Home Share

Federal Agency: Department of Housing and Urban Development Federal Program Name: Supportive Housing for Persons with Disabilities Assistance Listing Number: 14.181 Award Period: April 1995 – April 2035 Type of Finding: • Material Weakness in Internal Control over Compliance and Other Matters Criteria or specific requirement: HUD regulations and the Project’s Regulatory Agreement require that, for nonprofit HUD‑assisted projects, all surplus cash at year‑end be either used to pay down debts subject to surplus cash or deposited into the residual receipts reserve within the timeframe specified in the Regulatory Agreement. Condition: During the audit year, the Project did not make a specific payments on debts subject to surplus cash limitations, nor were any deposits made to the residual receipts reserve in the amount of prior year’s surplus cash amount of $46,906. Payments were made on amounts due to related party subject to surplus cash throughout the year for expenses related to operations, but there was no specific identifiable payment related to 2024 surplus cash. Questioned costs: N/A Context: The absence of debt payments subject to surplus cash and the lack of residual receipts deposit occurred during the year under audit and relate to the Project’s year‑end cash position and compliance with HUD financial requirements. Cause: Management did not have sufficiently detailed policies and procedures to ensure that surplus cash was either used to pay down debts subject to surplus cash or deposited into residual receipts reserve within the time frame set by the regulatory agreement. Effect: Failure to make the required deposit increases the risk that HUD‑restricted funds could be improperly retained or used, and that loan repayment provisions tied to surplus cash may not be properly enforced. Repeat Finding: No Recommendation: We recommend that management establish and implement formal written policies and procedures to ensure surplus cash is either used to pay down debts subject to surplus cash or deposited in the residual receipts reserve in a timely manner in accordance with HUD requirements and the project’s Regulatory Agreement. Views of responsible officials: There is no disagreement with the audit findings. Management Response: We have strengthened our internal controls by implementing a documented audit trail and a formal monthly reconciliation process for all intercompany activity between Home Share and Accord. Each month, the Contract Accountant prepares and submits to the Vice President of Finance a summary of the year to date activity along with the full outstanding intercompany balance, including prior year amounts. The Vice President of Finance reviews this reconciliation against the Home Share account balances to determine the amount that can be transferred to reduce the intercompany liability in accordance with HUD surplus cash requirements. Once the transfer is approved and completed, the Contract Accountant receives confirmation along with a copy of the ACH transaction to document the transaction. This process is performed and documented as part of each month end close to ensure timely, accurate, and compliant surplus cash transfers.

Supportive Housing for Persons with Disabilities (Section 811) – Assistance Listing No. 14.181 Recommendation: We recommend that management establish and implement formal written policies and procedures to ensure surplus cash is either used to pay down debts subject to surplus cash or deposited in the residual receipts reserve in a timely manner in accordance with HUD requirements and the project’s Regulatory Agreement. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: We have strengthened our internal controls by implementing a documented audit trail and a formal monthly reconciliation process for all intercompany activity between Home Share and Accord. Each month, the Contract Accountant prepares and submits to the Vice President of Finance a summary of the year to date activity along with the full outstanding intercompany balance, including prior year amounts. The Vice President of Finance reviews this reconciliation against the Home Share account balances to determine the amount that can be transferred to reduce the intercompany liability in accordance with HUD surplus cash requirements. Once the transfer is approved and completed, the Contract Accountant receives confirmation along with a copy of the ACH transaction to document the transaction. This process is performed and documented as part of each month end close to ensure timely, accurate, and compliant surplus cash transfers. Name(s) of the contact person(s) responsible for corrective action: Jes Cuoco Planned completion date for corrective action plan: May 31, 2025

