Corrective Action Plans

Condition and Criteria: The Authority’s purpose for existence is providing decent safe and affordable housing to low-income persons. As such, HUD requires the Authority to comply with special tests and provisions relating to its Housing Choice Voucher program. The Authority must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the Authority must conduct quality control re-inspections. The Authority must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). During our testing of 40 HCV tenant files, we noted annual HQS inspections for all the tested units. However, the Authority did not perform the required quality control re-inspections.Auditor’s Recommendation: The Authority should perform housing quality control re-inspections according to HUD guidelines. Anticipated Completion Date: June 30, 2024

Finding 2023-002 – U.S. Department of Education (USDE), Title IV Student Financial Aid Programs (Deficiency): We observed the following conditions in connection with our testing of the various U.S. Department of Education, Title IV, Student Financial Assistance Programs a) One (1) out of six (6) students tested for R2T4 did not have Title IV funds returned to the Federal government within the required 45 days. Title IV HEA 34 CFR 668.22. b) The College was not reconciling between Financial Aid and Business Office on the monthly basis per SFA Handbook Ch. 5 CFR668.161-668.176. Auditor’s Recommendation – We recommend that the College ensure adequate documentation is obtained and kept on file as evidence that all expenditures meet allowable cost and other requirements under the grant program. Corrective Action – Management agrees with this finding. The College will place additional emphasis on the R2T4 of funds. Management is reviewing the timing of presentation of situations to Financial Aid that require returning funds to the Department. Additional focus will be placed on procedures to timely report withdraws to Financial Aid to support returned funds in the required 45 days. In addition, the College prepares monthly reconciliations between Financial Aid and the Business Office, but often delayed in completion. Going forward, the reconciliation will be noted on the monthly closing list and requires both the Assistant Vice President of Financial Aid and Controller to sign and date the reconciliation to demonstrate compliance with the monthly requirement.

Condition and Criteria: The Authority’s purpose for existence is providing decent safe and affordable housing to low-income persons. As such, HUD requires the Authority to comply with special tests and provisions relating to its Housing Choice Voucher program. The Authority must inspect the unit leased to a family at least annually to determine if the unit meets Housing Quality Standards (HQS) and the Authority must conduct quality control re-inspections. The Authority must prepare a unit inspection report (24 CFR sections 982.158(d) and 982.405(b)). During our testing of 40 HCV tenant files, we noted annual HQS inspections for all the tested units. However, the Authority did not perform the required quality control re-inspections.Auditor’s Recommendation: The Authority should perform housing quality control re-inspections according to HUD guidelines. Anticipated Completion Date: June 30, 2024

March 29, 2024 U.S. Department of Housing and Urban Development The Memphis Housing Authority respectfully submits the following corrective action plan for the year ended June 30, 2023. Berman Hopkins Wright & LaHam, CPAs and Associates, LLP 8035 Spyglass Hill Road Melbourne, FL 32940 Audit period: July 1, 2022 - June 30, 2023 The findings from the June 30, 2023 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. FINDINGS – FEDERAL AWARDS 2023-002 Special Tests and Provisions - Waiting List Public and Indian Housing Program - AL No. 14.850 Significant deficiency in internal control Other matter required to be reported in accordance with Uniform Guidance Condition: Out of 40 applicants that were selected from the waiting list for testing, 14 lacked documentation to show their current status and whether they were given the opportunity to be housed. In addition, there were difficulties obtaining any historical waiting lists for the Public Housing properties. Auditor’s Recommendations: The Authority should implement archiving procedures for its historical waiting lists on a routine basis. In addition, the Authority should document for proper auditing purposes, those given the opportunity to be housed from the waiting list and their current status. The Authority should provide proper training for all staff at the properties to ensure procedures and policies are being followed consistently across all of the Authority’s Public Housing properties. Action Taken: • MHA will ensure we have a saved copy of all public housing site-based waiting lists. LaTonia Young, Director of Asset Management, will save copies of the waiting list for all Public Housing sites on a monthly basis effective March 28, 2024. Tomecia Brown, Director of Compliance and Training will ensure that all site staff are trained on how to pull from the waiting list during the monthly site staff meeting effective April 23, 2024.

