Finding 1137270 (2022-010)

Late Submission Criteria: The Authority must submit the audited financial statement to REAC and the Federal Clearinghouse within 9 months of the fiscal year. Condition: I noted that the Authority did not submit the electronic transmission of their GAAP based audited Financial Data Schedule (FDS) to the Financial Assessment Subsystem of REAC and the Federal Clearinghouse within the 9 months of their year-end. Questioned Costs: None noted. Effect: As a result, the Authority did not comply with the HUD requirement of submitting the audit within the allotted time. Cause: The Authority was not required to have an audit performed in previous years due to the level of federal funding received. Effective FY 2022, the federal funding changed significantly due to the Authority absorbing Rusk Housing Authority Housing Choice Vouchers. However, it appears that the previous administration was not aware of this requirement to have an audit performed. Recommendation: I recommend that the Authority implement controls to ensure the audit is performed and submitted in a timely manner. Management’s Response: The financial statements were submitted to HUD after the required deadline. To prevent future delays, management has implemented a compliance calendar to track all reporting deadlines. Reports are now scheduled for internal review at least two weeks prior to submission to ensure timeliness.