Finding Text
2024 – 011 - Allowable Cost – Public Housing Federal Agency: U.S. Department of Housing and Urban Development Federal Program Name: Public Housing Operating Fund Assistance Listing Number: 14.850 Federal Award Identification Number and Year: FL007, 2024 Award Period: July 1, 2023 to June 30, 2024 Type of Finding: • Material Weakness in Internal Control over Compliance • Material Noncompliance (Modified Opinion) Criteria or specific requirement: Project-specific operating expenses include, but are not limited to, direct administrative costs, utilities costs, maintenance costs (maintenance must be either decentralized, or if centralized, recovered via fee-for service), tenant services, protective services, general expenses, non-routine or capital expenses, and other PHA- or HUD-identified costs which are project-specific for management purposes. Condition: During the testing of the Public Housing Operating Fund we noted the following errors Cash Disbursements • Of the 40 invoices that we reviewed, we noted a total of 30 invoices did not have a documented approval • Of the 40 invoices that we reviewed, we noted a total of 2 expenses that did not have supporting documentation Payroll Disbursement Testing • 4 timecards were noted as not having been approved • 4 timecards could not be provided • Information for 2 employees could not be provided Questioned costs: Unable to determine. Context: Cash Disbursements Out of the 40 invoices that we reviewed, we noted a total of 30 invoices without written approval on the invoices. Payroll Disbursements Out of the 40 timecards files that we reviewed, we noted 7 timecard files that contained errors as noted. 2024 – 011 - Allowable Cost – Public Housing Cause: The Authority failed to follow the internal controls process that was designed to ensure that requirements were being met. Effect: The Authority does not have proper controls over the payroll and cash disbursement processing. Repeat Finding: No Recommendation: We recommend that the Authority designate an individual to review both cash disbursements and payroll disbursements for all program expenditures. Views of responsible officials: There is no disagreement with the audit finding.