Finding 1084333 (2024-001)

Finding 2024-001 - Moving To Work Demonstration Tenant Files - Eligibility - Internal Control over Tenant Files - Noncompliance and Significant Deficiency Moving To Work Demonstration - Subsidy ALN 14.881 Condition & Cause: During the review of sixty (60) tenant files from the Moving to Work program, six (6) files, or 10%, were found to be noncompliant regarding the verification and/or calculation of adjusted annual income. Some files contained multiple instances of noncompliance, including • Four (4) instances in which the income verification was missing or did not agree to what was reported on the form 50058 • Three (3) instances of improper verification or reporting of deductions • One (1) instance in which income was improperly excluded • One (1) instance in which annual wages were projected using the Incorrect pay frequency Using extrapolation, we were able to determine that the potential misstatement of subsidy is immaterial to the financial statements. Criteria: The Code of Federal regulations, the Housing Authority's ACOP, Admin Plan, MTW Plan, and specific HUD guidelines in documenting and maintaining the Public Housing and Housing Choice Voucher tenant files. Effect: The absence of proper income verification and the presence of miscalculations can lead to noncompliance with federal regulations governing the MTW program, inaccurate rent determinations potentially resulting in overpayments or underpayments by tenants, and increased risk of financial penalties or loss of funding for the program. Recommendation: We recommend that the Authority conduct a thorough review of tenant files to determine the extent of noncompliance and establish a schedule for regular internal audits of tenant files to ensure compliance with verification requirements and accurate income calculations. Questioned Costs: None Repeat Finding: No Was sampling statistically valid? Yes Views of responsible officials: The PHA agrees with the results of the audit and recommendations.