Audit 340664

CONDITION: On our review of the Financial Assessment Sub-system (FASS-PH), the Municipality submitted the GAAP- based audited financial information electronically to HUD for fiscal year 2022 after required submitting date and fiscal year 2023 has not been submitted. Fiscal Due Date Past Due Year Date Submitted Days 2021 September 30, 2022 February 23, 2024 512 days 2022 March 31, 2023 not submitted CRITERIA: According to 24 CFR 902.33 “Financial Reporting Requirements”, the PHA must submit an audited Financial Data Schedule no later than 9 months after the PHA’s fiscal year ends. PHAs are required to submit their financial information through the FASS-PH system. CAUSE AND EFFECT: This condition occurred because the Project Administrator has not adopted adequate internal controls and procedures designed to ensure the timely submission of program reports and the lack of adequate training and supervision of the municipal employees in charge of the preparation of the aforementioned reports. This condition, if not corrected, may increase the risk of avoidable instances of material non-compliances with the laws and regulations applicable to the Program.RECOMMENDATION: The Project Administrator should improve existing procedures to ensure the timely submission of the financial reports in order to comply with Federal regulation. Also, the Project Administrator should consider implementing a reporting calendar to keep all personnel aware of the reporting deadlines of each federal financial report. This will provide an additional tool to help the Municipality in complying with the federal regulation.

Statement of Condition: As part of our eligibility test for participant, we selected 20 participant’s files. The following deficiency was noted during our examination. - In 10 (50%) of participants files examined citizen certification were not present in files. - In 5 (25%) of participants files examined the Rent Reasonableness Certification were not present in files. - In 19 (95%) of participants file examined the bank account and assets certification were not present on files. - In 4 (20%) of participants file examined the sex offender verification were not present on files. NONE Criteria: The PHA must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payments as necessary using the documentation from third-party verification. Except as provided in paragraph (a)(3) of this section, the PHA must obtain and document in the tenant file third-party verification of the following factors, or must document in the tenant file why third-party verification was not available: (i) Reported family annual income;(ii) The value of assets; (iii) Expenses related to deductions from annual income; and (iv) Other factors that affect the determination of adjusted income. (24 CFR section 982.516). A PHA that administers a Section 8 or public housing program under an Annual Contributions Contract with HUD must carry out background checks necessary to determine whether a member of a household applying for admission to any federally assisted housing program is subject to a lifetime sex offender registration requirement under a State sex offender registration program. This check must be carried out with respect to the State in which the housing is located and with respect to States where members of the applicant household are known to have resided. (24 CFR 5.905 Cause and Effect: This condition arose because the Municipality has not implemented specific internal controls and procedures designed to minimize the errors when performing the annual family reexaminations. Recommendation: The Project Administrator should improve existing procedures to ensure the completeness of the particippants files. The Municipality should implement a checklist in order to verify participant files completeness of required documents and forms.

CONDITION: On our review of the Financial Assessment Sub-system (FASS-PH), the Municipality submitted the GAAP- based audited financial information electronically to HUD for fiscal year 2022 after required submitting date and fiscal year 2023 has not been submitted. Fiscal Due Date Past Due Year Date Submitted Days 2021 September 30, 2022 February 23, 2024 512 days 2022 March 31, 2023 not submitted CRITERIA: According to 24 CFR 902.33 “Financial Reporting Requirements”, the PHA must submit an audited Financial Data Schedule no later than 9 months after the PHA’s fiscal year ends. PHAs are required to submit their financial information through the FASS-PH system. CAUSE AND EFFECT: This condition occurred because the Project Administrator has not adopted adequate internal controls and procedures designed to ensure the timely submission of program reports and the lack of adequate training and supervision of the municipal employees in charge of the preparation of the aforementioned reports. This condition, if not corrected, may increase the risk of avoidable instances of material non-compliances with the laws and regulations applicable to the Program.RECOMMENDATION: The Project Administrator should improve existing procedures to ensure the timely submission of the financial reports in order to comply with Federal regulation. Also, the Project Administrator should consider implementing a reporting calendar to keep all personnel aware of the reporting deadlines of each federal financial report. This will provide an additional tool to help the Municipality in complying with the federal regulation.

Statement of Condition: As part of our eligibility test for participant, we selected 20 participant’s files. The following deficiency was noted during our examination. - In 10 (50%) of participants files examined citizen certification were not present in files. - In 5 (25%) of participants files examined the Rent Reasonableness Certification were not present in files. - In 19 (95%) of participants file examined the bank account and assets certification were not present on files. - In 4 (20%) of participants file examined the sex offender verification were not present on files. NONE Criteria: The PHA must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payments as necessary using the documentation from third-party verification. Except as provided in paragraph (a)(3) of this section, the PHA must obtain and document in the tenant file third-party verification of the following factors, or must document in the tenant file why third-party verification was not available: (i) Reported family annual income;(ii) The value of assets; (iii) Expenses related to deductions from annual income; and (iv) Other factors that affect the determination of adjusted income. (24 CFR section 982.516). A PHA that administers a Section 8 or public housing program under an Annual Contributions Contract with HUD must carry out background checks necessary to determine whether a member of a household applying for admission to any federally assisted housing program is subject to a lifetime sex offender registration requirement under a State sex offender registration program. This check must be carried out with respect to the State in which the housing is located and with respect to States where members of the applicant household are known to have resided. (24 CFR 5.905 Cause and Effect: This condition arose because the Municipality has not implemented specific internal controls and procedures designed to minimize the errors when performing the annual family reexaminations. Recommendation: The Project Administrator should improve existing procedures to ensure the completeness of the particippants files. The Municipality should implement a checklist in order to verify participant files completeness of required documents and forms.