Federal Agency: Department of Housing and Urban Development Federal Program Name: Supportive Housing for Persons with Disabilities Assistance Listing Number: 14.181 Award Period: April 1995 – April 2035 Type of Finding: • Material Weakness in Internal Control over Compliance Criteria or specific requirement: The owner submits monthly vouchers to HUD for payment of rental assistance. The total amount of assistance equals total HUD-approved operating expenses for the Project minus the tenant payments received for all units (PRAC paragraph 2.4(f)(1)). Tenants generally are required to pay rent in accordance with a project rental assistance contract. The owner receives assistance from HUD on vacant rental assistance units at a rate of 50 percent of operating expense for a unit under PRAC (PRAC paragraph 2.4(b)) for the first 60 days of vacancy, given certain conditions are met (24 CFR section 891.445). Condition: The Project submits monthly HAP vouchers for rental assistance; however, there was no review performed of the form by someone who had not prepared the voucher prior to submission. Questioned costs: N/A Context: The absence of proper review of the monthly HAP Vouchers before submission. Cause: Management does not have controls in place to ensure the monthly HAP vouchers are properly reviewed before submission. Effect: The absence of proper review of the monthly HAP Vouchers could allow the receipt of improper rental assistance amounts. Repeat Finding: No Recommendation: We recommend that management establish and implement a formal internal control to ensure that someone who did not prepare the HAP Voucher reviews them for accuracy before submission. The preparation and review should be documented with a signature and date to ensure there is a proper audit trail. Views of responsible officials: There is no disagreement with the audit findings. Management Response: We will strengthen our internal controls by implementing a formal, documented review process to ensure that all monthly HAP Vouchers receive an independent review prior to submission to HUD. Beginning with the next reporting cycle, our HUD Consultant will be responsible for preparing the monthly HAP Voucher and assembling all supporting documentation. Once prepared, the voucher package will be forwarded to the Contract Accountant for an independent review. The Contract Accountant will verify the accuracy and completeness of the voucher, including agreement to tenant ledgers, mathematical accuracy, proper application of subsidy rules, and consistency with prior month activity. This review will be documented through a dated signature on the voucher cover sheet, establishing a clear audit trail and ensuring appropriate segregation of duties between preparation and review. This control will be incorporated into the monthly close process and performed consistently going forward to ensure accurate, compliant, and fully supported HAP Voucher submissions.

Supportive Housing for Persons with Disabilities (Section 811) – Assistance Listing No. 14.181 Recommendation: We recommend that management establish and implement a formal internal control to ensure that someone who did not prepare the HAP Voucher reviews them for accuracy before submission. The preparation and review should be documented with a signature and date to ensure there is a proper audit trail. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: We will strengthen our internal controls by implementing a formal, documented review process to ensure that all monthly HAP Vouchers receive an independent review prior to submission to HUD. Beginning with the next reporting cycle, our HUD Consultant will be responsible for preparing the monthly HAP Voucher and assembling all supporting documentation. Once prepared, the voucher package will be forwarded to the Contract Accountant for an independent review. The Contract Accountant will verify the accuracy and completeness of the voucher, including agreement to tenant ledgers, mathematical accuracy, proper application of subsidy rules, and consistency with prior month activity. This review will be documented through a dated signature on the voucher cover sheet, establishing a clear audit trail and ensuring appropriate segregation of duties between preparation and review. This control will be incorporated into the monthly close process and performed consistently going forward to ensure accurate, compliant, and fully supported HAP Voucher submissions. Name(s) of the contact person(s) responsible for corrective action: Jes Cuoco Planned completion date for corrective action plan: April 1, 2026

