FAC Explorer

Finding 29449 (2022-001)

Significant Deficiency
Requirement
E
Questioned Costs
-
Year
2022
Accepted
2023-05-30
Audit: 29611
Organization: Elk County Housing Authority (PA)
Auditor: Maher Duessel CPAS

AI Summary

  • Core Issue: Elk County Housing Authority lacks effective internal controls for the annual re-examination process of HUD-50058 forms, leading to potential inaccuracies.
  • Impacted Requirements: The Authority must accurately prepare HUD-50058 forms for admissions and re-examinations, ensuring correct income support and medical deductions are applied.
  • Recommended Follow-Up: Implement procedures to verify and support income and medical deductions to prevent miscalculations in tenant rent and ensure compliance.

Finding Text

Finding 2022-001 U.S. Department of Housing and Urban Development (HUD) Housing Voucher Cluster/Section 8 Housing Choice Voucher ? ALN 14.871 Eligibility Condition: During our review of HUD-50058, Family Report (HUD-50058) forms prepared by Elk County Housing Authority (Authority), we noted a lack of functioning internal controls with regards to the annual re-examination process. Criteria: The Authority is required to prepare and submit a HUD-50058 form each time the Authority completes an admission, annual reexamination, portability move-in, or other change of unit for a family. The form provides HUD and the Authority with vital eligibility data for each program participant such as family composition, family income, the assets and liabilities of program participants, and ultimately provides for the calculation of tenant rent and rental/housing assistance payments for each program participant. Cause: The Authority?s internal controls and procedures in place, did not ensure that the appropriate income support and/or medical deductions were obtained and used on the HUD-50058. Effect: HUD-50058 forms provide essential information to HUD and assist with the determination of program eligibility. In addition, the HUD-50058 form provides for the calculation of tenant rent and rental/housing assistance payments. A lack of functioning of internal controls could lead to inaccurate HUD-50058 forms. This could result in program participants or HUD being over- or under-charged tenant rent. We noted two instances where income support and/or medical deductions were not appropriately supported. In one of the instances, the insufficient income support and/or medical deductions caused tenant rent to be miscalculated. Questioned Costs: Unknown Recommendation: We recommend that the Authority implement procedures to ensure that the appropriate support is obtained and used. View of Responsible Officials and Planned Corrective Action: Management agrees with the finding, see separate corrective action plan.

Corrective Action Plan

CORRECTIVE ACTION PLAN May 16, 2023 United States Department of Housing and Urban Development Elk County Housing Authority respectfully submits the following corrective action plan for the year ending September 30, 2022. Name and address of independent public accounting firm: Maher Duessel, CPA?s 503 Martindale Street, Suite 600 Pittsburgh, PA 15212 Audit Period: October 1, 2021 ? September 30, 2022 FINDINGS ? FINANCIAL STATEMENT AUDIT No matters were reported FINDINGS ? FEDERAL AWARD PROGRAMS AUDITS Finding 2022-001 U.S. Department of Housing and Urban Development Housing Voucher Cluster/Section 8 Housing Choice Vouchers ALN 14.871 Eligibility Recommendation: We recommend that the Authority implement procedures to ensure appropriate support is obtained and used. Authority Management Response: ECHA staff has already made changes to the internal controls by performing a file check upon completion, which should bring to light any mathematical errors. Self-certification was the highest form of verification during COVID-19, which ended on January 1, 2022. The files with the discrepancy were prepared prior to that date. Since January 1, 2022, ECHA only uses Self-certification as a last resort. If the Department of Housing and Urban Development has questions regarding this plan, please call Amy Auman at 814-965-2532. Sincerely yours, Amy Auman, Executive Director

Categories

HUD Housing Programs Eligibility Internal Control / Segregation of Duties

Other Findings in this Audit

  • 605891 2022-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $872,627
14.850 Public and Indian Housing $636,108
14.872 Public Housing Capital Fund $182,202