| ID | Status | Date | Public/Private | Industry | AHACPA Contact |
|---|---|---|---|---|---|
| #7598 | Closed | public | Multifamily | Les Sparks |
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On one I’m working on now, they have been approved by HUD to withdraw monies for “replacement”, but will do it after the year end. But for the end of year B/S the client recorded it as a receivable-other and reduced the replacement reserve by the same amount. My question is does the receivable get recorded in the Computation of Surplus Cash as part of Total Cash? There is an accounts payable to the contractor for the same amount as of the year end. Thanks, I am looking forward to your response so I can meet the deadline. |
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From Les Sparks: HUD has a specific line for amounts withdrawn from the R4R account but not yet deposited in the operating account. However, if the transfer is not completed by year end then nothing should be done. Recording an A/R from the R4R account just grosses up operating cash and then forces a liability to be recorded to avoid surplus cash being too high. It is best to just leave it where it is and then it has no impact on the financial statements at all. i have seen some clients who have “saved money in operations record a liability to avoid a residual receipts deposit, but absent hat there is no real reason to do any of this. |