Attachment 17 - Senior Housing Solutions financial statementSENIOR HOUSING SOLUTIONS
(A NON - PROFIT CORPORATION}
FINANCIAL STATEMENTS
FOR THE YEAR ENDED JUNE 30, 2012
TOGETHER WITH
REPORT OF CERTIFIED PUBLIC ACCOUNTANT
- Ferguson & Company
CER71FED PUBLIC ACCOUNTANT
1734 MARTIN LUTHER KING Xt WAY
OAKLAND, CA 91612
K5191 M1512
ATTACHMENT 1 7
SENIOR HOUSING SOLUTIONS
(A NON - PROPIT CORPORATION)
JUNE 30, 2012
TABLE OF CONTENTS
Pan NO.
GENERAL INFORMATION 2
INDEPENDENT AUDITOR'S REPORT 3
FINANCIAL STATEMENTS
Statement of Financial Position 4
Statement of Activity 5
Statement of Functional Expenses 6
Statement of Cash Flows 7
Notes to Financial Statements 8
SUPPLEMENTARY INFORMATION
Schedule of Expenditures of Federal and State Awards 14
Schedule of Findings and Questioned Costs 15
Report on Compliance and Internal Control Over Financial Reporting
Based on an Audit of Financial Statements in Accordance
with Government Auditing Standards 17
Report on Compliance With Requirements Applicable To each Major
Program and Internal Control Over Compliance in Accordance
with OMB Circular A -133 18
I
GENERAL INFORMATION
SENIOR ROUSING SOLUTIONS
to NON - PROFIT CORPORATION)
JUNE 30, 2012
GENERAL INFdRMATION
1. Full Official Name of the Agency:
SENIOR HOUSING SOLUTIONS
2. Type of Agency
Non Profit Corporation
3. Address of Agency Headquarters
512 Valley Way
Milpitas, California 95035
4. Name of Chief Executive Officer
Jesus Orosco, Executive Director
5. Telephone Number
408 - 416-0271
6. Period Covered by Examination
July 1, 7011 through June 30, 2012
2
INDEPENDENT AUDITOR'S REPORT
1734 MARTIN LUTHER KING JF. WAY
OAKLAND, CA 86612
16101435.1512
FAX f610t Sa6.6606
Board of Directors
SENIOR HOUSING SOLUTIONS
Milpitas, California
Ferguson & Company
CW080 PUWD A000 9n (
We have audited the accompanying statement of financial position of SENIOR HOUSING
SOLUTIONS as of dune 30, 2012, and the related statements of activities and crib flows for
the year then ended. These financial statements are the responsibility of the entity's
management. Our responsibility is to express an opinion on these financial statements based on
our audit.
We conducted our audit in accordance with generally accepted auditing standards and
Government Auditing Standards issued by the Comptroller General of the United States.
Those standards require that we plan and perform the audit to obtain reasonable assurance
about whether the financial statements are free of material misstatements. An audit includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial
statements. An audit also includes assessing the accounting principles used and significant
estimates made by management as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our opinion.
Senior Housing Solution's continning significant operating losses raise substantial doubt about
its ability to continue as a going concern. The financial statements do not include any
adjustments that might result from the outcome of this uncertainty (see Note 9). In our opinion,
subject to the disposition of the aforementioned uncertainty, the financial statements referred to
above present fairly, in all material respects, the financial position of Senior Housing
Solutions on June 30, 2012, and the changes in its net assets and its cash flows for the year
then ended, in conformity with accounting principles generally accepted in the United States of
America.
In accordance with Government Auditing Standards, we have also issued our report dated
March 22, 2013, on our consideration of SENIOR HOUSING SOLUTIONS's internal
control over financial reporting and our tests of its compliance with certain provisions of laws,
regulations, contracts and grants agreements and other matters. The purpose of that report is to
describe the scope of our testing of internal control over financial reporting and compliance and
the results of that testing, and not to provide an opinion on the internal control over financial
reporting or on compliance. That report is an integral part of an audit performed in accordance
with Government Auditing Standards and should be considered in assessing the results of our
audit.
