Audit 355767

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

ALLOWABLE ACTIVITIES AND ALLOWABLE COSTS - SIGNIFICANT DEFICIENCY Federal Program Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria 2 CFR Section 200.400 requires recipients and subrecipients of federal grant funds to maintain adequate documentation to support costs charged to a federal award. FAQ #5 issued by the Department of Treasury related to this program indicates that Grantees must obtain, if available, a current lease, signed by the applicant and the landlord or sublessor, that identifies the unit where the applicant resides and establishes the rental payment amount. Additionally, FAQ #6 notes that all payments for utilities and home energy costs should be supported by a bill, invoice, or evidence of payment to the provider of the utility or home energy service. Condition/Cause During 2022 payments of rental and utility assistance were entered as batches within the financial accounting software. A separate spreadsheet was utilized to track individual payments included within the batches. The original spreadsheet provided contained data entry errors. After revising for corrections, the detail provided by the Authority outlining individual payments was $472,226 lower than expenses reported in the financial reporting software and could not be reconciled by management. For 6 out of 60 cases tested, the amount paid for rent did not agree to a lease agreement or bills on file for the following reasons: (1) clerical errors, (2) duplicate payments due to multiple staff working on the same file, or (3) failure to request support before payment was made. The Authority did not have controls in place to detect the noncompliance prior to issuing payments. Effect The Authority is not in compliance with the 2 CFR Part 200 requirement to maintain adequate documentation to support costs charged to a federal program. Questioned Costs Known questioned costs are $475,094, which includes $472,226 for which expenditure details could not be provided and $2,868 of unallowable costs detected in our sample of cases. Context The Authority was unable to identify payments made for 1.95% of the population. Within our testing of 60 cases, questioned costs comprise approximately 0.59% of the total costs tested. Repeat Finding Yes. 2021-006. Recommendation We recommend the Authority revisit and strengthen internal controls over tracking individual payments for transactions entered as batches, particularly when related to federal awards. We encourage the Authority to continue working to identify the individual transactions making up the remainder of the federal expenditures under this program. We also recommend the Authority revisit and strengthen internal controls over allowable activities and allowable costs related to grant programs. Management Response See corrective action plan included in this report package.

REPORTING - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Section 3 of the Housing and Urban Development Act of 1968 requires reporting of certain data on an annual basis related to the Community Development Block Grant to ensure that employment and other economic opportunities generated by certain HUD financial assistance programs shall, to the greatest extent feasible, and consistent with existing federal, state, and local laws and regulations, be directed to low- and very-low income persons, particularly those who are recipients of government assistance for housing, and to business concerns which provide economic opportunities to low- and very-low income persons. The Emergency Rental Assistance grant agreements each contain reporting requirements for both monthly and quarterly reports. Treasury has issued reporting guidance to all grantees. Condition/Cause The Authority did not maintain documentation of internal controls over reporting for the programs. For required Community Development Block Grant Reporting under Section 3 of the Housing and Urban Development Act of 1968, total Labor Hours reported for 2022 did not agree to support maintained. Additionally, for the Emergency Rental Assistance program, while reporting spreadsheets were provided, supporting documentation for the amounts reported were not maintained. Effect The Authority did not have documentation to support an internal control over reporting. Documentation does not support Section 3 labor hours reported for the year. Additionally, as certain files were over-written, the Authority could not produce documentation to support emergency rental assistance information reported. Questioned Costs None. Context During our testing of Community Development Block Grant reporting, we requested the Section 3 report filed for 2022. Total labor hours reported were 1,202 but should have been reported as 770 hours based on certified payroll documentation maintained. During our testing of Emergency Rental Assistance Program reporting, we sampled 15 reports, including both monthly and quarterly reporting. While the Authority could provide certain spreadsheets, a detail of supporting documentation could not be provided for 9 out of the 15 reports selected for testing. Repeat Finding Yes. 2021-007. Recommendation We recommend that all grant reports are reviewed by a person independent of the preparer who has knowledge of the grant requirements. This review should include comparing the amounts reported to detailed support for accuracy. We also recommend the Authority review their recordkeeping procedures for documentation related to grant reporting. There should be a process in place to ensure all required documentation is maintained and filed in an orderly system that allows the Authority to locate and provide documentation when required. Management Response See corrective action plan included in this report package.

