Finding Text
Statement of Condition: The auditors noted that the entity did not complete a required annual housing inspection within the required timeframe for certain tenants/units. Specifically, for 1 of the 11 eligibility samples selected for testing, the annual housing inspection was not completed within the last 12 months. Criteria: Applicable HUD program requirements and the entity’s policies and procedures generally require housing inspections to be performed and documented at least annually (i.e., within each 12-month period) to support compliance with inspection requirements and housing quality standards. Context: This condition was identified during eligibility testing for the HUD program. The auditors tested 11 eligibility items and noted one exception in which the required annual housing inspection was not performed within the required 12-month period. Cause: The condition appears to have resulted from inadequate tracking or monitoring of inspection due dates and/or inspection scheduling challenges, resulting in inspections not being performed and documented timely. Effect: Failure to perform annual housing inspections within the required timeframe results in noncompliance with applicable program requirements and increases the risk that housing quality standards issues are not identified and addressed timely. This condition represents a deficiency in controls over monitoring and completion of required annual inspections. Recommendation: The entity should improve processes and controls over annual housing inspections by maintaining an inspection schedule and tracking log, implementing reminders for upcoming and overdue inspections, documenting completion dates, and performing supervisory review and periodic monitoring to ensure inspections are completed and documented at least every 12 months. Management Response: Management noted the finding was caused partially by the change in management company and the required documentation to validate the prior year housing inspections was not provided. Management will continue to monitor annual inspections to ensure ongoing compliance with HUD occupancy requirements and to prevent similar issues moving forward.