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Audit 28314

FY End
2022-03-31
Total Expended
$40.42M
Findings
2
Programs
7
Organization: Housing Authority of the City of Paterson (NJ)
Year: 2022 Accepted: 2022-12-28
Auditor: Novogradac & Company LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
21393 2022-002 Significant Deficiency - E
597835 2022-002 Significant Deficiency - E

Programs

ALN Program Spent Major Findings
14.871 Section 8 Housing Choice Vouchers $33.07M Yes 1
14.850 Public and Indian Housing $5.09M Yes 0
14.872 Public Housing Capital Fund $1.46M Yes 0
14.218 Community Development Block Grants/entitlement Grants $635,888 - 0
14.870 Resident Opportunity and Supportive Services - Service Coordinators $88,165 - 0
14.896 Family Self-Sufficiency Program $62,249 - 0
14.169 Housing Counseling Assistance Program $17,313 - 0

Contacts

Name Title Type
VCQQJ7QP7BC5 Shruti Shah Auditee
9736848248 Rich Larsen Auditor
No contacts on file

Notes to SEFA

Title: NOTE 4 - SCHEDULE OF CAPITAL FUND PROGRAM COSTS AND ADVANCES Accounting Policies: BASIS OF PRESENTATIONThe accompanying Schedule of Expenditures of Federal Awards (the "Schedule") includes the federal grant activity of Housing Authority of the City of Paterson under programs of the federal government for the year ended March 31, 2022. The information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance) and the State of New Jersey OMB Circular 15-08. Because the Schedule presents only a selected portion of operations of the Housing Authority of the City of Paterson, it is not intended to and does not present the financial position, changes in net position or cash flows of the Housing Authority of the City of Paterson.SUMMARY OF SIGNIFICANT ACCOUNTING POLICIESExpenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. INDIRECT COST RATEThe Authority has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. P501-15, Budget $650,623, Advances: Cumulative through 3/31/21 - $650,623, Current Year - $0, Cumulative through 3/31/22 - $650,623, Costs: Cumulative through 3/31/21 - $650,623, Current Year - $0, Cumulative through 3/31/22 - $650,620, Excess/(deficiency) - $0. P501-17, Budget $2,589,509, Advances: Cumulative through 3/31/21 - $2,471,603, Current Year - $117,906, Cumulative through 3/31/22 - $2,589,509, Costs: Cumulative through 3/31/21 - $2,471,603, Current Year - $117,906, Cumulative through 3/31/22 - $2,589,509, Excess/(deficiency) - $0. P501-18, Budget $4,020,559, Advances: Cumulative through 3/31/21 - $1,838,183, Current Year - $787,605, Cumulative through 3/31/22 - $2,625,788, Costs: Cumulative through 3/31/21 - $1,982,808, Current Year - $758,884, Cumulative through 3/31/22 - $2,741,692, Excess/(deficiency) - $(115,904). P501-19 Budget $4,221,930, Advances: Cumulative through 3/31/21 - $0, Current Year - $578,161, Cumulative through 3/31/22 - $578,161, Costs: Cumulative through 3/31/21 - $0, Current Year - $581,182, Cumulative through 3/31/22 - $581,182, Excess/(deficiency) - $(3,021). Total, Budget $11,482,621, Advances: Cumulative through 3/31/21 - $4,960,409, Current Year - $1,483,672, Cumulative through 3/31/22 - $6,444,081, Costs: Cumulative through 3/31/21 - $5,105,034, Current Year - $1,457,972, Cumulative through 3/31/22 - $6,563,006, Excess/(deficiency) - $(118,925). Grant numbers NJ39R021501-15 and NJ39P021501-17 with approved funding of $650,623 and $2,589,509, respectively, have been fully drawn down and expended per Capital Fund Program grant regulations.

Finding Details

Finding 2022-002
Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Section 8 Housing Choice Vouchers Program Federal Catalog Numbers: 14.871 Noncompliance ? E. Eligibility - Tenant Files Non Compliance Material to the Financial Statements: No Significant deficiency in Internal Control over Compliance for Eligibility Criteria: Tenant Files. The PHA must do the following: As a condition of admission or continued occupancy, require the tenant and other family member to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). Condition: Based upon inspection of the Authority?s files and on discussions with management there were documents that were unavailable for examination at the time of audit. Context: Of a sample size of thirty-six (36) tenant files, the following information was unavailable for examination at the time of audit: Verification of income and assets was missing in one (1) file. Our sample size is statistically valid. Known Questioned Costs: $11,054 Cause: There is a significant deficiency in internal controls over the compliance for the eligibility type of compliance related to the maintenance of tenant files. The Authority has not properly considered and designed a system of internal controls that reasonably assures the program is in compliance. Effect: The Section 8 Housing Choice Vouchers Program is in non-compliance with the eligibility type of compliance related to the maintenance of tenant files. Recommendation: We recommend the Authority design and implement internal control procedures that will reasonably assure compliance with the Uniform Guidance and the compliance supplement. Authority Response: We agree with the Auditor?s observations on the inspection of the tenant files and will implement internal control procedures that will assure tenant file compliance.
Finding 2022-002
Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Section 8 Housing Choice Vouchers Program Federal Catalog Numbers: 14.871 Noncompliance ? E. Eligibility - Tenant Files Non Compliance Material to the Financial Statements: No Significant deficiency in Internal Control over Compliance for Eligibility Criteria: Tenant Files. The PHA must do the following: As a condition of admission or continued occupancy, require the tenant and other family member to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). Condition: Based upon inspection of the Authority?s files and on discussions with management there were documents that were unavailable for examination at the time of audit. Context: Of a sample size of thirty-six (36) tenant files, the following information was unavailable for examination at the time of audit: Verification of income and assets was missing in one (1) file. Our sample size is statistically valid. Known Questioned Costs: $11,054 Cause: There is a significant deficiency in internal controls over the compliance for the eligibility type of compliance related to the maintenance of tenant files. The Authority has not properly considered and designed a system of internal controls that reasonably assures the program is in compliance. Effect: The Section 8 Housing Choice Vouchers Program is in non-compliance with the eligibility type of compliance related to the maintenance of tenant files. Recommendation: We recommend the Authority design and implement internal control procedures that will reasonably assure compliance with the Uniform Guidance and the compliance supplement. Authority Response: We agree with the Auditor?s observations on the inspection of the tenant files and will implement internal control procedures that will assure tenant file compliance.