| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
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| #7134 | Closed | public | Multifamily | Les Sparks |
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Hi Les, They have signed an agreement to sell their facility to a separate legal entity in April 2017 and I am wondering appropriate reporting requirements as I cannot find anything on the HUD website. Specifically: The client has minimal documentation at this point so I am hoping you can provide some clarification. |
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From Les: The project will be required to submit a stub period financial statement from July 1 through the day before the sale. No liquidation accounting is allowed. This is the reason for the day before the sale… Unfortunately, you are so late int he year that no other choice of period is available to you. Everything should look as it did last year with the exception of a footnote regarding the sale. From client: One follow-up – timing of the REAC. Is it due 90 days as of the stub reporting period or can it still be submitted 90 days after the normal fiscal year-end? From Les: Technically it should be 90 days from the closing date. However, there is no late tracking in the REAC system, so you get away with filing later at year end. I think that main thing is that is it received sometime before the end. From client: Thanks for all of the guidance. Once issue we just found out is that with the sale they no longer have access to the tenant files. Have you seen other audit firms with this issue and how did they resolve? From Les: All of the time. The truth is the new management company should never restrict access to the old auditor. If I had this occur, I would issue a scope limitation naming the new management company as the culprit. By name. This should never occur. However, it does all the time. |