: Finding Reference Number
2023-001 (Material Weakness)
S3800-011: Program Information
Federal Program: Mortgage Insurance for Purchase or Refinancing of Existing Multifamily Rental
Housing (Section 207/223(F))
Federal Agency: Department of Housing and Urban Development (HUD)
Assistance Listing #: 14.155
Pass-through Entity: None
Federal Award Identification Number and Year: N/A
Type of Compliance Finding: N – Special Tests and Provisions
S3800-015: Type of Finding
Financial Statement and Federal Awards
S3800-016: Finding Resolution Status
Unresolved
S3800-017: Information on Universe Population Size
N/A
S3800-018: Sample Size Information
N/A
S3800-019: Identification of Repeat Finding and Finding Reference Number
N/A
S3800-020: Criteria
The regulatory agreement requires that the Organization’s books and records are maintained in
accordance with HUD guidelines and generally accepted accounting principles.
S3800-030: Statement of Condition
Several misstatements were identified by the auditor in the unaudited financial statements and
accounts of the Organization.
S3800-032: Cause
The Organization lacks adequate internal controls to ensure that books and records are kept
accurately and completely.
S3800-033: Effect or Potential Effect
The Organization was not in compliance with the regulatory agreement requirement to maintain
accurate and complete books and accounts.
S3800-035: Auditor Non-Compliance Code
S – Internal Control Deficiencies
S3800-040: Questioned Costs
None
S3800-045: Reporting Views of Responsible Officials
Management agrees with the finding.
S3800-050: Context
On the general ledger, various accounts such as rent, vacancies, and escrow accounts did not
tie to supporting documentation. The Organization did not capitalize the fixed assets as per the
capitalization policy. The cash balance in general ledger did not tie the bank reconciliation
statement.
S3800-080: Recommendation
The Auditor recommends the Organization follows their policies and procedures to ensure that
accounting records are kept accurate and complete, and a responsible official should review and
sign off on the monthly financial statements.
S3800-090: Auditor’s Summary of the Auditee’s Comments on the Findings and
Recommendations
Auditee agreed with our recommendation.
S3800-130: Response Indicator
Agree
S3800-140: Completion Date or Proposed Completion Date
June 30, 2024
S3800-150: Response
See Corrective Action Plan