Audit 1414

Federal Agency: U.S. Department of Housing and Urban Development Pass-through Agency: N/A Federal Program Title: Housing Choice Voucher Section-8, IPA number RQ54 CFDA Number: 14.871 Compliance Requirement: Type of Finding: Material Noncompliance Reporting and Material Weakness Responsible Official: Federal Program Director Condition: The Municipality did not submit the required Financial Reports to the US Housing and Urban Development for the fiscal year ending June 30, 2020 during the required period. The unaudited Financial Report was not submitted on or before August 30, 2020, also, the audited Financial Report was not submitted on or before September 30, 2020. Criteria: 22 CFR § 5.801 Uniform financial reporting standards, (b) (1) Entities (or individuals) to which this subpart is applicable must provide to HUD such financial information as required by HUD. Such information must be provided on a n annual basis, except as required more accordance with Generally Accepted Accounting Principles as further defined by HUD in supplementary guidance; (2) Submitted electronically to HUD through the internet, or in such other electronic format designated by HUD, or in such non-electronic format as HUD may allow if the burden or cost of electronic reporting is determined by HUD to the excessive; and (3) Submitted in such form and substance as prescribed by HUD. Also, on Section (c) (1) the financial information to be submitted to HUD in accordance with paragraph (b) of this section, must be submitted to HUD annually, no later than 60 days after the end of the fiscal year of the reporting period, and as otherwise provided by law. In addition, on Section (d) (1) states that unaudited financial statements will be required 60 days after the PHA”s fiscal year end, and audited financial statements will then be required no later than 9 months after the PHA’s fiscal year end, in accordance with the Single Audit Act and 2 CFR Part 200, Subpart F. Questioned Cost: None determined Cause: Puerto Rico was affected by the Covid-19 Pandemic in Corozal, causing a delay in the financial reports required by HUD on 2020 and 2021. Effect: The Municipality did not comply with the submission date required for the Financial Reports to the US Housing and Urban Development; this could affect the continuance and new approvals of federal program funds. Recommendation: We recommend the Municipality to maintain adequate accounting records related to the federal funds in order to properly prepare the financial statements accurate and in a timely manner. In addition, the Municipality need to implement adequate internal controls procedures in order to assure that the supporting documentation is available on a timely manner. Also, proper training in the accounting system should be obtained by the personnel in charge of preparing the bank reconciliations and Financial Reports required by HUD. Identification of a repeat finding: This is a repeat finding from the immediate previous audit 2020-004. Views of responsible officials and planned corrected action: The municipality agrees with the finding and will adhere to the correction action plan on page 99 on this report.

Federal Agency: U.S. Department of Housing and Urban Development Pass-through Agency: N/A Federal Program Title: Housing Choice Voucher Section-8, IPA number RQ54 CFDA Number: 14.871 Compliance Requirement: Type of Finding: Material Noncompliance Reporting and Material Weakness Responsible Official: Federal Program Director Condition: The Municipality did not submit the required Financial Reports to the US Housing and Urban Development for the fiscal year ending June 30, 2020 during the required period. The unaudited Financial Report was not submitted on or before August 30, 2020, also, the audited Financial Report was not submitted on or before September 30, 2020. Criteria: 22 CFR § 5.801 Uniform financial reporting standards, (b) (1) Entities (or individuals) to which this subpart is applicable must provide to HUD such financial information as required by HUD. Such information must be provided on a n annual basis, except as required more accordance with Generally Accepted Accounting Principles as further defined by HUD in supplementary guidance; (2) Submitted electronically to HUD through the internet, or in such other electronic format designated by HUD, or in such non-electronic format as HUD may allow if the burden or cost of electronic reporting is determined by HUD to the excessive; and (3) Submitted in such form and substance as prescribed by HUD. Also, on Section (c) (1) the financial information to be submitted to HUD in accordance with paragraph (b) of this section, must be submitted to HUD annually, no later than 60 days after the end of the fiscal year of the reporting period, and as otherwise provided by law. In addition, on Section (d) (1) states that unaudited financial statements will be required 60 days after the PHA”s fiscal year end, and audited financial statements will then be required no later than 9 months after the PHA’s fiscal year end, in accordance with the Single Audit Act and 2 CFR Part 200, Subpart F. Questioned Cost: None determined Cause: Puerto Rico was affected by the Covid-19 Pandemic in Corozal, causing a delay in the financial reports required by HUD on 2020 and 2021. Effect: The Municipality did not comply with the submission date required for the Financial Reports to the US Housing and Urban Development; this could affect the continuance and new approvals of federal program funds. Recommendation: We recommend the Municipality to maintain adequate accounting records related to the federal funds in order to properly prepare the financial statements accurate and in a timely manner. In addition, the Municipality need to implement adequate internal controls procedures in order to assure that the supporting documentation is available on a timely manner. Also, proper training in the accounting system should be obtained by the personnel in charge of preparing the bank reconciliations and Financial Reports required by HUD. Identification of a repeat finding: This is a repeat finding from the immediate previous audit 2020-004. Views of responsible officials and planned corrected action: The municipality agrees with the finding and will adhere to the correction action plan on page 99 on this report.