Anamosa Senior Citizens Housing IncNon-Profit

Finding 2024-001 Segregation of Duties Condition: The Corporation’s offices are not large enough to permit an adequate segregation of duties for effective internal controls. Management has not separated incompatible activities of personnel, thereby creating risks related to the safeguarding of cash and the accuracy of the financial statements. Criteria: Proper controls over financial reporting include adequate segregation of duties. Cause: The concentration of closely related duties and responsibilities such as the recording and processing of cash receipts, preparing grant expenditure reports, preparing financial information for posting and analyzing financial information by a small staff makes it impossible to establish an adequate system of automatic internal checks on the accuracy and reliability of the accounting records. Effect: This deficiency results in a reasonable possibility that the Corporation would not be able to detect misstatements that would be material in relation to the financial statements and/or federal award program in a timely period by employees in the normal course of performing their assigned functions. Recommendation: While we do recognize that the Corporation is not large enough to permit a segregation of duties for effective internal controls, we believe it is important the Corporation be aware that this condition does exist. Repeat Finding: Yes. Views of Responsible Officials and Planned Corrective Actions: Management is cognizant of this limitation and will implement additional controls where possible.

Finding 2024-002 Tenant File Documentation Condition: Five tenants did not have a signed rental agreement on file, one tenant’s income on the tenant certification could not be recomputed, one tenant did not have a signed tenant certification, and no new tenants had inspections signed. Criteria: The Corporation should ensure that tenant files are complete with all documentation and signatures. Cause: The Corporation’s previous property manager did not have a system in place to verify tenant files were up to date. Effect: This deficiency would not have a material effect on the tenant rent. Recommendation: We recommend the Corporation create a checklist to ensure that tenant files are properly documented. Repeat Finding: Yes. Views of Responsible Officials and Planned Corrective Actions: We agree with the auditgor and will take it under advisement.

Finding 2024-003 Reserve Funds Condition: The required annual payments have not been made to the reserve funds. Criteria: The Corporation is required to make annual payments to the reserve funds until the funds reach a minimum dollar amount. Cause: There is not a system in place to make the required annual payments to the reserve funds. Effect: Not funding the reserve funds could adversely affect the Corporation’s compliance with the USDA-Rural Development regulations. Recommendation: We recommend that the Corporation discuss with the USDA the required minimum amounts in the reserve funds and determine what the annual payments should be for each apartment building. Repeat Finding: Yes. Views of Responsible Officials and Planned Corrective Actions: We agree with the auditgor and will take it under advisement.

Finding 2024-004 MINC Reports Were Not Timely Filed Condition: MINC reports were submitted July 9, 2025. Criteria: MINC reports are required to be filed by March 31. The Corporation was given a 30 day extension. Cause: The necessary information needed to finish the reports was not given to the accountant until July. Effect: Not filing the MINC reports timely could affect the Corporation’s compliance with the USDA-Rural Development regulations. Recommendation: We recommend that the Corporation file the MINC reports timely. Repeat Finding: No. Views of Responsible Officials and Planned Corrective Actions: We agree with the auditor and will take under advisement.

Finding 2024-005 No Board Meetings Were Held During 2024 Condition: An annual board meeting was not held during 2024 due to lack of a quorum of board members. Criteria: Non-profit organizations are to certify that the board is active and maintains oversight of the property. Cause: Board members resigned, and their positions were not filled. Effect: Having an inactive board could affect the Corporation’s compliance with the USDA-Rural Development regulations. Recommendation: We recommend that board members are found, and a board meeting is held. Repeat Finding: No. Views of Responsible Officials and Planned Corrective Actions: We agree with the auditor and will take under advisement.

Finding 2024-006 Incurred Late Payment Fees On Invoices Condition: Professional fees invoice had late fees added to the original bill since the invoice was not paid timely. Criteria: The Corporation should have cash management procedures in place to mitigate the risk of incurring unnecessary expenses. Cause: There was not enough money in the operating account when the invoice was received. Effect: The Corporation paid for expenses that were not necessary. Recommendation: We recommend that all invoices are paid timely to avoid late fees. Repeat Finding: No. Views of Responsible Officials and Planned Corrective Actions: We agree with the auditor and will take under advisement.

