2022-002 ? ALN 14.871 ? Housing Voucher Cluster ? Eligibility Condition and Criteria: During our audit, it was determined that significant deficiencies in internal controls existed over the Authority?s Housing Voucher Cluster eligibility process being compliant with HUD regulatory requirements. As landlords begin participating in the HCV program of the Housing Authority, the Housing Authority should request and obtain specific documentation to ensure the legitimacy of the landlord. This documentation includes W-9 tax form, a voided check to set up direct deposit, and an IRS form showing the federal employer identification number. The Authority was unable to provide any adequate landlord documentation for landlords tested to prove the legitimacy of the landlord. The Authority also did not utilize effective controls to ensure relevant documentation is requested and filed for all landlords participating in the HCV program. Amount of Questioned Costs: None Context: Of the 40 tenant files tested for eligibility, we selected a sample of 21 of these to test landlord documentation to ensure each landlord was legitimate including a W-9, voided check to set up direct deposit, IRS form showing the federal employer identification number. The Authority was only able to locate the necessary landlord information for 13 of the 21 selected. Due to them not being able to locate these requested files, we believe this is due to an internal control deficiency. Cause: The Authority did not utilize adequate internal controls over the HCV program as there is a lack of sufficient documentation to prove the legitimacy of the landlord. Additionally, the files where the Authority obtains information for landlords has not been adequately or consistently monitored and updated. Effect or Potential Effect: Some of the landlords participating in the HCV program may not be legitimate landlords. Auditor?s Recommendation: We recommend the Authority obtain all landlord documentation, including a W-9, a voided check to set up direct deposit, and an IRS form showing the federal employer identification number, for all landlords participating in the Housing Authority's HCV program. The Authority should utilize effective controls to ensure relevant documentation is requested and obtained for all landlords participating in the HCV program. Grantee Response: Management acknowledges the finding and will follow the auditor's recommendations.
2022-003 ? ALN 14.871 ? Housing Voucher Cluster ? Reporting Condition and Criteria: During our audit, it was determined that noncompliance in internal controls existed over the Authority's Housing Voucher Cluster VMS reporting process containing materially correct information and being compliant with HUD financial reporting requirements. The Authority must adequately prepare the VMS Data Collection Report on a monthly basis to reflect the month's vouchers, HAP totals, net position balances, and other housing choice voucher specific attributes. The Authority must properly prepare this and retain corresponding documentation for the calculation of the data reported. As part of our Single Audit testing of Housing Choice Vouchers Program Reporting, we tested the monthly Data Collection Reporting within the Voucher Management System (VMS) online within HUD?s Real Estate Assessment Center (REAC) website. Testing revolved around the accuracy and completeness of reporting within the Total Vouchers, HAP Total, Unrestricted Net Position (UNP) as of the Last Day of the Month, and Restricted Net Position (RNP) as of the Last Day of the Month Data Collection Report lines for the entire fiscal year ended December 31, 2022. Amounts reported on these lines were tested against the Authority?s financial reports including the general ledger reports and Unaudited Financial Data Schedule (FDS). Amounts were also tested against the Authority?s internally prepared VMS reconciliation support. Amount of Questioned Costs: None Context: During testing, we identified variances in the Data Collection Report lines for UNP and RNP when compared against the general ledger reports and Unaudited FDS. The Authority's did not have adequate backup for amounts reported on the VMS. Therefore, amounts reported on the current year VMS were misstated. Cause: The Authority's VMS reconciliation process used to determine the amounts to be reported on the VMS did not adequately reflect UNP and RNP. The Authority was using several software systems that did not meet the Authority's needs. Effect or Potential Effect: Amounts reported in the Data Collection Reports in VMS were misstated, which may have an impact on the Authority's monthly Housing Choice Vouchers program funding. Auditor?s Recommendation: Management is updating their internal VMS reconciliation to properly reflect the correct General Ledger accounts that tie into the reconciliation and VMS report. We recommend the Authority compare the General Ledger, internally prepared reconciliation, and VMS report monthly to ensure all amounts are correctly reported and reflected. We also recommend the Authority implement a software system that will adequately meet all of the Authority's reporting requirements. Grantee Response: Management acknowledges the finding and will follow the auditor?s recommendations.
