Finding No. 2022-001; Section 8 Housing Assistance Payments Program, Assistance Listing 14.195 Criteria Loans are not permitted to be made from project cash without prior authorization from HUD. Condition During the year ended December 31, 2022, the Project paid expenses in the amount of $1,455 on behalf of an affiliate from project cash without HUD approval. The amount due to the Project as of December 31, 2022 is $1,455. Cause Procedures were not in place to ensure that cash disbursements of project funds were limited to project operating costs. Effect or Potential Effect The payments of $1,455 were unauthorized loans and are therefore considered to be questioned costs. Questioned Costs Questioned costs totaled $1,455. Context In connection with the procedures applied to a sample of 25 disbursements, there were two instances, totaling $1,455, where management did not detect and timely correct disbursements made on behalf of another EHI managed project with a similar project name. Identification as a Repeat Finding Not a repeat finding. Recommendation Management should immediately reimburse the amount due to the Project and establish procedures to ensure payments of this nature are not made in the future. Auditor Noncompliance Code: G ? Unauthorized loans from project assets. Finding Resolution Status: Resolved. The Project was reimbursed via check in the amount of $1,455 for the funds disbursed on behalf of a different EHI managed project on February 27, 2023. Views of Responsible Officials Management concurs that the Project paid expenses in the amount of $1,455 on behalf of an affiliate from project cash without HUD approval. Management further notes that they have retrained staff, reaffirmed the review and approval process to ensure accuracy and existence of each transaction to ensure no cash disbursements are made on behalf of affiliates without HUD approval. Management has made changes to internal controls to prevent and detect unauthorized cash disbursements from project assets. It has also been reimbursed from the affiliate project.
Finding No. 2022-002; Section 8 Housing Assistance Payments Program, Assistance Listing 14.195 Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Condition In connection with our lease file review we noted 1 out of 1 new tenants tested did not have documentation in their lease file that the move-in EIV was run within 90 days of move-in. Cause Management?s policies with respect to the determination of tenant eligibility and the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect The procedures for determining tenant eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs No questioned costs identified. Context In connection with the procedures applied to a sample of 1 tenant, there was one instance where management did not run the EIV within the 90 day window. Identification as a Repeat Finding Not a repeat finding. Recommendation Management should establish procedures and monitor compliance with those procedures to insure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R ? Section 8 program administration. Finding Resolution Status: Resolved. The Project ran the EIV on January 13, 2023. Views of Responsible Officials Management concurs that the move-in EIV was not run within 90 days of move in and that this is not in compliance with the requirement to maintain HUD tenant lease files per the HUD Handbook 4350.3. Management staff have been trained on the requirements to run EIV reports in accordance with the HUD Handbook. Staff have included a note to file explaining the deficiency in the tenant file and will ensure that EIV reports are ran as required moving forward.
Finding No. 2022-001; Section 8 Housing Assistance Payments Program, Assistance Listing 14.195 Criteria Loans are not permitted to be made from project cash without prior authorization from HUD. Condition During the year ended December 31, 2022, the Project paid expenses in the amount of $1,455 on behalf of an affiliate from project cash without HUD approval. The amount due to the Project as of December 31, 2022 is $1,455. Cause Procedures were not in place to ensure that cash disbursements of project funds were limited to project operating costs. Effect or Potential Effect The payments of $1,455 were unauthorized loans and are therefore considered to be questioned costs. Questioned Costs Questioned costs totaled $1,455. Context In connection with the procedures applied to a sample of 25 disbursements, there were two instances, totaling $1,455, where management did not detect and timely correct disbursements made on behalf of another EHI managed project with a similar project name. Identification as a Repeat Finding Not a repeat finding. Recommendation Management should immediately reimburse the amount due to the Project and establish procedures to ensure payments of this nature are not made in the future. Auditor Noncompliance Code: G ? Unauthorized loans from project assets. Finding Resolution Status: Resolved. The Project was reimbursed via check in the amount of $1,455 for the funds disbursed on behalf of a different EHI managed project on February 27, 2023. Views of Responsible Officials Management concurs that the Project paid expenses in the amount of $1,455 on behalf of an affiliate from project cash without HUD approval. Management further notes that they have retrained staff, reaffirmed the review and approval process to ensure accuracy and existence of each transaction to ensure no cash disbursements are made on behalf of affiliates without HUD approval. Management has made changes to internal controls to prevent and detect unauthorized cash disbursements from project assets. It has also been reimbursed from the affiliate project.
Finding No. 2022-002; Section 8 Housing Assistance Payments Program, Assistance Listing 14.195 Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Condition In connection with our lease file review we noted 1 out of 1 new tenants tested did not have documentation in their lease file that the move-in EIV was run within 90 days of move-in. Cause Management?s policies with respect to the determination of tenant eligibility and the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Effect or Potential Effect The procedures for determining tenant eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Questioned Costs No questioned costs identified. Context In connection with the procedures applied to a sample of 1 tenant, there was one instance where management did not run the EIV within the 90 day window. Identification as a Repeat Finding Not a repeat finding. Recommendation Management should establish procedures and monitor compliance with those procedures to insure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R ? Section 8 program administration. Finding Resolution Status: Resolved. The Project ran the EIV on January 13, 2023. Views of Responsible Officials Management concurs that the move-in EIV was not run within 90 days of move in and that this is not in compliance with the requirement to maintain HUD tenant lease files per the HUD Handbook 4350.3. Management staff have been trained on the requirements to run EIV reports in accordance with the HUD Handbook. Staff have included a note to file explaining the deficiency in the tenant file and will ensure that EIV reports are ran as required moving forward.