Audit 43028

FY End
2022-12-31
Total Expended
$7.09M
Findings
2
Programs
3
Year: 2022 Accepted: 2023-08-31

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
50594 2022-001 Significant Deficiency - A
627036 2022-001 Significant Deficiency - A

Programs

ALN Program Spent Major Findings
14.850 Public and Indian Housing $4.64M Yes 1
14.872 Public Housing Capital Fund $1.43M - 0
14.871 Section 8 Housing Choice Vouchers $1.01M - 0

Contacts

Name Title Type
FMJ4XT6X65B8 Holly Girdwood Auditee
7246565100 Chad Porter Auditor
No contacts on file

Notes to SEFA

Accounting Policies: Note 1 - Summary of Significant Accounting Policies to the Schedule of Expenditures of Federal AwardsA.) Scope of PresentationThe accompanying schedule of expenditures of federal awards (the Schedule) presents the expendituresincurred (and related awards received) by the Housing Authority of the County of Lawrence (The Authority) thatare reimbursable under federal programs of federal agencies providing financial assistance awards. For thepurposes of this schedule, only the portion of program expenditures reimbursable with such federal funds arereported in the accompanying schedule. Program expenditures in excess of the maximum federal or statereimbursement authorized or the portion of the program expenditures that were funded with, state, local or othernonfederal funds are excluded from the accompanying schedule.B.) Basis of AccountingThe expenditures included in the accompanying schedule were reported on the accrual basis of accounting .Expenditures are recognized in the accounting period in which the related liability is incurred . Expendituresreported included any property or equipment acquisitions incurred under the federal program.The Schedule was prepared from only the accounts of the grant programs and, therefore, does not present thefinancial position or results of operations of Housing Authority of the County of Lawrence.C.) SubrecipientsDuring the fiscal year ended December 31, 2021, Housing Authority of the County of Lawrence disbursed noFederal funds to subrecipients.D.) 10% De Minimis Indirect Costs RateThe Authority did not elect to use the 10% de minimis indirect costs rate as allowed by Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate.

Finding Details

2022-001 Description Criteria After subsidy (operating) is calculated at a project level, operating subsidy can be transferred as the PHA determines during the PHA's fiscal year to another ACC project(s) if a project's financial information, as described more fully in 240 CFR ? 990.280, produces excess cash flow, and only in the amount up to those excess cash flows. 240 CFR ? 990.205. Condition During our audit, the Authority transferred PHA cash and charged asset management fees in AMP 2 and AMP in excess of the excess cash amount from the 2021 audited numbers. Context AMP 4 and AMP 10 have issues cash flowing and rely on the other AMPS to transfer excess cash every year. In 2021, the other AMPs had less excess cash, so were unable to subsidize AMP 4 and AMP 10 like normal. The Authority did not detect the cash flow issue until after the fiscal year ended. Resulting in noncompliance with the program's rules Cause Controls were not followed to ensure fungibility rules between each project were followed Effect The authority unallowably transferred $203,000 to other AMPs Recommendations Perform monthly reconciliations to ensure fungibility is properly maintained Management Views See Corrective Action Plan
2022-001 Description Criteria After subsidy (operating) is calculated at a project level, operating subsidy can be transferred as the PHA determines during the PHA's fiscal year to another ACC project(s) if a project's financial information, as described more fully in 240 CFR ? 990.280, produces excess cash flow, and only in the amount up to those excess cash flows. 240 CFR ? 990.205. Condition During our audit, the Authority transferred PHA cash and charged asset management fees in AMP 2 and AMP in excess of the excess cash amount from the 2021 audited numbers. Context AMP 4 and AMP 10 have issues cash flowing and rely on the other AMPS to transfer excess cash every year. In 2021, the other AMPs had less excess cash, so were unable to subsidize AMP 4 and AMP 10 like normal. The Authority did not detect the cash flow issue until after the fiscal year ended. Resulting in noncompliance with the program's rules Cause Controls were not followed to ensure fungibility rules between each project were followed Effect The authority unallowably transferred $203,000 to other AMPs Recommendations Perform monthly reconciliations to ensure fungibility is properly maintained Management Views See Corrective Action Plan