Corrective Action Plans

Finding 501551 (2023-004)

Significant Deficiency 2023

City of Avon Park

FL

Allowable Costs / Cost Principles Cash Management Significant Deficiency

Airport Improvement Program – Assistance Listing No. 20.106 Recommendation: We recommend the City designate a responsible and qualified grant manager and establish internal controls for matching requirement. Explanation of disagreement with audit finding: There is no disagreement with the audit fi...

Airport Improvement Program – Assistance Listing No. 20.106 Recommendation: We recommend the City designate a responsible and qualified grant manager and establish internal controls for matching requirement. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The City is in the process of establishing interal controls for reporting and will review and file all future required reports in a timely and accurate manner. Name(s) of the contact person(s) responsible for corrective action: Melody Sauerhafer Planned completion date for corrective action plan: 09/30/2024

View Audit 323605

Finding 501546 (2023-003)

Significant Deficiency 2023

Stand Down Housing Westerly, Inc.

RI

HUD Housing Programs Internal Control / Segregation of Duties Cash Management

FINDING 2023-003: Section 811 Capital Advance Program and Project Rental Assistance Contract ALN# 14.181 Recommendation: Management will immediately transfer the delinquent surplus cash to the residual receipts reserve account and implement robust internal controls to ensure all future deposits are ...

FINDING 2023-003: Section 811 Capital Advance Program and Project Rental Assistance Contract ALN# 14.181 Recommendation: Management will immediately transfer the delinquent surplus cash to the residual receipts reserve account and implement robust internal controls to ensure all future deposits are made promptly and in compliance with the Regulatory Agreement. Action Taken: Management has transferred the overdue amount to the residual receipts reserve account and implemented enhanced internal controls to prevent future non-compliance.

View Audit 323597

Finding 501545 (2023-002)

Significant Deficiency 2023

Stand Down Housing Westerly, Inc.

RI

Internal Control / Segregation of Duties HUD Housing Programs

FINDING 2023-002: Section 811 Capital Advance Program and Project Rental Assistance Contract ALN# 14.181 Recommendation: Management will implement a comprehensive internal control system to ensure all tenant files include required documentation, and will conduct a thorough review of all current tena...

FINDING 2023-002: Section 811 Capital Advance Program and Project Rental Assistance Contract ALN# 14.181 Recommendation: Management will implement a comprehensive internal control system to ensure all tenant files include required documentation, and will conduct a thorough review of all current tenant files to verify compliance and completeness. Action Taken: Ownership agrees with the auditor’s finding and recommendation and has hired a new management agent to oversee the implementation of a comprehensive internal control system, ensuring all tenant files include required documentation

View Audit 323597

Finding 501542 (2023-001)

Significant Deficiency 2023

Stand Down Housing, Inc.

RI

Internal Control / Segregation of Duties HUD Housing Programs

FINDING 2023-001: Section 811 Capital Advance Program and Project Rental Assistance Contract ALN# 14.181 Recommendation: Management will implement a comprehensive internal control system to ensure all tenant files include required documentation, and will conduct a thorough review of all current tena...

FINDING 2023-001: Section 811 Capital Advance Program and Project Rental Assistance Contract ALN# 14.181 Recommendation: Management will implement a comprehensive internal control system to ensure all tenant files include required documentation, and will conduct a thorough review of all current tenant files to verify compliance and completeness. Action Taken: Ownership agrees with the auditor’s finding and recommendation and has hired a new management agent to oversee the implementation of a comprehensive internal control system, ensuring all tenant files include required documentation.

View Audit 323596

Finding 501538 (2023-002)

Significant Deficiency 2023

Housing Authority of Sunnyside, Washington

WA

Reporting Significant Deficiency Matching / Level of Effort / Earmarking

Views of responsible officials and planned corrective action: Management agrees with the finding and will implement the aforementioned recommendations. Ketha Kimbrough, Executive Director, will be responsible to implement this corrective action by December 31, 2024.

View Audit 323592

Finding 501537 (2023-001)

Significant Deficiency 2023

Housing Authority of Sunnyside, Washington

WA

Questioned Costs Significant Deficiency Matching / Level of Effort / Earmarking

Views of responsible officials and planned corrective action: Management agrees with the finding and will implement the aforementioned recommendations. Ketha Kimbrough, Executive Director, will be responsible to implement this corrective action by December 31, 2024.

