| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
|---|---|---|---|---|---|
| #6694 | Closed | public | Multifamily | Les Sparks |
|
If a non-profit multifamily Organization puts more money into its tax / insurance escrow than what would typically be required, does this become an audit finding? In the past it hasn’t been an issue; however, there is potential that this could affect the surplus cash calculation. There does not appear to be anything in the HUD handbook prohibiting this. Any assistance in the matter would be helpful. |
|
|
From Les Sparks: Oh the age old question. How do I avoid residual receipts? Let me count the ways…. This really only comes up now on Cap Advance projects where they maintain their own escrows. However, the question is asked every year. Most CPAs allow for up to an extra year in the escrow account. There is not really any guidance issued by HUD for this program in a handbook or other type of publication and I just rechecked again. This is pretty much the constant conversation for these projects. Anything more than a year’s worth starts to look weird to HUD. I am never sure how far to push it. I am sorry for not having a better answer. |