FAC Explorer

Finding 25129 (2022-001)

Significant Deficiency
Requirement
E
Questioned Costs
-
Year
2022
Accepted
2023-03-29
Audit: 22621
Organization: The Housing Authority of the City of Bessemer, Alabama (AL)
Auditor: Moody & Company

AI Summary

  • Core Issue: Eleven out of 40 tenant files lacked required annual inspections, indicating a significant deficiency in compliance.
  • Impacted Requirements: The Housing Authority must verify eligibility through proper documentation of inspections as per program guidelines.
  • Recommended Follow-up: Strengthen internal controls to ensure timely annual inspections are conducted for all units.

Finding Text

PART II. FINDINGS ? FINANCIAL STATEMENTS AUDIT 2022-001 ? Section 8 Housing Assistance Payments Program CFDA Number: 14.195, Section 8 Housing Assistance Payments Program Compliance Requirement: Eligibility Condition and Criteria: Under the compliance portion of the program, the PHA must verify the eligibility by documenting inspections, as appropriate. Of the 40 tenant files reviewed during the audit, eleven (11) did not contain an annual inspection. Type of Finding: Significant Deficiency Cause: The internal control structure was not adequate to prevent these deficiencies. Effect: Units were not inspected on a timely basis. Questioned Costs: None known. Auditors? Recommendation: We recommend that the Housing Authority strengthen its internal controls to ensure inspections are conducted on an annual basis. Corrective Action Plan: See attached response from Executive Director on page 42.

Corrective Action Plan

The Housing Authority of the City of Bessemer agrees with the identified deficiencies and a plan or action has been developed to strengthen internal controls. The Housing Authority of the City of Bessemer recognizes the need for satisfactory internal controls. The identified deficiency was a result of interruption in inspections due to an unprecedented pandemic. Although, inspections were reinstated, the Housing Authority failed to complete all catch-up inspections. The Housing Authority hired a third-party vendor to conduct all inspections as a result of this deficiency. We have also hired a compliance officer to conduct file audits and confirm that all HUD required policies are met in all programs. We believe that these adjustments will ensure that our internal control environment is greatly improved.

Categories

HUD Housing Programs Eligibility Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

  • 25130 2022-002
    Significant Deficiency
  • 601571 2022-001
    Significant Deficiency
  • 601572 2022-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $4.27M
14.850 Public and Indian Housing $3.82M
14.195 Section 8 Housing Assistance Payments Program $2.30M
14.872 Public Housing Capital Fund $2.28M
14.870 Resident Opportunity and Supportive Services - Service Coordinators $226,667