Finding Text
Assistance Listing, Federal Agency, and Program Name - 14.871, U.S. Department of Housing and Urban Development (HUD), Section 8 Housing Choice Vouchers Program Federal Award Identification Number and Year - Not applicable Pass-through Entity - Not applicable Finding Type - Material weakness Repeat Finding - No Criteria - Per 2 CFR 200.303, the recipient must establish, document, and maintain effective internal control over the federal award that provides reasonable assurance that the recipient is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should align with the guidance in Standards for Internal Control in the Federal Government, issued by the Comptroller General of the United States, or the Internal Control-Integrated Framework, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition - The City did not have adequate controls in place around the salaries and wages charged to the program. Questioned Costs - Not applicable If questioned costs are not determinable, description of why known questioned costs were undetermined or otherwise could not be reported - Not applicable Identification of How Questioned Costs Were Computed - Not applicable Context - During testing over the City's internal controls, PM identified the City did not have supporting documentation to show controls in place to review the salaries and wages charged to the program. Cause and Effect - The City was not able to provide sufficient documentation to support a review of salaries and wages. Although no instances of noncompliance were identified, the risk of noncompliance exists due to the fact no controls were in place to review expenditures for payroll applied to the program. Recommendation - We recommend the City implement controls surrounding the review of payroll-related expenditures. Views of Responsible Officials and Corrective Action Plan - The City acknowledges this finding and has updated our procedures to include the City Administrators’ review and approval, as evidenced by his signature, on all Section 8 employee timesheets. The City believes this finding will be corrected by June 30, 2026.