Villa South (III) d/b/a Villa Madonna III Apartments, Inc.

S3800-010 Finding Reference Number ? 2022-001 S3800-011 Title and CFDA Number of Federal Program ? Section 202 Capital Advance 14.157 S3800-015 Type of Finding ? Federal Award S3800-016 Finding Resolution Status ? Unresolved S3800-017 Information on Universe Population Size ? N/A S3800-018 Sample Size Information ? N/A S3800-019 Identification of Repeat Finding and Finding Reference Number ? 2021-001 S3800-020 Criteria ? In accordance with the Regulatory Agreement, surplus cash is required to be deposited into a residual receipts account within 90 days of year-end. S3800-030 Statement of Condition ? Surplus cash was not deposited into a residual receipts account within 90 days of year-end. S3800-032 Cause ? Management was unaware of the requirement for the prior year audit. S3800-033 Effect or Potential Effect ? The Project is in violation of the Regulatory Agreement. S3800-035 Auditor Non-Compliance Code ? B S3800-040 Questioned Costs ? $3,811 S3800-045 Reporting Views of Responsible Officials ? Management will reference the audit in future years to ensure proper deposits are made in a timely manner. S3800-050 Context ? Management will ensure the residual receipts deposits are made in a timely manner. S3800-080 Recommendation ? Management should ensure surplus cash is calculated in a timely matter in order to make any required deposit to the residual receipts account. S3800-090 Auditor?s Summary of the Auditee?s Comments on the Finding and Recommendations ? Management will reference the audit in future years to ensure proper deposits are made in a timely manner. S3800-130 Response Indicator ? Agree S3800-140 Completion Date ? May 2, 2022 S3800-150 Response ? Management will ensure surplus cash is calculated in a timely manner in order to make the required residual receipts deposit.

S3800-010 Finding Reference Number ? 2021-001 S3800-011 Title and CFDA Number of Federal Program ? Section 202 Capital Advance 14.157 S3800-015 Type of Finding ? Federal Award S3800-016 Finding Resolution Status ? Unresolved S3800-017 Information on Universe Population Size ? N/A S3800-018 Sample Size Information ? N/A S3800-019 Identification of Repeat Finding and Finding Reference Number ? 2020-001 S3800-020 Criteria ? In accordance with the Regulatory Agreement, surplus cash is required to be deposited into a residual receipts account within 90 days of year-end. S3800-030 Statement of Condition ? Surplus cash was not deposited into a residual receipts account within 90 days of year-end. S3800-032 Cause ? Management was unaware of the requirement for the prior year audit. S3800-033 Effect or Potential Effect ? The Project is in violation of the Regulatory Agreement. S3800-035 Auditor Non-Compliance Code ? B S3800-040 Questioned Costs ? $3,403 S3800-045 Reporting Views of Responsible Officials ? Management will reference the audit in future years to ensure proper deposits are made in a timely manner. S3800-050 Context ? Management will ensure the residual receipts deposits are made in a timely manner. S3800-080 Recommendation ? Management should ensure surplus cash is calculated in a timely matter in order to make any required deposit to the residual receipts account. S3800-090 Auditor?s Summary of the Auditee?s Comments on the Finding and Recommendations ? Management will reference the audit in future years to ensure proper deposits are made in a timely manner. S3800-130 Response Indicator ? Agree S3800-140 Completion Date ? November 18, 2021 S3800-150 Response ? Management will ensure surplus cash is calculated in a timely manner in order to make the required residual receipts deposit.