REPORTING - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Section 3 of the Housing and Urban Development Act of 1968 requires reporting of certain data on an annual basis related to the Community Development Block Grant to ensure that employment and other economic opportunities generated by certain HUD financial assistance programs shall, to the greatest extent feasible, and consistent with existing federal, state, and local laws and regulations, be directed to low- and very-low income persons, particularly those who are recipients of government assistance for housing, and to business concerns which provide economic opportunities to low- and very-low income persons. The Emergency Rental Assistance grant agreements each contain reporting requirements for both monthly and quarterly reports. Treasury has issued reporting guidance to all grantees. Condition/Cause The Authority did not maintain documentation of internal controls over reporting for the programs. For required Community Development Block Grant Reporting under Section 3 of the Housing and Urban Development Act of 1968, total Labor Hours reported for 2022 did not agree to support maintained. Additionally, for the Emergency Rental Assistance program, while reporting spreadsheets were provided, supporting documentation for the amounts reported were not maintained. Effect The Authority did not have documentation to support an internal control over reporting. Documentation does not support Section 3 labor hours reported for the year. Additionally, as certain files were over-written, the Authority could not produce documentation to support emergency rental assistance information reported. Questioned Costs None. Context During our testing of Community Development Block Grant reporting, we requested the Section 3 report filed for 2022. Total labor hours reported were 1,202 but should have been reported as 770 hours based on certified payroll documentation maintained. During our testing of Emergency Rental Assistance Program reporting, we sampled 15 reports, including both monthly and quarterly reporting. While the Authority could provide certain spreadsheets, a detail of supporting documentation could not be provided for 9 out of the 15 reports selected for testing. Repeat Finding Yes. 2021-007. Recommendation We recommend that all grant reports are reviewed by a person independent of the preparer who has knowledge of the grant requirements. This review should include comparing the amounts reported to detailed support for accuracy. We also recommend the Authority review their recordkeeping procedures for documentation related to grant reporting. There should be a process in place to ensure all required documentation is maintained and filed in an orderly system that allows the Authority to locate and provide documentation when required. Management Response See corrective action plan included in this report package.

REPORTING - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Section 3 of the Housing and Urban Development Act of 1968 requires reporting of certain data on an annual basis related to the Community Development Block Grant to ensure that employment and other economic opportunities generated by certain HUD financial assistance programs shall, to the greatest extent feasible, and consistent with existing federal, state, and local laws and regulations, be directed to low- and very-low income persons, particularly those who are recipients of government assistance for housing, and to business concerns which provide economic opportunities to low- and very-low income persons. The Emergency Rental Assistance grant agreements each contain reporting requirements for both monthly and quarterly reports. Treasury has issued reporting guidance to all grantees. Condition/Cause The Authority did not maintain documentation of internal controls over reporting for the programs. For required Community Development Block Grant Reporting under Section 3 of the Housing and Urban Development Act of 1968, total Labor Hours reported for 2022 did not agree to support maintained. Additionally, for the Emergency Rental Assistance program, while reporting spreadsheets were provided, supporting documentation for the amounts reported were not maintained. Effect The Authority did not have documentation to support an internal control over reporting. Documentation does not support Section 3 labor hours reported for the year. Additionally, as certain files were over-written, the Authority could not produce documentation to support emergency rental assistance information reported. Questioned Costs None. Context During our testing of Community Development Block Grant reporting, we requested the Section 3 report filed for 2022. Total labor hours reported were 1,202 but should have been reported as 770 hours based on certified payroll documentation maintained. During our testing of Emergency Rental Assistance Program reporting, we sampled 15 reports, including both monthly and quarterly reporting. While the Authority could provide certain spreadsheets, a detail of supporting documentation could not be provided for 9 out of the 15 reports selected for testing. Repeat Finding Yes. 2021-007. Recommendation We recommend that all grant reports are reviewed by a person independent of the preparer who has knowledge of the grant requirements. This review should include comparing the amounts reported to detailed support for accuracy. We also recommend the Authority review their recordkeeping procedures for documentation related to grant reporting. There should be a process in place to ensure all required documentation is maintained and filed in an orderly system that allows the Authority to locate and provide documentation when required. Management Response See corrective action plan included in this report package.