Our audit was performed for the purpose of fanning an opinion on the financial statements of
SENIOR HOUSING SOLUTIONS. The accompanying Schedule of Expenditures of Federal
Awards (page 11) and supplementary information is presented on pages 1 i to 16 inclusive, for
purposes of additional analysis as required by the U.S. Office of Management and Budget
Circular A -133, Audits of States, Local. Governments, and Non -Profit Organizations, and
is not a required part of the basic financial statements. Such information has been subjected to
the auditing procedures applied in the audit of the basic fine Iirial statements.
Ferguson & Company, CPA
March 22, 2013
r
I
FINANCIAL STATEMENTS
SENIOR HOUSING SOLUTIONS
STATEMENT OF FINANCIAL POSITION
JUNE 30, 2612
CURRENT ASSETS
Cash
Other Assets
Total Current Assets
FIXED ASSETS
Furniture & Fixtures (Note 4)
Accumulated Depreciation (Note 4)
Total Fixed Assets
OTHER ASSETS
Deposits
Certificate of Deposit
Total Other Assets
TOTAL ASSETS
CURRENT LURILMUMS,
Accounts Payable
Accrued Expenses
Total Current Liabilities
LONG -TERM LIABUAM
Notes Payable (Note 6)
Accrued Interest Payable (Note 6)
Total Long Term Liabilities
SETS
Temporarily
21,392 -
U-n—rcaricted
Restricred
Total
$21,248
$37,270
$58,518
8,914
-
8 914
30,162
37,270
67,432
11,631,488
-
11,631,488
(1,368,485)
-
(1.368.485)
10,263,003
-
10,263,003
1,503 - 1,503
- 21.366 21.366
1,503 21,366 22,869
$10,294,668 $58,636 $10,353,304
$22,969 -
$22,969
21,392 -
21
44.361
- 44.361
7,058,296
7,058,296
1,076,395
- 1.076.305
8,134,601
- 8,134,601
Total Liabilities 8.178,962
NET ASSETS
Unrestricted -- -(12,696)
Temporarily Restricted (Note 8)
Invested in Fixed Assets 2,128,402
Total Net Assets 2,115.70
TOTAL LIABILITIES & NET ASSETS $10,294,668
8.178,962
-- -- - -- (12,696)
$58,636 58,636
- 2 128.40?
58.636 2,174,
$58,636 $1D,353,304
See accompanying notes and accountants' report.
4
SENIOR HOUSING SOLUTIONS
STATEMENT OF ACTIVITIES
FOR THE YEAR ENDED JUNE 30, 2012
Net Assets Released From
Temporary Restrictions
Temporarily
67 500
-
Unrestricted Restricted
Total
SUPPORT
426,425
EXPENSES
Rental Income
$302,850
$302,850
Grants
27,578
27,575
Contributions & Donations
95,452
95,452
Other Income
545
Total Expenses
Total Support & Revenue
426,425
42C42
Net Assets Released From
Temporary Restrictions
67500
67 500
-
Total Support & Revenue
493,923
(67,500)
426,425
EXPENSES
Program Services
712,882
712,882
Supportive Services
107,567
107,567
Total Expenses
820A49
820,449
DECREASE IN UNRESTRICTED NET ASSETS
(326,524)
(67,500)
(394,024)
NET ASSETS AT BEGINNING OF YEAR
2,442.230
126.136
1568,366
NET ASSETS AT END OF YEAR
$2,115,706
S51IM6
$2,174 342
See accompanying notes and accountants' report
i
SENIOR HOUSING SOLUTIONS
STATEMENT OF FUNCTIONAL EXPENSES
FOR THE YEAR ENDED JUNE 30, 2012
EXPENSES
Personnel Expenses
Professional Fees
Meats & Entertainment
D &O Insurance
Bank Charges
Loan Fees
Bad Debt
Supplies
Credit Check
Telephone
Postage
Rent Expenses
Repairs & Maintenance
Yard Service
Utilities
Liability/ Prop. Insurance
Property Taxes
Small Equip. Purchases
Equipment Maintenance
PdritingrProgram
Mileage
Training
Recruitment/Advertising
Promotion
Licenses & Fees
Memberships & Dues
Pass Thru Grunts
Miscellaneous
Interest Expense
Depreciation
TOTAL
Program
Management
Services
& General
Tool
$162,947
$32,597
$195,544
42,222
8,448
50,668
375
75
450
3,637
727
4,364
229
46
275
125
25
150
1,322
264
1,586
4,133
827
4,960
750
150
900
13,324
2,666
15,990
1,379
276
1,655
21,082
4,218
25,300
27,491
5,500
32,991
9,590
1,918
11,508
38,849
7,772
46,621
17,329
3,467
20,796
3,540
708
4,248
67
14
81
5,452
1,091
6,543
90
18
108
6,872
1,375
8,247
668
133
799
276
55
331
500
100
600
143
29
172
400
60
480
3,467
694
4,161
21,017
4,204
25,221
137,767
27,560
165,327
187.841
2.532
190.373
$712,882
$107,587
$620,449
See accompanying notes and accountants' report.