2023-001 Eligibility Public and Indian Housing Program - AL No. 14.850 Significant deficiency in internal control Other matter required to be reported in accordance with Uniform Guidance Condition: Out of an approximate population of 2,083 tenants, 44 tenant files were tested and the following deficiencies were noted: • 1 file was missing the support packet for the fiscal year 2023 recertification including but not limited to income support, third party verification, and flat rent sheet, • 3 files had late recertifications, • 2 files were missing support of inspection, • 1 file was missing tenant wage support, and • 1 file was missing a valid 9886 form. Auditor Recommendations: The Authority should consider reevaluating their established procedures and controls in place to ensure full compliance in regards to eligibility. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample. Action Taken: • 1 file was missing the support packet for the fiscal year 2023 recertification LaTonia Young, Director of Asset Management, lyoung@memphisha.org, 901-544-1129, is working with the new Community Manager to make the corrections for the missing information no later than April 30, 2024. Going forward Tomecia Brown, Director of Compliance and Training, tbrown1@memhisha.org, 901-544-6402, will continue to conduct file reviews to ensure that the required documentation is in the file. •3 files had late recertifications. We will ensure that all recertifications are completed within 30 – 120 days of the effective date. Tomecia Brown, Director of Compliance and Training, will complete a recertification due review on a monthly basis effective April 1, 2024. • 2 file was missing support of inspection. LaTonia Young, Director of Asset Management, will ensure that all units are inspected on an annual basis. In our monthly site staff meeting, Asset Management will inform staff to ensure that all inspections are in the file. • 1 file was missing tenant wage support. We will have the new Community Manager verify wages and make corrections by April 5, 2024. MHA will be sending the owner a non-compliance letter no later than April 30, 2024. Tomecia Brown, Director of Compliance and Training, will continue to complete file reviews on a monthly basis and train staff on the Public Housing process. • 1 file was missing a valid 9886 form. Tomecia Brown, Director of Compliance and Training, will continue to conduct file reviews to ensure that the HUD 9886 form is in the file for all Public Housing sites effective April 23, 2024.

Finding 2023-002: (L) Reporting of Unreimbursed Expenses Attributable to Coronavirus and Lost Revenues within the Health Resources Services Administration (HRSA) Provider Relief Fund Portal Program: COVID-19 - Provider Relief Fund (PRF) and American Rescue Plan (ARP) Distribution Assistance Listing Number: 93.498 Agency: Department of Health and Human Services (HHS) Award Year: 1/1/2023-3/31/2023 Award Number: Not available Management’s Response to Finding: Management acknowledges the Period 4 HRSA Reporting portal submission errors noted. The personnel and supply costs identified at St. James Hospital and Memorial Hospital of William F and Gertrude F Jones Inc. were all allowable and reported in Period 4, but were over- or under-stated in a particular quarter. Management acknowledges that St. James Hospital understated its lost revenue in Reporting Period 4. Management’s Corrective Action Plan: The University is unable to amend the Reporting Period 4 submissions. HRSA has only provided guidance to providers with respect to how to account for unallowable expenses identified in prior reporting periods. The portal submission expense items identified were all allowable expenses, but under- or over- reported in a particular quarter of the Period 4 Reporting. The lost revenue calculation for St. James Hospital was an error in reporting. Since there is no ability to amend the Period 4 reporting for either of these entities, the University will ensure that it documents these corrections in case of future inquiries from the HRSA. As noted above, the URMC Office of the Chief Financial Officer, in support with the Office of University Audit, the Controller’s Office, and the University of Rochester Medical Center (URMC) Office of Integrity and Compliance, conducted enterprise-wide reviews of the HRSA Reporting portal submissions of all University affiliates in FY23 prior to submission to the HRSA. The University will continue to conduct enhanced reviews with respect to its future required portal submissions. Contact person: Adam Anolik, URMC Senior Vice President and CFO, Adam_Anolik@URMC.Rochester.edu