View Audit 323592 Questioned Costs: $1

Finding 501508 (2023-002)

Significant Deficiency 2023

La Clinica Tepeyac

CO

Cash Management Internal Control / Segregation of Duties Significant Deficiency § 200.303

Consolidated Health Centers Grant — Assistance Listing No. 93.224 & 93.527 Recommendation: Our auditors recommended the Organization to review internal controls in regards to the approval of federal fund drawdown requests. Explanation of disagreement with audit finding: There is no disagreement w...

Consolidated Health Centers Grant — Assistance Listing No. 93.224 & 93.527 Recommendation: Our auditors recommended the Organization to review internal controls in regards to the approval of federal fund drawdown requests. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The Organization has reviewed all of our internal controls to ensure all approvals are documented. The procedure has been updated to include preparing the draw documentation, entering accounts receivable invoice into the accounting system, which now requires an approval for all accounts receivable invoices. Once the accounts receivable invoices are approved in the accounting system then a drawdown can be requested in the payment management system

View Audit 323583

Finding 501507 (2023-001)

Material Weakness 2023

La Clinica Tepeyac

CO

Internal Control / Segregation of Duties Subrecipient Monitoring Material Weakness

Consolidated Health Centers Grant — Assistance Listing No. 93.224 & 93.527 Recommendation: Our auditors recommended the Organization to review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categ...

Consolidated Health Centers Grant — Assistance Listing No. 93.224 & 93.527 Recommendation: Our auditors recommended the Organization to review internal controls in regards to the determination, recording, and monitoring of the sliding fee process to ensure that appropriate sliding fee rates/categories are utilized for each sliding fee encounter. The auditors also recommended the Organization put a process in place to make sure all applications are retained. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The Organization made several changes at the end of 2023 to ensure we appropriate documentation in patient charts. The following is a summary of the changes: • Hired a patient services manager to manage the front desk and call center in November 2023. Moved sliding fee application process to the front desk from enrollment, previously the applications were handed off for scanning. Now the front desk owns the entire process from getting the application from the patient to scanning it into the chart. We have implemented a monthly audit process to spot check applications for accuracy and ensure complete documentation in the chart. We also began using an app called Luma to help patients complete sliding fee electronically when a patient is comfortable. This eliminates the need to scan documents.

View Audit 323583

Finding 501500 (2023-001)

Significant Deficiency 2023

New Beginnings

WA

Significant Deficiency Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Corrective Action: Beginning in 2024, management will take minutes for its monthly meetings with program leads and accounting staff to document discussions of grant compliance matters including matching requirements. Projected Completion Date: December 31, 2024

View Audit 323570

Finding 501494 (2023-002)

Significant Deficiency 2023

Public Health - Madison and Dane County

WI

Subrecipient Monitoring Reporting Matching / Level of Effort / Earmarking § 200.303

City of Madison Fire Department will coordinate with the City of Madison, Internal Audit and Grants function of the Finance Department, for an independent person to review the reports before submission to ensure the loss revenue calculation and amounts reported are accurate. This additional internal...

City of Madison Fire Department will coordinate with the City of Madison, Internal Audit and Grants function of the Finance Department, for an independent person to review the reports before submission to ensure the loss revenue calculation and amounts reported are accurate. This additional internal control procedure will ensure there are proper review and approval processes over completeness and accuracy of reports before submissions to federal agencies.

View Audit 323562

Finding 501483 (2023-004)

None 2023

Alamo Area Mutual Housing Association

TX

Internal Control / Segregation of Duties Allowable Costs / Cost Principles

CORRECTIVE ACTION PLAN Name and Number of the Project: Alamo Area Mutual Housing Association Audit Firm: M Group, LLP Audit Period: The year ended December 31, 2023 Compliance Review A. COMMENTS ON FINDINGS AND RECOMMENDATIONS We concur with the findings and recommendations of our auditors regar...

CORRECTIVE ACTION PLAN Name and Number of the Project: Alamo Area Mutual Housing Association Audit Firm: M Group, LLP Audit Period: The year ended December 31, 2023 Compliance Review A. COMMENTS ON FINDINGS AND RECOMMENDATIONS We concur with the findings and recommendations of our auditors regarding our noncompliance as cited in the accompanying Schedule of Findings and Questioned Costs. ACTIONS TAKEN FINDING 2023-004: The Company does not have effective internal controls or consistently follow the written policies and procedures over federal awards. CORRECTIVE ACTION: Alamo is seeking training and support to improve internal controls and policies and procedures for oversight of federal awards. We have prepared the corrective action plan as required by the standards applicable to financial statements contained in Government Auditing Standards and by the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Any questions regarding the above corrective action plan should be directed to Christine Drennon, Executive Director.

