Finding Text
Eligibility Section 8 Project-Based Cluster Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 240 of tenants, 11 tenant files were tested and the following deficiencies were noted: • Four files did not have annual recertifications performed during the year, • Two files did not have a 214 declaration form for all members of the household, • Two files used incorrect income based on the support provided during the annual recertification, • One file did not have documentation necessary to verify the reported income, and • One files did not have utility allowance documentation. Criteria: 24 CFR 983.353 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Context: The auditor randomly selected tenant files out of the population as outlined, which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and support to ensure that proper procedures are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Cause: The Authority experienced staffing and operational challenges during the onset of COVID- 19 and did not have the available staff to follow the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to verify eligibility and calculate accurate housing assistance payments. Effect: The Authority is not in compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided. Questioned Costs: Unknown. Auditor Recommendations: The Authority should reevaluate their established procedures and controls in place to ensure full compliance in regards to eligibility and the timeliness of recertifications. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample. Management Response: See Corrective Action Plan.