AHEPA 127, Inc.

Finding reference number: #2020-001 CFDA Title and a number (Federal award identification number and year): Supportive Housing for the Elderly, CFDA 14.157 (Project identification number 046-EE055) Auditor non-compliance code: A - Unauthorized withdrawal from replacement reserve Finding resolution status: Resolved Universe population size: 23 invoices from 3 HUD approved 9250 withdrawals. Sample size information: 23 invoices from 3 HUD approved 9250 withdrawals. Noncompliance information: See statement of condition #2020-001 for noncompliance information. Statically valid sample: Yes Name of Federal agency: U.S. Department of Housing and Urban Development Pass Through entity: N/A Questioned costs: $2,250 Statement of condition #2020-001: During the year ended June 30, 2020, HUD approved a reserve for replacements withdrawal that included invoices from a previously approved withdrawal. The reserve for replacements account was not reimbursed for the duplicate withdrawals. Criteria: Pursuant to the Regulatory Agreement, the Corporation shall not make withdrawals from the reserve for replacements account except after receiving the written consent of HUD and for the purpose of replacing structural elements and mechanical equipment of the Property. Effect or potential effect: The Corporation is not in compliance with the terms of the Regulatory Agreement. At June 30, 2020, the Property's reserve for replacements account is underfunded by $2,250. Cause: Management requested a reimbursement from the reserve for replacements account for the same invoices twice. Recommendation: Management should transfer funds from the operating account in order to reimburse the reserve for replacements account. Completion date: August 24, 2020 Management Response: Agree. On August 24, 2020, management reimbursed the Property's reserve for replacements account in the amount of $2,250.