View Audit 323539

Finding 501480 (2023-003)

Significant Deficiency 2023

Alamo Area Mutual Housing Association

TX

Questioned Costs Internal Control / Segregation of Duties HUD Housing Programs

CORRECTIVE ACTION PLAN Name and Number of the Project: Alamo Area Mutual Housing Association Audit Firm: M Group, LLP Audit Period: The year ended December 31, 2023 Compliance Review A. COMMENTS ON FINDINGS AND RECOMMENDATIONS We concur with the findings and recommendations of our auditors rega...

CORRECTIVE ACTION PLAN Name and Number of the Project: Alamo Area Mutual Housing Association Audit Firm: M Group, LLP Audit Period: The year ended December 31, 2023 Compliance Review A. COMMENTS ON FINDINGS AND RECOMMENDATIONS We concur with the findings and recommendations of our auditors regarding our noncompliance as cited in the accompanying Schedule of Findings and Questioned Costs. ACTIONS TAKEN FINDING 2023-003: Section 223(a)(7) HUD Insured Loan, Assistance Listing 14.135 - AAMHA Western Hills, LLC HUD Project No. 115-115888, AAMHA KPTP, LLC HUD Project No 115-35652 and Section 223(f) HUD Insured Loan, Assistance Listing 14.155 - AAMHA Calcasieu, LLC HUD Project No 115-11280Section 223(a)(7) HUD Insured Loan, Assistance Listing 14.135. Entity expenses and receipts were recorded on the incorrect project’s books. CORRECTIVE ACTION COMPLETED: a. AAMHA Western Hills, LLC - On April 24, 2024, $3,199 was received from an affiliate. b. AAMHA KPTP, LLC - During 2023, $16,321 was received from affiliates. On May 10, 2023, the Project received $8,027. c. AAMHA Calcasieu, LLC – On April 16, 2024, the Project received $5,869 from an affiliate. We have prepared the corrective action plan as required by the standards applicable to financial statements contained in Government Auditing Standards and by the audit requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Any questions regarding the above corrective action plan should be directed to Christine Drennon, Executive Director.

View Audit 323539 Questioned Costs: $1

Finding 501236 (2023-002)

Material Weakness 2023

Mount Carmel Area School District

PA

Internal Control / Segregation of Duties Reporting

The Business Manager has year-end procedures in place to ensure year end adjusting entries are performed prior to the audit.

View Audit 323523

Finding 501230 (2023-001)

Material Weakness 2023

Logan Health

MT

Internal Control / Segregation of Duties Material Weakness Reporting

Finding 2023-001 Federal Agency Name: Department of Health and Human Services Program Name: COVID-19 Provider Relief Fund and American Rescue Plan Rural Distribution Federal Assistance Listing #93.498 Federal Agency Name: Department of Health and Human Services Program Name: Activities to Support St...

Finding 2023-001 Federal Agency Name: Department of Health and Human Services Program Name: COVID-19 Provider Relief Fund and American Rescue Plan Rural Distribution Federal Assistance Listing #93.498 Federal Agency Name: Department of Health and Human Services Program Name: Activities to Support State, Tribal, Local and Territorial (STLT) Health Department Response to Public Health or Healthcare Crisis Federal Assistance Listing: #93.391 Finding Summary: During the course of our engagement, we noted a material program missing from the Schedule that was not identified by management. Responsible Individuals: Kevin Abel, CEO and Brigid Burke, CFO Status: Procedures and controls over tracking and recording of federal programs with the Schedule will be updated in order to provide a complete Schedule. Anticipated Completion Date: 12/31/2024

View Audit 323504

Finding 501225 (2023-007)

Material Weakness 2023

State of Alabama

AL

Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties § 200.303

Finding: According to the Uniform Guidance, 2 CFR 200.303 (a), non-Federal entities receiving Federal awards must establish and maintain effective internal controls over these awards. These controls must provide reasonable assurance that the entity manages the Federal award in compliance with applic...