L7
SENIOR HOUSING SOLUTIONS
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED JUNE 30, 2012
Cash Flows From O ratingAStiities-
Change in Net Assets
Adjustments to reconcile change in net assets to net cash
provided by operating activities:
Depreciation
Changes in Assets and Liabilities:
Decrease In Accounts Receivable
Decrease In Grants Receivable
Decrease In Prepaid Expenses
Increase In Other Assets
Decrease In Accounts Payable
Increase In Accrued Expenses
Decrease In Notes Payable - Current
Decrease In Retandawe Deposits
Other - Net
Total Adjustments
Net Cash Used By Operating Activities
Cash Flown From Inv ct±nw Aug,•
Purchases of Property and Equipment
Net Cash Used By investment Activities
Cash Flows From Fi anr:no Activities•
Proceeds From New Debt
Increase in Accrued Interest Payable
Net Cash Prodded by Fiinancing Activities
Decrease In Cash_ .- ... .._ .. _
CASH, Beginning of Year
CASH, End of Year
See accompanying notes and accountants, report,
7
($394,024)
190,373
3,139
158,604
6,386
(8,914)
(107,836)
1,678
(40,000)
(14,651)
L446
124.185
(203 -939)
372,464
160 181
532.842
- .._..- (51.011)
149,5.14
$58,518
SENIOR HOUSING SOLUTIONS
(A Nan -Pmf+t C"ra6on)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
NOTE I - SIGNIFICANT ACCOUNTING POLICIES
A. General
The SENIOR HOUSING SOLUTIONS (the Organization) is a nonprofit organization, founded in
1476 and incorporated in the State of California. On April 25, 2005, Project Match's Restated
Articles of Incorporation were approved by the State of California Secretary of State and, on that
date, the name of the Organization changed from Project Match to Senior Housing Solutions. The
Organization addresses the problem of an inadequate supply of available and affordable housing for
seniors who are struggling economically. The purpose of this organization is to increase the supply
of affordable housing and provide support services that will help low- income seniors improve the
quality of their lives.
B. Basis of Accountine
The Organization's records are maintained on the accrual basis of accounting.
C. Promises To Give
Contributions are recognized when the donor makes a promise to give to the organization that is, in
substance, unconditional. Contributions that are restricted by the donor are reported as increases in
unrestricted net assets if the restrictions expire in the fiscal year in which the contributions are
recognized. All other donor - restricted contributions are reported as increases in temporary or
permanently restricted net assets depending on the nature of the restrictions. When a restriction
expires, temporarily restricted net assets are reclassified to unrestricted net assets.
Based upon prior year's experience and management's analysis, no allowance for uncollectible
unconditional promises is considered necessary.
D. Contributed Services
During the year ended June 30, 2012 the Organization received no contributed services meeting the
requirements for recognition in the financial statements.
E. Estimates
The preparation of financial statements in conformity with generally accepted accounting principles
requires management to make estimates and assumptions that affect certain reported amounts and
disclosures. Accordingly, actual results could differ from those estimates.