2024 – 001 Federal Agency: Department of Housing and Urban Development Federal Program Name: Supportive Housing for Persons with Disabilities Assistance Listing Number: 14.181 Award Period: N/A Type of Finding: *Material Weakness in Internal Control over Compliance and Other Matters Criteria or specific requirement: Owners are required to establish and maintain a separate project account in federally insured depository. All rents, charges, income, and revenues arising from the project operation shall be deposited into this account. Project funds must be used for the operation of the project (including required insurance coverage), and to make required deposits to replacement reserve and the residual receipts accounts (24 CFR section 891.400(e)). Condition: It was observed that rent deposits were not being processed through the Sunrise Bank Lockbox (implemented in January of 2024) to the correct entity's operating account. Additionally, in January through September of 2024, the activity was not being transferred to Home Share in a timely manner and there is no proof that the bank reconciliation is being reviewed. Questioned costs: N/A Context: The project is required to maintain a separate account for all project-related income and expenses to ensure proper financial management and compliance with federal regulations. This account should be used exclusively for project operations, including required insurance coverage and deposits to replacement reserve and residual receipts accounts. Additionally, there should be controls in place to ensure these are being properly recorded. Cause: The process for handling rent deposits in January through September of 2024 was not aligned with the established criteria. This misalignment was due to the onboarding of Remit Plus (lockbox company for Sunrise Bank). Accord can only have one lockbox where all checks are sent, including rent for Home Share. Despite having a separate project in Remit Plus for Home Share, not all checks were properly deposited into the company’s operating account, but rather into Accord’s operating account. In Q1-Q3, timely transfer of Home Share funds did not occur. Once Accord identified the issue, timely transfers begin in Q4. Effect: Failure to deposit rent income into the correct operating account and delay in transferring activity to Home Share can lead to financial discrepancies, mismanagement of project funds, and noncompliance with federal regulations. This can ultimately affect the project's ability to meet operational and regulatory requirements. Repeat Finding: No Recommendation: It is recommended that the Project continue to monitor the deposit of Home Share funds into Accord’s operating account & transfer the funds in a timely manner. In addition, a review of the bank reconciliation should be documented to support that the deposits were reviewed and transferred timely. Views of responsible officials: There is no disagreement with the audit findings. Management Response: We have taken corrective action to ensure that funds are transferred to the appropriate account in a timely manner and have strengthened our review procedures to confirm compliance. We are actively working with Remit Plus & Sunrise Bank to prevent future delays and ensure ongoing compliance with federal regulations.

Supportive Housing for Persons with Disabilities (Section 811) – Assistance Listing No. 14.181 Recommendation: It is recommended that the Project continue to monitor the deposit of Home Share funds into Accord’s operating account & transfer the funds in a timely manner. In addition, a review of the bank reconciliation should be documented to support that the deposits were reviewed and transferred timely. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: We have taken corrective action to ensure that funds are transferred to the appropriate account in a timely manner and have strengthened our review procedures to confirm compliance. We are actively working with Remit Plus & Sunrise Bank to prevent future delays and ensure ongoing compliance with federal regulations. Name(s) of the contact person(s) responsible for corrective action: Jes Cuoco Planned completion date for corrective action plan: May 31, 2025

2023-001 Lack of Review Department of Housing and Urban Development AL #14.181 - Supportive Housing for Persons with Disabilities (Section 811) Material Weakness Category of Finding – Eligibility Condition – For most of 2023, Home Share did not have controls in place to ensure that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual making the initial determination or annual recertification. Criteria – 2 CFR section 200.303 requires that organizations who receive federal awards establish and maintain effective internal controls over the federal award that provides reasonable assurance that the organization is managing the federal award in compliance with the federal statues, regulations, and terms and conditions of the award. It also states that controls "should" be in compliance with guidance in "standards for Internal Control in the Federal Government" issued by the Comptroller General of the United State (the Green Book) or the "Internal Control Integrated Framework", issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Illustrative specific design and implementation of control activates over eligibility include the following (excerpt from the Green Book): • Proper design of control activities to ensure program compliance should include a process for management to identify and put into effect actions need to carry out specific responses to risks identified in the risk assessment process such as providing benefits to ineligible individuals, calculating amounts to be received for or on behalf of individuals incorrectly, unauthorized changes to system configurations, fraud, unauthorized payments, etc. • Segregations of duties should exist between those determining a participant's eligibility and those reviewing/approving eligibility. Where segregation of duties is not practical, management should select and develop alternative control activities. • Management should establish responsibility and accountability for control activities with management (or other designated personnel) of the unit or function in which the relevant risks reside. Responsible personnel should perform control activities in a timely manner as defined by policies and procedures. Cause – Due to the limited number of staff employed by the Organization in the Housing department there is a lack of adequate segregation of duties in regards to the review of eligibility and rent calculations. This service was contracted out during 2023, but the contractor also only involved a limited number of staff in the process for there was still a lack of adequate segregation of duties in regards to the review. Effect – By not having proper implementation of controls to ensure that recertifications and rent calculations are reviewed and/or approved, there is a risk that individuals are allowed to continue in the program after becoming ineligible and that rent calculations do not determine the proper split between the tenant payment and the project rental assistance payment. Questioned Costs – None. Recommendation – We recommend controls be put in place to ensure the eligibility determinations and rent calculations (initial or recertifications) be reviewed and/or approved by someone other than the individual making the determination. Management’s Response and Corrective Action – Management agrees with this finding. Beginning in September 2023, management has changed contractors. The contract with the new contractor includes a process by which the contractor acts one part of the preparation and review process and that staff members at Accord act of the other half, so that there is always a review occurring by on individual other than the preparer. Responsible party for corrective action: Robert Pickering, Chief Financial Officer Repeat Finding: This is a repeat finding. A similar finding was reported as 2022-001

