Finding Text
S3800-010: Finding Reference Number
2024-003 (Material Weakness)
S3800-011: Program Information
Federal Program: Supportive Housing for the Elderly - Section 202
Federal Agency: U.S. Department of Housing and Urban Development
Assistance Listing #: 14.157
Pass-through Entity: None
Federal Award Identification Number and Year: N/A
Type of Compliance Finding: A/B – Activities Allowed or Unallowed and Allowable Costs/Cost Principles
S3800-015: Type of Finding
Federal Awards
S3800-016: Finding Resolution Status
Unresolved
S3800-017: Information on Universe Population Size
>250
S3800-018: Sample Size Information
25
S3800-019: Identification of Repeat Finding and Finding Reference Number
2023-003
S3800-020: Criteria
Per 24 CFR Part 891, PRAC project funds may be used only for expenses that are reasonable and necessary to the operation of the project as provided for in the Regulatory Agreement between HUD and the project owner.
S3800-030: Statement of Condition
During our audit of the Organization’s fiscal year ended March 31, 2024 federal award program, we noted that the Organization did not:
• Maintain proper documentation to support expenditures for three of the twenty-five samples
• Adhere to the HUD approved budget
o Manager or Superintendent salaries were greater than approved amount
o Payroll expenses were greater than approved amount
o Garbage and trash removal expenses were greater than approved amount
S3800-032: Cause
The Organization did not follow HUD required procedures and the approved budget for activities allowed or unallowed and allowable costs and cost principles and Management is not following processes in place that require supporting documentation to be included with all expenditures. S3800-033: Effect or Potential Effect
The Organization was not in compliance with the requirements of HUD related to activities allowed or unallowed and allowable costs and cost principles and expenditures may not be allowed.
S3800-035: Auditor Non-Compliance Code
S – Internal control deficiencies
S3800-040: Questioned Costs
$40,295
S3800-045: Reporting Views of Responsible Officials
Management agrees with auditor’s finding.
S3800-050: Context
The Organization is required to be in compliance with provisions relating to activities allowed or unallowed and allowable costs and cost principles.
S3800-080: Recommendation
The Organization should follow procedures to ensure expenditures are not greater than the HUD approved budget and expenditures include supporting documentation before they are posted to the general ledger. The Organization should also review the accuracy / completeness of all documentation prior to making payment.
S3800-090: Auditor’s Summary of the Auditee’s Comments on the Findings and Recommendations
Concur
S3800-130: Response Indicator
Agree
S3800-140: Completion Date or Proposed Completion Date
December 31, 2024
S3800-150: Response
See Corrective Action Plan