FAC Explorer

Finding 404718 (2023-002)

Material Weakness
Requirement
C
Questioned Costs
-
Year
2023
Accepted
2024-06-29
Audit: 311099
Organization: Wise County Redevelopment and Housing Authority (VA)
Auditor: Bostic Tucker and Company PC

AI Summary

  • Core Issue: The Authority made payments to contractors before officially requesting funds from LOCCS, sometimes up to two months in advance.
  • Impacted Requirements: This practice violates HUD's fiscal requirements for the capital fund program.
  • Recommended Follow-up: Review payment processes to ensure compliance with HUD guidelines and avoid using other program funds for advance payments.

Finding Text

The Authority paid contractor and other associated invoices before submitting requests for payment in LOCCS up to two months in advance. In addition, when funds received, payment occurred more than three days after deposit. LOCCS drawdowns did reflect actual payment totals to vendors. The Authority is not in compliance with the HUD requirements for the fiscal requirements for the capital fund program. Other program funds were used for payment pending drawdown from LOCCS for approximately two months in one instance.

Corrective Action Plan

The Housing Authority understands that our prior procedure was incorrect and inadequate for capital fund drawdowns. The Finance Director has been instructed on the proper procedure of capital fund drawdowns to first reconcile LOCCS requests to vendor billing to properly request and expend funds with the three-day period

Categories

Cash Management HUD Housing Programs

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
10.415 Rural Rental Housing Loans $2.96M
14.871 Section 8 Housing Choice Vouchers $2.90M
14.872 Public Housing Capital Fund $965,167
14.850 Public and Indian Housing $785,684
10.427 Rural Rental Assistance Payments $371,277
10.766 Community Facilities Loans and Grants $268,466