Finding: 2023-001 – Compliance and Controls over Compliance – Eligibility Supportive Housing for Persons with Disabilities (Section 811), CFDA No. 14.181 Material Weakness & Noncompliance In 2023, Home Share did not have controls in place to ensure that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual making the initial determination or annual recertification. Actions Taken or Planned: Management agrees with this finding. Beginning in September 2023, management has changed the contractor they work with for the eligibility determination process. Management is working with the contractor to include a second individual in this process so that there will be a review performed by someone other than the individual making the initial determination or annual recertification. Contact Persons: Robert Pickering, Chief Financial Officer

2022-001

SECTION II ? FINDINGS - FINANCIAL STATEMENTS AUDIT No matters were reported. SECTION III ? FINDINGS AND QUESTIONED COSTS -MAJOR FEDERAL AWARD PROGRAM AUDIT 2022-001 Lack of Review Department of Housing and Urban Development AL #14.181 - Supportive Housing for Persons with Disabilities (Section 811) Material Weakness Category of Finding ? Eligibility Condition ? In 2022, Home Share did not have controls in place to ensure that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual making the initial determination or annual recertification. Criteria ? 2 CFR section 200.303 requires that organizations who receive federal awards establish and maintain effective internal controls over the federal award that provides reasonable assurance that the organization is managing the federal award in compliance with the federal statues, regulations, and terms and conditions of the award. It also states that controls "should" be in compliance with guidance in "standards for Internal Control in the Federal Government" issued by the Comptroller General of the United State (the Green Book) or the "Internal Control Integrated Framework", issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Illustrative specific design and implementation of control activates over eligibility include the following (excerpt from the Green Book): ? Proper design of control activities to ensure program compliance should include a process for management to identify and put into effect actions need to carry out specific responses to risks identified in the risk assessment process such as providing benefits to ineligible individuals, calculating amounts to be received for or on behalf of individuals incorrectly, unauthorized changes to system configurations, fraud, unauthorized payments, etc. ? Segregations of duties should exist between those determining a participant's eligibility and those reviewing/approving eligibility. Where segregation of duties is not practical, management should select and develop alternative control activities. Management should establish responsibility and accountability for control activities with management (or other designated personnel) of the unit or function in which the relevant risks reside. Responsible personnel should perform control activities in a timely manner as defined by policies and procedures. Cause ? Due to the limited number of staff employed by the Organization in the Housing department there is a lack of adequate segregation of duties in regards to review eligibility and rent calculations. Effect ? By not having proper implementation of controls to ensure that recertifications and rent calculations are reviewed and/or approved, there is a risk that individuals are allowed to continue in the program after becoming ineligible and that rent calculations do not determine the proper split between the tenant payment and the project rental assistance payment. Questioned Costs ? None. Recommendation ? We recommend controls be put in place to ensure the eligibility determinations and rent calculations (initial or recertifications) be reviewed and/or approved by someone other than the individual making the determination. Management?s Response and Corrective Action ? Management agrees with this finding. Beginning in January 2022, management has contracted out the eligibility determination process to a third-party contractor with significant experience in affordable housing and similar processes. Management is working with the contractor to include a second individual in this process so that there will be a review performed by someone other than the individual making the initial determination or annual recertification. Responsible party for corrective action: Robert Pickering, Chief Financial Officer Ernest Johnson, Housing Associate Director Repeat Finding: This is a repeat finding. A similar finding was reported as 2021-001 in 2021.

