Core Issue: Cash disbursements showed significant deficiencies, including missing receipts, unsupported credit card payments, and lack of contracts.
Impacted Requirements: Non-compliance with HUD regulations and internal control standards for cash disbursement documentation.
Recommended Follow-Up: Review and strengthen the cash disbursement process, update internal controls, and conduct regular quality checks to ensure compliance.
Finding Text
2021-002 Condition: Deficiencies Noted in Cash Disbursements
During the review of Cash Disbursement, the following deficiencies were noted:
3 checks selected for audit were not fully supported with receipts and invoices to support the disbursement
1 Credit Card Payments lacked support and disbursement explanation
13 Disbursements lacked signed contracts or procurement documentation
1 payroll check were paid in a manner inconsistent with policy for work performed
Assistance Listing #: 14.867 and 21.023
Questioned Costs: Undetermined
Cause: The Authority’s deficiency in the area of cash disbursements is a lack of internal controls or the invoice approval process.
Effect: The Authority has not been in complete compliance with HUD regulations and internal control requirements to support invoices.
Criteria: 24 CFR requirements for Cash Disbursements Documentation
Recommendation: We recommend a review of the cash disbursement documentation process in order to ensure that each disbursement is fully documented prior to check issuance, and we further recommend an update of internal control policies and regular quality control reviews over cash disbursements to ensure compliance with HUD regulations.
Reply: Management agrees with the audit finding and the auditor’s recommendation. We will implement procedures and changes to ensure that this finding will be cleared by the subsequent fiscal year audit.
Corrective Action Plan
2021-002 Condition: Deficiencies Noted in Cash Disbursements
Steps to resolve: Management agrees with the audit finding and the auditor’s recommendation. We will implement procedures and changes to ensure that this finding will be cleared by the subsequent fiscal year audit.
Individual responsible for correction: Mr. Damon Dunbar, Executive Director
Timeframe: As of December 31, 2022
Categories
Procurement, Suspension & DebarmentHUD Housing ProgramsInternal Control / Segregation of Duties