S3800-010 Finding Reference Number ? 2020-001 S3800-011 Title and CFDA Number of Federal Program ? Section 202 Capital Advance 14.157 S3800-015 Type of Finding ? Federal Award S3800-016 Finding Resolution Status ? Unresolved S3800-017 Information on Universe Population Size ? N/A S3800-018 Sample Size Information ? N/A S3800-019 Identification of Repeat Finding and Finding Reference Number ? 2019-001 S3800-020 Criteria ? In accordance with the Regulatory Agreement, surplus cash is required to be deposited into a residual receipts account within 90 days of year-end. S3800-030 Statement of Condition ? Surplus cash was not deposited into a residual receipts account within 90 days of year-end. S3800-032 Cause ? Management was unaware of the requirement for the prior year audit. S3800-033 Effect or Potential Effect ? The Project is in violation of the Regulatory Agreement. S3800-035 Auditor Non-Compliance Code ? B S3800-040 Questioned Costs ? $0 S3800-045 Reporting Views of Responsible Officials ? The new management company during the prior year was unable to obtain accounting information from the prior management company in a timely manner to calculate surplus cash and make the residual receipts deposit as required. S3800-050 Context ? The management company changed during the prior year, and the new management company was unable to obtain accounting information from the old management company prior to year-end. S3800-080 Recommendation ? Management should ensure surplus cash is calculated in a timely matter in order to make any required deposit to the residual receipts account. S3800-090 Auditor?s Summary of the Auditee?s Comments on the Finding and Recommendations ? The new management company was unable to obtain accounting information from the prior management company in a timely manner to calculate surplus cash. S3800-130 Response Indicator ? Agree S3800-140 Completion Date ? December 20, 2020 S3800-150 Response ? Management will ensure surplus cash is calculated in a timely manner in order to make the required residual receipts deposit.

S3800-010 Finding Reference Number ? 2019-001 S3800-011 Title and CFDA Number of Federal Program ? Section 202 Capital Advance 14.157 S3800-015 Type of Finding ? Federal Award S3800-016 Finding Resolution Status ? Unresolved S3800-017 Information on Universe Population Size ? N/A S3800-018 Sample Size Information ? N/A S3800-019 Identification of Repeat Finding and Finding Reference Number ? 2018-003 S3800-020 Criteria ? In accordance with the Regulatory Agreement, surplus cash is required to be deposited into a residual receipts account within 90 days of year-end. S3800-030 Statement of Condition ? Surplus cash was not deposited into a residual receipts account within 90 days of year-end. S3800-032 Cause ? Management was unaware of the requirement for the prior year audit. S3800-033 Effect or Potential Effect ? The Project is in violation of the Regulatory Agreement. S3800-035 Auditor Non-Compliance Code ? B S3800-040 Questioned Costs ? $0 S3800-045 Reporting Views of Responsible Officials ? The new management company was unable to obtain accounting information from the prior management company in a timely manner to calculate surplus cash and make the residual receipts deposit as required. S3800-050 Context ? The management company changed during the prior year, and the new management company was unable to obtain accounting information from the old management company prior to year-end. S3800-080 Recommendation ? Management should ensure surplus cash is calculated in a timely matter in order to make any required deposit to the residual receipts account.S3800-090 Auditor?s Summary of the Auditee?s Comments on the Finding and Recommendations ? The new management company was unable to obtain accounting information from the prior management company in a timely manner to calculate surplus cash. S3800-130 Response Indicator ? Agree S3800-140 Completion Date ? October 23, 2019 S3800-150 Response ? Management will ensure surplus cash is calculated in a timely manner in order to make the required residual receipts deposit.

