FAC Explorer

Audit 360680

FY End
2024-09-30
Total Expended
$30.87M
Findings
4
Programs
4
Organization: Housing Authority of South Bend (IN)
Year: 2024 Accepted: 2025-06-30
Auditor: Berman Hopkins Wright & Laham CPAS and Associates

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
569029 2024-002 Significant Deficiency - E
569030 2024-001 Material Weakness - E
1145471 2024-002 Significant Deficiency - E
1145472 2024-001 Material Weakness - E

Programs

ALN Program Spent Major Findings
14.871 Section 8 Housing Choice Vouchers $24.47M Yes 1
14.850 Public and Indian Housing $3.69M Yes 1
14.872 Public Housing Capital Fund $2.65M - 0
14.870 Resident Opportunity and Supportive Services - Service Coordinators $76,168 - 0

Contacts

Name Title Type
Q1S6W4K6ALA1 Jeremy Kuskye Auditee
5742359346 Sean Cedar Auditor
No contacts on file

Notes to SEFA

Title: NOTE A: BASIS OF PRESENTATION Accounting Policies: The accompanying schedule of expenditures of federal awards includes the federal grant activity of the Housing Authority of South Bend and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10-percent de minimis indirect cost rate. The accompanying schedule of expenditures of federal awards includes the federal grant activity of the Housing Authority of South Bend and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority.
Title: NOTE B: INDIRECT COST RATE Accounting Policies: The accompanying schedule of expenditures of federal awards includes the federal grant activity of the Housing Authority of South Bend and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10-percent de minimis indirect cost rate. The Authority did not elect to use the 10-percent de minimis indirect cost rate.
Title: NOTE C: SUB-RECIPIENTS Accounting Policies: The accompanying schedule of expenditures of federal awards includes the federal grant activity of the Housing Authority of South Bend and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10-percent de minimis indirect cost rate. During the year ended September 30, 2024, the Authority had no sub-recipients.
Title: NOTE D: NONCASH ASSISTANCE AND OTHER Accounting Policies: The accompanying schedule of expenditures of federal awards includes the federal grant activity of the Housing Authority of South Bend and is presented on the accrual basis of accounting. The information on this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. In accordance with HUD regulations, HUD considers the Annual Budget Authority for the Section 8 Housing Choice Voucher Program ("HCV"), AL No. 14.871, to be an expenditure for the purposes of this schedule. Therefore, the amount in this schedule is the total amount received directly from HUD and not the expenditures paid by the Authority. De Minimis Rate Used: N Rate Explanation: The Authority did not elect to use the 10-percent de minimis indirect cost rate. The Authority did not receive any noncash assistance, federal loans, or federally funded insurance during the year ended September 30, 2024.

Finding Details

Finding 2024-002
Condition: Out of an approximate population of 585 Low Rent Public Housing tenants the following deficiencies were noted: • One file did not have an annual recertification performed within twelve months, • One file did not have a flat rent option sheet, • One file did not have a birth certificate for a minor household member, • One file did not use the correct income calculation, and • Nine files did not contain evidence of timely unit inspections being performed. Criteria: The Authority’s ACOP and 24 CFR 960.259 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete and accurate tenant files. In addition, 24 CFR 5.705 requires each unit be periodically inspected. Context: The auditor randomly selected 40 tenant files out of the population, which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and support to ensure that proper procedures are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Cause: The Authority experienced staffing and operational challenges and did not have the available staff to follow the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to verify eligibility, calculate accurate tenant rent amounts and provide support for inspections performed. Effect: The Authority is not in compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided. Questioned Costs: Unknown. Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility, the timeliness of recertifications and inspections performed. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample. Management Response: See Corrective Action Plan.
Finding 2024-001
Condition: Out of an approximate population of 2,280 Section 8 Housing Choice Voucher tenants the following deficiencies were noted: • One file did not have an annual recertification performed during the year available, • Four files did not have a 214 declaration for a member of the household, • Two files did not have 9886 release of information from within 15 months of the annual recertification, • Three files did not have identification or birth certificates for a household member, • One file did not use the correct utility allowance, • Two files did not use the correct income calculation, • One file did not have support necessary to verify income adjustments Criteria: The Authority’s Administrative Plan and 24 CFR 982.516 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete and accurate tenant files. Context: The auditor randomly selected 40 tenant files out of the population, which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and support to ensure that proper procedures are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Cause: The Authority experienced staffing and operational challenges and did not have the available staff to follow the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to verify eligibility and calculate accurate housing assistance payments. Effect: The Authority is not in compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided. Questioned Costs: Unknown. Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility and the timeliness of recertifications. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample. Management Response: See Corrective Action Plan.
Finding 2024-002
Condition: Out of an approximate population of 585 Low Rent Public Housing tenants the following deficiencies were noted: • One file did not have an annual recertification performed within twelve months, • One file did not have a flat rent option sheet, • One file did not have a birth certificate for a minor household member, • One file did not use the correct income calculation, and • Nine files did not contain evidence of timely unit inspections being performed. Criteria: The Authority’s ACOP and 24 CFR 960.259 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete and accurate tenant files. In addition, 24 CFR 5.705 requires each unit be periodically inspected. Context: The auditor randomly selected 40 tenant files out of the population, which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and support to ensure that proper procedures are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Cause: The Authority experienced staffing and operational challenges and did not have the available staff to follow the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to verify eligibility, calculate accurate tenant rent amounts and provide support for inspections performed. Effect: The Authority is not in compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided. Questioned Costs: Unknown. Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility, the timeliness of recertifications and inspections performed. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample. Management Response: See Corrective Action Plan.
Finding 2024-001
Condition: Out of an approximate population of 2,280 Section 8 Housing Choice Voucher tenants the following deficiencies were noted: • One file did not have an annual recertification performed during the year available, • Four files did not have a 214 declaration for a member of the household, • Two files did not have 9886 release of information from within 15 months of the annual recertification, • Three files did not have identification or birth certificates for a household member, • One file did not use the correct utility allowance, • Two files did not use the correct income calculation, • One file did not have support necessary to verify income adjustments Criteria: The Authority’s Administrative Plan and 24 CFR 982.516 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete and accurate tenant files. Context: The auditor randomly selected 40 tenant files out of the population, which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and support to ensure that proper procedures are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Cause: The Authority experienced staffing and operational challenges and did not have the available staff to follow the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to verify eligibility and calculate accurate housing assistance payments. Effect: The Authority is not in compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided. Questioned Costs: Unknown. Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility and the timeliness of recertifications. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample. Management Response: See Corrective Action Plan.