March 26, 2024 HUD Service Audit Director Kansas City, Kansas Integrated Living, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2023. SSC CPAs, P.A. 58525 SW 29th St, Suite 100 Topeka, Kansas 66614 Audit period: Year ended June 30, 2023 The findings from the June 30, 2023 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section I of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDINGS-FINANCIAL STATEMENT AUDIT 2023‐001 Internal Controls over Financial Statement Presentation (Material Weakness) Recommendation: The Board of Directors and management should review the impact of the current year adjustments on the financial reporting process. Once this review is complete, the Organization should then perform a risk assessment to determine the best way to implement appropriate internal controls over financial reporting to ensure conformity with U.S. GAAP. Action Taken (Unaudited): Management is in the process of updating its control procedures to include proper written policies for the internal control over financial reporting to ensure conformity with U.S. GAAP. John Griffin, CFO of COF Training Services, Inc. (Management Agent of Integrated Living, Inc.) is responsible for this corrective action. Anticipated completion date is June 30, 2024. FINDINGS-FEDERAL AWARD PROGRAMS AUDITS 2023‐002 Review and Approval of Project Expenditures (Significant Deficiency) Department of Housing and Urban Development Section 811 Supportive Housing for Person with Disabilities, Assistance Listing Number 14.181 Recommendation: The Organization should obtain proper approval of all project expenditures and that evidence of that approval is documented and maintained.. Action Taken (Unaudited): Management is in the process of updating its control procedures to ensure proper approval of all project expenditures. John Griffin, CFO of COF Training Services, Inc. (Management Agent of Integrated Living, Inc.) is responsible for this corrective action. Anticipated completion date is June 30, 2024. 2023‐003 Written Procedures of Internal Control over Compliance (Significant Deficiency) Department of Housing and Urban Development Section 811 Supportive Housing for Person with Disabilities, Assistance Listing Number 14.181 Recommendation: The Organization should develop written policies for the internal control over compliance of federal awards. Action Taken (Unaudited): Management is in the process of updating its control procedures to include proper written policies for the internal control over compliance of federal awards John Griffin, CFO of COF Training Services, Inc. (Management Agent of Integrated Living, Inc.) is responsible for this corrective action. Anticipated completion date is June 30, 2024. If HUD has questions regarding this plan, please call Patrick Gardner at 785-242-5035. Sincerely yours, Patrick Gardner CEO, COF Training Services, Inc. (Management Agent of Integrated Living, Inc.)

March 26, 2024 HUD Service Audit Director Kansas City, Kansas Integrated Living, Inc. respectfully submits the following corrective action plan for the year ended June 30, 2023. SSC CPAs, P.A. 58525 SW 29th St, Suite 100 Topeka, Kansas 66614 Audit period: Year ended June 30, 2023 The findings from the June 30, 2023 schedule of findings and questioned costs are discussed below. The findings are numbered consistently with the numbers assigned in the schedule. Section I of the schedule, Summary of Audit Results, does not include findings and is not addressed. FINDINGS-FINANCIAL STATEMENT AUDIT 2023‐001 Internal Controls over Financial Statement Presentation (Material Weakness) Recommendation: The Board of Directors and management should review the impact of the current year adjustments on the financial reporting process. Once this review is complete, the Organization should then perform a risk assessment to determine the best way to implement appropriate internal controls over financial reporting to ensure conformity with U.S. GAAP. Action Taken (Unaudited): Management is in the process of updating its control procedures to include proper written policies for the internal control over financial reporting to ensure conformity with U.S. GAAP. John Griffin, CFO of COF Training Services, Inc. (Management Agent of Integrated Living, Inc.) is responsible for this corrective action. Anticipated completion date is June 30, 2024. FINDINGS-FEDERAL AWARD PROGRAMS AUDITS 2023‐002 Review and Approval of Project Expenditures (Significant Deficiency) Department of Housing and Urban Development Section 811 Supportive Housing for Person with Disabilities, Assistance Listing Number 14.181 Recommendation: The Organization should obtain proper approval of all project expenditures and that evidence of that approval is documented and maintained.. Action Taken (Unaudited): Management is in the process of updating its control procedures to ensure proper approval of all project expenditures. John Griffin, CFO of COF Training Services, Inc. (Management Agent of Integrated Living, Inc.) is responsible for this corrective action. Anticipated completion date is June 30, 2024. 2023‐003 Written Procedures of Internal Control over Compliance (Significant Deficiency) Department of Housing and Urban Development Section 811 Supportive Housing for Person with Disabilities, Assistance Listing Number 14.181 Recommendation: The Organization should develop written policies for the internal control over compliance of federal awards. Action Taken (Unaudited): Management is in the process of updating its control procedures to include proper written policies for the internal control over compliance of federal awards John Griffin, CFO of COF Training Services, Inc. (Management Agent of Integrated Living, Inc.) is responsible for this corrective action. Anticipated completion date is June 30, 2024. If HUD has questions regarding this plan, please call Patrick Gardner at 785-242-5035. Sincerely yours, Patrick Gardner CEO, COF Training Services, Inc. (Management Agent of Integrated Living, Inc.)

