Finding 1156784 (2024-001)

Material Weakness Repeat Finding
Requirement
L
Questioned Costs
-
Year
2024
Accepted
2025-09-30

AI Summary

  • Core Issue: The Authority miscalculated tenant income during annual recertification, affecting compliance with reporting requirements.
  • Impacted Requirements: The PHA must verify income eligibility and maintain accurate documentation as per 24 CFR sections 5.230, 5.609, and 982.516.
  • Recommended Follow-Up: Implement stronger internal control procedures to ensure compliance with the Uniform Guidance and improve reporting accuracy.

Finding Text

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Titles: Section 8 Housing Choice Vouchers Program Federal Catalog Numbers: 14.871 Noncompliance – L. Reporting - Special Reporting Non Compliance Material to the Financial Statements: No Significant Deficiency in Internal Control over Compliance for Reporting Criteria: Special Reporting. The PHA must do the following: As a condition of admission or continued occupancy, require the tenant and other family member to provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 982.516). These files are required to be maintained and available for examination at the time of audit. Condition: Based upon inspection of the Authority's files and on discussion with management, the Authority included income that was miscalculated during their annual recertification. Context: There are approximately four thousand four hundred seventy one (4,471) units. Of a sample size of forty five (45) tenant files, one (1) tenants' annual recertification (HUD-50058 form) included income that was miscalculated. Our sample size is statistically valid. Known Questioned Costs: Amount is below threshold of $25,000. Cause: There is a significant deficiency in internal controls over the compliance for the reporting type of compliance related to special reporting. The Authority has established a compliance unit to review and implement new procedures to ensure program compliance. Effect: The Section 8 Housing Choice Vouchers Program is in non-compliance with the reporting type of compliance related to special reporting. Recommendation: We recommend the Authority design and implement internal control procedures that will assure compliance with the Uniform Guidance and the compliance supplement.

Corrective Action Plan

Views of Responsible Officials and Planned Corrective Action: The Authority agrees with the auditors' recommendation. To improve oversight of the Section 8 Housing Choice Vouchers Program, the Authority has established a compliance unit. This unit will ensure that internal control policies are implemented accurately and in a timely manner. Perla Guerrero, Director of Compliance, is responsible for implementing this corrective action by December 31, 2025.

Categories

HUD Housing Programs

Other Findings in this Audit

  • 1156785 2024-002
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $71.26M
14.872 Public Housing Capital Fund $2.04M
14.267 Continuum of Care Program $1.30M
14.850 Public and Indian Housing $801,692
14.870 Resident Opportunity and Supportive Services - Service Coordinators $13,564