F. Financial Statement Presentation
The Organization .Pollows.Statement.of -- Financial Accounting-standards (SFAS) No4l7— "Financial
Statements of Nat - for -Profit Organizations." Under SFAS No. 117, the organization reports
information regarding its financial position and activities according to three classes of net assets:
unrestricted net assets, temporarily restricted net assets, and permanently restricted net assets.
SENIOR HOUSING SOLUTIONS
(A Non -Profit GVPOrQdan)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
NOTE I - SIGNIFICANT ACCOUNTING POLICIES (CONT'l))
C. Contributions
Unrestricted contributions are recognized when cash is received or ownership of donated assets is
transferred to the organization.
Temporarily restricted contributions are recognized as contribution income when cash or ownership
of donated assets is transferred to the Organization. These contributions are subsequently
transferred to unrestricted net assets to cover expenses which have been incurred in satisfaction of
those restrictions. Temporarily restricted contributions are reported as unrestricted contributions if
the restrictions are met or expire in the same fiscal year as that contribution was recognized as
revenue.
....w auwuac e�uu�uawua -- yurest"11reu 2112 1 2111110rarrly Restricted
All gains and losses arising from the sale, collection or other disposition of investments and fixed
assets are accounted for in the fund which owned such assets according to restrictions placed on the
original gift. Ordinary income derived from investments, receivables and the like is accounted for in
the unrestricted fund.
J. Property. Building and Fguinment
Property, building and equipment that have a historical cost of approximately $500 or more and have
reasonably determinable useful lives are capitalized. Property, building and equipment are recorded at
cost and depreciated by the straight- line method over their estimated useful lives, 5 to 27.5 years.
Assets received as donations are recorded at their fair market value when received.
Depreciation expense is proportionally allocated to the individual programs and support functions
based on the percentage of program or support function expenses relative to total expenses.
Assets held under capital leases are recorded at the lower of net present value of the minimum lease
payments or the fair value of the leased asset at the inception of the lease. Amortization expense is
computed using the straight -line method over the shorter of the estimated useful lives of the assets or
the period of the related lease.
K Accumulated Vacation and Sick Leave
Accumulated unpaid employee vacations are recognized as liabilities of the Organization. Sick leave
benefits are accumulated for each employee; however, the employees do not have_ a_Yestcd right to
ncic leave. Sick leave benefits are not recognized as liabilities of the Organization since payment of
such benefits is not determinable. Accordingly, sick leave benefits are recorded as an expense in the
period sick leave is taken.
0
SENIOR HOUSING SOLUTIONS
(A Non -Pr*J"u Corporadion)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
NOTE 2 - CONTINGENCIES
The Organization has received funds for specific purposes that are subject to review and audit by the
grantor agencies. Although such audits could generate expenditure disallowances under terms of the
grants, it is believed that any disallowances will not be material.
NOTE 3 — INCOME TA75
No provision has been made for income taxes in the financial statements. The Organization is
exempt from Federal and State income taxes under the Internal Revenue Code Section 501(c) (3)
and Section 23701 (d) under the Intcrnal Revenue Code and California Taxation Code, respectively.
This code section enables the Organization to accept donations which qualify as charitable
contributions to the donor. The Organization has been classified as a publicly supported
organization, which is not a private foundation.
NOTE 4 — LAND ,PROPERTY, BUILDING AND EQUIPMENT
Land, Property, Building and Equipment at June 30, 2012 consisted of the following:
Land $4,947.556
Building & Improvements
Construction in Progress
Leasehold Improvements
Furniture and Equipment
Accumulated Depreciation
Net Property & Equipment
5,654,012
788,358
31,495
210.067
11,631,488
(1.368.485)
$10.263.003
NOTE 5 — MAINTENANCE RESERVE FUND
In June 1995, the Organization entered into an agreement with the City of Santa Clara's
Redevelopment Agency (RDA) for the purchase of a Senior Croup Residence. This agreement calls
for the Organization to maintain a Project Reserve Fund, in a separate bank account, for future major
repair and replacement costs. At June 30, 2012 the required accumulated funds in the project reserve
fund is $46,146. These funds are comprised of $21,366 in a certificate of deposit and the remaining
- balance in-eash: Amds3etttatning in this account after five years ate considered suiphis "fund. At
June 30, 2012, the accumulated surplus funds was $0. Surplus funds remaining after fifteen years
will be split equally between the RDA and the Organization. If the Organization defaults on the
terms of this agreement it will have to reimburse the RDA the reserve fund balance.
