| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
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| #7145 | Closed | public | Multifamily | Les Sparks |
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We are completing an audit of a for-profit HUD project with a mortgage insured by HUD under 223(f) loan. They do not participate in Section 8 or have any other rental assistance. We have always followed the HUD consolidated audit guide. We sample and complete a cash disbursement and cash receipt test. In addition, we select a sample of tenants and review their lease to make sure they are being charged the correct amount. We also sample and test security deposits collected and returned. Are we over auditing since the Project only has a loan? We are looking for ways to cut down the cost and time. |
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From Les Sparks: Over testing depends, I guess on you definition. With only a mortgage, the required compliance steps would be limited to the following: There is no real reason (from HUD) to trace leases. Although, it may be a terrific audit procedure for other reasons. I have seen alternative procedures to replace the cash receipts testing. This is especially true given the requirement is to make sure all cash makes it to the project. It is very difficult to get rid of cash disbursement testing. Most of the wasted effort is in planning and other similar areas to complete all the PPC forms. Les |