Finding 46722 (2022-001)

Material Weakness
Requirement
E
Questioned Costs
-
Year
2022
Accepted
2023-09-29

AI Summary

  • Core Issue: The Authority has significant weaknesses in internal controls, leading to errors in tenant file eligibility, including incorrect utility allowances, income calculations, and payment standards.
  • Impacted Requirements: Compliance with the Authority's Administrative Plan and HUD regulations is lacking, risking incorrect rental assistance amounts.
  • Recommended Follow-Up: The Authority should reassess its procedures and controls to ensure compliance and evaluate the broader impact on all tenant files beyond the audit sample.

Finding Text

2022-001 Eligibility Housing Voucher Cluster Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 1,436 tenants, 43 tenant files were tested and the following deficiencies were noted: ? 13 files had incorrect utility allowance calculations, ? 12 files had an incorrect income calculation, and ? 2 files utilized incorrect payment standard. 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 complete and accurate tenant files. Context: The auditor randomly selected 43 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 procedure are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files. Cause: The Authority did not have the available staff to fully implement the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to complete a tenants file. In addition, during the year the Authority was in the process of implementing Moving-to-Work program, as well as catching up from post-COVID waivers and extensions. 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: None. Auditor Recommendations: The Authority should consider reevaluating their established procedures and controls in place to ensure full compliance in regards to eligibility. The Authority needs to consider the impact to the rest of the population of tenant files that were not selected as part of the auditor?s sample. Management Response: See Corrective Action Plan.

Corrective Action Plan

2022-001 Eligibility Housing Voucher Cluster Material Weakness in Internal Control Material Noncompliance Condition: Out of an approximate population of 1,436 tenants, 43 tenant files were tested and the following deficiencies were noted: ? 13 files had incorrect utility allowance calculations, ? 12 files had an incorrect income calculation, ? 2 files utilized incorrect payment standard, and ? 1 file was missing the 214 declaration for all tenants in household. Auditor Recommendations: The Authority should consider reevaluating their established procedures and controls in place to ensure full compliance in regards to eligibility. The Authority needs to consider the impact to the rest of the population of tenant files that were not selected as part of the auditor?s sample. Action Taken: This audit provides an opportunity for the Lakeland Housing Authority staff in correcting problems identified during the audit, we are implementing new procedures and increasing staff proficiency. The plan is as follows: ? The department under the supervision of Carlos Pizarro has hired an additional Quality Control and Compliance Specialist Courtney Mitchell, from now until done she will be leading with the assistance of the program's Assistant Manager Alondra Baez a full 100% file audit, ? The current staff will be re-trained on income calculation, file management, fair housing, occupancy, inspections, SEMAP, etc? ? The staff will continue to use a quality control sheet while processing all recertifications or changes, ? The HCV program issued a task order to one of the consultants to help us monitor the progress of our internal file audit.

Categories

Eligibility HUD Housing Programs Material Weakness Internal Control / Segregation of Duties

Other Findings in this Audit

  • 46721 2022-002
    Material Weakness
  • 46723 2022-001
    Material Weakness
  • 46724 2022-001
    Material Weakness
  • 623163 2022-002
    Material Weakness
  • 623164 2022-001
    Material Weakness
  • 623165 2022-001
    Material Weakness
  • 623166 2022-001
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
14.850 Public and Indian Housing $1.41M
14.871 Section 8 Housing Choice Vouchers $574,763
14.879 Mainstream Vouchers $407,926
14.872 Public Housing Capital Fund $287,984
17.274 Youthbuild $204,833
14.896 Family Self-Sufficiency Program $131,651
14.870 Resident Opportunity and Supportive Services - Service Coordinators $59,739