10
SENIOR HOUSING SOLUTIONS
(A Nan -Profu Corponugon)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
NOTE 6 - NOTES PAYBLE
Notes Payable at June 30, 2012 are as follows:
Property
Fairtands, Camgbel]
City of Campbell
Santa Clara Co. HCD
Santa Clara Co-
Homestead, Santa Clara
City of Santa Clara
Klee. Suanwale
Sunnyvale
Sunnyvale
Wolfe. Snunwale
City of Mountain View
Sunnyvale
Sunnyvale
Pollard. Campbell
Date
Maturity
Santa Clara Co. OAR
Interest
Principal
Accrued
Commenced
Date
Ref
Rate
Balance
Interest
Santa Clara Co-
IV19103
Santa Clara Co.
01/15/93
01/15/23
B
3%
$163,000
$95,058
06/06/92
06/06/22
B
3%
60,000
35,329
01/07/03
01/01/13
B
3%
137,702
48,548
12/20/94
12/20/24
A
0%
123,042
-
01/21/97
01/21/27
B
3%
170,250
94,230
07/31/10
08101/30
B
3%
365,723
30,764
07/03/97
07/03/27
B
3%
131,850
59,664
07/02197
07!03!27
B
3%
75,000
33,938
04/03/02
04/03127
B
5%
84,742
7,348
Santa Clara Co.
12/01/01
Santa Clara Co. OAR
11/29/01
LCD
02/28/02
Blossom Hill. Los Gatos
6%
Town of Los Gatos
07/07/03
LCD
07/18/03
Santa Clara Co-
IV19103
Santa Clara Co.
12/17/03
Santa Clara Co.
08/04!05
Vasona. Milpitas
104,752
_.Santa Clara -Co_ - -._ . _
-- .06115106
Santa Clara Co.
12111/06
LCD
06/15/06
City of Milpitas
02/15/07
Santa Clara Co.
11/09/07
12/01/31
B
6%
123,900
82,263
11/29/16
B
6%
53,281
25,103
02/28/32
B
1%
50,000
5,167
07/07/2102
B
3%
$388,801
104,752
07/18153
B
0%
60,000
-
12/19/33
B
6%
90,493
46,367
12/17/33
B
6%
72,359
37,075
08/04/20
B
3%
169,067
35,032
- 06115/36
B ...._.3
0/*--
---250,000
44,375
12/11/36
B
3%
60,741
9,186
06115161
B
0%
100,000
-
02/i5/57
B
0%
316,416
-
IIM9/27
13
6%
91,196
30,094
11
SENIOR HOUSING SOLUTIONS
(A Non -Pmfet Corporation)
NOTES TO FINANCIAL
STATEMENTS
j
JULIE
30, 2012
NOTE 7 —NOTES PAYBLE (Cont'd)
Date
Maturity
Interest
Principal
Accrued
Prom
Commenced
Date
Ref
Rate
Balance
Interest
Llewellyn, Campbell
f Santa Clara Co.
4112107
4/12/37
B
6%
400,000
104,547
i Santa Clara Co.
