Russo Street Apartments, Inc.Non-Profit

Conduct a detailed review of the replacement reserve account to confirm the total excess deposits of $683. Identify the transactions that led to these excess deposits. Adjust the accounting records to reflect the accurate balance in the replacement reserve account. Document all adjustments for transparency and future reference. Review the funding guidelines for the replacement reserve to prevent future excess deposits. Ensure that all stakeholders understand the criteria for deposits into the reserve.

2023-001

Correct Existing Files: Review and update the tenant file identified with the error, and ensure the initial EIV form is completed and filed. Extend this review to other recent move-ins to correct any similar issues. Create a Checklist: Develop and implement a checklist for tenant file certifications to include mandatory steps such as completing the initial EIV form. Ensure the checklist is used for every new move-in. Conduct Training: Provide training to all relevant staff on the importance of the initial EIV form and the updated certification process. Reinforce the need for accuracy and completeness in tenant file documentation. Record Keeping: Maintain records of corrective actions taken, including updated tenant files, training sessions conducted, and audit results. Ensure these records are available for future reference and compliance checks.

Management will reduce next year's deposits by the excess amount. HOC has made significant changes to our software systems, expanded our finance team and restructured functions to improve financial record keepting. The Senior Accountant responsible for this property is Corey Krajewski(krajewski@wdchoc.org)

Management will ensure the initial EIV'sare run in the future and will retain sufficient documentation for waitlist purposes. HOC's Director of Property Management, Financial Resources and Residetn Resources, Vickie Walters (walters@wdchoc.org) and HOC's Assistance Director - Property Management will ensure that staff are trained on these topics and institute review policies to ensure that tenant fiels contain the appropriate certification, EIV form and waitlist management.

August 26, 2022 D?Ambra CPA 531 Harris Avenue Woonsocket, RI 02895 RE: Corrective Action Plan: Russo Apartments Finding 2022-001: Federal program - Section 811: Criteria - HUD regulations specify the amount required to be deposited on a monthly basis to the replacement reserve account.; Condition - one month's deposit totaling $683 was not made during the year; Cause - the property is experiencing a cash flow problem and was unable to make the required deposit; Recommendation management should make every effort to deposit the monthly required amount to the reserve account. Response: Subsequent to year end management received a rent increase and will be able to deposit the shortfall amount to the reserve account. Corrective Action Plan: Management has adopted the attached internal control workflow to ensure that program requirements are more strictly adhered to. We have also expanded our finance department by 2 FTE?s in the past two years (including a new position of Financial Analyst/Asset Manager in July 2022) to ensure that we have proper staffing to monitor properties financial performance and compliance with program requirements. Responsible party: Frank Shea

Housing Opportunities Corporation has put into place a Compliance/Asset Manager (Rene Marin), to audit all move in files and all A/Rs for all the properties. If at the time of his auditing an error is found, or an omission is found, the Compliance/Asset Manager will bring the discrepancies to the Property Managers attention for correction. Only after this is done will the tenant?s information be put into the system. All 90 day EIV requirements are now placed into Property Managers electronic Calendars as a reminder. It is also in the electronic Calendar of the Compliance/Asset Manager.