x My Mini Rant - Spectrum Enterprises


My Mini Rant

Written by Deborah Bechetti, Spectrum Enterprises

I have recently had a very difficult review week.  Loads of files to review and properties that were unprepared for an audit.

At least in Maryland, we will always complete the physical inspection and the file review at the same time.  All tax credit tenants must be notified of the possibility of a unit inspection.  This has been the standard operating procedure for at least ten years and should not come as a surprise to any site manager.    Several of my sites lately have said they had no idea that I would also be inspecting units.  They blame upper management for not passing along this information, which is explicitly explained in our notification letter.  This policy has been in place long enough so that all veteran site managers should be fully aware of the procedure and all new managers should be made aware by their supervisors.  Make sure that maintenance personnel is available to accompany our inspector.  It seems to be the same management companies that are unaware of the inspections over and over.

Per the 1.42-5 IRS Monitoring Regulations the units selected will not be disclosed until our arrival at the property.   The units selected for review will have the file pulled and the unit inspected.  Please make sure you know which units are not tax credit units, as we will not inspect those units.  If you have separate files for tax credits and HUD, please make sure that all required forms are in the tax credit file (lease, application, certification and all verifications).  If you have one file for both tax credit and HUD, please make sure that the EIV form is either:  not in the file, or in an envelope so that we cannot see it.  As ridiculous as it is, HUD will not allow us access to the EIV information.  Please pull all of the files requested at the beginning of the audit.  The piles will not intimidate us, but the one last file that is not in the stack when we get to what we think is the end of the audit, may not be so easily located in a short period of time.

In short, audits are nothing to be afraid of, just be present and prepared.


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