PROGRAM INCOME - MATERIAL WEAKNESS Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Criteria Per 2 CFR section 200.307(a), program income must be expended prior to requesting Federal Funds. The Authority receives program income under the above grants and must report the receipt and application of program income within the United States Department of Housing and Urban Development Integrated Disbursement and Information System (IDIS). Condition/Cause The Authority did not properly report program income in IDIS during the year, and therefore could not support that program income was applied prior to drawing down entitlement funding. In some instances, program income received was not reported in IDIS, and one receipt was entered into IDIS twice. When received, program income is reported in a separate general ledger account in the financial reporting software. The Fiscal Officer then enters the program income into IDIS on a regular basis. No control exists to ensure completeness or accuracy of information entered into IDIS related to program income. Effect The Authority cannot provide documentation of compliance with the program income requirements of the programs during 2022. Questioned Costs HOME Investment Partnership Program - $64,128 Community Development Block Grant/Entitlement Grant - Less than $25,000 Context For the HOME Investment Partnership Program, a receipt of $10,000 was entered twice into IDIS. Receipts of $74,128.05 were identified as program income on the general ledger but not entered into IDIS. For the Community Development Block Grant Program, program income identified on the general ledger was $24,221 higher than program income reported in IDIS. The difference could not be identified by management. Repeat Finding No. Recommendation We recommend the Authority develop a procedure/internal control to ensure program income is entered accurately and completely within IDIS. This will allow for documentation to support that program income is being utilized prior to drawing down entitlement funding. This will also ensure compliance with reporting requirements for reports generated within IDIS on an annual basis. Management Response See corrective action plan included in this report package.

PROGRAM INCOME - MATERIAL WEAKNESS Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Criteria Per 2 CFR section 200.307(a), program income must be expended prior to requesting Federal Funds. The Authority receives program income under the above grants and must report the receipt and application of program income within the United States Department of Housing and Urban Development Integrated Disbursement and Information System (IDIS). Condition/Cause The Authority did not properly report program income in IDIS during the year, and therefore could not support that program income was applied prior to drawing down entitlement funding. In some instances, program income received was not reported in IDIS, and one receipt was entered into IDIS twice. When received, program income is reported in a separate general ledger account in the financial reporting software. The Fiscal Officer then enters the program income into IDIS on a regular basis. No control exists to ensure completeness or accuracy of information entered into IDIS related to program income. Effect The Authority cannot provide documentation of compliance with the program income requirements of the programs during 2022. Questioned Costs HOME Investment Partnership Program - $64,128 Community Development Block Grant/Entitlement Grant - Less than $25,000 Context For the HOME Investment Partnership Program, a receipt of $10,000 was entered twice into IDIS. Receipts of $74,128.05 were identified as program income on the general ledger but not entered into IDIS. For the Community Development Block Grant Program, program income identified on the general ledger was $24,221 higher than program income reported in IDIS. The difference could not be identified by management. Repeat Finding No. Recommendation We recommend the Authority develop a procedure/internal control to ensure program income is entered accurately and completely within IDIS. This will allow for documentation to support that program income is being utilized prior to drawing down entitlement funding. This will also ensure compliance with reporting requirements for reports generated within IDIS on an annual basis. Management Response See corrective action plan included in this report package.