Finding: According to the Uniform Guidance, 2 CFR 200.303 (a), non-Federal entities receiving Federal awards must establish and maintain effective internal controls over these awards. These controls must provide reasonable assurance that the entity manages the Federal award in compliance with applicable Federal statutes, regulations, and the terms and conditions of the award. A fundamental objective of an effective internal control system is to ensure that information is accurate and reliable, which includes a thorough review and approval process. The Uniform Guidance, 2 CFR Part 200, Appendix XI Compliance Supplement, May 2023, requires the Alabama Department of Labor to ensure an employer’s experience rating is properly applied, as the employer’s “experience” with the unemployment of former employees is the dominant factor in the computation of the employer’s annual state Unemployment Insurance tax rate. The Alabama Department of Labor was unable to provide audit documentation to support their review and approval of employer experience rated tax rates. The Alabama Department of Labor did not have policies and procedures in place to document the review and approval of the employer experience rated tax rates. As a result, the employer experience related tax rates could be incorrect, resulting in potential overpayments or underpayments of taxes. Recommendation: The Alabama Department of Labor should develop and document internal controls over employer experience rated tax rates to help ensure they are accurate and properly applied. Response/Views: ADOL does not agree with this finding as explained in the Request for Views CAP letter. Corrective Action Planned: Procedures were in place to ensure accuracy of information. However, the support documentation of this verification was not retained during the time of this review. Anticipated Completion Date: Additional processes to retain support documentation of this verification have already been implemented. Contact Person(s): Thomas Daniel, ADOL Unemployment Compensation Division Director

View Audit 323486

Finding 501221 (2023-003)

Significant Deficiency 2023

State of Alabama

AL

Reporting Significant Deficiency Internal Control / Segregation of Duties

Finding: 45 CFR Section 261 .63 requires the Alabama Department of Human Resources to submit a Work Verification Plan to the U.S. Department of Health and Human Services (HHS) for approval. The Alabama Department of Human Resources must comply with its approved Work Verification Plan to ensure accur...

Finding: 45 CFR Section 261 .63 requires the Alabama Department of Human Resources to submit a Work Verification Plan to the U.S. Department of Health and Human Services (HHS) for approval. The Alabama Department of Human Resources must comply with its approved Work Verification Plan to ensure accuracy in reporting work activities by work eligible individuals on the Temporary Assistance for Needy Families (TANF) Data Report. Data for work participation activities are used in calculating work participation rates. During our testing of 25 TANF cases, we found two cases in which the hours reported for an individual participating in a work activity were inaccurate. The Department of Human Resources failed to ensure accuracy of data for work participation activities which may result in an inaccurate work participation rate. This is a significant deficiency in internal controls. The Department of Human Resources did not have adequate procedures in place to ensure that the information included on the TANF Data Report is accurate. Recommendation: The Department of Human Resources should establish and maintain effective internal controls to ensure accuracy in reporting work activities by work-eligible individuals on the TANF Data Report. Response/Views: We disagree. The finding statement declares that the Department of Human Resources failed to ensure accuracy of data for work participation activities which may result in an inaccurate work participation rate. This is a significant deficiency in internal controls. The Department of Human Resources did not have adequate procedures in place to ensure that the information included on the TANF Data Report is accurate. We do agree with the findings of two cases "in which the hours reported for an individual participating in a work activity were inaccurate." We agree that the 2 of the 25 cases selected had the incorrect frequency for the number of employment hours entered which could potentially affect the work participation rate for Alabama. Corrective Action Planned: The two cases which involved an error in the frequency of the hours reported appear to be isolated and inadvertent in nature. Our policy requires verification and calculation of employment hours at the beginning of employment and reverification and calculation of employment hours in the fifth month of employment. Based on our JOBS policy, your review of 25 cases, potentially represents up to 200 calculations and your findings indicate only 2 calculation errors. Furthermore, our research indicates that the errors in the two cases addressed in your findings did not have an affect on the State's overall Work Participation Rate. Additionally, we believe our supervisory reviews as well as a percentage of record rereviews remain the best way to monitor accuracy of information entered in our system while basic and refresher training remains the course of prevention for information prior to entry into the system. Basic training for each new employee involves two weeks of intense, in person, interactive training. Refresher training or one to one support is provided as needed or requested by county staff. The official policy and automation helpdesk are staffed by specialists, who responds to questions daily. County consultants also perform re-reviews of the county's reviews and provide guidance as observed or requested. The stated purpose of these processes is to ensure systematic review of the work done in the family assistance program; to identify worker problems; to identify error trends and concentrations; and to monitor program performance. At the county level information from that process can be used for worker performance assessment, local corrective action, to train new workers, to identify areas of strengths and weaknesses of staff. At the State level the process provides information to monitor program performance to include identifying problems and error trends by county, region and statewide. Analysis of this data provides a way to determine training needs and to evaluate performance standards and the impact of program changes. The Division case record re-review process of the work of the supervisor provides yet another level of oversight to address the issues. Resulting corrective action from these reviews both at the County and State Office level can include additional individual worker or general staff training, program clarifications, as well as attention to the specific cases identified. Longstanding practice of such activity and experience tells us the process does prevent, detect, and correct errors. These errors have been discussed with the county worker and supervisor for case corrective action. Finally, DHR is in the final stages of development of a new TANF and JOBS system and we have requested that the hours of participation field require a question regarding the frequency of hours listed. Anticipated Completion Date: December 31, 2024. Contact Person(s): Fannie Ashley or Tessa Mitchell

