Finding 404756 (2023-002)

2023-002 Eligibility Housing Voucher Cluster Material Weakness in Internal Control Material Noncompliance Condition: During our testing it was noted that certain deficiencies existed in the tenant recertification process to calculate total tenant payments and other verification items required by HUD. Criteria: The Authority’s Administrative Plan and 24 CFR 982.516 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding timely, complete and accurate tenant files. Context: The auditor randomly selected 41 tenant files out of the population, which we consider to be a statistically valid sample size. The auditor reviewed the tenant files and support to ensure that proper procedures are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. In addition the internal quality control review performed by Authority staff identified significant improvement needed in multiple areas. Cause: The Authority experienced staffing and operational challenges and did not have the available staff to follow the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to verify eligibility and calculate accurate housing assistance payments. Effect: The Authority is not in compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided. Questioned Costs: Unknown. Auditor Recommendations: The Authority should evaluate and change their established procedures and controls in place to ensure full compliance in regards to eligibility of recertifications. The Authority needs to correct the deficiencies noted in the internal quality control sample and consider the impact to the rest of the population of tenant files that were not selected as part of the sample. Management Response: See Corrective Action Plan.