Finding Text
Finding 2024-003: HUD Depository Agreement
Housing Choice Voucher Program – 14.871
Material Weakness/Noncompliance – Special Tests and Provisions
Repeat Finding 2023-003
Criteria: The Authority is required to enter into depository agreements with its financial institutions in the form required by HUD. The agreements serve as safeguards for federal funds and provide third-party rights to HUD.
Condition: In the prior years, the Authority opened up new bank accounts and did not obtain the required depository agreement. This was reported as a finding in the prior year. The Authority’s current bank has indicated it will not sign the depository agreement and the Authority did not move the funds to a bank that would.
Cause: The Authority did not take appropriate action to correct the prior year finding.
Effect or Potential Effect: The Authority was in noncompliance with HUD’s requirement to have proper depository agreements.
Recommendation: The Authority must move its funds to a bank that will sign the HUD depository agreement.
View of the Responsible Officials of the Auditee: The auditee’s management agrees with the finding.