PROGRAM INCOME - MATERIAL WEAKNESS Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Criteria Per 2 CFR section 200.307(a), program income must be expended prior to requesting Federal Funds. The Authority receives program income under the above grants and must report the receipt and application of program income within the United States Department of Housing and Urban Development Integrated Disbursement and Information System (IDIS). Condition/Cause The Authority did not properly report program income in IDIS during the year, and therefore could not support that program income was applied prior to drawing down entitlement funding. In some instances, program income received was not reported in IDIS, and one receipt was entered into IDIS twice. When received, program income is reported in a separate general ledger account in the financial reporting software. The Fiscal Officer then enters the program income into IDIS on a regular basis. No control exists to ensure completeness or accuracy of information entered into IDIS related to program income. Effect The Authority cannot provide documentation of compliance with the program income requirements of the programs during 2022. Questioned Costs HOME Investment Partnership Program - $64,128 Community Development Block Grant/Entitlement Grant - Less than $25,000 Context For the HOME Investment Partnership Program, a receipt of $10,000 was entered twice into IDIS. Receipts of $74,128.05 were identified as program income on the general ledger but not entered into IDIS. For the Community Development Block Grant Program, program income identified on the general ledger was $24,221 higher than program income reported in IDIS. The difference could not be identified by management. Repeat Finding No. Recommendation We recommend the Authority develop a procedure/internal control to ensure program income is entered accurately and completely within IDIS. This will allow for documentation to support that program income is being utilized prior to drawing down entitlement funding. This will also ensure compliance with reporting requirements for reports generated within IDIS on an annual basis. Management Response See corrective action plan included in this report package.

PROGRAM INCOME - MATERIAL WEAKNESS Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Criteria Per 2 CFR section 200.307(a), program income must be expended prior to requesting Federal Funds. The Authority receives program income under the above grants and must report the receipt and application of program income within the United States Department of Housing and Urban Development Integrated Disbursement and Information System (IDIS). Condition/Cause The Authority did not properly report program income in IDIS during the year, and therefore could not support that program income was applied prior to drawing down entitlement funding. In some instances, program income received was not reported in IDIS, and one receipt was entered into IDIS twice. When received, program income is reported in a separate general ledger account in the financial reporting software. The Fiscal Officer then enters the program income into IDIS on a regular basis. No control exists to ensure completeness or accuracy of information entered into IDIS related to program income. Effect The Authority cannot provide documentation of compliance with the program income requirements of the programs during 2022. Questioned Costs HOME Investment Partnership Program - $64,128 Community Development Block Grant/Entitlement Grant - Less than $25,000 Context For the HOME Investment Partnership Program, a receipt of $10,000 was entered twice into IDIS. Receipts of $74,128.05 were identified as program income on the general ledger but not entered into IDIS. For the Community Development Block Grant Program, program income identified on the general ledger was $24,221 higher than program income reported in IDIS. The difference could not be identified by management. Repeat Finding No. Recommendation We recommend the Authority develop a procedure/internal control to ensure program income is entered accurately and completely within IDIS. This will allow for documentation to support that program income is being utilized prior to drawing down entitlement funding. This will also ensure compliance with reporting requirements for reports generated within IDIS on an annual basis. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

TIMING OF AUDIT COMPLETION - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Certain debt agreements require the Authority to submit audited financial statements to the lender within 120 to 270 days after the end of each fiscal year. Additionally, the audit was required to be submitted to the Federal Audit Clearinghouse by September 30, 2023. Condition The 2022 financial statement audit was not completed until April of 2025. Cause The significant increase in grant funding limited staff capacity to prepare for and provide information requested for the audit. For example, key reconciliations needed to support balances were not prepared by management prior to the audit. Effect Due to the delays in preparing for the audit, audited financial statements were not provided to the bank within the timeline prescribed in certain debt agreements. This could limit future borrowing ability of the Authority. Additionally, the delay in the audit will cause the Authority to be considered a high-risk auditee by the Uniform Guidance for the following two years. Questioned Costs None Context The Authority was unable to meet filing deadlines for bank loans as well as the data collection form submission. Repeat Finding Yes. 2021-003. Recommendation We recommend that the Authority revisit job descriptions and staff capacity as well as evaluate needed training so that there is adequate time to gather and provide necessary audit information in a timely manner. Job descriptions should assign responsibility for this process, as well as provide a level of review for accountability. Management Response See corrective action plan included in this report package.

