Finding 1073191 (2023-002)

Significant Deficiency 2023-002 Depository Agreements Federal Program U.S. Department of Housing and Urban Development AL #14.871 & 14.879 Grant Award No. ND031-Housing Choice Vouchers & ND031-Mainstream Vouchers Grant Award Year 2023 Questioned Costs None. Criteria The Authority must have valid depository agreements in place for all financial institutions where HUD funds are held. Condition It was noted during our audit that the Authority did not have a valid depository agreement in place with one of the financial institutions that hold the Authority’s HUD deposits. Context We tested to determine if valid depository agreements were in place for all financial institutions utilized by the Authority. Effect Lack of safeguards over federal funds and no third-party rights over those funds for HUD. Cause Lack of controls and oversight during the year. Repeat Finding Not a repeat finding. Recommendation We recommend the Authority follow its policy and have valid depository agreements with all financial institutions that hold federal funds. Views of Responsible Officials Management recognizes this oversight and will ensure depository agreements are in place.