Low Rent Program-CDFA#14.850 and Housing Choice Voucher-CDFA#14.871 2021-001-Inadequate Internal Controls Over Disbursements and Payables-Allowable Costs Criteria or specific requirement Internal controls over disbursements should be adequately supported by supporting invoices or other adequate information, and cancelled checks. Payments owed to retirement plans, the IRS, and vendors should be made on a timely basis. Condition Found (a)-We reviewed an initial sample of 44 disbursements for the General Fund that covers the Low Rent program. No support was available for 6 of the disbursements, that totaled $11,387. All of the payees appeared to be normal vendors used in the Authority’s regular business dealings. (b)-We reviewed an initial sample of 40 Housing Choice Vouchers. No exceptions were noted. (c)-We also reviewed 25 Section 8 payments. We noted no exceptions in our review of supporting information or cancelled checks for these disbursements. (d)-In our other tests, we reviewed 9 other disbursements which totaled $23,634 which were not supported by invoices. All of the payees appeared to be normal vendors used in the Authority’s regular business dealings. (f)-Payroll taxes, payments to the IRA Simple Plan, and payments to various vendors were not timely paid, and significant amounts were owed at year-end. Context Disbursements should always be adequately supported by invoices or other supporting information. All payments to third parties should be timely done. Cause This finding existed in the prior year. For that audit, we asked the Executive Director why the above information was not retained. We also asked why the retirement payments and payroll taxes were not time made. We did not receive an adequate explanation. That Executive Director is no longer with the Authority. Effect Internal controls were not operating effectively. Federal regulations require that disbursements be adequately supported. Federal regulations require that retirement payments and payroll taxes be timely paid. In addition, federal law as outlined by the Employee Retirement Security Act (ERISA} was not complied with. Questioned Costs None Recommendation Payments should be adequately supported by invoices. Payments should be timely made that are owed to third parties. View of Responsible Official I am Diane Adams, Executive Director of the Housing Authority of the City of Shawnee, Oklahoma and Designated Person to answer these findings. The Shawnee PHA executed a Cooperative Agreement with the Bristow Housing Authority, effective December 1, 2023. The Agreement was subsequently extended through November 30, 2025. We have worked diligently to address and correct the deficiencies that we have encountered.
Low Rent Program-CDFA#14.850 Finding 2021-002-Low Rent Tenant File Deficiencies-Eligibility Criteria and Specific Requirement HUD regulations dictate the necessary steps for intake, processing, maintaining the waiting list, processing of move-ins, interims, re-examinations, and various other aspects of the required paperwork and procedures. Condition Found We reviewed 18 files, 4 of which were audit year move-ins, and 14 were annual re-examinations. We noted the following exceptions: (a)-We were unable to find any annual inspections for the 14 re-examinations. We did note them for the 4 move-ins.(b)-We were unable to find the required annual review of the utility allowances. The January 27, 2020 Minutes discuss utility allowances and approve new ones. However, the minutes do not reflect for which period the new allowances covered. In addition, there was no documented analysis of whether utility rates had increased beyond the level which required revision, and whether the allowances changed or instead were a holdover from the old rates. (c)-We were unable to view the waiting list, and thus could not review whether the 4 move-ins reached the top of the list. (d)-One required Enterprise Income Verification (EIV} was not present in the proper time frame for the 18 files reviewed. (e)-Of the 14 re-examinations we reviewed, one was past-due when done. (f)-We were unable to review documentation of the review of flat rents. Cause It appears that the supervision was inadequate. There is no documentation of a supervisor’s review. Effect Assurance is not at the minimum required level that applicants were admitted in the proper order, that tenant rents were correctly calculated, and the other steps were properly executed. Recommendation to prevent future occurrences Staff should receive adequate training and be adequately supervised. Likely the situation has been corrected, given the current management, as noted below. View of Responsible Officials As noted previously, we were not the management during this audit period. Our initial Cooperative Agreement was executed November 14, 2023. We believe we have corrected the noted deficiencies.
Low Rent Program-CDFA#14.850, Section 8 Housing Choice Voucher Program-CDFA#14.871Capital Fund Program-CDFA#14.872 Finding 2021-005-Board Minutes-Reporting Criteria and Specific Requirement Board minutes should meet in accordance with its bylaws. In additions, regular board meetings are necessary to either timely inform the board of commissioners or to seek their approval for future actions or decisions. Condition Found We do not have access to any board minutes between the minutes of the January 28, 2022 and December 26, 2023. Current management represents that they are not aware of any board minutes for that period, or if the board met. Cause The cause is unknown. The long-time Executive Director was in poor health. However, the board should have met and generated proper minutes for third party review. Effect Needed decisions and actions were likely not timely made. The minutes that began December 26th, after the retention of new management indicates that the new management inherited a host of problems, and were busy addressing them. Recommendation to prevent occurrences It appears that current management is holding regular board meetings and keeping well documented board minutes.View of Responsible Officials As noted above, the Authority now holds regular board meetings and the minutes are generated.
Low Rent Program-CDFA#14.850, Section 8 Housing Choice Voucher Program-CDFA#14.871Capital Fund Program-CDFA#14.872 Finding 2021-006-Late Filing of Audit Report-Reporting and Special Tests Criteria and Specific Requirement HUD regulations require that the audit report be filed with REAC no later than 9 months after year end. This audit report was due to be filed no later than March 31, 2022. Condition Found This audit report is past-due. Cause The long-time Executive Director was in ill health as the deadline approached. This person left the position after the deadline passed. As noted elsewhere, current management signed a Cooperative Agreement dated November 14, 2023. We contacted both new management and the Authority’s fee accountant regarding the unaudited financial statements’ status. Both claimed that the accounting and related records were in disarray or missing, and they were working to finish the unaudited financial statements. The unaudited statements were posted on REAC’s website on June 19, 2025. We received a drop box from the fee accountant on June 25th, which included much of the information we needed to perform the audit. Effect The board of commissioners, HUD, and other interested third parties did not receive timely financial information. In addition, since total awards expended on all federal programs exceeded $750,000 ($756,809), the audit must be done in accordance with the Single Audit Act which includes specific steps for the calculated “major program”, as outlined in the OMB Compliance Supplement. Low Rent is the calculated “major program.” The Compliance Supplement that covered audits with years beginning with years ended June 30, 2021, for the first time, required the auditor to perform specific detailed steps to test the calculation of the Low Rent performance operating subsidy. These steps include, but are not limited to, reviewing the numbers on Form 52722, the compilation of utility usage data, and the three- year rolling base. Due to passage of years, we are unable to test the PFS, as required by the Compliance Supplement. Recommendation to prevent future occurrences Current management is aware of the federal deadlines for the Authority. View of Responsible Officials We are aware of the filing deadlines.