March 27, 2023 HOME SHARE HUD PROJECT NO. 092-HD017 Corrective Action Plan Finding: 2022-001 ? Compliance and Controls over Compliance ? Eligibility Supportive Housing for Persons with Disabilities (Section 811), CFDA No. 14.181 Material Weakness & Noncompliance In 2022, Home Share did not have controls in place to ensure that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual making the initial determination or annual recertification. Actions Taken or Planned: Management agrees with this finding. Beginning in January 2022, management has contracted out the eligibility determination process to a third-party contractor with significant experience in affordable housing and similar processes. Management is working with the contractor to include a second individual in this process so that there will be a review performed by someone other than the individual making the initial determination or annual recertification. Contact Persons: Ernest Johnson, Housing Associate Director Robert Pickering, Chief Financial Officer

2021-001

2021-001 Compliance and Controls over Compliance Category of Finding ? Eligibility Condition ? During 2021, Home Share did not complete the annual recertification for two of the three tenants selected for testing. These annual recertifications are used to verify that the tenant meets the low income or very low-income designation as determined by HUD and also used to complete the rent/assistance calculations. Also, all three tenants tested, did not include the required EIV reports. Home Share did not have controls in place to ensure these recertifications were being completed on a timely basis, that all appropriate supporting documentation for eligibility was maintained in each resident file, and that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual making the initial determination or annual recertification. Criteria ? Section 811 of the National Affordable Housing Act provides funding for housing for persons with disabilities. To qualify as disabled, the household must consist of at least one person who is an adult (18 years or older) with a disability, two or more persons with disabilities living together, or a surviving household member under certain circumstances (42 USC 1437a(b)(3); 24 CFR section 891.505). Resident must also qualify as very low-income households to be eligible (42 USC 8013). The owner is responsible for annually reexamining income of households occupying assisted units and make appropriate adjustments to the tenant payment and the project rental assistance payment (24 CFR section 891.410). The owner is also required to use HUD's Enterprise Income Verification (EIV) system) for both original certification and annual recertifications for these households (24 CFR section 5.233). 2 CFR section 200.303 requires that organizations who receive federal awards establish and maintain effective internal controls over the federal award that provides reasonable assurance that the organization is managing the federal award in compliance with the federal statues, regulations, and terms and conditions of the award. It also states that controls "should" be in compliance with guidance in "standards for Internal Control in the Federal Government" issued by the Comptroller General of the United State (the Green Book) or the "Internal Control Integrated Framework", issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Illustrative specific design and implementation of control activates over eligibility include the following (excerpt from the Green Book): - Proper design of control activities to ensure program compliance should include a process for management to identify and put into effect actions need to carry out specific responses to risks identified in the risk assessment process such as providing benefits to ineligible individuals, calculating amounts to be received for or on behalf of individuals incorrectly, unauthorized changes to system configurations, fraud, unauthorized payments, etc. - Segregations of duties should exist between those determining a participant's eligibility and those reviewing/approving eligibility. Where segregation of duties is not practical, management should select and develop alternative control activities. - Management should establish responsibility and accountability for control activities with management (or other designated personnel) of the unit or function in which the relevant risks reside. Responsible personnel should perform control activities in a timely manner as defined by policies and procedures. Cause ? During 2021, Home Share hired a contractor to run the required EIV reports and perform reviews of files to approve tenant eligibility before tenants moved in and at recertification in response to the finding in the 2020 Single Audit. However, based on inquiries of the housing department staff, this process was abandoned when it began to interfere with performing certifications and recertifications on a timely manner. Additionally, Accord had difficulties with completing the recertification in a timely manner in 2021 due to the impacts of the COVID-19 pandemic. Effect ? By not having proper implementation of controls to ensure that EIV reports and run or that recertifications are completed on a timely basis, and reviewed and/or approved, there is a risk that individuals are allowed to continue in the program after becoming ineligible and that rent calculations do not determine the proper split between the tenant payment and the project rental assistance payment. Questioned Costs ? None. Context ? A sample of three units were selected from a population of 22 units for eligibility testing. Three instances of non-compliance were noted, as no files included the EIV reporting. Also, the 2021 recertification for two tenants had not been completed. The eligibility determination and rent calculation for these tenants are currently based on the 2020 recertification. Recommendation ? We recommend controls be put in place to ensure all re-certification are completed on a timely basis, documentation supporting eligibility is maintained, and that documentation is maintained showing all eligibility determination and rent calculations (initial or recertifications) are reviewed and/or approved by someone other than the individual making the determination. Management?s Response and Corrective Action ? Management agrees with this finding. Beginning in January 2022, management has contracted out the eligibility determination process to a third-party contractor with significant experience in affordable housing and similar processes. Responsible party for corrective action: Robert Pickering, Chief Financial Officer Ernest Johnson, Housing Associate Director Repeat Finding: This is a repeat finding. The finding was reported as 2020-001 in 2020.

