Finding 43248 (2022-001)

FINDING: 2022-001 Eligibility Federal Agency: U.S. Department of Housing and Urban Development Program: HUD Supportive Housing for the Elderly (Section 202) ALN Number 14.157. Criteria: Management is responsible for establishing internal controls to ensure the accuracy of yearly completion and submission of the HUD 50059 of households occupying assisted units and making appropriate adjustments to the tenant payment and the project rental assistance payment (24 CFR section 891.410). Condition: Six tenant files were selected for audit of the certification of the proper calculation of tenant rent. The test found that for two tenants, the submitted Form HUD-50059 was completed but not included in the tenant?s file and could not be located. Additionally, supporting documentation was not included to support the calculation. Cause: Internal controls and compliance review were not in place to ensure the tenant files included form HUD-50059 and the supporting documentation used in the calculation of tenant rent. Effect: Alverno Apartments, Inc. (Property) rent for the two out of six tenants tested was not properly supported to verify the allocation of rental payment between the tenant and HAP portion. Questioned Costs: Unknown Recommendation: The Property should have internal controls in place to review Form HUD-50059 to ensure all documentation used to calculate the tenant rent and assistance payment is supported and properly calculated. Views of Responsible Official and Planned Corrective Action: Management agrees with finding; see separate corrective action plan.