Finding Text
2024-003 – Timely Reporting
Federal program(s)
U.S. Department of Housing and Urban Development -
Lead Hazard Reduction Grant Program (ALN 14.905); Direct award; All project numbers.
Criteria. Recipients of federal awards are required to report periodically on financial information, as specified by the 2 CFR 200 Compliance Supplement or grant agreement. Reported information should be supported by the entity’s accounting records and subjected to an independent review and approval prior to submission in order to detect and correct any errors or omissions. Quarterly SF-425 reports are due no later than January 30, April 30, July 31, and October 31 for the preceding quarter. Additionally, HUD requires recipients that provide HUD-program benefits to individuals or families to report data on race, ethnicity and other data annually by using form HUD-27061, which must be submitted annually by January 10.
Condition. During our audit procedures over the City's reporting process, we noted that the City did not submit the quarterly SF-425 reports for fiscal year by the deadlines outlined in the grant agreements. Additionally, it was noted that the City did not complete and submit the required race and ethnic data for fiscal year 2024 using form HUD-27061.
Cause. This condition was caused by the lack of understanding by program staff of the specific requirements of reporting on forms SF-425 and HUD-27061.
Effect. As a result of this condition, the City did not comply fully with the reporting requirements under this federal award. In addition, the City was exposed to an increased risk that the reports filed could contain errors and not be detected and corrected on a timely basis.
Questioned Costs. No costs have been questioned as a result of this finding inasmuch as no unallowable costs were identified.
Recommendation. We recommend that the City establish procedures to ensure that the HUD-27061 form is completed. We also recommend that all required reports are filed by their deadlines.
View of Responsible Officials. The City acknowledges the SF-425 reports for the Lead Hazard Reduction Grant Program were not timely submitted. Finance and Community Development will work together to strengthen financial reporting so that it is timely moving forward. Staff working on this grant are new to their positions since the last time the program was audited, and are committed to reviewing policies and procedures to make sure reporting is completed appropriately. Community Development will work with HUD to clarify the use of form HUD-27061.
Responsible Officials. Revenue Services Director and Community Services Director
Estimated Completion Date. June 30, 2025