FAC Explorer

Audit 7713

FY End
2022-06-30
Total Expended
$1.75M
Findings
2
Programs
4
Organization: Potter County Housing Authority (PA)
Year: 2022 Accepted: 2023-12-20
Auditor: Polcari & Company CPAS

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
5708 2022-001 Material Weakness Yes C
582150 2022-001 Material Weakness Yes C

Programs

ALN Program Spent Major Findings
14.871 Section 8 Housing Choice Vouchers $1.18M Yes 1
14.182 Section 8 New Construction and Substantial Rehabilitation $441,896 - 0
10.427 Rural Rental Assistance Payments $84,607 - 0
14.U01 Hcv Cares Act Funding $47,416 - 0

Contacts

Name Title Type
PGJ3VJJQ71C4 Richard M Duzick Auditee
8142747031 Ralph Polcari Auditor
No contacts on file

Notes to SEFA

Title: Note 1 Accounting Policies: The Schedule of Expenditures of Federal Awards is presented in accordance with generally accepted accounting principles and is presented in accordance with the requirements of the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the general purpose financial statements. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10% de minimis cost rate. Basis of Presentation - The Schedule of Expenditures of Federal Awards is presented in accordance with generally accepted accounting principles and is presented in accordance with the requirements of the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the general purpose financial statements.
Title: Note 2 Accounting Policies: The Schedule of Expenditures of Federal Awards is presented in accordance with generally accepted accounting principles and is presented in accordance with the requirements of the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the general purpose financial statements. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10% de minimis cost rate. There were no subrecipient activities during the audit period.
Title: Note 3 Accounting Policies: The Schedule of Expenditures of Federal Awards is presented in accordance with generally accepted accounting principles and is presented in accordance with the requirements of the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the general purpose financial statements. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10% de minimis cost rate. The Authority has elected not to use the 10% de minimis cost rate.
Title: Note 4 Accounting Policies: The Schedule of Expenditures of Federal Awards is presented in accordance with generally accepted accounting principles and is presented in accordance with the requirements of the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the general purpose financial statements. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10% de minimis cost rate. The Authority received no non-cash assistance.
Title: Note 5 Accounting Policies: The Schedule of Expenditures of Federal Awards is presented in accordance with generally accepted accounting principles and is presented in accordance with the requirements of the Uniform Guidance. Therefore, some amounts presented in this schedule may differ from amounts presented in, or used in the preparation of the general purpose financial statements. De Minimis Rate Used: N Rate Explanation: The Authority has elected not to use the 10% de minimis cost rate. The Authority did not have any HUD issued mortgages or loans.

