HOUSTON SRO HOUSING CORP

Findings reference number: 2025-001 - Title and AL Number of Federal Program: Section 8 Moderate Rehabilitation Single Room Occupancy (AL 14.249). - Type of finding: Internal Control - Resolution Status: In process - Population size: N/A - Sample size: N/A - Repeat finding: No - Criteria: The detail for significant accounts should be analyzed on a timely basis to ensure the information is correct. - Statement of condition: Certain general ledger accounts, including cash and prepaid rent were not properly reconciled at December 31, 2025 and significant adjusting entries had to be made. Other entries were made for items that were improperly posted in the general ledger or needed to be accrued at year end. - Cause: Management oversight. - Effect: The in house financial statements overstated cash and prepaid rent by significant amounts and understated revenue. - Questioned costs: N/A. - Reporting views of officials: Auditee agrees with the finding. - Contract Number: N/A - Context: Management had some turnover in key personnel and moved its office to a new location. The office also needed a significant amount of improvements. Management's efforts were concentrated on the improvements and some of the accounting functions were overlooked. - Recommendation: Procedures should be set in place to ensure timely analysis of significant accounts are made and the books are reconciled properly. - Auditors' summary of auditee's comments: They are in agreement.

Findings reference number: 2024-001 - title and AL Number of Federal Program: Housing Opportunities for Persons with AIDS , AL 14.241 - Type of finding: Federal Award - Resolution Status: In process - Population size: N/A - Sample size: N/A - Repeat finding: No - Criteria: Reports to the federal government must be filed by the due date and should include all Federal assistance. - Condition: The data collection form (DCF) is due 30 days after the financial statement audit is received or 180 days after the fiscal year end. DCF for the year ended December 31, 2024 was filed late. - Cause: The audit was completed 180 days after the fiscal year end. - Effect: The DCF has not been filed timely. - Noncompliance code: L - Reporting. - Questioned costs: N/A. - Reporting views of officials: Auditee agrees with the finding. - Contract Number: N/A - Context: Management had some turnover in key personnel and moved its office to a new location. The new location required certain improvements. This process delayed the accounting work that was needed to complete the audit by the due date. Additionally, one of the contracts ended in July 2025, and management no longer had access to certain documents required for the audit, which caused delays. - Recommendation: Procedures should be set in place to ensure timely completion of the audit and submissions of all required reports. - Auditors' summary of auditee's comments: They are in agreement.