Finding 2023-001 Segregation of Duties Condition: The Corporation’s offices are not large enough to permit an adequate segregation of duties for effective internal controls. Management has not separated incompatible activities of personnel, thereby creating risks related to the safeguarding of cash and the accuracy of the financial statements. Criteria: Proper controls over financial reporting include adequate segregation of duties. Cause: The concentration of closely related duties and responsibilities such as the recording and processing of cash receipts, preparing grant expenditure reports, preparing financial information for posting and analyzing financial information by a small staff makes it impossible to establish an adequate system of automatic internal checks on the accuracy and reliability of the accounting records. Effect: This deficiency results in a reasonable possibility that the Corporation would not be able to detect misstatements that would be material in relation to the financial statements and/or federal award program in a timely period by employees in the normal course of performing their assigned functions. Recommendation: While we do recognize that the Corporation is not large enough to permit a segregation of duties for effective internal controls, we believe it is important the Corporation be aware that this condition does exist. Repeat Finding: Yes. Views of Responsible Officials and Planned Corrective Actions: Management is cognizant of this limitation and will implement additional controls where possible.

Finding 2023-002 Tenant File Documentation Condition: One tenant did not have a signature on the rental agreement and one tenant’s income on the tenant certification could not be recomputed. Criteria: The Corporation should ensure that tenant files are complete with all documentation and signatures. Cause: The Corporation’s previous property manager did not have a system in place to verify tenant files were up to date. Effect: This deficiency would not have a material effect on the tenant rent. Recommendation: We recommend the Corporation create a checklist to ensure that tenant files are properly documented. Repeat Finding: Yes.

Finding 2023-003 Reserve Funds Condition: The required annual payments have not been made to the reserve funds. Criteria: The Corporation is required to make annual payments to the reserve funds until the funds reach a minimum dollar amount. Cause: There is not a system in place to make the required annual payments to the reserve funds. Effect: Not funding the reserve funds could adversely affect the Corporation’s compliance with the USDA-Rural Development regulations. Recommendation: We recommend that the Corporation discuss with the USDA the required minimum amounts in the reserve funds and determine what the annual payments should be for each apartment building. Repeat Finding: Yes.

Finding 2022-001 Segregation of Duties Condition: The Corporation?s offices are not large enough to permit an adequate segregation of duties for effective internal controls. Management has not separated incompatible activities of personnel, thereby creating risks related to the safeguarding of cash and the accuracy of the financial statements. Criteria: Proper controls over financial reporting include adequate segregation of duties. Cause: The concentration of closely related duties and responsibilities such as the recording and processing of cash receipts, preparing grant expenditure reports, preparing financial information for posting and analyzing financial information by a small staff makes it impossible to establish an adequate system of automatic internal checks on the accuracy and reliability of the accounting records. Effect: This deficiency results in a reasonable possibility that the Corporation would not be able to detect misstatements that would be material in relation to the financial statements and/or federal award program in a timely period by employees in the normal course of performing their assigned functions. Recommendation: While we do recognize that the Corporation is not large enough to permit a segregation of duties for effective internal controls, we believe it is important the Corporation be aware that this condition does exist. Repeat Finding: Yes. Views of Responsible Officials and Planned Corrective Actions: Management is cognizant of this limitation and will implement additional controls where possible.

Finding 2022-002 Condition: The Corporation reported vacancies to the USDA even though there were tenants that occupied those rooms. Criteria: The Corporation should properly report tenant information to the USDA. Cause: The Corporation does not have an internal control system designed to ensure that vacancies are appropriately documented and maintained. Effect: Lack of internal controls over vacancy reporting resulted in a loss of revenue of approximately $1,818. Management fees are to be calculated using the number of occupied rooms. Due to the incorrect vacancies, management fees may not have been calculated correctly. Recommendation: We recommend the Corporation create policies and procedures to ensure that all tenants are accurately reported to the USDA. Repeat Finding: Yes. Views of Responsible Officials and Planned Corrective Actions: We agree with the auditor and will take under advisement.

Finding 2022-003 Tenant File Documentation Condition: One tenant did not have a signature for the tenant certification and one tenant did not have a rental agreement in the file. Criteria: The Corporation should ensure that tenant files are complete with all documentation and signatures. Cause: The Corporation?s previous property manager did not have a system in place to verify tenant files were up to date. Effect: This deficiency did not have an effect on the tenant rent. Recommendation: We recommend the Corporation create a checklist to ensure that tenant files are properly documented. Repeat Finding: Yes. Views of Responsible Officials and Planned Corrective Actions: We agree with the auditor and will take under advisement.

Finding 2022-004 Condition: Form 3560-12 was not filled out for a transfer that was made from the reserve funds. Bank fees have also been paid out of the reserve funds and Form 3560-12 was not filled out. The required annual payments have not been made to the reserve funds. Criteria: The Corporation is required to fill out Form 3560-12 to obtain approval for withdrawals from the reserve funds. The Corporation is required to make annual payments to the reserve funds until the funds reach a minimum dollar amount. Cause: The Corporation?s previous property manager did not have the proper forms on file for all disbursements made from the reserve funds. The previous property manager did not have a system in place to make the required annual payments to the reserve funds. Effect: Lack of documentation of reserve withdrawals and not funding the reserve funds could adversely affect the Corporation?s compliance with the USDA-Rural Development regulations. Recommendation: We recommend the Corporation fill out Form 3560-12 each time distributions are to be made from the reserve funds and validate the forms to match the invoices that were paid. We also recommend that the Corporation discuss with the USDA the required minimum amounts in the reserve funds and determine what the annual payments should be for each apartment building. Repeat Finding: Yes. Views of Responsible Officials and Planned Corrective Actions: We agree with the auditor and will take under advisement.