Recommendation: The Authority should designate an individual to review tenant files to determine if a rent reasonableness has been performed. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The HACMB currently has a Quality Control Coordinator who is designated to review samples of tenant files to ensure compliance. The HACMB has reviewed its Quality Control process for areas of improvement; (1) The Quality Control Coordinator will increase the number of file samples that are undergoing the Quality Control process. (2) The Quality Control Coordinator will hold bimonthly reviews with the specialists to ensure the same standard processes are being followed and to focus on retaining the supporting document in the files. The Section 8 staff will be notified of the appropriate action to take regarding any finding in the files. Name(s) of the contact person(s) responsible for corrective action: Suzie Millien Director of Section 8-HCV Planned completion date for corrective action plan: 3/31/2024.

Recommendation: The Authority should designate an individual to review tenant files to ensure that the income reported on the HUD-50058 is supported with proper calculations. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The HACMB currently has a Quality Control Coordinator who is designated to review samples of tenant files to ensure compliance. The HACMB has reviewed its Quality Control process for areas of improvement; (1) The Quality Control Coordinator will increase the number of file samples that are undergoing the Quality Control process. (2) The Quality Control Coordinator will hold bimonthly reviews with the specialists to ensure the same standard processes are being followed and to focus on each targeted area that needs assistance the most. The Section 8 staff will be notified of the appropriate action to take regarding any finding in the files. Name(s) of the contact person(s) responsible for corrective action: Suzie Millien, Director of Section 8-HCV. Planned completion date for corrective action plan: 3/31/2024.

In accordance with the Project's regulatory agreement with HUD, management shall establish and maintain a replacement reserve account to aid in funding extraordinary maintenance and repair and replacement of capital items. HUD regulation mandates that permission be obtained prior to any withdrawals from the replacement reserve. Management's View: Management acknowledges that permission must be obtained from HUD before doing any withdrawal from the reserve. Date of withdrawal will be after permission granted from HUD. Proposed Corrective Action: Corrective Action will take place as soon as a withdrawal is needed for Las Puertas Abiertas.

In accordance with the Project's regulatory agreement with HUD, management shall establish and maintain a replacement reserve account to aid in funding extraordinary maintenance and repair and replacement of capital items The replacement reserve funds must be deposited in a federally secured depository in an interest-bearing account. All earnings including interest on the reserve must be added to the reserve. An amount as required by HUD will be deposited monthly in the reserve fund. All disbursements from the reserve must be approved by HUD. Management's View: Proposed Corrective Action: Management will ensure to speak to CEO and change reserve account into an account that when transferred is made, it will be into an account that is actually an interest-bearing account. Anticipated Correction Date: Correction to be done 1st week of April 2004.

Special Tests and Provisions: In accordance with the Project's regulatory agreement with HUD, management shall establish a residual receipts account and make deposits into the account in accordance with HUD requirements (within 90 days after the close of the fiscal year). Disbursements from such fund may be made only after written consent is received from HUD, Management's View: Management acknowledges finding and simultaneously underscores this was an internal facing situation. Proposed Corrective Action: Management will ensure that all proper approvals from HUD are obtained before making a withdrawals from residual receipts account. Anticipated Correction Date: Correction has been implemented.

Reporting: In accordance with the Department of Housing and Urban Development Chapter 3 Audit Guidance, the regulatory agreement related to the Project requires that the Project submit an annual operating budget 30 days before the beginning of each fiscal year Management's View: Management acknowledges finding was an internal facing situation . Management also finding responsibility of correctly and efficiently submitting financial statements to HUD by required deadline. Proposed Corrective Action: Management will be proactive in establishing policies to further enhance financial closing processes to ensure reporting requirements are met. Anticipated Correction Date: Correction has been implemented

We agree with this finding and have taken steps to prevent this from occurring in the future. Our policy has been to make surplus cash deposits after the final audit has been issued. A residual receipts account has been established and the required fiscal year 2022 surplus cash deposit of $17,660 has been made to the account on October 21, 2022.

