Finding Text
023-005 – ELIGIBILITY
Material Weakness/Material Noncompliance
U.S. Department of Housing and Urban Development
ALN #: 14.850 – Public and Indian Housing
CRITERIA
For both family income examinations and reexamination, obtain and document in the family file third-party verification of (1) reported family annual income (2) the value of assets (3) expenses related to deductions from annual income; and (4) other factors that affect the determination of adjusted income or income-based rent (24 CFR Section 960.259).
Determine income eligibility and calculate the tenant’s rent payment using the documentation from third-party verification in accordance with 24 CFR Part 5 subpart F (24 CFR section 5.601 et seq.) (24CFR sections 960.253, 960.255, 960.259).
CONDITION
As a result of our audit, we identified the following exceptions in our testing:
Fourteen (14) instances of income, asset or medical expense miscalculation or insufficient verification.
Fifteen (15) instances of untimely reexamination.
CAUSE
The Authority’s system of internal controls over the participant recertification process was not sufficient to meet the requirements established by HUD.
EFFECT
Redetermination of tenant’s rent was not performed in accordance with HUD regulations. As a result, tenants may have paid more or less in rent than they should have paid.
QUESTIONED COSTS
None noted.
CONTEXT
We selected a sample of 40 from a population of 243. This was not a statistically valid sample.
REPEAT FINDING
See finding 2022-006.
RECOMMENDATION
We recommend that the Authority develop and implement a recertification checklist to accompany the tenant file to ensure all required documentation is obtained.
AUDITEE’S RESPONSE AND PLANNED CORRECTIVE ACTION
See Corrective Action Plan.