View Audit 323486

Finding 501207 (2023-004)

Significant Deficiency 2023

Shasta Regional Transportation Agency

CA

Cash Management Reporting Significant Deficiency

Federal Agency: U.S. Department of Transportation Program/Cluster: Metropolitan Planning and Research Federal Assistance Listing Number: 20.505 Pass‐through: California Department of Transportation Award No. and Year: 74A0821, 2022/2023 Compliance Requirement: Reporting Type of Finding: Significant ...

Federal Agency: U.S. Department of Transportation Program/Cluster: Metropolitan Planning and Research Federal Assistance Listing Number: 20.505 Pass‐through: California Department of Transportation Award No. and Year: 74A0821, 2022/2023 Compliance Requirement: Reporting Type of Finding: Significant Deficiency over Compliance, Instance of Noncompliance Views of Responsible Officials and Corrective Action Plan: Management agrees with the finding. Delay in Caltrans approving the first quarter request for reimbursement and progress reports until January 24, 2023, as well as additional staff time needed to prepare the narrative information, resulted in the submittal of the second quarter reports nine days after the due date of January 30, 2023. Caltrans District 2 staff were notified early that there would be a delay in the reporting and indicated this was acceptable. This is an extraordinary occurrence, as it is SRTA’s common practice to submit all required reports before the deadline. Corrective Action Plan: The Agency will send a memorandum to all staff to ensure timely reporting of required quarterly reports in accordance with the agency’s established policies and procedures and compliance with the Master Fund Transfer Agreement that is active at the time of submittal. The Agency will also create reminders on the shared agency calendar that will be set to automatically alert the executive director, CFO, OWP manager, and relevant staff, of the deadline to submit the quarterly narratives to further eliminate the risk of late reporting. Responsible Individual(s): Sean Tiedgen, Executive Director and Jessica Carlson, Chief Fiscal Officer Anticipated Completion Date: June 30, 2024

View Audit 323480

Finding 501204 (2023-001)

Significant Deficiency 2023

Church Housing for Fairfield, Inc.

CT

HUD Housing Programs Internal Control / Segregation of Duties

Finding 2023-001: The Organization did not retain a printed and dated copy of the Failed Verification and Failed EIV Prescreen reports for two out of twelve months of the year. Recommendations (2023-001-a): Auditor recommends that management reevaluate its system and procedures to ensure that the ...

Finding 2023-001: The Organization did not retain a printed and dated copy of the Failed Verification and Failed EIV Prescreen reports for two out of twelve months of the year. Recommendations (2023-001-a): Auditor recommends that management reevaluate its system and procedures to ensure that the required reports are printed and retained on the required schedule with clear dates of printing, going forward. View of Responsible Officials: Management concurs with this finding and agrees with the auditor’s recommendation. Management considers corrective action to be completed and will reevaluate its system to ensure future compliance.

View Audit 323476

Finding 501157 (2023-001)

Material Weakness 2023

Rappahannock Goodwill Industries, Inc.

VA

Internal Control / Segregation of Duties Reporting

Management was able to see deficiencies in the finance and accounting department in 2023. There was turnover of several staff, and in December 2023 the VP of Finance was removed from the position and a new qualified CFO was hired in mid-January 2024. An accounting and consulting firm, Cherry Bekae...

Management was able to see deficiencies in the finance and accounting department in 2023. There was turnover of several staff, and in December 2023 the VP of Finance was removed from the position and a new qualified CFO was hired in mid-January 2024. An accounting and consulting firm, Cherry Bekaert was hired in early January 2024 to assist with bringing the accounting and financial systems up to GAAP standards. In addition, the GL accountant position has been upgraded in 2024 to a Senior Accountant position and new qualified staff have been hired to continue to allow for internal controls. The AR and AP positions continue so that there is separation of duties as well. Additionally, management decided in 2023, to move away from the accounting system ‘Traverse’ that was very difficult to navigate and was antiquated in its functioning. The new Sage Intacct accounting software was implemented in 2024. Cherry Bekaert was hired and under the direction of the new CFO the implementation was completed on May 1, 2024. SAGE Intacct has made the accounting process much more efficient to enable proper functioning of the accounting department. Moving forward, the intention is to continue the assistance of the consulting firm, as a long-term consulting partner, to complete reconciliations and to ensure stability if there is staff turnover. This also ensures oversight and corrections of processes monthly.