March 29, 2022 HOME SHARE HUD PROJECT NO. 092-HD017 Corrective Action Plan Finding: 2021-001 ? Compliance and Controls over Compliance ? Eligibility Supportive Housing for Persons with Disabilities (Section 811), CFDA No. 14.181 Material Weakness & Noncommpliance Home Share did not complete the annual eligibility reexamination for two of the three tenants selected for testing. Also, all three tenants tested did not include the required EIV reports. These annual reexaminations are used to verify the tenant meets the low income or very low-income designations as determined by HUD and are also used to complete the rent calculations for the -assisted units. Home Share did not have controls in place to ensure that reexaminations were completed on a timely basis, that all appropriate supporting documentation for eligibility was maintained in each resident file, and that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual performing the initial determination or annual reexamination. Actions Taken or Planned: Management agrees with this finding. Beginning in January 2022, management has contracted out the eligibility determination process to a third-party contractor with significant experience in affordable housing and similar processes. Contact Persons: Ernest Johnson, Housing Associate Director Robert Pickering, Chief Financial Officer

2020-001

2020-001 ? Compliance and Controls over Compliance - Eligibility Supportive Housing for Persons with Disabilities (Section 811), CFDA No. 14.181 Condition: During 2020, Home Share did not complete the annual eligibility reexamination for one of the four tenants selected for testing. These annual reexaminations are used to verify the tenant meets the low income or very low-income designations as determined by HUD and are also used to complete the rent calculations for the HOME-assisted units. Home Share did not have controls in place to ensure that reexaminations were completed on a timely basis, that all appropriate supporting documentation for eligibility was maintained in each resident file, and that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual performing the initial determination or annual reexamination. Criteria: Section 811 of the National Affordable Housing Act (the Program) provides funding for housing for persons with disabilities. To qualify as disabled, the household must consist of at least one person who is an adult (18 years or older) with a disability, two or more persons with disabilities living together, or a surviving household member under certain circumstances (42 USC 1437a(b)(3); 24 CFR section 891.505). Residents must also qualify as very low-income households to be eligible (42 USC 8013). The owner is responsible for annually reexamining incomes of households occupying assisted units and make appropriate adjustments to the tenant payment and the project rental assistance payment (24 CFR section 891.410). Assistance applicants shall submit signed consent forms upon initial application and at reexamination (24 CFR section 5.230). 2 CFR section 200.303 indicates that the internal controls required to be established by a nonfederal entity receiving Federal awards ?should? be in compliance with guidance in ?Standards for Internal Control in the Federal Government,? issued by the Comptroller General of the United States (the Green Book) or the ?Internal Control Integrated Framework? (revised in 2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Illustrative specific design and implementation of control activities over eligibility include the following (excerpted from the Green Book): - Proper design of controls activities to ensure program compliance should include a process for management to identify and put into effect actions needed to carry out specific responses to risks identified in the risk assessment process such as providing benefits to ineligible individuals, calculating amounts to be received for or on behalf of individuals incorrectly, unauthorized changes to system configurations, fraud, unauthorized payments, etc. - Segregations of duties should exist between those determining a participant's eligibility and those reviewing/approving eligibility. Where