Finding 2021-001 Segregation of Duties Condition: The Corporation?s offices are not large enough to permit an adequate segregation of duties for effective internal controls. Management has not separated incompatible activities of personnel, thereby creating risks related to the safeguarding of cash and the accuracy of the financial statements. Criteria: Proper controls over financial reporting include adequate segregation of duties. Cause: The concentration of closely related duties and responsibilities such as the recording and processing of cash receipts, preparing grant expenditure reports, preparing financial information for posting and analyzing financial information by a small staff makes it impossible to establish an adequate system of automatic internal checks on the accuracy and reliability of the accounting records. Effect: This deficiency results in a reasonable possibility that the Corporation would not be able to detect misstatements that would be material in relation to the financial statements and/or federal award program in a timely period by employees in the normal course of performing their assigned functions. Recommendation: While we do recognize that the Corporation is not large enough to permit a segregation of duties for effective internal controls, we believe it is important the Corporation be aware that this condition does exist. View of Responsible: Management is cognizant of this limitation and will implement additional controls where possible.

Finding 2021-002 Vacancy Reporting Condition: The Corporation reported vacancies to the USDA even though there were tenants that occupied those rooms. Criteria: The Corporation should be properly reporting tenant information to the USDA. Cause: The Corporation does not have an internal control system designed to ensure that vacancies are appropriately documented and maintained. Effect: Lack of internal controls over vacancy reporting resulted in a loss of revenue of approximately $3,922. Management fees are to be calculated using the number of occupied rooms. Due to the incorrect vacancies, management fees may have not been calculated correctly. Recommendation: We recommend the Corporation create policies and procedures to ensure that all tenants are accurately reported to the USDA. View of Responsible: We agree with the auditor and will take under advisement.

Finding 2021-003 Tenant File Documentation Condition: Two tenants did not have signatures for the tenant certification and one tenant did not have supporting documentation for income on the certification form. Criteria: The Corporation should ensure that their tenant files are complete with all documentation and signatures. Cause: The Corporation?s previous property manager did not have a system in place to verify tenant files were up to date. Effect: This deficiency did not have an effect on the tenant rent. Recommendation: We recommend the Corporation create a checklist to ensure that tenant files are properly documented. View of Responsible: We agree with the auditor and will take under advisement.

Finding 2021-004 Reserve Fund Withdrawals Condition: Form 3560-12 was not filled out for three disbursements that were made from the reserve funds. One Form 3560-12 was approved but it did not match the invoice or withdrawal that was made from the reserve fund. Laundry money is being deposited to the reserve account. Then when coin money is needed for the laundry machines, the Corporation has been taking money out of the reserve fund and Form 3560-12 was not filled out. Criteria: The Corporation is required to fill out Form 3560-12 to obtain approval for withdrawals from the reserve fund. Cause: The Corporation?s previous property manager did not have the proper forms on file for all disbursements made from the reserve funds. Effect: Lack of documentation of reserve withdrawals could adversely affect the Corporation?s compliance with the USDA-Rural Development regulations. Recommendation: We recommend the Corporation fill out Form 3560-12 each time distributions are to be made from the reserve fund and to validate the forms match the invoices that were paid. Also, laundry receipts should be deposited into the operating account. View of Responisble: We agree with the auditor and will take under advisement.

2020-003 USDA ? Rural Development Federal Financial Assistance Listing 10.415 Rural Rental Housing Loan and Rural Rental Housing Interest Subsidy Cash Receipts: Vacancy Documentation Significant Deficiency in Internal Control over Compliance Criteria: The Organization is required to have proper documentation to evidence the vacancy of a unit. Condition: Our testing of cash receipts detected that documentation to support the vacancy of certain units could not be provided. Cause: Controls are currently not in place to ensure vacancies are appropriately documented and maintained. Effect: Lack of internal controls that maintain proper written documentation as evidence of a vacancy could adversely affect the Project?s compliance with USDA ? Rural Development regulations. Questioned Costs: None reported. Recommendation: We recommend the Organization review policies and procedures to ensure documentation of vacancies is maintained. Views of Responsible Officials: Management agrees with the finding and the recommendation.