FAC Explorer

Audit 316737

FY End
2023-12-31
Total Expended
$1.92M
Findings
8
Programs
4
Organization: Housing and Redevelopment Authority of the City of Worthington (MN)
Year: 2023 Accepted: 2024-08-06
Auditor: Abdo LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
480539 2023-001 - Yes N
480540 2023-002 Significant Deficiency Yes P
480541 2023-001 - Yes N
480542 2023-002 Significant Deficiency Yes P
1056981 2023-001 - Yes N
1056982 2023-002 Significant Deficiency Yes P
1056983 2023-001 - Yes N
1056984 2023-002 Significant Deficiency Yes P

Programs

ALN Program Spent Major Findings
14.871 Section 8 Housing Choice Vouchers $1.34M Yes 2
14.872 Public Housing Capital Fund $284,238 - 0
14.850 Public and Indian Housing $205,881 - 0
14.871 Section 8 Housing Emergency Housing Vouchers $90,326 Yes 2

Contacts

Name Title Type
ZLKXCX3FD649 Tanner Rogers Auditee
5073766788 Brad Falteysek Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on this schedule are reported on the modified accrual basis of accounting. De Minimis Rate Used: N Rate Explanation: During the year ended December 31, 2023, the HRA did not elect to use the 10% de minimis indirect cost rate. The accompanying Schedule of Expenditures of Federal Awards includes the federal grant activity of the Worthington Housing Redevelopment Authority (the HRA), Worthington, Minnesota for the year ended December 31, 2023. The HRA's reporting entity is defined in Note 1A to the HRA's financial statements. The information in this schedule is presented in accordance with the requirement of the Uniform Guidance, Audits of States, Local Governments, and Non-Profit Organizations. All Federal awards received directly from Federal agencies as well as Federal awards passed through other government agencies are included on the schedule.
Title: Pass-Through Entity Identifying Numbers Accounting Policies: Expenditures reported on this schedule are reported on the modified accrual basis of accounting. De Minimis Rate Used: N Rate Explanation: During the year ended December 31, 2023, the HRA did not elect to use the 10% de minimis indirect cost rate. Pass-through entity identifying numbers, if any, are presented where available.
Title: Subrecipients Accounting Policies: Expenditures reported on this schedule are reported on the modified accrual basis of accounting. De Minimis Rate Used: N Rate Explanation: During the year ended December 31, 2023, the HRA did not elect to use the 10% de minimis indirect cost rate. No federal expenditures presented in this schedule were provided to subrecipients.

