FAC Explorer

Audit 317907

FY End
2023-09-30
Total Expended
$9.44M
Findings
2
Programs
3
Organization: Housing Authority of the Town of Morristown (NJ)
Year: 2023 Accepted: 2024-08-26
Auditor: Novogradac & Company LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
485124 2023-002 Material Weakness - N
1061566 2023-002 Material Weakness - N

Programs

ALN Program Spent Major Findings
14.871 Section 8 Housing Choice Vouchers $7.22M Yes 1
14.850 Public and Indian Housing $1.23M Yes 0
14.872 Public Housing Capital Fund $985,130 - 0

Contacts

Name Title Type
VDCCMKJT7BE5 Allison Durham Auditee
9735386343 Rich Larsen Auditor
No contacts on file

Notes to SEFA

Accounting Policies: BASIS OF PRESENTATION The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of the Authority under programs of the federal government for the year ended September 30, 2023. 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 State of New Jersey OMB Circular 15-08. Because the Schedule presents only a selected portion of operations of the Authority, it is not intended to and does not present the net position, changes in net position or cash flows of the Authority. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of the financial statements. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the principles contained in the Uniform Guidance and State of New Jersey OMB Circular 15-08, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: INDIRECT COST RATE The Authority has not elected to use the ten percent de minimis indirect cost rate allowed under the Uniform Guidance.

Finding Details

Finding 2023-002
Federal Program Titles: Section 8 Housing Choice Vouchers Program Federal Assistance Listing Numbers: 14.871 Noncompliance – N. Special Tests and Provisions– Housing Quality Standards Inspections Non Compliance Material to the Financial Statements: Yes Material Weakness in Internal Control over Compliance for Special Tests and Provisions– Housing Quality Standards Inspections Criteria: The Authority must inspect the unit leased to a family annually to determine if the unit meets Housing Quality Standards (HQS) and the Authority must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Condition: Based upon inspection of the Authority’s files and on discussion with management, there were documents that were unavailable for examination at the time of audit. Context: There are approximately 318 units. Of a sample size of fourteen (14) tenant files, two (2) files did not contain annual inspection reports per HQS compliance requirements. Our sample size is statistically valid. Known Questioned Costs: $33,504. Cause: There is a material weakness in internal controls over the compliance for HQS inspections. The Authority has not properly considered, designed, implemented, maintained and monitored a system of internal controls that assures the program is in compliance. Effect: The Section 8 Housing Choice Vouchers Program is in material non-compliance with the Special Tests and Provisions - HQS Inspections type of compliance related to the program. Recommendation: We recommend the Authority design and implement internal control procedures that will assure compliance with the Uniform Guidance and the compliance supplement. Authority Response: The Authority accepts the recommendation of the auditor, and will implement internal control procedures that will ensure compliance with the Uniform Guidance.
Finding 2023-002
Federal Program Titles: Section 8 Housing Choice Vouchers Program Federal Assistance Listing Numbers: 14.871 Noncompliance – N. Special Tests and Provisions– Housing Quality Standards Inspections Non Compliance Material to the Financial Statements: Yes Material Weakness in Internal Control over Compliance for Special Tests and Provisions– Housing Quality Standards Inspections Criteria: The Authority must inspect the unit leased to a family annually to determine if the unit meets Housing Quality Standards (HQS) and the Authority must conduct quality control re-inspections. The PHA must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). Condition: Based upon inspection of the Authority’s files and on discussion with management, there were documents that were unavailable for examination at the time of audit. Context: There are approximately 318 units. Of a sample size of fourteen (14) tenant files, two (2) files did not contain annual inspection reports per HQS compliance requirements. Our sample size is statistically valid. Known Questioned Costs: $33,504. Cause: There is a material weakness in internal controls over the compliance for HQS inspections. The Authority has not properly considered, designed, implemented, maintained and monitored a system of internal controls that assures the program is in compliance. Effect: The Section 8 Housing Choice Vouchers Program is in material non-compliance with the Special Tests and Provisions - HQS Inspections type of compliance related to the program. Recommendation: We recommend the Authority design and implement internal control procedures that will assure compliance with the Uniform Guidance and the compliance supplement. Authority Response: The Authority accepts the recommendation of the auditor, and will implement internal control procedures that will ensure compliance with the Uniform Guidance.