Finding 497298 (2023-001)

2023-001 – SPECIAL TESTS AND PROVISIONS: GENERAL DEPOSITORY AGREEMENTS Significant Deficiency/Noncompliance U.S. Department of Housing and Urban Development ALN #:14.871 – Housing Voucher Cluster CRITERIA PHAs are required to enter into depository agreements with their financial institutions in the form required by HUD. The agreements serve as safeguards for federal funds and provide third party rights to HUD. Among the terms in many agreements are requirements for funds to be placed in an interest-bearing account (24CFR section 982.156). CONDITION As a result of our audit, we identified that the Authority does not have an executed General Depository Agreement on file for all depositories of federal funds. CAUSE The Authority experienced few turnovers including its Executive Director position, due to which certain documentation and information could not be located by the Authority personnel. EFFECT The covenants set forth by the General Depository Agreement have not been conveyed to and agreed upon by the Authority and its financial institutions. QUESTIONED COSTS None identified. CONTEXT The Authority does not have an executed General Depository Agreement on file for all depositories of federal funds. REPEAT FINDING This is not a repeat finding. RECOMMENDATION We recommend that the Authority obtain signed General Depository Agreement in form approved by HUD from their financial institutions with whom they have deposits of federal funds. AUDITEE’S RESPONSE AND PLANNED CORRECTIVE ACTION See Corrective Action Plan.