2023-001 Mortgage Insurance Under Section 207, Pursuant to Section 223(f) – Assistance Listing No. 14.157 Recommendation: Management should immediately make the proper deposit into the replacement reserve fund and should consistently follow their internal control procedures over replacement reserve deposits to ensure deposit are made paid timely and for the correct amount. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: We deposited the $70.25 that was underfunded in 2023 into the replacement reserve account on March 4, 2024. Name(s) of the contact person(s) responsible for corrective action: Todd Fliflet, CFO

With the implementation of the new software, Yardi Voyager 7s, a plan is in place to develop Standard Operating Procedures that are consistent with the City of Pittsburg’s Standard Operating Procedures. The Housing Authority Staff is updating the Administrative Plan to address operational procedures and the Finance Department Staff are developing procedures for internal control and transactional review. The Housing Authority has and will continue to provide resources for training and education. The budget for Fiscal Year 2023-2024 includes an increased allocation for Staff Training. Source documents have been collected and data is under review. We have engaged our former Accountant II to assist with corrections for December 2021-June 2022. The current Accountant II is finalizing an open ticket with Yardi to correct errors to the software-generated VMS report for July 2022-November 2022. The reporting errors have been identified as originating from an improper account set up during initial implementation. We have opened a ticket with the software vendor and the Yardi Development team is reviewing our findings.

Federal Agency Name: U.S. Department of Housing and Urban Development Program Name: Mortgage Insurance Rental Housing Federal Financial Assistance Listing: #14.134 Finding Summary: Testing performed by the auditors relating to testing of property, operations, and distributions detected one instance where a disbursement of Project funds was not supported with a detailed receipt. Responsible Individuals: Sue Lund, Administrator Corrective Action Plan: The Project will implement new form for invoice approval completion which includes ensuring proper documentation is obtained and retained before disbursement of funds occurs. Anticipated Completion Date: May 31, 2024

The Health Center will consult with HHS as to whether re-submittal of the Provider Relief Fund Reporting Portal is appropriate.