Finding Details

Finding 2023-001
2023-001 Depository Agreements U.S. Department of Housing and Urban Development Section 8 Housing Voucher Program 14.871 Condition: During the audit we noted the HRA did not have depository agreements with the banks. Criteria: Code of Federal Regulations § 982.156 requires depository agreements to be deposited with a financial institution selected as depositary by the PHA in accordance with HUD requirements. Cause: The HRA did not have all necessary forms for single audit compliance. Effect: The HRA is not in compliance with Federal Award Programs. Recommendation: We recommend the HRA management complete the necessary forms with the bank to ensure compliance. Management Response: The HRA’s management will complete the depository agreement forms with the bank.
Finding 2023-002
2023-002 Claims Approval U.S. Department of Housing and Urban Development Section 8 Housing Voucher Program 14.871 Condition: During the audit we noted the HRA did not get Board approval for several Section 8 Housing Vouchers disbursements. Criteria: Minnesota Statute § 412.271, subd. 1 directs all claims be audited and allowed by the HRA Board. Meaning all claims paid by the HRA are required to be approved by the Board at the HRA’s monthly meetings. The HRA also relies on Board approval of expenditures as a key control over federal spending. We noted instances throughout the year where there were gaps in the check sequences that the HRA was approving, thereby not approving all claims. Cause: Section 8 Housing Voucher claims were not included in monthly Board meetings for approval. Effect: The HRA is not in compliance with Minnesota legal compliance and there were not proper internal controls over federal expenditures. Recommendation: We recommend the HRA include all claims paid by the HRA in monthly Board meetings for approval. Management Response: The HRA’s management will include all claims paid by the HRA in monthly Board meetings.
Finding 2023-001
2023-001 Depository Agreements U.S. Department of Housing and Urban Development Section 8 Housing Voucher Program 14.871 Condition: During the audit we noted the HRA did not have depository agreements with the banks. Criteria: Code of Federal Regulations § 982.156 requires depository agreements to be deposited with a financial institution selected as depositary by the PHA in accordance with HUD requirements. Cause: The HRA did not have all necessary forms for single audit compliance. Effect: The HRA is not in compliance with Federal Award Programs. Recommendation: We recommend the HRA management complete the necessary forms with the bank to ensure compliance. Management Response: The HRA’s management will complete the depository agreement forms with the bank.
Finding 2023-002
2023-002 Claims Approval U.S. Department of Housing and Urban Development Section 8 Housing Voucher Program 14.871 Condition: During the audit we noted the HRA did not get Board approval for several Section 8 Housing Vouchers disbursements. Criteria: Minnesota Statute § 412.271, subd. 1 directs all claims be audited and allowed by the HRA Board. Meaning all claims paid by the HRA are required to be approved by the Board at the HRA’s monthly meetings. The HRA also relies on Board approval of expenditures as a key control over federal spending. We noted instances throughout the year where there were gaps in the check sequences that the HRA was approving, thereby not approving all claims. Cause: Section 8 Housing Voucher claims were not included in monthly Board meetings for approval. Effect: The HRA is not in compliance with Minnesota legal compliance and there were not proper internal controls over federal expenditures. Recommendation: We recommend the HRA include all claims paid by the HRA in monthly Board meetings for approval. Management Response: The HRA’s management will include all claims paid by the HRA in monthly Board meetings.
Finding 2023-001
2023-001 Depository Agreements U.S. Department of Housing and Urban Development Section 8 Housing Voucher Program 14.871 Condition: During the audit we noted the HRA did not have depository agreements with the banks. Criteria: Code of Federal Regulations § 982.156 requires depository agreements to be deposited with a financial institution selected as depositary by the PHA in accordance with HUD requirements. Cause: The HRA did not have all necessary forms for single audit compliance. Effect: The HRA is not in compliance with Federal Award Programs. Recommendation: We recommend the HRA management complete the necessary forms with the bank to ensure compliance. Management Response: The HRA’s management will complete the depository agreement forms with the bank.
Finding 2023-002
2023-002 Claims Approval U.S. Department of Housing and Urban Development Section 8 Housing Voucher Program 14.871 Condition: During the audit we noted the HRA did not get Board approval for several Section 8 Housing Vouchers disbursements. Criteria: Minnesota Statute § 412.271, subd. 1 directs all claims be audited and allowed by the HRA Board. Meaning all claims paid by the HRA are required to be approved by the Board at the HRA’s monthly meetings. The HRA also relies on Board approval of expenditures as a key control over federal spending. We noted instances throughout the year where there were gaps in the check sequences that the HRA was approving, thereby not approving all claims. Cause: Section 8 Housing Voucher claims were not included in monthly Board meetings for approval. Effect: The HRA is not in compliance with Minnesota legal compliance and there were not proper internal controls over federal expenditures. Recommendation: We recommend the HRA include all claims paid by the HRA in monthly Board meetings for approval. Management Response: The HRA’s management will include all claims paid by the HRA in monthly Board meetings.
Finding 2023-001
2023-001 Depository Agreements U.S. Department of Housing and Urban Development Section 8 Housing Voucher Program 14.871 Condition: During the audit we noted the HRA did not have depository agreements with the banks. Criteria: Code of Federal Regulations § 982.156 requires depository agreements to be deposited with a financial institution selected as depositary by the PHA in accordance with HUD requirements. Cause: The HRA did not have all necessary forms for single audit compliance. Effect: The HRA is not in compliance with Federal Award Programs. Recommendation: We recommend the HRA management complete the necessary forms with the bank to ensure compliance. Management Response: The HRA’s management will complete the depository agreement forms with the bank.
Finding 2023-002
2023-002 Claims Approval U.S. Department of Housing and Urban Development Section 8 Housing Voucher Program 14.871 Condition: During the audit we noted the HRA did not get Board approval for several Section 8 Housing Vouchers disbursements. Criteria: Minnesota Statute § 412.271, subd. 1 directs all claims be audited and allowed by the HRA Board. Meaning all claims paid by the HRA are required to be approved by the Board at the HRA’s monthly meetings. The HRA also relies on Board approval of expenditures as a key control over federal spending. We noted instances throughout the year where there were gaps in the check sequences that the HRA was approving, thereby not approving all claims. Cause: Section 8 Housing Voucher claims were not included in monthly Board meetings for approval. Effect: The HRA is not in compliance with Minnesota legal compliance and there were not proper internal controls over federal expenditures. Recommendation: We recommend the HRA include all claims paid by the HRA in monthly Board meetings for approval. Management Response: The HRA’s management will include all claims paid by the HRA in monthly Board meetings.