Audit 308803

Finding 2020-001: Financial Reporting Requirements for Financial Assessment Submission-PHA (“FASPHA”). Federal Agency: U.S. Department of Housing and Urban Development; CFDA 14.871, Section 8 Housing Choice Vouchers. Criteria: The Financial Assessment Sub-system, FASS-PH and (24 CFR section 5.801) require PHAs to submit timely GAAP-based unaudited and audited financial information electronically to HUD. The FASS-PH system is one of HUD's main monitoring and oversight systems for the Housing Choice Voucher Program (“HCVP”). Condition: PHA Management has not filed the audited data for the years 2009 through 2019. This condition continues from previous years. Reference prior year finding 2019-001. Cause: PHA management uses an outside accounting service to submit the required information to the Financial Assessment Sub-system. Since 2009 only unaudited data has been submitted by the outside accounting service. The outside service has not reconciled and reported the audited data. Effect: Since the required audited information has not been submitted to the FASS-PH System, as the PHA’s Independent Public Accountant, (“IPA”) we have not been able to verify that the actual audit information was correctly entered into the system. We are not able to certify and agree to the PHA’s submission. Questioned Costs: None Recommendation: Management must comply with the requirements to submit timely GAAP-based unaudited and audited financial information to the FASS-PH system. Management’s Views and Corrective Action Plan Management’s views and corrective action plan are included at the end of this report.

Finding 2020-002: Rolling Forward Equity Balances: Federal Agency: U.S. Department of Housing and Urban Development. CFDA 14.871, Section 8 Housing Choice Vouchers, Criteria: PHAs are required to maintain complete and accurate accounts. HUD enters into an Annual Contributions Contract (“ACC”). The ACC requires the PHA to properly account for program activity. Proper accounting requires that (1) account balances are properly maintained, (2) records and accounting transactions support a proper roll-forward of equity, and (3) errors are corrected as detected. Condition: The unaudited year end working trial balance reflected total positive equity of $844,060 and did not reflect correct HAP and Administrative Fee equity balances. This condition continues from previous years. Reference prior year finding 2019-002. Cause: PHA management is not making the proper entries to ensure the HAP and Administrative Fee equity balances are stated correctly. Effect: This could result in the PHA not being funded correctly and may result in HUD’s Office of Inspector General findings against the PHAs. Questioned Costs: None Recommendation: PHA management must close the books each year and ensure that the HAP and Administrative Fee equity accounts are properly stated. Management’s Views and Corrective Action Plan Management’s views and corrective action plan are included at the end of this report.

Finding 2020-001: Financial Reporting Requirements for Financial Assessment Submission-PHA (“FASPHA”). Federal Agency: U.S. Department of Housing and Urban Development; CFDA 14.871, Section 8 Housing Choice Vouchers. Criteria: The Financial Assessment Sub-system, FASS-PH and (24 CFR section 5.801) require PHAs to submit timely GAAP-based unaudited and audited financial information electronically to HUD. The FASS-PH system is one of HUD's main monitoring and oversight systems for the Housing Choice Voucher Program (“HCVP”). Condition: PHA Management has not filed the audited data for the years 2009 through 2019. This condition continues from previous years. Reference prior year finding 2019-001. Cause: PHA management uses an outside accounting service to submit the required information to the Financial Assessment Sub-system. Since 2009 only unaudited data has been submitted by the outside accounting service. The outside service has not reconciled and reported the audited data. Effect: Since the required audited information has not been submitted to the FASS-PH System, as the PHA’s Independent Public Accountant, (“IPA”) we have not been able to verify that the actual audit information was correctly entered into the system. We are not able to certify and agree to the PHA’s submission. Questioned Costs: None Recommendation: Management must comply with the requirements to submit timely GAAP-based unaudited and audited financial information to the FASS-PH system. Management’s Views and Corrective Action Plan Management’s views and corrective action plan are included at the end of this report.

Finding 2020-002: Rolling Forward Equity Balances: Federal Agency: U.S. Department of Housing and Urban Development. CFDA 14.871, Section 8 Housing Choice Vouchers, Criteria: PHAs are required to maintain complete and accurate accounts. HUD enters into an Annual Contributions Contract (“ACC”). The ACC requires the PHA to properly account for program activity. Proper accounting requires that (1) account balances are properly maintained, (2) records and accounting transactions support a proper roll-forward of equity, and (3) errors are corrected as detected. Condition: The unaudited year end working trial balance reflected total positive equity of $844,060 and did not reflect correct HAP and Administrative Fee equity balances. This condition continues from previous years. Reference prior year finding 2019-002. Cause: PHA management is not making the proper entries to ensure the HAP and Administrative Fee equity balances are stated correctly. Effect: This could result in the PHA not being funded correctly and may result in HUD’s Office of Inspector General findings against the PHAs. Questioned Costs: None Recommendation: PHA management must close the books each year and ensure that the HAP and Administrative Fee equity accounts are properly stated. Management’s Views and Corrective Action Plan Management’s views and corrective action plan are included at the end of this report.