Audit 404122

Criteria The Economic Development Initiative, Community Project Funding, and Miscellaneous Grants program requires management submit all required performance reports semi-annually in accordance with the specified reporting timelines. Condition During our audit procedures, we noted that Latin American Community Center, Inc., failed to submit one of the two required annual reports for the period under audit. Specifically, the report covering the first reporting period of the fiscal year was not filed. Cause The failure to submit the required report was attributable to confusion related to the reporting requirements given this was management's first required report for this program. This is the first time management has utilized this program. Effect or Potential Effect Failure to submit required reports in a timely manner represents noncompliance with HUD reporting requirements and may result in increased regulatory scrutiny, potential sanctions, withholding of funds, or other enforcement actions by HUD. Additionally, untimely reporting limits HUD's ability to monitor program performance and compliance. Recommendation We recommend that management strengthen internal controls over compliance by implementing procedures to track all required reporting deadlines and ensure timely submission of all required reports in accordance with HUD requirements. Views of Responsible Officials Management agrees with the finding and has submitted the missing report. Management has implemented the following actions: Responsibility for preparing and submitting performance reports has been assigned to the Director of Development, with support from Apex Gov Solutions, an external consultant. Internal work assignments and deadlines have been established to ensure sufficient time for the preparation, review, and submission of all required reports before their due dates, which will occur on the 30th day following the end of each reporting period (January 30 and July 30). The Director of Development and Apex Gov Solutions will periodically review reporting requirements to ensure compliance with HUD reporting obligations and prevent future missed deadlines.