6121/07
6/21122
B
3%
85,000
10,936
Campbell
4/01/08
4/1/63
B
0%
100,000
-
Socorro, Sunnyvale
Sunnyvale
1/15108
1/15/38
B
3%
710,400
95,904
J Opportunity Fund
`
4/17109
2/01/38
B
0%
100,000
-
Ann Way, Los Gatos
Lenders of Community
Dev, 5/21108
5121163
B
0%
455,000
-
1 Santa Clara Co.
7108109
7108139
B
3%
150,000
13,401
Price, Cupertino
Opportunity Fund
1/09109
1/09139
B
0%
100,000
City of Cupertino
8/25109
8125164
B
3%
239,490
11,478
City of Cupertino
6130111
6130166
B
3%
166,785
5,004
N. Park Victoria, Milpitas
Opportunity Fund
7130109
7124139
B
00/0
190,000
County of Santa Clara
5105111
5/05/41
B
3%
28,954
967
r City of Milpitas
10/26/10
-
B
00/0
224,521
I Cypress, Santa Clara
Opportunity Fund
7131/10
8101165
B
0%
100,000
-
} City of Santa Clara
7/31/10
7/31/30
B
0%
790,582
Santa Clara County
7/31/)0
07131
B
3%
170,000
9,775
57,058,295
$1,076,305
A - Loan principal and interest is forgiven if conditions of maintaining property as low income
are met.
f B - Loan principal and interest
are deferred until maturity
date.
1
i_
12
SENIOR HOUSING SOLUTIONS
(A Non - Profit Corporation)
NOTES TO FINANCIAL STATEMENTS
JUNE 30, 2012
NOTE 7 -- NOTES PAYBLE (Cout'd)
Future minimum payments are as follows:
June 30, 2013 _
June 30, 2014
June 30, 2015
June 30, 2016 _
Thereafter $6,72583 2
$6,725,832
I NOTE 8 — TEMPORARILY RESTRICTED NET ASSETS
Temporarily Restricted Net Assets for the year ended June 30, 2012 are as follows:
Belinnin¢ Additions Releases
Time Restriction $76,136 $17,500
Grant Receivable 50.000 SO,000
Total $126.136 $67,500
Lading
$58,636
558.636
NOTE 9 — OPERATING DEFICIIT
Senior Housing Solution's continued significant operating losses create substantial doubt as to the
Organization's ability to continue as a going concern, The financial statements do not include any
adjustments that might result from these uncertainties.
13
SUPPLEMENTAL INFORMATION
SENIOR HOUSING SOLUTIONS
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
FOR THE YEAR ENDED JUNE 30, 2412
Federal Grantorl
Pass Through Grantor/ FEDERAL
Disbursements/
Pro ram Tale: CFDA NIMBER
&pet►ditures:
FEDERAL:
Major Programs:
Department of Housing and Ur&m Development
Passed Through Community Development Block Grant 14.218
Santa Clara County
$404,048
City of Campbell
248,900
City of Sunnyvale
620,715
City of Milpitas
540,937
City of Cupertino
406,276
TOW Community Development Block Grant
2,220,876
Passed Through Home Investment Partnership 14.239
Santa Clara County
570,000
City of Sunnyvale
785,400
City of Santa Clara
790,582
City of Mountain View
131,850
Total Home Investment Partnership
2,277,932—
Total US Department of Housing and Urban Development
4,498,748
Total Expenditures of Federal Awards
$4,498,708
Basis of Presentation:
The above schedule includes the federal grant activity of Senior Housing Solutions and
is presented in accordance with the requirements of OMB Circular A -133, Audits of
States, Local Governments, and Non -profit Organizations. Some amounts presented in
this schedule may differ fmm amounts presented in, or used in the preparation of the basic
financial statements.
All of the items in the above schedule are notes payable outstanding as of June 30, 2012.
14
SENIOR HOUSING SOLUTIONS
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2012
A. SUMMARY OF AUDITOR'S RESULTS
I. Financial Statements
1. The Independent Auditor's Report on the financial statements of SENIOR HOUSING SOLUTIONS
expressed a qualified opinion on the Organization's financial statements (see Note 8).
2. Internal Control over Financial Reporting:
a. CURRENT FINDINGS:
NONE
3. We noted no instances of noncompliance which would be material to the financial statements.
11. Federal Awards
1. Internal Controls Over Major Programs:
a. Material wealmess identified? NO
b. Reportable conditions identified? NO
2. Any audit findings that are required to be reported
in accordance with section 510(a) of Circular A -133? NO
3. The auditor's report on compliance for the major federal awards programs for SENIOR
HOUSING SOLUTIONS, expressed an unqualified opinion.