View Audit 323413

Finding 501146 (2023-005)

None 2023

Houston Housing Authority

TX

Special Tests & Provisions HUD Housing Programs Internal Control / Segregation of Duties

2023-005 Special Tests and Provisions – Waiting List Moving to Work Demonstration Program AL No. 14.881 Other Matter to be Reported Under the Uniform Guidance Condition: While testing of applicants that reached the top of the waiting list during the year ended December 31, 2023, the Authority was u...

2023-005 Special Tests and Provisions – Waiting List Moving to Work Demonstration Program AL No. 14.881 Other Matter to be Reported Under the Uniform Guidance Condition: While testing of applicants that reached the top of the waiting list during the year ended December 31, 2023, the Authority was unable to provide sufficient documentation for one of the applicants to support their position on the list. Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to waiting list selection process and document retention requirements. Action Taken: The Houston Housing Authority agrees with this finding. A review of existing procedures revealed that there were issues with the management of the waiting lists. The Houston Housing Authority is transitioning to a new software program during 2024. One of the reasons for the implantation of the new software is to make use of a better wait list management feature that is available within the new software. Waitlists have been reviewed and purged of stale an do dated information which will facilitate better management of the waitlist for future periods.

View Audit 323395

Finding 501145 (2023-004)

Material Weakness 2023

Houston Housing Authority

TX

HUD Housing Programs Eligibility Material Weakness

2023-004 Eligibility Section 8 Project-Based Cluster Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 670 of tenants, 20 tenant files were tested and the following deficiencies were noted: • Nine files did not have annual recertification...

2023-004 Eligibility Section 8 Project-Based Cluster Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 670 of tenants, 20 tenant files were tested and the following deficiencies were noted: • Nine files did not have annual recertifications performed during the year, • Eight files did not have 9886 release of information forms within 15 months of annual recertification, • Six files did not have an annual recertification performed within 12 months, • Six files did not have documentation necessary to verify the reported income, and • Three files did not have a 214 declaration form for all members of the household. Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility and the timeliness of recertifications. 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: The Houston Housing Authority agrees with this finding. The Houston Housing Authority has for the past several months undertaken a program to review all voucher files for purposes of getting all delinquent recertifications completed. During this process if other required documents are found to be missing steps are being taken to complete the missing documentation and make sure that the files are complete. This review is substantially completed with final completion expected in the third quarter of 2024. Procedures have been implemented with regards to preventing this situation from recurring. Where needed staff will be provided the necessary training to make sure that a HCVP staff have the skills needed to successfully complete their job tasks. To facilitate this training, the Houston Housing Authority has created a training center that is made available to not only Houston Housing Authority staff but also others to provide a wide variety of training classes. Current leadership at the Houston Housing Authority is committed to having a competent trained staff working in the HCVP as well as other departments with the agency. Because the file clean up work was being performed in calendar year 2024 we expected this finding would be present for the 2023 audit. This work is handled by the Voucher Program Operations department. The VP of this department and the Director of this department are primarily responsible for making sure the necessary corrections are made and the fill review is completed within the third quarter of 2024

View Audit 323395

Finding 501144 (2023-003)

Material Weakness 2023

Houston Housing Authority

TX

HUD Housing Programs Eligibility Material Weakness

2022-003 Eligibility Housing Voucher Cluster Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 484 of Housing Voucher Cluster tenants the following deficiencies were noted: Mainstream Voucher AL #14.879 (a total of 4 tenants selected for ...