2022-002 ? ALN 14.871 ? Housing Voucher Cluster ? Eligibility Condition and Criteria: During our audit, it was determined that significant deficiencies in internal controls existed over the Authority?s Housing Voucher Cluster eligibility process being compliant with HUD regulatory requirements. As landlords begin participating in the HCV program of the Housing Authority, the Housing Authority should request and obtain specific documentation to ensure the legitimacy of the landlord. This documentation includes W-9 tax form, a voided check to set up direct deposit, and an IRS form showing the federal employer identification number. The Authority was unable to provide any adequate landlord documentation for landlords tested to prove the legitimacy of the landlord. The Authority also did not utilize effective controls to ensure relevant documentation is requested and filed for all landlords participating in the HCV program. Amount of Questioned Costs: None Context: Of the 40 tenant files tested for eligibility, we selected a sample of 21 of these to test landlord documentation to ensure each landlord was legitimate including a W-9, voided check to set up direct deposit, IRS form showing the federal employer identification number. The Authority was only able to locate the necessary landlord information for 13 of the 21 selected. Due to them not being able to locate these requested files, we believe this is due to an internal control deficiency. Cause: The Authority did not utilize adequate internal controls over the HCV program as there is a lack of sufficient documentation to prove the legitimacy of the landlord. Additionally, the files where the Authority obtains information for landlords has not been adequately or consistently monitored and updated. Effect or Potential Effect: Some of the landlords participating in the HCV program may not be legitimate landlords. Auditor?s Recommendation: We recommend the Authority obtain all landlord documentation, including a W-9, a voided check to set up direct deposit, and an IRS form showing the federal employer identification number, for all landlords participating in the Housing Authority's HCV program. The Authority should utilize effective controls to ensure relevant documentation is requested and obtained for all landlords participating in the HCV program. Grantee Response: Management acknowledges the finding and will follow the auditor's recommendations.
2022-003 ? ALN 14.871 ? Housing Voucher Cluster ? Reporting Condition and Criteria: During our audit, it was determined that noncompliance in internal controls existed over the Authority's Housing Voucher Cluster VMS reporting process containing materially correct information and being compliant with HUD financial reporting requirements. The Authority must adequately prepare the VMS Data Collection Report on a monthly basis to reflect the month's vouchers, HAP totals, net position balances, and other housing choice voucher specific attributes. The Authority must properly prepare this and retain corresponding documentation for the calculation of the data reported. As part of our Single Audit testing of Housing Choice Vouchers Program Reporting, we tested the monthly Data Collection Reporting within the Voucher Management System (VMS) online within HUD?s Real Estate Assessment Center (REAC) website. Testing revolved around the accuracy and completeness of reporting within the Total Vouchers, HAP Total, Unrestricted Net Position (UNP) as of the Last Day of the Month, and Restricted Net Position (RNP) as of the Last Day of the Month Data Collection Report lines for the entire fiscal year ended December 31, 2022. Amounts reported on these lines were tested against the Authority?s financial reports including the general ledger reports and Unaudited Financial Data Schedule (FDS). Amounts were also tested against the Authority?s internally prepared VMS reconciliation support. Amount of Questioned Costs: None Context: During testing, we identified variances in the Data Collection Report lines for UNP and RNP when compared against the general ledger reports and Unaudited FDS. The Authority's did not have adequate backup for amounts reported on the VMS. Therefore, amounts reported on the current year VMS were misstated. Cause: The Authority's VMS reconciliation process used to determine the amounts to be reported on the VMS did not adequately reflect UNP and RNP. The Authority was using several software systems that did not meet the Authority's needs. Effect or Potential Effect: Amounts reported in the Data Collection Reports in VMS were misstated, which may have an impact on the Authority's monthly Housing Choice Vouchers program funding. Auditor?s Recommendation: Management is updating their internal VMS reconciliation to properly reflect the correct General Ledger accounts that tie into the reconciliation and VMS report. We recommend the Authority compare the General Ledger, internally prepared reconciliation, and VMS report monthly to ensure all amounts are correctly reported and reflected. We also recommend the Authority implement a software system that will adequately meet all of the Authority's reporting requirements. Grantee Response: Management acknowledges the finding and will follow the auditor?s recommendations.