FAC Explorer

Audit 6226

FY End
2022-06-30
Total Expended
$790,006
Findings
4
Programs
1
Organization: Iowa Northland Regional Housing Authority (IA)
Year: 2022 Accepted: 2023-12-12
Auditor: Denman & Company LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
3951 2022-001 Significant Deficiency Yes P
3952 2022-002 Significant Deficiency Yes P
580393 2022-001 Significant Deficiency Yes P
580394 2022-002 Significant Deficiency Yes P

Programs

ALN Program Spent Major Findings
14.871 Section 8 Housing Choice Vouchers Program $790,006 Yes 2

Contacts

Name Title Type
CJWSTMPYVNQ6 Stephen B. Bruner Auditee
3194835079 Stephen B. Bruner Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: NOTE 1 – BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of the Authority under programs of the federal government for the year ended June 30, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Authority, it is not intended to and does not present the financial position, changes in financial position, or cash flows of the Authority. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-87, Cost Principles for State, Local and Indian Tribal Governments, or the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Indirect Cost Rate The Authority is not eligible to use the 10 percent de minimus indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Authority is not eligible to use the 10 percent de minimus indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of the Authority under programs of the federal government for the year ended June 30, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Authority, it is not intended to and does not present the financial position, changes in financial position, or cash flows of the Authority.
Title: Summary of Significant Accounting Policies Accounting Policies: NOTE 1 – BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of the Authority under programs of the federal government for the year ended June 30, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Authority, it is not intended to and does not present the financial position, changes in financial position, or cash flows of the Authority. NOTE 2 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Expenditures Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-87, Cost Principles for State, Local and Indian Tribal Governments, or the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Indirect Cost Rate The Authority is not eligible to use the 10 percent de minimus indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: The Authority is not eligible to use the 10 percent de minimus indirect cost rate as allowed under the Uniform Guidance. Expenditures reported in the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following, as applicable, either the cost principles in OMB Circular A-87, Cost Principles for State, Local and Indian Tribal Governments, or the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Indirect Cost Rate - The Authority is not eligible to use the 10 percent de minimus indirect cost rate as allowed under the Uniform Guidance.

Finding Details

Finding 2022-001
The Authority engages the independent auditor to assist them with their external financial statement reporting, as the Authority’s accounting staff does not possess the necessary expertise with certain financial statement reporting and disclosure reporting requirements of generally accepted accounting principles, as is the case with most small organizations.External financial statement reporting, including footnote disclosures is a requirement of internal control over financial reporting. The operating budget for an organization the size of the Authority does not allow for hiring someone with this expertise. The financial statements prepared by management will be incomplete without adequate footnote disclosures. Unless and until the Authority’s accounting staff possesses the necessary expertise required for preparation of external financial statements in accordance with generally accepted accounting principles, this is considered a significant deficiency that must be reported as a finding. The Authority has determined that the operating budget cannot handle the additional expense of hiring someone with this expertise.
Finding 2022-002
An adequate segregation of duties was not present related to the accounting and financial duties. As a result, many of those aspects of internal control procedures which rely upon an adequate segregation of duties are, for all practical purposes, missing. An adequate segregation of duties is a key component of accounting internal control. The operating budget for an organization the size of the Authority does not allow for the hiring of additional accounting personnel to further segregate incompatible accounting duties. Employees of the Authority perform incompatible functions with regards to accounting duties in relation to internal control. Unless and until the Authority can hire additional accounting staff to adequately segregate the accounting duties, this deficiency will be reported as a finding. The Authority has determined that the operating budget cannot handle the additional expense of hiring additional accounting personnel.
Finding 2022-001
The Authority engages the independent auditor to assist them with their external financial statement reporting, as the Authority’s accounting staff does not possess the necessary expertise with certain financial statement reporting and disclosure reporting requirements of generally accepted accounting principles, as is the case with most small organizations.External financial statement reporting, including footnote disclosures is a requirement of internal control over financial reporting. The operating budget for an organization the size of the Authority does not allow for hiring someone with this expertise. The financial statements prepared by management will be incomplete without adequate footnote disclosures. Unless and until the Authority’s accounting staff possesses the necessary expertise required for preparation of external financial statements in accordance with generally accepted accounting principles, this is considered a significant deficiency that must be reported as a finding. The Authority has determined that the operating budget cannot handle the additional expense of hiring someone with this expertise.
Finding 2022-002
An adequate segregation of duties was not present related to the accounting and financial duties. As a result, many of those aspects of internal control procedures which rely upon an adequate segregation of duties are, for all practical purposes, missing. An adequate segregation of duties is a key component of accounting internal control. The operating budget for an organization the size of the Authority does not allow for the hiring of additional accounting personnel to further segregate incompatible accounting duties. Employees of the Authority perform incompatible functions with regards to accounting duties in relation to internal control. Unless and until the Authority can hire additional accounting staff to adequately segregate the accounting duties, this deficiency will be reported as a finding. The Authority has determined that the operating budget cannot handle the additional expense of hiring additional accounting personnel.