Finding Text
Criteria - The Uniform Financial Reporting Standards (24 CFR Section 5.801) require Public Housing Authorities to submit timely GAAP-based unaudited financial information to HUD annually, no later than 60 days after the end of the fiscal year of the reporting period, and as otherwise provided by law (see also 24 CFR 903.33).
Condition - The Authority failed to submit its unaudited Financial Data Schedule (FDS) to HUD by the prescribed due date.
Cause - The delay in submission was primarily attributed to internal staffing challenges and an oversight in the financial department's year-end closeout processes. Additionally, there was a lack of adequate monitoring and reminder systems for critical HUD reporting deadlines.
Effect - The late submission of the unaudited FDS resulted in non-compliance with HUD's reporting requirements, potentially affecting Authority’s future funding allocations and its reputation with HUD.
Questioned Costs - None identified.
Recommendation - We recommend that the Authority consider the following correct actions:
1) Review and strengthen internal controls related to the financial reporting process, ensuring all critical deadlines are met.
2) Provide additional training for finance department staff on HUD reporting requirements and the importance of adhering to submission deadlines.
3) Develop and implement a comprehensive monitoring system that alerts staff of upcoming HUD reporting deadlines well in advance.
4) Conduct a thorough review of the year-end closeout processes to identify and rectify inefficiencies that may lead to delays in financial reporting.
Management’s Response - (1) Finding 2023-001
(a) Comments on the finding and recommendation - The Authority agrees with the finding. The Authority also agrees with the recommendation, please see below for action.
(b) Action taken - The Authority will strengthen internal controls and training of staff to ensure reporting deadlines are met.
(c) Planned implementation date - The Authority expects to complete the corrective actions by August 31, 2024, at the time of its next required unaudited submission.