2022-003 Eligibility Housing Voucher Cluster Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 484 of Housing Voucher Cluster tenants the following deficiencies were noted: Mainstream Voucher AL #14.879 (a total of 4 tenants selected for testing): • One file did not have an annual recertification performed during the year, • One file did not have an annual recertification performed within 12 months, • Two files did not have 9886 release of information forms within 15 month of the annual recertification, • One file did not have a 214 declaration form for all members of the household, and • One file did not have documentation necessary to verify the reported income. Emergency Housing Voucher AL #14.871 (a total of 5 tenants selected for testing): • Four files did not have an annual recertification performed within 12 months, • Three files did not have a 214 declaration form for all members of the household, • Four files did not have 9886 release of information forms within 15 month of the annual recertification, and • Five files did not have rent reasonableness form performed for the annual certification. The Houston Housing Authority agrees with this finding. The Houston Housing Authority has for the past several months undertaken a program to review all voucher files for purposes of getting all delinquent recertifications completed. During this process if other required documents are found to be missing steps are being taken to complete the missing documentation and make sure that the files are complete. This review is substantially completed with final completion expected in the third quarter of 2024. Procedures have been implemented with regards to preventing this situation from recurring. Where needed staff will be provided the necessary training to make sure that a HCVP staff have the skills needed to successfully complete their job tasks. To facilitate this training, the Houston Housing Authority has created a training center that is made available to not only Houston Housing Authority staff but also others to provide a wide variety of training classes. Current leadership at the Houston Housing Authority is committed to having a competent trained staff working in the HCVP as well as other departments with the agency. Because the file clean up work was being performed in calendar year 2024 we expected this finding would be present for the 2023 audit. This work is handled by the Voucher Program Operations department. The VP of this department and the Director of this department are primarily responsible for making sure the necessary corrections are made and the fill review is completed within the third quarter of 2024. FINDINGS - FEDERAL AWARD PROGRAMS AUDIT 2023-003 Eligibility Housing Voucher Cluster Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 1,500 of Housing Voucher Cluster tenants the following deficiencies were noted: Mainstream Voucher AL #14.879 (a total of 5 tenants selected for testing): • Five files did not have supporting documents needed to determine eligibility. Emergency Housing Voucher AL #14.871 (a total of 5 tenants selected for testing): • Four files did not have supporting documents needed to determine eligibility, and • One files did not have an annual recertification performed. Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility and the timeliness of recertifications. 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: The Houston Housing Authority agrees with this finding. The Houston Housing Authority has for the past several months undertaken a program to review all voucher files for purposes of getting all delinquent recertifications completed. During this process if other required documents are found to be missing steps are being taken to complete the missing documentation and make sure that the files are complete. This review is substantially completed with final completion expected in the third quarter of 2024. Procedures have been implemented with regards to preventing this situation from recurring. Where needed staff will be provided the necessary training to make sure that a HCVP staff have the skills needed to successfully complete their job tasks. To facilitate this training, the Houston Housing Authority has created a training center that is made available to not only Houston Housing Authority staff but also others to provide a wide variety of training classes. Current leadership at the Houston Housing Authority is committed to having a competent trained staff working in the HCVP as well as other departments with the agency. Because the file clean up work was being performed in calendar year 2024 we expected this finding would be present for the 2023 audit. This work is handled by the Voucher Program Operations department. The VP of this department and the Director of this department are primarily responsible for making sure the necessary corrections are made and the fill review is completed within the third quarter of 2024.

View Audit 323395

Finding 501143 (2023-002)

Material Weakness 2023

Houston Housing Authority

TX

HUD Housing Programs Eligibility Material Weakness

2023-002 Eligibility Moving to Work Demonstration Program AL No. 14.881 Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 18,300 of Section 8 Housing Choice Voucher and 2,300 Low Rent Public Housing tenants the following deficiencies were n...

2023-002 Eligibility Moving to Work Demonstration Program AL No. 14.881 Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 18,300 of Section 8 Housing Choice Voucher and 2,300 Low Rent Public Housing tenants the following deficiencies were noted: Section 8 Housing Choice Voucher (a total of 40 tenants selected for testing): • Thirty-five files did not have annual recertifications performed during the year, • Nine files did not have 9886 release of information forms within 15 months of annual recertification, • Four files did not have a annual recertification performed with 12 months of the previous certification, • Three file did not have an inspection performed during the year • Three files did not have documentation necessary to verify the reported income, • Two files did not have a 214 declaration for a member of the household, and • Two files did not have documentation necessary to verify custody of dependents. Low Rent Public Housing (a total of 40 tenants selected for testing): • Fourteen files did not contain flat rent options forms, • Ten files did not have documentation necessary to verify the reported income, • Seven files did not have the annual recertification performed or documented, • Five files did not have a 214 declaration for a member of the household, • Three files did not have support necessary to verify income allowances, • Two files did not have 9886 release of information form within 15 months of the annual recertification, and • One file did not have annual recertifications performed within 12 months of the previous annual certification. Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility and the timeliness of recertifications. 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: The Houston Housing Authority agrees with this finding. The Houston Housing Authority has for the past several months undertaken a program to review all voucher files for purposes of getting all delinquent recertifications completed. During this process if other required documents are found to be missing steps are being taken to complete the missing documentation and make sure that the files are complete. This review is substantially completed with final completion expected during the final quarter of 2024. Procedures have been implemented with regards to preventing this situation from recurring. Where needed staff will be provided the necessary training to make sure that all HCVP staff have the skills needed to successfully complete their job tasks. To facilitate this training, the Houston Housing Authority has created a training center that is made available to not only Houston Housing Authority staff but also others to provide a wide variety of training classes. Current leadership at the Houston Housing Authority is committed to having a competent trained staff working in the HCVP as well as other departments with the agency. Because the file clean up work was being performed in calendar year 2024 we expected this finding would be present for the 2023 audit. This work is handled by the Voucher Program Operations department. The VP of this department and the Director of this department are primarily responsible for making sure the necessary corrections are made and the fill review is completed within the final quarter of 2024.