segregation of duties is not practical, management should select and develop alternative control activities. - Management should establish responsibility and accountability for control activities with management (or other designated personnel) of the unit or function in which the relevant risks reside. Responsible personnel should perform control activities in a timely manner as defined by policies and procedures. Cause: In prior years, there had been controls in place for the Director of Housing to review each tenant?s file to verify that procedures were followed, eligibility criteria was met, and rent calculations were accurate prior to acceptance into the program, or during the annual reexamination process. Per inquiries with the housing department staff, the Auditor determined that this control was not in place during 2019 or 2020. Management has engaged an outside consultant to assist in the review of file and train compliance staff, however, the corrective action plan was not fully implemented. Additionally, Accord had difficulties with completing reexaminations in 2020 due to the impacts of COVID-19. Questioned Costs: None. Effect: By not having a proper implementation of controls to ensure that reexaminations are completed and reviewed and/or approved, there is a risk that individuals are allowed to continue in the program after becoming ineligible and that rent calculations do not determine the proper split between the tenant payment and the project rental assistance payment. Context: A sample of four tenants were selected from a population of 15 tenants for eligibility testing. The test found one instance of noncompliance. The 2020 reexamination for this one tenant is currently in process, pending receipt of supporting documentation from the tenant. The eligibility determination and rent calculation for this tenant are currently based on the 2019 reexamination. Our sample was determined to be a statistically valid sample. Repeat Finding of Immediate Prior Year: Yes. Recommendation: We recommend controls be put in place to ensure all reexaminations are completed on a timely basis, documentation supporting eligibility is maintained, and that all eligibility determinations and rent calculations (initial or reexaminations) are reviewed and approved by someone other than the individual making the determination. View of Responsible Officials and Planned Corrective Actions: Management agrees with this finding. An outside consultant has been engaged to assist in the timely review and completion of the files and train compliance staff to verify that the tenant files contain the documentation to support eligibility requirements and comply with contract requirements.

March 29, 2021 HOME SHARE HUD PROJECT NO. 092-HD017 Corrective Action Plan Accord 1515 Energy Park Dr St Paul, MN 55108 Phone: 612-362-4400 Finding: 2020-001- Compliance and Controls over Compliance - Eligibility Supportive Housing for Persons with Disabilities (Section 811), CFDA No. 14.181 Home Share did not complete the annual eligibility reexamination for one of the four tenants selected for testing. These annual reexaminations are used to verify the tenant meets the low income or very low-income designations as determined by HUD and are also used to complete the rent calculations for the HOME-assisted units. Home Share did not have controls in place to ensure that reexaminations were completed on a timely basis, that all appropriate supporting documentation for eligibility was maintained in each resident file, and that eligibility criteria and rent calculations were being reviewed and/or approved by someone other than the individual performing the initial determination or annual reexamination. Actions Taken or Planned: Management agrees with this finding. An outside consultant has been engaged to assist in the timely review and completion of the files and train compliance staff to verify that the tenant files contain the documentation to support eligibility requirements and comply with contract requirements. Contact Persons: Ernest Johnson, Housing Associate Director Robert Pickering, Chief Financial Officer Sincerely, Robert Pickering Chief Financial Officer

