Finding 504013 (2024-003)

Material Weakness
Requirement
CN
Questioned Costs
$1
Year
2024
Accepted
2024-10-29

AI Summary

  • Core Issue: The Authority improperly drew Capital Funds for reimbursements without proper invoices, violating cash management rules.
  • Impacted Requirements: Vouchers must be submitted for bills due only after work is completed, and funds must be paid within 3 business days.
  • Recommended Follow-Up: Implement stronger internal controls over voucher draws to ensure compliance with cash management requirements.

Finding Text

Program: Public Housing Capital Funds Requirement: Cash management and disbursement Capital Funds: To initiate disbursement of Capital Funds, the Authority must submit a voucher for payment through LOCCS. The Authority may only submit a voucher to disburse funds for bills due and payable for work that has already been performed or for items received. Once funds are disbursed, i.e., transferred from LOCCS to the Authority’s bank account, the Authority must pay the applicable bill(s) within 3 business days after the deposit of the funds into the Authority’s bank account. The Authority cannot expend nonfederal funds first to pay the applicable bills and then use Capital Funds to reimburse themselves. Condition: The Authority had draws that were made as reimbursements of Capital Fund expenditures and had one draw that they were unable to provide a supporting invoice for the expenditure. Cause: The Authority does not have the appropriate internal controls over their Capital Fund draws to ensure that Vouchers are drawn in a timely manner. Questioned Costs: $7,704 Effect: These deficiencies result in the possibility that errors or irregularities can exist and not be detected by the Housing Authority’s internal control. Prior Year Finding: n/a Information: Sampling was not applicable to this finding and systemic problem. Recommendation: It is recommended that the Authority implements appropriate controls over voucher draws to ensure compliance with Public Housing Capital Fund cash management requirements. Management’s Response: Management concurs with the recommendation to implement timely LOCCS fundings that coincide with our normal accounting cycle.

Corrective Action Plan

Audit Finding Number: 2024-003 – Cash Management Agency: Public Housing Capital Fund Responsible Person, Title: Deb Spitzer, Finance Director Completion date: 4/1/2024 Agency Response: Concur Corrective Action Plan: Management concurs with the recommendation to implement timely LOCCS fundings that coincide with our normal accounting cycle.

Categories

Questioned Costs Cash Management HUD Housing Programs Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 1080455 2024-003
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
14.872 Public Housing Capital Fund $1.13M
14.850 Public and Indian Housing $756,593