Audit 24020

2022-005. Significant Audit Adjustments Criteria: The Authority should take the steps necessary to ensure accuracy and completeness of the financial statements. Condition: This audit required a number of significant adjusting journal entries. These entries were necessary because certain unadjusted general ledger accounts were incorrect and/or not recorded correctly. Questioned Costs: None noted. Effect: The PHA?s financial statements before any adjusting entries contained errors and/or were not properly recorded. Cause: This appears to be an oversight by the Authority. Recommendation: I recommend that the Authority exercise more care in processing and recording transactions and that more care be taken to ensure the completeness of financial reporting. Management?s Response: We cannot say whether this is a problem caused by the Dodge City Housing Authority or if it lies with our fee accountant. At the end of every fiscal year, we have a close-out process that includes a questionnaire from our fee accountant on several expense areas (compensated absences, allowance for doubtful accounts, end of year investment balances, inventory, etc.). Apparently, they did not use that information in our end of year accounting. This resulted in our auditor having to make many end of the year adjusting journal entries for our Agency. I had all of the information in our budget file, and it looked as though I had sent it to our fee accountant, however, they apparently did not receive it and use it to complete their end of year accounting for us. We will be sure to follow up with our fee accountant from this point forward to make sure they receive what we send at the end of the year.

2022-006 SEMAP Supporting Documentation Criteria: SEMAP indicators should be supported by sufficient documentation. Condition: I noted that certain indicators appearing on the September 30, 2022, SEMAP certification could not be verified as they were either not supported by adequate documentation or no quality control work were performed to substantiate PHA?s response. Questioned Costs: None noted. Effect: Responses on SEMAP certification may not be an accurate representation of PHA?s FY 2022 submission. Cause: Proper internal control procedures relating to SEMAP were not performed or maintained for SEMAP certification. Recommendation: I recommend that the Authority implement and perfect the procedures necessary to provide accurate and complete supporting documentation for future SEMAP certification. Management?s Response: We hired a new Maintenance Director near the end of FY 2022. We did not get him trained on HQS regulations prior to the end of FY 2022. Normally our old Maintenance Director would have done the inspections with me in the summer of FY 2022. He retired in May of 2022 and our new Director did not come on until July of 2022. He has since been trained in HQS and will be conducting our quality control HQS inspections with me this summer on the 4 units we must do quality control inspections on.

2022-005. Significant Audit Adjustments Criteria: The Authority should take the steps necessary to ensure accuracy and completeness of the financial statements. Condition: This audit required a number of significant adjusting journal entries. These entries were necessary because certain unadjusted general ledger accounts were incorrect and/or not recorded correctly. Questioned Costs: None noted. Effect: The PHA?s financial statements before any adjusting entries contained errors and/or were not properly recorded. Cause: This appears to be an oversight by the Authority. Recommendation: I recommend that the Authority exercise more care in processing and recording transactions and that more care be taken to ensure the completeness of financial reporting. Management?s Response: We cannot say whether this is a problem caused by the Dodge City Housing Authority or if it lies with our fee accountant. At the end of every fiscal year, we have a close-out process that includes a questionnaire from our fee accountant on several expense areas (compensated absences, allowance for doubtful accounts, end of year investment balances, inventory, etc.). Apparently, they did not use that information in our end of year accounting. This resulted in our auditor having to make many end of the year adjusting journal entries for our Agency. I had all of the information in our budget file, and it looked as though I had sent it to our fee accountant, however, they apparently did not receive it and use it to complete their end of year accounting for us. We will be sure to follow up with our fee accountant from this point forward to make sure they receive what we send at the end of the year.

2022-006 SEMAP Supporting Documentation Criteria: SEMAP indicators should be supported by sufficient documentation. Condition: I noted that certain indicators appearing on the September 30, 2022, SEMAP certification could not be verified as they were either not supported by adequate documentation or no quality control work were performed to substantiate PHA?s response. Questioned Costs: None noted. Effect: Responses on SEMAP certification may not be an accurate representation of PHA?s FY 2022 submission. Cause: Proper internal control procedures relating to SEMAP were not performed or maintained for SEMAP certification. Recommendation: I recommend that the Authority implement and perfect the procedures necessary to provide accurate and complete supporting documentation for future SEMAP certification. Management?s Response: We hired a new Maintenance Director near the end of FY 2022. We did not get him trained on HQS regulations prior to the end of FY 2022. Normally our old Maintenance Director would have done the inspections with me in the summer of FY 2022. He retired in May of 2022 and our new Director did not come on until July of 2022. He has since been trained in HQS and will be conducting our quality control HQS inspections with me this summer on the 4 units we must do quality control inspections on.