The City has studied its existing procedures and Information Technology (IT) resources in relation to the three noted exceptions. We have identified how the City’s procedures for inspectors lead to the exceptions and the conditions that allowed for the documentation and evidence of resolved inspection failures to be insufficient: • Since 2017, the City has served as a demonstration agency for what is now HUD’s final National Standards for the Physical Inspection of Real Estate (NSPIRE). The purpose of the demonstration was to conduct Housing Quality Standards (HQS) inspections and inspections under the test protocol simultaneously, with some inspectors using HQS and some inspectors using the test standards. The test standards were conducted using electronic devices so the inspection results could be communicated to HUD, and the HQS inspections continued to be documented using HUD Form 52580. • Utilizing two methodologies for inspection documentation over a time span of greater than five years lead to inconsistent training of new staff, and inconsistent methods and expectations for documenting failed inspection results and follow up. • This condition was exacerbated in Calendar Year 2021 and 2022 when the City began the “catch-up” inspections required by HUD after the COVID-19 inspection waivers. To resolve these issues and correct the conditions going forward, the City will: • Design and implement an inspection application (app) to be used on the inspectors’ mobile devices. The app will be based on HUD’s new NSPIRE Inspection Tool and Checklist. This document has not been assigned a HUD Form number, but is available for review on HUD’s NSPIRE website. The app will be functional on mobile devices even when there is no cellular signal or WiFi connectivity by storing the data, which will be downloaded by the inspector. • The app will include the following features to ensure that documentation is completed properly and timely: - An electronic signature will be required for all inspections, regardless of whether the inspection passed or failed. - An auto-generated summary report of the day’s failed inspections will be emailed to the Supervisors and to the inspector who completed the failed inspection. The report will include the family and owner name, the unit address, identification of the failed items, to whom the responsibility for resolving the failed item is assigned (either family or owner), and the deadline by which the failed items must be resolved. - An auto-generated letter to the family and owner will be mailed and/or emailed within 2 business days of the completed inspection. The letter will include the family and owner name, the unit address, identification of the failed items, to whom the responsibility for resolving the failed item is assigned (either family or owner), the deadline by which the failed items must be resolved, and the potential date of termination if the failed inspection is not resolved. This letter will replace the Failed Inspection Memo which is currently being used by the City to communicate inspection failures. - The app will send email notifications to the Supervisors and inspector beginning 10 days in advance of the repair deadline reminding them that the inspection has not been resolved. - The inspector will use the app to document the resolution of the inspection by indicating what evidence the inspector used to demonstrate the repaired/resolved item. - The inspector will use the app to assign an extension of the deadline when necessary and appropriate. - If a failed inspection has not passed by the deadline or extension, the app will alert the inspector and Supervisor to either document the resolved inspection items or begin the termination process. The City believes that automating these aspects of the failed inspection procedures will prevent the conditions noted in the audit findings by streamlining documentation for the inspectors, alerting supervisors of failed inspections, and providing a consolidated report across all inspectors that can be reviewed regularly. The City has already started the inspection app design process with the IT department, capitalizing and expanding on an existing app that inspectors use for scheduling inspections. When the inspection app is ready to test, the lead inspector, Sylvia Coombs, will begin using it immediately and communicate any feedback to Elizabeth Durham, Rebecca Lane and the IT department. The City anticipates the app will be ready for testing by March 31, 2024. When the app has been tested and refined, Sylvia Coombs and Elizabeth Durham will train the staff in its use and communicate the requirement and expectation that the app is replacing the paper HUD Form 52580 and the Failed Inspection Memo. This change will be implemented by April 30, 2024. Elizabeth Durham and Rebecca Lane will be responsible for monitoring the results of these changes. Responsible Party: Elizabeth Durham Acting Manager Housing and Community Services Department Rebecca Lane Program Specialist Housing and Community Services Department Anticipated Implementation Date: April 30, 2024

