Finding Text
Finding No. 2023-004: Tenant File Maintenance (Material Weakness)
Statement of condition
Eligibility
In connection with the procedures applied to a sample of five tenant lease files, the Organization did not maintain the required lead-based paint disclosure in all selected lease files.
Criteria
Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs.
Cause
Management’s policies with respect to the determination of tenant eligibility and the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs, were not consistently followed.
Effect
The procedures for determining tenant eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This noncompliance could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD.
Recommendation
Management should review and enhance procedures and monitor compliance with those procedures to ensure that tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs.
Identification of repeat finding
The finding is a repeat of Finding No. 2022-007.
Auditor non-compliance code
S - Internal control deficiencies
Questioned costs
None
Finding resolution status
In process