Finding Details

Finding 2022-001
Finding 2022-1 – Interfund Receivables and Payables Financial Statement Audit Significant Deficiency The Authority must review the balances of the interfund receivables and payables on an annual basis to determine if repayment can be expected. Governmental accounting standards stipulate that if repayment is not expected within a reasonable time period, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Cause During the prior years, the Authority does not have procedures in place to prevent cash deficits from occurring in multiple funds, which resulted in interfund receivables and payables and accumulated deficits. Condition When a particular fund has a cash deficit and borrows funds from another fund, an interfund payable results in the fund that borrowed the funds and an interfund receivable results in the fund that paid out the funds. Over time, these interfund receivables and payables can grow as a result of the fund deficits. Effect of Condition Significant interfund balances have accumulated over the years from having large cash deficits in certain funds. Recommendation The Authority should address the repayment of the interfund receivables and payables. The balances of the receivables and payables should be review by management on an annual basis to determine if repayment is expected in a reasonable time period. If repayment is not expected, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Question Costs $0 Response There is no disagreement with the audit finding. Finding 2022-1 – Interfund Receivables and Payables Financial Statement Audit Significant Deficiency The Authority must review the balances of the interfund receivables and payables on an annual basis to determine if repayment can be expected. Governmental accounting standards stipulate that if repayment is not expected within a reasonable time period, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Cause During the prior years, the Authority does not have procedures in place to prevent cash deficits from occurring in multiple funds, which resulted in interfund receivables and payables and accumulated deficits. Condition When a particular fund has a cash deficit and borrows funds from another fund, an interfund payable results in the fund that borrowed the funds and an interfund receivable results in the fund that paid out the funds. Over time, these interfund receivables and payables can grow as a result of the fund deficits. Effect of Condition Significant interfund balances have accumulated over the years from having large cash deficits in certain funds. Recommendation The Authority should address the repayment of the interfund receivables and payables. The balances of the receivables and payables should be review by management on an annual basis to determine if repayment is expected in a reasonable time period. If repayment is not expected, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Question Costs $0 Response There is no disagreement with the audit finding. Finding 2022-1 – Interfund Receivables and Payables Financial Statement Audit Significant Deficiency The Authority must review the balances of the interfund receivables and payables on an annual basis to determine if repayment can be expected. Governmental accounting standards stipulate that if repayment is not expected within a reasonable time period, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Cause During the prior years, the Authority does not have procedures in place to prevent cash deficits from occurring in multiple funds, which resulted in interfund receivables and payables and accumulated deficits. Condition When a particular fund has a cash deficit and borrows funds from another fund, an interfund payable results in the fund that borrowed the funds and an interfund receivable results in the fund that paid out the funds. Over time, these interfund receivables and payables can grow as a result of the fund deficits. Effect of Condition Significant interfund balances have accumulated over the years from having large cash deficits in certain funds. Recommendation The Authority should address the repayment of the interfund receivables and payables. The balances of the receivables and payables should be review by management on an annual basis to determine if repayment is expected in a reasonable time period. If repayment is not expected, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Question Costs $0 Response There is no disagreement with the audit finding.
Finding 2022-001
Finding 2022-1 – Interfund Receivables and Payables Financial Statement Audit Significant Deficiency The Authority must review the balances of the interfund receivables and payables on an annual basis to determine if repayment can be expected. Governmental accounting standards stipulate that if repayment is not expected within a reasonable time period, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Cause During the prior years, the Authority does not have procedures in place to prevent cash deficits from occurring in multiple funds, which resulted in interfund receivables and payables and accumulated deficits. Condition When a particular fund has a cash deficit and borrows funds from another fund, an interfund payable results in the fund that borrowed the funds and an interfund receivable results in the fund that paid out the funds. Over time, these interfund receivables and payables can grow as a result of the fund deficits. Effect of Condition Significant interfund balances have accumulated over the years from having large cash deficits in certain funds. Recommendation The Authority should address the repayment of the interfund receivables and payables. The balances of the receivables and payables should be review by management on an annual basis to determine if repayment is expected in a reasonable time period. If repayment is not expected, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Question Costs $0 Response There is no disagreement with the audit finding. Finding 2022-1 – Interfund Receivables and Payables Financial Statement Audit Significant Deficiency The Authority must review the balances of the interfund receivables and payables on an annual basis to determine if repayment can be expected. Governmental accounting standards stipulate that if repayment is not expected within a reasonable time period, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Cause During the prior years, the Authority does not have procedures in place to prevent cash deficits from occurring in multiple funds, which resulted in interfund receivables and payables and accumulated deficits. Condition When a particular fund has a cash deficit and borrows funds from another fund, an interfund payable results in the fund that borrowed the funds and an interfund receivable results in the fund that paid out the funds. Over time, these interfund receivables and payables can grow as a result of the fund deficits. Effect of Condition Significant interfund balances have accumulated over the years from having large cash deficits in certain funds. Recommendation The Authority should address the repayment of the interfund receivables and payables. The balances of the receivables and payables should be review by management on an annual basis to determine if repayment is expected in a reasonable time period. If repayment is not expected, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Question Costs $0 Response There is no disagreement with the audit finding. Finding 2022-1 – Interfund Receivables and Payables Financial Statement Audit Significant Deficiency The Authority must review the balances of the interfund receivables and payables on an annual basis to determine if repayment can be expected. Governmental accounting standards stipulate that if repayment is not expected within a reasonable time period, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Cause During the prior years, the Authority does not have procedures in place to prevent cash deficits from occurring in multiple funds, which resulted in interfund receivables and payables and accumulated deficits. Condition When a particular fund has a cash deficit and borrows funds from another fund, an interfund payable results in the fund that borrowed the funds and an interfund receivable results in the fund that paid out the funds. Over time, these interfund receivables and payables can grow as a result of the fund deficits. Effect of Condition Significant interfund balances have accumulated over the years from having large cash deficits in certain funds. Recommendation The Authority should address the repayment of the interfund receivables and payables. The balances of the receivables and payables should be review by management on an annual basis to determine if repayment is expected in a reasonable time period. If repayment is not expected, the interfund balances should be reduced and the amount that is not expected to be repaid should be reported as a transfer from the fund that made the loan to the fund that received the loan. Question Costs $0 Response There is no disagreement with the audit finding.