Finding Text
Finding Number: 2025-004 Program: Housing Opportunities for Persons with AIDS (HOPWA) ALN #: 14.241 Pass-through Entity: N/A- Direct Award Federal Agency: Department of Housing and Urban Development Federal Award Year: July 1, 2024–June 30, 2025 Compliance Requirement: Performance Reporting Type of finding: Material weakness and material noncompliance Criteria Performance Reporting for the HOPWA Consolidated Annual Performance and Evaluation Report Per HUD, the Consolidated Annual Performance and Evaluation Report (CAPER) provides annual performance reporting on client outputs and outcomes that enables an assessment of grantee performance in achieving the housing stability outcome measure. The CAPER fulfills statutory and regulatory program reporting requirements and provides the grantee and HUD with the necessary information to assess the overall program performance and accomplishments against planned goals and objectives. Both HOPWA formula and competitive grantees submitting reports after January 1, 2023, must complete and submit the HUD-4155 “Consolidated APR/CAPER” (OMB number 2506-0133). HOPWA Formula Grantees that accept the supplemental funding authorized under the CARES Act should report on the use of supplemental grant funds in the same performance report as their use of entitlement funds. Both formula and competitive grantees are required to submit their completed HUD-4155 no later than 90 days after the close of their program or operating year. Competitive grantees have 120 days after the end of their grant’s last period of performance to submit the final HUD-4155. Grantees should be able to demonstrate that funds disbursed through federal financial systems are traceable in local accounts and accurately reported in Key Line Items in the HUD-4155. Lastly, 2 CFR 200.303(a) states, the nonfederal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the nonfederal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. These internal controls should be in compliance with 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 does not have properly designed controls and documented procedures in place to ensure compliance with the following requirements: • CAPER report is submitted to HUD within 90 days of the end of the 12-month program year. • Review of subrecipient’s CAPER to ensure complete and accurate reporting over key line items. Cause Subrecipients are required to submit their individual CAPER reports to the City prior to the City submitting its report to HUD. The City has had difficulty in getting the subrecipients to comply with the CAPER reporting, which is primarily due to staffing issues at the subrecipients. As a result, the City did not submit its CAPER to HUD within the required time-frame. Proper perspective The City failed to submit the CAPER that covers the period from July 1, 2023 to June 30, 2024 to HUD by the September 30, 2024 deadline. The City ultimately submitted the CAPER on February 28, 2025. Additionally, for four of four subrecipients selected for testing, the City was unable to provide documentation that the subrecipients’ CAPER reconciled to the Integrated Disbursement and Information System (IDIS) or the City’s general ledger system. Possible asserted effect Incomplete or inaccurate information from its subrecipients has resulted in the City’s inability to properly comply with HUD’s CAPER reporting requirements. Questioned costs Not determinable Statistical sampling The sample was not intended to be, and was not, a statistically valid sample. Repeat finding Yes, 2024-005 Recommendation We recommend that the City establish policies, procedures, and internal controls to ensure that all subrecipient CAPER reports are reconciled to the IDIS system and submitted to HUD within 90 days of year-end. Views of responsible officials and corrective actions The Audit, while investigating FY25 programs and activities, assessed the FY24 HOPWA CAPER, which was delivered to HUD past its due date. For the FY25 CAPER, a submission by nature of general reporting timelines occurs in FY26, was completed by the grantees on time and submitted to the City on time, including certain specific revisions and corrections, and was delivered to and accepted by HUD by the required submission deadline. The City expects future CAPERs to be submitted in a timely manner as grantees successfully adapted to the new Excel based reporting format.