Finding 390794 (2020-001)

Section III - Federal Awards Findings and Questioned Costs SIGNIFICANT DEFICIENCIES Item #2020-1 – Real Estate Assessment Center (REAC) Report Filing Criteria: Per the HUD Regulatory Agreement, the Corporation is required to provide an annual audited financial statement submission through REAC within 90 days after the end of the fiscal year of the reporting period. Condition: The Corporation did not file the June 30, 2020 audited financial statements within 90 days of the end of the fiscal year. Cause: Management needed additional time to file due to a changes in audit firms as well as delays due to staffing complications as a result of the COVID-19 pandemic. Effect: The Corporation is not in compliance with HUD laws and regulations. Recommendation: We recommend that the Corporation implement internal control procedures to ensure audited financial statements are submitted timely and in accordance with HUD regulations. Views of Responsible Officials and Planned Corrective Actions: The Corporation has filed with REAC as of the date of the audit report. Delays in financial reporting were due to a change in the audit firm completing the annual audit for the Corporation as well as staffing constraints as a result of the COVID-19 pandemic. No material weaknesses reported.