2019-001

2019-001 ? Eligibility Supportive Housing for Persons with Disabilities (Section 811), CFDA No. 14.181 Criteria: Section 811 of the National Affordable Housing Act (the Program) provides funding for housing for persons with disabilities. To qualify as disabled, the household must consist of at least one person who is an adult (18 years or older) with a disability, two or more persons with disabilities living together, or a surviving household member under certain circumstances (42 USC 1437a(b)(3); 24 CFR section 891.505). 2 CFR section 200.303 indicates that the internal controls required to be established by a nonfederal entity receiving Federal awards ?should? be in compliance with guidance in ?Standards for Internal Control in the Federal Government,? issued by the Comptroller General of the United States (the Green Book) or the ?Internal Control Integrated Framework? (revised in 2013), issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Illustrative specific design and implementation of control activities over eligibility include the following (excerpted from the Green Book): ? Proper design of controls activities to ensure program compliance should include a process for management to identify and put into effect actions needed to carry out specific responses to risks identified in the risk assessment process such as providing benefits to ineligible individuals, calculating amounts to be received for or on behalf of individuals incorrectly, unauthorized changes to system configurations, fraud, unauthorized payments, etc. ? Segregations of duties should exist between those determining a participant's eligibility and those reviewing/approving eligibility. Where segregation of duties is not practical, management should select and develop alternative control activities. ? Management should establish responsibility and accountability for control activities with management (or other designated personnel) of the unit or function in which the relevant risks reside. Responsible personnel should perform control activities in a timely manner as defined by policies and procedures. Condition: Home Share did not have controls in place to ensure all appropriate supporting documentation for eligibility was maintained in each resident file prior to approving eligibility (or continued eligibility) into the program. Home Share did not maintain proof of disability for all of its residents to support eligibility criteria into the Program. Additionally, re-certifications were not filled out in accordance with HUD requirements during 2019. Questioned Costs: None Context: In prior years, there has been procedures in place for the Director of Housing to review each resident file and verify that procedures were followed and that everything matched prior to doing final approval into the program. During 2019, through inquiries with the housing department staff, this process did not occur. Our sample of six resident files from a population of 19 resident files found that two residents within the Program did not have supporting documentation for proof of disability as required per 42 USC 1737a(b)(3) and 24 CFR section 891.505. Subsequent proof of disability was obtained by Home Share supporting compliance with 42 USC 1737a(b)(3) and 24 CFR section 891.505. In addition, during our audit it was determined re-certification forms were not filled out and filed with HUD correctly, resulting in a freeze in reimbursements from HUD to Home Share. Cause: During 2019, Home Share experienced significant turnover within its housing department. The internal controls over ensuring the information gathered during the application process and during the annual reexamination is saved in each resident file were not followed. Effect: By not having a proper design of controls to ensure required documentation supporting the eligibility of residents is maintained in each resident file, there is a risk that Home Share could accept ineligible residents into the Program. Additionally, there was a potential understatement of revenue and receivable for tenant assistant payments of $4,700 related to the freeze in reimbursements from HUD to Home Share. Repeat Finding of Immediate Prior Year: No Recommendation: We recommend management strengthen its internal controls to ensure documentation is maintained in each resident file, supporting eligibility (or continued eligibility) for participation in the Program. We recommend a separate individual verify resident files contain documentation to support eligibility requirements prior to accepting the resident into the Program and prior to approving the annual re-examination for continued involvement in the Program. View of Responsible Officials and Planned Corrective Actions: Management agrees with this finding. An outside consultant has been engaged to assist in the review of the files and train compliance staff to verify that the tenant files contain the documentation to support eligibility requirements.

Accord 1600 Broadway Street NE Minneapolis, MN 55413 Phone: 612-362-4400 accord.org March 17, 2020 HOME SHARE HUD PROJECT NO. 092-HD017 Corrective Action Plan Finding: Two residents within the Program did not have supporting documentation for proof of disability as required per 42 USC 1737a(b)(3) and 24 CFR section 891.505. Subsequent proof of disability was obtained by Home Share supporting compliance with 42 USC 1737a(b)(3) and 24 CFR section 891.505. In addition, during our audit it was determined re-certification forms were not filled out and filed with HUD correctly, resulting in a freeze in reimbursements from HUD to Home Share Actions Taken or Planned: Management agrees with this finding. An outside consultant has been engaged to assist in the review of the files and train compliance staff to verify that the tenant files contain the documentation to support eligibility requirements and comply with contract requirements. Contact Persons: Ernest Johnson, Housing Director Robert Pickering, Chief Financial Officer Sincerely, Robert Pickering Chief Financial Officer