THE HAVEN ON BROAD SOUTH INCNon-Profit

S2700-005 Finding Reference Number 2021-001 S2700-006 Finding Resolution Status Resolved S2700-007 Information on Universal Population Size N/A S2700-008 Sample Size Information N/A S2700-009 Noncompliance Information N/A S2700-010 Statement of Condition At December 31, 2021, the project made disbursements from the replacement reserve fund prior to receiving HUD approval as required by the Regulatory Agreement. S2700-020 Criteria Pursuant to the requirements of the Regulatory Agreement, the Project is required to comply with all HUD regulations and other requirements. The Regulatory Agreement establishes the requirement to disburse funds from the replacement reserve only after obtaining written consent from HUD. S2700-030 Effect or Potential Effect The Project is not in compliance with the terms of the Regulatory Agreement. Failure to abide by the terms of the Regulatory Agreement may result in a referral to either the Departmental Enforcement Center or to Multifamily for compliance evaluation/action. S2700-040 Cause The Project improperly disbursed funds from the replacement reserve account. S2700-050 Recommendation Disbursements should not be made from the replacement reserve fund prior to HUD approval. All disbursements should occur after HUD authorization has been received. S2700-055 Auditor Non-Compliance Code A. Unauthorized withdrawals from replacement reserve account S2700-065 Amount of Questioned Costs $4,078 S2700-100 Reporting Views of Responsible Officials This project will submit 9250 requests prior to using funds from the Reserve for Replacement Account. S2700-070 Concur or Do Not Concur with this Finding Concurs S2700-075 Agree or Disagree with auditor recommendations Agrees S2700-080 Completion Date or Proposed Completion Date March 22, 2022 S2700-090 Actions Taken or Planned on the Finding This project will submit 9250 requests prior to using funds from the Reserve for Replacement Account.

Finding #2019-001 Program: Section 202 Project Rental Assistance CFDA 14.157 Criteria: Project rental assistance payments may only be requested and received for tenants eligible to receive assistance. Statement of Condition: During 2019, two tenants resided at the project who were ineligible to receive assistance as described in Note D. $3,912 in project rental assistance was requested and received for those tenants in 2019. Context: Not applicable. Effect: $3,912 in project rental assistance was incorrectly billed and received during 2019. Questioned Costs: $3,912 Cause: cccc Repeat Finding: Yes (2018-001, 2017-001,2016-001) Recommendation: The amounts incorrectly received in 2019 have been added to the liability for repayment to HUD recorded on the statement of financial position. Management should develop and implement a repayment plan for returning the incorrectly billed project rental assistance to HUD. Management?s Response: We are continuing to research and pursue a resolution to this issue. We will develop and implement a repayment plan and begin to make repayment by reducing future project rental assistance payments vouchers as project cash flow allows.

Finding #2019-002 Program: Section 202 Capital Advance CFDA 14.157 Criteria: Management's accounting policies and procedures should provide a high level of assurance that expenditures are charged to the correct project. Statement of Condition: During the audit for the year ended December 31, 2019, a test of twenty-five randomly selected disbursements made by The Haven on Broad South, Inc. identified charges included in one payment by The Haven on Broad South, Inc. that should have been paid by The Haven on Broad, Inc. The Haven on Broad South, Inc. made approximately 212 disbursements during 2019. Additionally, a test of twenty-five randomly selected disbursements by The Haven on Broad, Inc. identified one invoice paid by The Haven on Broad, Inc. that should have been paid by The Haven on Broad South, Inc. The net amount paid by The Haven on Broad South, Inc that should have been paid by The Haven on Broad, Inc. was $48. Context: See statement of condition above. Effect: Certain expenditures for the year ended December 31, 2019 were not charged to the correct project as described in the statement of condition above. Cause: Errors in assigning charges from shared vendors to the correct project for payment. Questioned Costs: $48 Repeat Finding: No Recommendation: Management should reemphasize the correct procedures for assigning purchases from shared vendors to The Haven on Broad, Inc. and The Haven on Broad South, Inc. with accounting personnel Management?s Response: We have discussed the errors identified during the audit with accounting personnel and have reemphasized the proper procedures for assigning purchases from shared vendors to The Haven on Broad, Inc. and The Haven on Broad South, Inc. The errors will be corrected in January 2021.

Finding #2019-003 Program: Section 202 Project Rental Assistance CFDA 14.157 Criteria: Management should perform frequent and sufficient monitoring of project and accounting personnel to provide reasonable assurance that all necessary corrective actions are made in an accurate and timely manner. Statement of Condition: Management has not yet addressed the refund due to HUD of project rental assistance received for ineligible tenants as described in Note D to the financial statements and other prior year findings as detailed in the summary schedule of prior audit findings. Context: Not applicable. Effect: A repayment plan and/or other corrective action for the project assistance received for ineligible tenants (as described in Note D to the financial statements) has not been implemented as of December 31, 2019. Questioned Costs: None Cause: Management's monitoring of project personnel was not frequent or detailed enough to provide reasonable assurance that all necessary corrective actions are made in an accurate and timely manner. Certain corrective actions have not been implemented due to project cash flow and other operating considerations. Repeat Finding: Yes (2018-003, 2017-003) Recommendation: Management should establish procedures to address and implement necessary corrective actions in an accurate and timely manner. Management?s Response: We are continuing to research and pursue a resolution to this issue. We will develop and implement a repayment plan and begin to make repayment by reducing future project rental assistance payments vouchers as project cash flow allows.

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