ALLOWABLE ACTIVITIES AND ALLOWABLE COSTS - SIGNIFICANT DEFICIENCY Federal Program Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria 2 CFR Section 200.400 requires recipients and subrecipients of federal grant funds to maintain adequate documentation to support costs charged to a federal award. FAQ #5 issued by the Department of Treasury related to this program indicates that Grantees must obtain, if available, a current lease, signed by the applicant and the landlord or sublessor, that identifies the unit where the applicant resides and establishes the rental payment amount. Additionally, FAQ #6 notes that all payments for utilities and home energy costs should be supported by a bill, invoice, or evidence of payment to the provider of the utility or home energy service. Condition/Cause During 2022 payments of rental and utility assistance were entered as batches within the financial accounting software. A separate spreadsheet was utilized to track individual payments included within the batches. The original spreadsheet provided contained data entry errors. After revising for corrections, the detail provided by the Authority outlining individual payments was $472,226 lower than expenses reported in the financial reporting software and could not be reconciled by management. For 6 out of 60 cases tested, the amount paid for rent did not agree to a lease agreement or bills on file for the following reasons: (1) clerical errors, (2) duplicate payments due to multiple staff working on the same file, or (3) failure to request support before payment was made. The Authority did not have controls in place to detect the noncompliance prior to issuing payments. Effect The Authority is not in compliance with the 2 CFR Part 200 requirement to maintain adequate documentation to support costs charged to a federal program. Questioned Costs Known questioned costs are $475,094, which includes $472,226 for which expenditure details could not be provided and $2,868 of unallowable costs detected in our sample of cases. Context The Authority was unable to identify payments made for 1.95% of the population. Within our testing of 60 cases, questioned costs comprise approximately 0.59% of the total costs tested. Repeat Finding Yes. 2021-006. Recommendation We recommend the Authority revisit and strengthen internal controls over tracking individual payments for transactions entered as batches, particularly when related to federal awards. We encourage the Authority to continue working to identify the individual transactions making up the remainder of the federal expenditures under this program. We also recommend the Authority revisit and strengthen internal controls over allowable activities and allowable costs related to grant programs. Management Response See corrective action plan included in this report package.

REPORTING - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Section 3 of the Housing and Urban Development Act of 1968 requires reporting of certain data on an annual basis related to the Community Development Block Grant to ensure that employment and other economic opportunities generated by certain HUD financial assistance programs shall, to the greatest extent feasible, and consistent with existing federal, state, and local laws and regulations, be directed to low- and very-low income persons, particularly those who are recipients of government assistance for housing, and to business concerns which provide economic opportunities to low- and very-low income persons. The Emergency Rental Assistance grant agreements each contain reporting requirements for both monthly and quarterly reports. Treasury has issued reporting guidance to all grantees. Condition/Cause The Authority did not maintain documentation of internal controls over reporting for the programs. For required Community Development Block Grant Reporting under Section 3 of the Housing and Urban Development Act of 1968, total Labor Hours reported for 2022 did not agree to support maintained. Additionally, for the Emergency Rental Assistance program, while reporting spreadsheets were provided, supporting documentation for the amounts reported were not maintained. Effect The Authority did not have documentation to support an internal control over reporting. Documentation does not support Section 3 labor hours reported for the year. Additionally, as certain files were over-written, the Authority could not produce documentation to support emergency rental assistance information reported. Questioned Costs None. Context During our testing of Community Development Block Grant reporting, we requested the Section 3 report filed for 2022. Total labor hours reported were 1,202 but should have been reported as 770 hours based on certified payroll documentation maintained. During our testing of Emergency Rental Assistance Program reporting, we sampled 15 reports, including both monthly and quarterly reporting. While the Authority could provide certain spreadsheets, a detail of supporting documentation could not be provided for 9 out of the 15 reports selected for testing. Repeat Finding Yes. 2021-007. Recommendation We recommend that all grant reports are reviewed by a person independent of the preparer who has knowledge of the grant requirements. This review should include comparing the amounts reported to detailed support for accuracy. We also recommend the Authority review their recordkeeping procedures for documentation related to grant reporting. There should be a process in place to ensure all required documentation is maintained and filed in an orderly system that allows the Authority to locate and provide documentation when required. Management Response See corrective action plan included in this report package.