View Audit 323395

Finding 501142 (2023-001)

Material Weakness 2023

Houston Housing Authority

TX

Internal Control / Segregation of Duties HUD Housing Programs Material Weakness

2023-001 Financial Reporting – Disclaimer of Opinion Material Weakness in Internal Control Material Noncompliance Condition: During our audit of the Authority’s financial statements, numerous adjustments were needed to properly report the financial statements in accordance with generally accep...

2023-001 Financial Reporting – Disclaimer of Opinion Material Weakness in Internal Control Material Noncompliance Condition: During our audit of the Authority’s financial statements, numerous adjustments were needed to properly report the financial statements in accordance with generally accepted accounting principles. Certain accounts had not been properly reconciled and corrective entries were not readily available. Significant audit adjustments were necessary for several audit areas and the audit was significantly delayed due to these adjustments. Given the amount of adjustments needed the auditor did not have enough time to complete the necessary audit procedures and as such have issued a disclaimer of opinion on the financial statements. Auditor’s Recommendations: The Authority should continue to develop and implement internal controls over both internal and external reporting, and the year-end close process to ensure reporting remains accurate and timely, with any unexpected financial data being investigated and corrected before it is reported. The Authority should consider additional staff training on development activities. Action Taken: The Houston Housing Authority agrees with this finding and related recommendations. During this audit, as these issues arose, notes were taken, evaluation of what had happened was made so that we could make the necessary adjustments to our procedures to prevent the continuation of these issues. In addition, we hired a firm to come in and undertake a review of the finance department. The purpose of this review was to review our existing staffing levels, workloads, experience, etc., for purposes of proposing a reorganization of the finance department to address any deficiencies. We have reviewed the recommendations from this consultant and are in the process of implementing many of the recommended changes. We are in the process of bringing in additional staff to expand the capacity of the Finance department. As we had fallen behind on our audits we anticipated the weaknesses noted in prior audits would continue to be present in future audits including the 2023 audit. We have been working very diligently to address the issues within the finance department that gave rise to this finding. We fully expected this finding or a similar finding to be present for the 2023 audit as many of the departmental improvements and changes were not in place during the 2023 calendar year. We have also been somewhat limited in the time available to implement changes as we have been working on clearing up the prior audit delinquencies since hiring out new outside auditors. This will be the first time in years where we will have a prior year audit available to us prior to the end of the current year. We will be able to have any 2023 audit adjustments posted to the general ledger prior to yearend 2024 so many of the reconciliation issues that have been encountered on the prior audits are not expected to be present when we move into the 2024 audit. The VP Fiscal and Business Operations as well as the Director of Finance are responsible for implementing the necessary process and procedural changes to eliminate the need for this type of finding for the 2024 audit.

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Finding 501135 (2023-002)

Significant Deficiency 2023

Georgia Alliance of Boys & Girls Clubs, Inc.

GA

Subrecipient Monitoring Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties § 200.305

Individuals Responsible for Corrective Action Plan: Kristine Steinmann, Alliance Director Shelby Mahoney, State Alliances Accounting Manager Corrective Action: The Alliance will enhance its procedures and internal controls around cash management to ensure that time between receipt of federal fun...

Individuals Responsible for Corrective Action Plan: Kristine Steinmann, Alliance Director Shelby Mahoney, State Alliances Accounting Manager Corrective Action: The Alliance will enhance its procedures and internal controls around cash management to ensure that time between receipt of federal funds and payment to its local clubs is minimized. The Alliance will also request notification of funding from the agency. Anticipated Completion Date: December 31, 2024

View Audit 323392

Corrective Action Plans

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