Finding Text
Finding 2022-002 ? Assistance #14.871 ? Section 8 Housing Choice Vouchers ? Eligibility (Material Weakness): Condition: A secondary review or approval of eligibility documentation was not being performed. Criteria: Someone other than the initial preparer of the eligibility calculations should be reviewing the information to ensure that all appropriate documentation has been received and input correctly. Questioned Costs: N/A Context: Although the Housing Authority implemented a new policy in October 2022 to ensure quality control reviews were performed for all eligibility decisions going forward, none of the 60 files selected for testing contained evidence of review by someone other than the preparer. The sample size was determined based upon guidelines provided by the AICPA which is not a statistically valid sample. Cause: The Housing Authority did not have a policy that required a secondary review or approval of eligibility documentation. Effect: Eligibility and associated housing assistance payment amounts could be calculated incorrectly. Recommendations: We recommend that the Housing Authority follow the new quality control policies and procedures implemented in the 4th quarter of 2022 to ensure that eligibility calculations are being reviewed by someone other than the preparer, and also that all required documentation is being maintained in tenant files. Views of Responsible Officials (Unaudited): Management agrees that this finding has already been addressed as noted in the recommendation. This is the same exact finding as 2021-006 in the prior year?s audit, which included a recommendation to add secondary review, which the Olathe Housing Authority implemented in 4Q 2022. While the new recommended control was implemented for all 4Q eligibility determinations, management understands that the files chosen for review were instead HCV files of voucher holders who began receiving rental assistance in 2022. Any applicant found eligible in 4Q 2022 did not begin receiving assistance until after receiving a voucher, signing a lease, and moving in, which did not occur until 1Q 2023. It is unfortunate that the auditors are required to once again choose files of HCV participants who had eligibility determined prior to implementing the recommended procedure change. Management understands that most of the HCV participant files that the auditors chose to review were from the exact same time period used during the prior year?s audit which made this finding a foregone conclusion. Management agrees that the control recommended in 2022 was not implemented until 2022, and so it remains just as true today as it was last year that files from many years ago continue to lack the control implemented in 2022. Management recommends that if files from prior to 2022 will continue to be reviewed for this control, and that if this finding is going to be repeatedly included, that auditor staff always review the prior year?s audit and always include an acknowledgement that the new secondary review control was implemented in 4Q 2022.