Finding Text
2024-001 – Eligibility - Tenant File Documentation
Finding Type. Immaterial noncompliance; Significant deficiency in internal control over compliance (Eligibility)
Federal program
U.S. Department of Housing and Urban Development
· Supportive Housing for the Elderly (ALN# 14.157)
Criteria. Under Section 202 of the National Housing Act of 1959, Project management is responsible for performing an examination of and obtaining support for items of income, assets, and expenses, for proper calculation of tenant assistance payments of applying residents, and annual recertification and calculation of such information thereafter, and for obtaining signed and properly completed forms.
Condition. Out of a sample of six tenant files, we noted:
1) One out of six instances where an EIV was not run for a tenant file within 90 days of move in;
2) One out of six instances where a refund was not disbursed to a tenant within 60 days of move-out;
3) Two out of six instances where the incorrect checking account balance was used in the verification of tenant assets.
Cause. Management does not appear to have sufficient internal control procedures in place to properly implement all of HUD's program requirements.
Effect. As a result of this condition, employees did not follow HUD guideline procedures, and/or did not properly calculate the tenant subsidy in HUD Form 50059. While there were no significant differences in the amount of subsidies allowed compared to subsidies received, the lack of effective internal controls could lead to future significant noncompliance.
Questioned Costs. No costs are required to be questioned as a result of this finding, in as much as no unallowable expenditures were noted.
Recommendation. We recommend that management should strengthen their current policies and follow a documented review process for all new and existing resident files and ensure that this review occurs on a timely basis. Further, we recommend that management ensure all proper HUD guideline procedures are followed, and tenant subsidies are appropriately calculated.
View of Responsible Officials. Management agrees with this comment and has prepared a corrective action plan.