S3800-010 Finding Reference Number ? 2019-002 S3800-011 Title and CFDA Number of Federal Program ? Section 202 Capital Advance 14.157 S3800-015 Type of Finding ? Federal Award S3800-016 Finding Resolution Status ? Unresolved S3800-017 Information on Universe Population Size ? N/A S3800-018 Sample Size Information ? N/A S3800-019 Identification of Repeat Finding and Finding Reference Number ? N/A S3800-020 Criteria ? The residual receipts funds must be held in an interest-bearing account. S3800-030 Statement of Condition ? The residual receipts fund is not an interest-bearing account. S3800-032 Cause ? Management was unaware of the requirement. S3800-033 Effect or Potential Effect ? The Project is in violation with HUD regulations. S3800-035 Auditor Non-Compliance Code ? P S3800-040 Questioned Costs ? $0 S3800-045 Reporting Views of Responsible Officials ? Management was unaware of the requirement and will make the correction. S3800-050 Context ? The residual receipts account was opened during the audit year and is not an interest-bearing account. S3800-080 Recommendation ? Management should transfer the residual receipts funds to an interest-bearing account. S3800-090 Auditor?s Summary of the Auditee?s Comments on the Finding and Recommendations ? Management was unaware of the requirement and will transfer the residual receipts funds to an interest-bearing account. S3800-130 Response Indicator ? Agree S3800-140 Completion Date ? July 2020 S3800-150 Response ? Management will transfer the residual receipts funds to an interestbearing account.

S3800-010 Finding Reference Number ? 2019-003 S3800-011 Title and CFDA Number of Federal Program ? Section 202 Capital Advance 14.157 S3800-015 Type of Finding ? Federal Award S3800-016 Finding Resolution Status ? Unresolved S3800-017 Information on Universe Population Size ? N/A S3800-018 Sample Size Information ? N/A S3800-019 Identification of Repeat Finding and Finding Reference Number ? N/A S3800-020 Criteria ? The replacement reserve funds must be held in an interest-bearing account. S3800-030 Statement of Condition ? The replacement reserve fund is not an interest-bearing account. S3800-032 Cause ? Management was unaware of the requirement. S3800-033 Effect or Potential Effect ? The Project is in violation with HUD regulations. S3800-035 Auditor Non-Compliance Code ? O S3800-040 Questioned Costs ? $0 S3800-045 Reporting Views of Responsible Officials ? Management was unaware of the requirement and will make the correction.S3800-050 Context ? The replacement reserve account was opened during the audit year and is not an interest-bearing account. S3800-080 Recommendation ? Management should transfer the replacement reserve funds to an interest-bearing account. S3800-090 Auditor?s Summary of the Auditee?s Comments on the Finding and Recommendations ? Management was unaware of the requirement and will transfer the replacement reserve funds to an interest-bearing account. S3800-130 Response Indicator ? Agree S3800-140 Completion Date ? July 2020 S3800-150 Response ? Management will transfer the replacement reserve funds to an interestbearing account.

S3800-010 Finding Reference Number ? 2019-004 S3800-011 Title and CFDA Number of Federal Program ? Section 202 Capital Advance 14.157 S3800-015 Type of Finding ? Federal Award S3800-016 Finding Resolution Status ? Resolved S3800-017 Information on Universe Population Size ? 2 tenants S3800-018 Sample Size Information ? 1 tenant S3800-019 Identification of Repeat Finding and Finding Reference Number ? N/A S3800-020 Criteria ? Security deposits paid by tenants must be refunded within 60 days of the date of move out. S3800-030 Statement of Condition ? The security deposit for the sample tenant move-out was not refunded until audit testing was performed and the unrefunded deposit was discovered. S3800-032 Cause ? Unknown S3800-033 Effect or Potential Effect ? The Project is in violation with HUD regulations. S3800-035 Auditor Non-Compliance Code ? M S3800-040 Questioned Costs ? $0 S3800-045 Reporting Views of Responsible Officials ? Management has subsequently refunded the security deposit. S3800-050 Context ? The tenant sampled moved out on September 13, 2019. The security deposit was not refunded until December 12, 2019 after the auditors discovered the unpaid refund during audit fieldwork. S3800-080 Recommendation ? Management should implement policies and procedures to ensure security deposits get refunded in a timely manner. S3800-090 Auditor?s Summary of the Auditee?s Comments on the Finding and Recommendations ? Management will implement policies and procedures to ensure security deposits get refunded in a timely manner. S3800-130 Response Indicator ? Agree S3800-140 Completion Date ? December 12, 2019 S3800-150 Response ? Management will implement policies and procedures to ensure security deposits get refunded in a timely manner.

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