Finding 499783 (2023-002)

Significant Deficiency Repeat Finding
Requirement
CELN
Questioned Costs
-
Year
2023
Accepted
2024-09-30

AI Summary

  • Core Issue: The Organization lacks a proper review process for eligibility determinations and related compliance areas, leading to potential noncompliance with federal requirements.
  • Impacted Requirements: Key compliance areas affected include cash management, eligibility, reporting, and special tests.
  • Recommended Follow-Up: Strengthen internal controls by establishing a review process and improving segregation of duties among staff to enhance oversight.

Finding Text

Finding 2023-002: Section 8 Project-Based Cluster Federal Assistance Number: 14.182 and 14.195 U.S. Department of Housing and Urban Development (Repeat of Finding 2022-002) Compliance Requirements: Cash Management, Eligibility, Reporting, Special Tests and Provisions Type of finding: Internal Control Over Compliance (significant deficiency) Criteria: The Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards require that the non-Federal entity establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award (2 CFR 200.303(a)). Condition: The Organization has not implemented a review or monitoring process to ensure propriety in eligibility determinations, tenant lease agreements, housing assistance payment requests, and return of funds for vacant units and rent adjustments to contract rent included on the monthly Housing Assistance Payment vouchers. Cause: The compliance responsibilities of the Organization are performed by a few people which has made it difficult to establish a proper review process over cash management, eligibility, reporting, and special tests and provisions requirements. Effect: Noncompliance with the Section 8 Project-Based Cluster requirements may exist and not be detected by the Organization. Recommendation: The Organization should strengthen its internal controls with adopted policies and procedures to ensure a review process is established through adequate segregation of duties. The Organization should consider assessing and realigning the duties and responsibilities of administrative staff allowing the administrator to act in a more supervisory position. Grantee’s Response: See corrective action plan.

Corrective Action Plan

Finding 2023-002: Section 8 Project-Based Cluster Federal Assistance Number: 14.182 and 14.195 U.S. Department of Housing and Urban Development (Repeat of Finding 2022-002) Compliance Requirements: Cash Management, Eligibility, Reporting, Special Tests and Provisions Type of finding: Internal Control Over Compliance (significant deficiency) Recommendation: The Organization should strengthen its internal controls with adopted policies and procedures to ensure a review process is established through adequate segregation of duties. The Organization should consider assessing and realigning the duties and responsibilities of administrative staff allowing the administrator to act in a more supervisory position. Action Taken: The Operation Administrator is overall responsible the operation of Tri-County Senior Center and Housing; working together with the bookkeeping staff and Executive Director as partners to maintain financial records and budgets. The Executive Director will sporadically review tenant eligibility of new certifications and re-certifications, HAP Contracts, samples of monthly HAP Assistance Payment requests, and her presence when auditors are in-house as well any other assistance requested by Administrator. To ensure the health, safety, and well-being of the residents and staff, the Administrator oversees the responsibilities and duties of all other staff in their roles, (Administration Assistant/Program Administrator-Senior Center Activities; Administration Assistant-Membership, monthly newsletters, answer phones and any other duties requested by the Administrator), to guide them in their specific roles so they understand their duties and responsibilities as administrative staff, and ensuring the facility meets all regulatory compliance standards. If there are questions regarding this plan, please call the responsible party at (719) 852-5778. Sincerely yours, Monica Wolfe Executive Director Tri-County Senior Citizens and Housing, Inc.

Categories

HUD Housing Programs Internal Control / Segregation of Duties Special Tests & Provisions Subrecipient Monitoring Allowable Costs / Cost Principles Cash Management Eligibility Reporting Significant Deficiency Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 499784 2023-002
    Significant Deficiency Repeat
  • 1076225 2023-002
    Significant Deficiency Repeat
  • 1076226 2023-002
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
14.182 New Construction and Substantial Rehabilitation $839,905
14.195 Project-Based Rental Assistance (pbra) $187,515