4. The programs tested as major programs are identified as follows:
CDFA Number Name of Federal Pro gram
U.S. Debt. Of Housing and Urban Development
14.218 Passed Through Community Development Block Grant
Santa Clara County
$404,{148
City of Campbell
248•
City of Sunnyvale
620,715
City of Milpitas
540,937
City of Cupertino
406'279
$2,220,832
14.239 Passed Through Home Investment Partnership
Santa Clara County
$570,000
City of Sunnyvale
785,400
- - -- - _City -af Santa Clara __.... - ............. _....... --
790,582
City of Mountain View
131.850
$2,277, 832
5 - The dollar threshold used to distinguish between Type A and 'I)pe B programs was $300,000.
15
SENIOR HOUSING SOLUTIONS
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
FOR THE YEAR ENDED JUNE 30, 2012
B. FINDINGS AND QUESTIONED COSTS
Questioned
Cost
I. Financial Statement Audit Now
Reportable Conditions None
II. Maior Federal Award Proerams Audit None
C. STATUS OF PRIOR YEAR FINDINGS
SIGNIFICANT DEFICIENCY:
Criteria
Contribution contracts received directly from awarding agencies or directly from a pass - througb
entity should be carefully evaluated to determine if funds include any federal funding. Any nonprofit
organization receiving federal awards over $300,000 may be subject to OMB Circular A -133
requirements.
con -
During the audit we noted that funds from pass - through entities during the year ended June 30, 2012
were not properly tracked as federal funds.
Lana
Failure to comply with the applicable provisions of OMB Circular A•133 may expose the
Organization to possible penalties or sanctions.
Recommendation
There should be a system in place to evaluate all funding and evaluate the source of the funding and
whether or not there are funds received from the federal government.
— -- Current'Yeai` -__._.__
The Organization now analyzes all federal funds received and ear -marks those funds that require
OMB Circular A -133 reporting.
LC
1731 MARTIN IUTHEA KING JR. WAY
OAKLAND, CA 99612
15101936-1612
FAX M101839-66136
Board of Directors
THE SENIOR ROME SOLUTIONS
Milpitas, California
Ferguson & Company
CedMa d Pah& Acrow f
We have audited the financial statements of SENIOR HOME SOLUTIONS for the year ended
June 30, 2012, and have issued our report thereon dated March 22, 2013. We conducted our
audit in accordance with auditing standards generally accepted in the United States of America
and the standards applicable to financial audits contained in Government Auditing Standards,
issued by the Comptroller General of the United States.
Internal Control Over Financial Renorthig
In planning and performing our audit, we considered SENIOR HOME SOLUTIONS's
internal control over financial reporting in order to determine our auditing procedures for the
purpose of expressing our opinion on the financial statemems and not to provide an opinion on
the internal control over financial reporting. However, we noted no matters involving the
internal control over financial reporting and its operations that we consider to be reportable
conditions. Reportable conditions involve matters coming to our attention relating to significam
deficiencies in the design or operation of the internal control over financial repotting that, in
our judgment, could adversely affect SENIOR HOME SOLUTIONS's ability to record,
process, summarize and report financial data consistent with the assertions of management in
the financial statements.
A material weakness is a condition in which the design or operation of one or more of the
internal control components does not reduce to a relatively low level the risk that misstatements
in amounts that would be material in relation to the financial statements being audited may
occur and not be detected within a timely period by employees in the normal course of
performing their assigned functions- Our consideration of the internal control over financial
reporting would not necessarily disclose all matters in the internal control over financial
reporting that might be material weaknesses and, accordingly, would not necessarily disclose
all reportable conditions that are also considered to be material weaknesses. However, we
noted no reportable conditions-
Compliance and Other Matters
As part of obtaining reasonable assurance about whether SENIOR HOME SOLUTIONS's
financial statements are free of material misstatement, we performed tests of its compliance
with certain provisions of laws, regulations, contracts and grant agreements, noncompliance
with which could have a direct and material effect on the determination of financial statement
amounts. However, providing an opinion on compliance with those provisions was not an
objective of our audit and, accordingly, we do not express such an opinion. The results of our
tests disclosed. no instances of noncompliance that are required to be reported d- under- - - -
Goverrunent Auditing Standards as noted in the accompanying schedule of findings and
questioned costs.