REPORTING - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Section 3 of the Housing and Urban Development Act of 1968 requires reporting of certain data on an annual basis related to the Community Development Block Grant to ensure that employment and other economic opportunities generated by certain HUD financial assistance programs shall, to the greatest extent feasible, and consistent with existing federal, state, and local laws and regulations, be directed to low- and very-low income persons, particularly those who are recipients of government assistance for housing, and to business concerns which provide economic opportunities to low- and very-low income persons. The Emergency Rental Assistance grant agreements each contain reporting requirements for both monthly and quarterly reports. Treasury has issued reporting guidance to all grantees. Condition/Cause The Authority did not maintain documentation of internal controls over reporting for the programs. For required Community Development Block Grant Reporting under Section 3 of the Housing and Urban Development Act of 1968, total Labor Hours reported for 2022 did not agree to support maintained. Additionally, for the Emergency Rental Assistance program, while reporting spreadsheets were provided, supporting documentation for the amounts reported were not maintained. Effect The Authority did not have documentation to support an internal control over reporting. Documentation does not support Section 3 labor hours reported for the year. Additionally, as certain files were over-written, the Authority could not produce documentation to support emergency rental assistance information reported. Questioned Costs None. Context During our testing of Community Development Block Grant reporting, we requested the Section 3 report filed for 2022. Total labor hours reported were 1,202 but should have been reported as 770 hours based on certified payroll documentation maintained. During our testing of Emergency Rental Assistance Program reporting, we sampled 15 reports, including both monthly and quarterly reporting. While the Authority could provide certain spreadsheets, a detail of supporting documentation could not be provided for 9 out of the 15 reports selected for testing. Repeat Finding Yes. 2021-007. Recommendation We recommend that all grant reports are reviewed by a person independent of the preparer who has knowledge of the grant requirements. This review should include comparing the amounts reported to detailed support for accuracy. We also recommend the Authority review their recordkeeping procedures for documentation related to grant reporting. There should be a process in place to ensure all required documentation is maintained and filed in an orderly system that allows the Authority to locate and provide documentation when required. Management Response See corrective action plan included in this report package.

REPORTING - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Section 3 of the Housing and Urban Development Act of 1968 requires reporting of certain data on an annual basis related to the Community Development Block Grant to ensure that employment and other economic opportunities generated by certain HUD financial assistance programs shall, to the greatest extent feasible, and consistent with existing federal, state, and local laws and regulations, be directed to low- and very-low income persons, particularly those who are recipients of government assistance for housing, and to business concerns which provide economic opportunities to low- and very-low income persons. The Emergency Rental Assistance grant agreements each contain reporting requirements for both monthly and quarterly reports. Treasury has issued reporting guidance to all grantees. Condition/Cause The Authority did not maintain documentation of internal controls over reporting for the programs. For required Community Development Block Grant Reporting under Section 3 of the Housing and Urban Development Act of 1968, total Labor Hours reported for 2022 did not agree to support maintained. Additionally, for the Emergency Rental Assistance program, while reporting spreadsheets were provided, supporting documentation for the amounts reported were not maintained. Effect The Authority did not have documentation to support an internal control over reporting. Documentation does not support Section 3 labor hours reported for the year. Additionally, as certain files were over-written, the Authority could not produce documentation to support emergency rental assistance information reported. Questioned Costs None. Context During our testing of Community Development Block Grant reporting, we requested the Section 3 report filed for 2022. Total labor hours reported were 1,202 but should have been reported as 770 hours based on certified payroll documentation maintained. During our testing of Emergency Rental Assistance Program reporting, we sampled 15 reports, including both monthly and quarterly reporting. While the Authority could provide certain spreadsheets, a detail of supporting documentation could not be provided for 9 out of the 15 reports selected for testing. Repeat Finding Yes. 2021-007. Recommendation We recommend that all grant reports are reviewed by a person independent of the preparer who has knowledge of the grant requirements. This review should include comparing the amounts reported to detailed support for accuracy. We also recommend the Authority review their recordkeeping procedures for documentation related to grant reporting. There should be a process in place to ensure all required documentation is maintained and filed in an orderly system that allows the Authority to locate and provide documentation when required. Management Response See corrective action plan included in this report package.

