Finding 1078152 (2020-003)

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Public and Indian Housing CFDA Number: 14.850 Award Period: 1/1/2020-12/31/2020 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Condition: During our testing we noted instances where the Authority did not follow the internal controls in place to ensure compliance with Eligibility requirements. Criteria or Specific Requirement: 24 CFR Section 960.259 states that for both family income examinations and reexaminations, 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. Per THA’s ACOP, documentation for eligibility should include a summary of the pertinent contents (public housing worksheet) which is to be signed and dated by the staff member who examined the verification (pg 20). Questioned Costs: Unknown Content: Testing of tenant files found exceptions with four of ten files as noted below: - One out of ten files tested did not have proper support for assets or expenses, and therefore had incorrectly calculated rent due to the missing information. - Four out of ten files tested did not have a signed general release form maintained in the tenant file. Cause: During the previous fiscal year, the Authority had a system conversion. Some of the information was not brought through correctly, causing differences between the rent in the tenants’ files and what was included in the HUD-50058 forms in the system. The Authority did not sufficiently monitor controls to ensure compliance with the file checklist requirements. Effect: The Authority is not providing accurate data to HUD to ensure the proper accounting of tenant information and the Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: We recommend that management review their procedures for retrieving tenant information and establish a method that ensures compliance. Views of Response Officials: There is no disagreement with the audit finding.