Corrective action plan: • On the first Friday of each month, the Housing Choice Voucher Program staff meets to discuss program policies and procedures for training purposes. At each meeting, specific aspects of administering the program are reviewed, along with the related HUD policies. Staff members are given the opportunity to ask any questions on any procedures or policies they may not understand. Activities from the Nan McKay Rent Calculation training are passed out to staff to complete individually. After staff completes the activity, the answers are reviewed as a group. Other activities take place which involve the staff answering questions regarding various case studies of situations that may occur in the daily activities of administering the HCV Program. • January 9th – 11th, all HCV and PBV Specialist received Combo HCV/LIPH Rent Calculation training with HOTMA updates from Nan McKay and Associates. • Review and update Administrative Plan/SOP with Policies and Procedures to ensure all staff is familiar with policies and procedures. • Staff restructuring • In-service meetings with Compliance Specialist as staff challenges some write ups of deficiencies to ensure that there are mutual understandings of policies. • HCV/Occupancy Specialists have been instructed to triple check all certifications for accuracy to mitigate the possibility for careless errors PERSONS INVOLVED HCV Case Management Staff Asset Manager RAD Project Based Voucher Community Manager Compliance Specialist Compliance Supervisor HCV Program Director Occupancy Specialist MONITORING The Compliance Supervisor and Specialist will continue to monitor files. The Compliance Supervisor and Specialist will begin adding the CFR Regulation and or Administrative Plan Policy and page number to each deficiency write-up to assist staff in understanding the error so that staff will not make consistent errors. The Compliance Supervisor will provide to staff recommendations for improvement. It is hopeful that a greater number of participant files will be audited throughout the year for both the HCV Program and for the PBV communities. On the first Friday of each month, the Housing Choice Voucher Program staff meets to discuss program policies and procedures for training purposes. During these meetings specific aspects of administering the program are reviewed, along with the related HUD policies. Staff members are given the opportunity to ask any questions on procedures or policies they may not understand. During many meetings, activities from the Nan McKay Rent Calculation training are passed out to staff to complete individually. After staff completes the activity, the answers are reviewed as a group. Staff also answers questions regarding various case studies that may occur in the daily activities of administering the HCV Program. We also have NRHA’s Compliance staff provide training to review common errors and to discuss any areas staff may have that are gray with audited files. Staff has also gone through an intensive training on the common errors per NRHA’s Compliance Department. Quarterly Quality Control trainings are held with caseworkers lead by the NRHA Compliance Department to address concerns and common errors. The Admission and Continued Occupancy Policies (ACOP) and Administrative Plan policies and procedures are reviewed to ensure that all staff has a clear understanding of the proper ways of calculating income, applying allowances, using proper payment standards, and approvals of lease ups and completion of certifications. A departmental quality control team was established to ensure there is consistency of policies and procedures and that when new procedures are implemented the processes are properly documented and disseminated to all staff. A departmental quality control sub-team was formed after the audit to include the actual custodians of program participant files comprised of:  1 Tax Credit PBV Property Manager  1 LIPH Property Manager  1 Compliance Specialist  1 Occupancy Specialist  1 Senior HCV Specialist  1 Tax Credit Administrative Assistant NRHA Caseworkers and Administrative Staff have been instructed to triple check all certifications for accuracy to mitigate the possibility for careless errors. The NRHA Compliance Department continues to audit files for the HCV Program to ensure that files are being processed properly; income calculated correctly, verifications are in the file, HAP payments issued are correct, and that units are inspected timely. Findings are noted and must be corrected by the Case Worker or Administrative Staff and the file is reevaluated by the Compliance Department to ensure findings were corrected. NRHA Caseworkers and Administrative Staff have been instructed to triple check all certifications for accuracy to mitigate the possibility for careless errors. The NRHA Compliance Department continues to audit files for the HCV Program to ensure that files are being processed properly; income calculated correctly, verifications are in the file, HAP payments issued are correct, and that units are inspected timely. Findings are noted and must be corrected by the Case Worker or Administrative Staff and the file is reevaluated by the Compliance Department to ensure findings were corrected. NRHA will continue to investigate the possibility of increasing the number of program participant files reviewed by the Compliance Department. NRHA has begun contract negotiations with a new software vendor. It is the feeling of the agency that with a different software platform the errors being made will lessen as the information gathered to perform rent calculations will be in a more automated form. It is anticipated that this will lessen staff time needed to enter the information and thus allow for more time to be spent verifying accuracy of information. The timeline for implementation is for the software to be live at the beginning of the 2026 fiscal year. This over-riding strategy is to be done in conjunction with the steps outlined below to mitigate this situation.

Planned Corrective Action: Implement accounting system to track federal awards; Reconcile general ledger to award amounts and to reimbursement requests.The organization purchased and is currently implementing a new accounting system which utilizes fund accounting and separate general ledger accounts for each award. Processes and procedures will be implemented to reconcile award amounts and reimbursement requests to each award within the general ledger. Additional supporting schedules will also continue to be maintained to reconcile to the general ledger.

FINDING NO. 2022-003 Statement of Condition: Management made an unauthorized withdrawal of $4,400 from the residual receipts account during the fiscal year ended June 30, 2022; the funds have not been returned to the residual receipts account. Auditor Recommendation: Management should deposit $4,400 into the residual receipts account to refund the unapproved withdrawal. S3800-150: Action Taken: Management agrees with the finding, and has taken corrective actions which include communication with the Project Accountant and Regional Manager and will transfer $4,400 from the operating account to the residual receipts account.

FINDING NO. 2023-002 Statement of Condition: Management only made nine (9) of the twelve (12) monthly required reserve deposits, leaving the account underfunded by $4,053 at June 30, 2022; for the year ended june 30, 2023, only $2,702 of the required $16,212 in deposits were made, leaving the account behind schedule by another $13,510, for a total deficiency of $17,563. Auditor Recommendation: Management agrees with the finding, and has taken corrective actions which include communication with the Project Accountant and Regional Manager. All future deposits the replacement reserve will be made as required in the regulatory agreement. Action Taken: Senior management has discussed the deficiency with the Project Accountant and Regional Manager. All future deposits the replacement reserve will be made as required in the regulatory agreement assuming there is sufficient cash in the operating account to make the deposit. -

Management concurs with the auditor's findings and recommendations. The management agent is making several organizational changes to help track and monitor compliance with contracts and agreements.