Finding Text
Criteria The HUD occupancy handbook requires security deposits be collected at the time of the initial lease execution for properties under Section 811 PRAC. Condition During the audit, we noted one instance where the security deposit has not been collected from the tenant. Cause The noncompliance was the result of administrative oversight, in which, project management personnel did not consistently follow the Organization’s policies and procedures. Effect The Organization is not in compliance with HUD’s requirements. Recommendation We recommend that the Organization comply with established policies and procedures to ensure security deposits are collected at the time of the initial lease execution. Views of Responsible Officials and Planned Corrective Action Management discussed failure of staff members to follow through with MHK’s Rent Rate and Collection procedure. Residential staff members were retrained about MHK’s policy and it was presented to management personnel.