PROGRAM INCOME - MATERIAL WEAKNESS Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Criteria Per 2 CFR section 200.307(a), program income must be expended prior to requesting Federal Funds. The Authority receives program income under the above grants and must report the receipt and application of program income within the United States Department of Housing and Urban Development Integrated Disbursement and Information System (IDIS). Condition/Cause The Authority did not properly report program income in IDIS during the year, and therefore could not support that program income was applied prior to drawing down entitlement funding. In some instances, program income received was not reported in IDIS, and one receipt was entered into IDIS twice. When received, program income is reported in a separate general ledger account in the financial reporting software. The Fiscal Officer then enters the program income into IDIS on a regular basis. No control exists to ensure completeness or accuracy of information entered into IDIS related to program income. Effect The Authority cannot provide documentation of compliance with the program income requirements of the programs during 2022. Questioned Costs HOME Investment Partnership Program - $64,128 Community Development Block Grant/Entitlement Grant - Less than $25,000 Context For the HOME Investment Partnership Program, a receipt of $10,000 was entered twice into IDIS. Receipts of $74,128.05 were identified as program income on the general ledger but not entered into IDIS. For the Community Development Block Grant Program, program income identified on the general ledger was $24,221 higher than program income reported in IDIS. The difference could not be identified by management. Repeat Finding No. Recommendation We recommend the Authority develop a procedure/internal control to ensure program income is entered accurately and completely within IDIS. This will allow for documentation to support that program income is being utilized prior to drawing down entitlement funding. This will also ensure compliance with reporting requirements for reports generated within IDIS on an annual basis. Management Response See corrective action plan included in this report package.

PROGRAM INCOME - MATERIAL WEAKNESS Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Criteria Per 2 CFR section 200.307(a), program income must be expended prior to requesting Federal Funds. The Authority receives program income under the above grants and must report the receipt and application of program income within the United States Department of Housing and Urban Development Integrated Disbursement and Information System (IDIS). Condition/Cause The Authority did not properly report program income in IDIS during the year, and therefore could not support that program income was applied prior to drawing down entitlement funding. In some instances, program income received was not reported in IDIS, and one receipt was entered into IDIS twice. When received, program income is reported in a separate general ledger account in the financial reporting software. The Fiscal Officer then enters the program income into IDIS on a regular basis. No control exists to ensure completeness or accuracy of information entered into IDIS related to program income. Effect The Authority cannot provide documentation of compliance with the program income requirements of the programs during 2022. Questioned Costs HOME Investment Partnership Program - $64,128 Community Development Block Grant/Entitlement Grant - Less than $25,000 Context For the HOME Investment Partnership Program, a receipt of $10,000 was entered twice into IDIS. Receipts of $74,128.05 were identified as program income on the general ledger but not entered into IDIS. For the Community Development Block Grant Program, program income identified on the general ledger was $24,221 higher than program income reported in IDIS. The difference could not be identified by management. Repeat Finding No. Recommendation We recommend the Authority develop a procedure/internal control to ensure program income is entered accurately and completely within IDIS. This will allow for documentation to support that program income is being utilized prior to drawing down entitlement funding. This will also ensure compliance with reporting requirements for reports generated within IDIS on an annual basis. Management Response See corrective action plan included in this report package.

