Audit 411613

Criteria: The Organization’s contract with Indiana Housing and Community Development Authority establishes an average cost per dwelling unit limitation of $8,250 at the end of each grant year. Program expenditures should be administered in a manner that ensures average costs do not exceed the applicable limitation established by the grant agreement and program requirements. Condition: During testing, it was noted the Organization's average cost per completed unit exceeded the applicable cost limitation. The average cost per unit was $10,375 compared to the allowable average cost per completed unit limitation of $8,250. The aggregate costs of exceeding the statutory average is $59,500. Cause: Although management appropriately approved and monitored program expenditures, controls were not sufficient to ensure compliance with the average cost limitation when these circumstances occurred. The Organization did provide for funds to mitigate the over overage. Effect or Potential Effect: The average cost per completed unit was over the earmarked average by $59,500. Context: The cumulative overage across 28 completed affected units resulted in total questioned costs of $59,500. The noncompliance was identified during substantive testing of final job costs accounting records matched against completed unit sign-offs. The Organization did report the cumulative overage on its grant close-out report (final reporting). Questioned Costs: $59,500