Ferguson & Company
Certified Public Accountant
March 22, 2013
17
7734 MARTIN LUTHER @NO JR. WAY
OAKLAND, CA 94812
(6101636.7672
FAX (al 01 a36-6606
Board of Directors
SENIOR HOME SOLUTIONS
Milpitas, California
Ferguson & Company
CVrUavd AdX[ACD rwf
Comoliauoe
We have audited the compliance of SENIOR HOME SOLUTIONS with the types of
compliance requirements described in the U.S. Office of Management and Budget (OMB)
Circular A -133 Compliance Supplement that are applicable to each of its major federal
programs for the year ended June 30, 2012. SENIOR HOME SOLUTIONS's major federal
programs are identified in the summary of auditor's results section of the accompanying
schedule of findings and questioned costs. Compliance with the requirements of laws,
regulations, contracts and grants applicable to each of its major federal programs is the
responsibility of SENIOR HOME SOLUTIONS's management. Our responsibility is to
express an opinion on SENIOR HOME SOLUTIONS's compliance based on our audit.
W conducted our audit of compliance in accordance with generally accepted auditing standards;
the standards applicable to financial audits contained in Goverumew Auditing Standards
issued by the Comptroller General of the United States; and OMB Circular A -133, Audits of
States, Local Governments, and Non -Profit Orgautaadons. Those standards and OMB
Circular A -133 require that we plan and perform the audit to obtain reasonable assurance
about whether noncompliance with the types of compliance requirements referred to above that
could have a direct and material effect on a major federal program occurred. An audit includes
examining, on a test basis, evidence about SENIOR HOME SOLUTIONS's compliance with
those requirements and performing such other procedures as we considered necessary in the
circumstances. Our audit does not provide a legal determination on SENIOR HOME
SOLUTIONS's compliance with those requirements.
In our opinion, SENIOR HOME SOLUTIONS complied, in all material respects, with the
requirements referred to above that are applicable to each of its major federal programs for the
Year: ended June 30, 2012. The results of our auditing procedures disclosed no instances of
noncompliance with those requirements that are required to be reported in accordance with
OMB Circular A -133 as noted in the accompanying schedule of findings and questioned costs.
)bkMg Control Over, Compliance
The management of SENIOR HOME SOLUTIONS is responsible for establishing and
maintaining effective internal control over compliance with requirements of laws, regulations,
contracts, and grants applicable to federal programs. In planting and performing our audit, we
considered SENIOR HOME SOLUTIONS's internal control over compliance with
requiretents thafcould have a direct and material effect on a major federal program in order to
determine our auditing procedures for the purpose of expressing our opinion on compliance and
to test and report on internal control over compliance in accordance with OMB Cirerllar A-
133.
18
We noted no matters involving the internal control over compliance and its operation that we
consider to be reportable conditions. Reportable conditions involve matters coming to am
attention relating to significant deficiencies in the design or operation of the 'internal control
over financial reporting that, in our judgment, could adversely affect SENIOR HOME
SOLITFIONS's ability to record, process, summarize and report financial data consistent with
the assertions of management in the financial statements.
A material weakness is a condition in which the design or operation of one or more of the
internal control components does not reduce to a relatively low level the risk that
noncompliance with applicable requirements of laws, regulations, contracts and grants that
would be material in relation to a major federal program being audited may occur and not be
detected within a timely period by employees in the normal come of performing their assigned
functions. Our consideration of the internal control over financial reporting would not
necessarily disclose all matters in the internal control over financial reporting that might be
material weaknesses and, accordingly, would not necessarily disclose all reportable conditions
that are also considered to be material weaknesses.
Ttiis report is intended for the information of the audit committee, management, and federal
awarding agencies and pass - through entities. However, this report is a matter of public record
and its distribution is not limited.
Ferguson & Company
Certified Public Accountant
March 22, 2013
Z