PROGRAM INCOME - MATERIAL WEAKNESS Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Criteria Per 2 CFR section 200.307(a), program income must be expended prior to requesting Federal Funds. The Authority receives program income under the above grants and must report the receipt and application of program income within the United States Department of Housing and Urban Development Integrated Disbursement and Information System (IDIS). Condition/Cause The Authority did not properly report program income in IDIS during the year, and therefore could not support that program income was applied prior to drawing down entitlement funding. In some instances, program income received was not reported in IDIS, and one receipt was entered into IDIS twice. When received, program income is reported in a separate general ledger account in the financial reporting software. The Fiscal Officer then enters the program income into IDIS on a regular basis. No control exists to ensure completeness or accuracy of information entered into IDIS related to program income. Effect The Authority cannot provide documentation of compliance with the program income requirements of the programs during 2022. Questioned Costs HOME Investment Partnership Program - $64,128 Community Development Block Grant/Entitlement Grant - Less than $25,000 Context For the HOME Investment Partnership Program, a receipt of $10,000 was entered twice into IDIS. Receipts of $74,128.05 were identified as program income on the general ledger but not entered into IDIS. For the Community Development Block Grant Program, program income identified on the general ledger was $24,221 higher than program income reported in IDIS. The difference could not be identified by management. Repeat Finding No. Recommendation We recommend the Authority develop a procedure/internal control to ensure program income is entered accurately and completely within IDIS. This will allow for documentation to support that program income is being utilized prior to drawing down entitlement funding. This will also ensure compliance with reporting requirements for reports generated within IDIS on an annual basis. Management Response See corrective action plan included in this report package.

PROGRAM INCOME - MATERIAL WEAKNESS Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Criteria Per 2 CFR section 200.307(a), program income must be expended prior to requesting Federal Funds. The Authority receives program income under the above grants and must report the receipt and application of program income within the United States Department of Housing and Urban Development Integrated Disbursement and Information System (IDIS). Condition/Cause The Authority did not properly report program income in IDIS during the year, and therefore could not support that program income was applied prior to drawing down entitlement funding. In some instances, program income received was not reported in IDIS, and one receipt was entered into IDIS twice. When received, program income is reported in a separate general ledger account in the financial reporting software. The Fiscal Officer then enters the program income into IDIS on a regular basis. No control exists to ensure completeness or accuracy of information entered into IDIS related to program income. Effect The Authority cannot provide documentation of compliance with the program income requirements of the programs during 2022. Questioned Costs HOME Investment Partnership Program - $64,128 Community Development Block Grant/Entitlement Grant - Less than $25,000 Context For the HOME Investment Partnership Program, a receipt of $10,000 was entered twice into IDIS. Receipts of $74,128.05 were identified as program income on the general ledger but not entered into IDIS. For the Community Development Block Grant Program, program income identified on the general ledger was $24,221 higher than program income reported in IDIS. The difference could not be identified by management. Repeat Finding No. Recommendation We recommend the Authority develop a procedure/internal control to ensure program income is entered accurately and completely within IDIS. This will allow for documentation to support that program income is being utilized prior to drawing down entitlement funding. This will also ensure compliance with reporting requirements for reports generated within IDIS on an annual basis. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.

PREPARATION OF SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS - SIGNIFICANT DEFICIENCY Federal Program Community Development Block Grant/Entitlement Grant ALN 14.218; passed through the County of Berks HOME Investment Partnership Program ALN 14.239; passed through the County of Berks Emergency Rental Assistance ALN 21.023; passed through the County of Berks Criteria Per the Uniform Guidance 2 CFR 200.510, the auditee is required to prepare a schedule of expenditures of federal awards (SEFA). Condition The Authority provided information relating to the federal programs including grant agreements and other supporting documentation. However, the information prepared by the auditee required material adjustments as a result of audit procedures Cause Certain account reconciliations were not performed prior to the audit, which impacted amounts reported on the SEFA. Effect Amounts reported on the general ledger used to develop the SEFA were not accurate. The SEFA was subsequently updated through audit procedures, including inquiry and review of grant documentation of awards received and amounts expended. Questioned Costs None. Context Several adjustments were required in order for the schedule to accurately reflect the current year activity. Repeat Finding No. Recommendation In order to meet Uniform Guidance requirements, the Authority should prepare the SEFA from the grant award documentation and any other relevant information including the assistance listing numbers, grant award amounts, grant amounts received, grant amounts expended, and grant revenue recorded. The amounts reported in the SEFA should reconcile to the general ledger. Management Response See corrective action plan included in this report package.