Finding Text
Public and Indian Housing Program - AL No. 14.850
Significant Deficiency in Internal Control
Other Matter to Reported Under the Uniform Guidance
Repeated from 2022 audit (see prior year Finding No. 2022-001)
Condition: Out of an approximate population of 550 tenants, 41 tenant files were tested and the following deficiencies were noted:
Five files had an annual recertification completed over 12 months after the previous recertification
Two files were missing signed 214 declaration forms
One file was missing a birth certificate or photo identification
Six files were missing the flat rent option sheet
Five files were missing signed 9886 forms
Four files had rent per form 50058 that did not equal the rent rolls
One file had an income calculation error
Eight files were missing the internal quality control checklists
Criteria: The Authority’s ACOP and 24 CFR 960.259 requires internal controls to be in place to ensure proper procedures are being followed in compliance with HUD requirements regarding complete and accurate tenant files.
Context: The auditor randomly selected 41 tenant files out of the population, which is considered to be a statistically valid sample. The auditor reviewed the tenant files and support to ensure that proper procedure are being followed and that the Authority is in compliance with HUD requirements regarding timely, complete, and accurate tenant files.
Cause: The Authority continued to experience staffing turnover and did not have the available staff to fully implement the established internal controls to ensure proper compliance with regards to timely recertifications and collection of required HUD documentation to complete the tenant files.
Effect: The Authority is not in full compliance with HUD requirements regarding eligibility which could result in the incorrect amount of rental assistance provided.
Questioned Costs: None.
Auditor Recommendations: The Authority should continue to train staff on the established procedures and controls in place to ensure full compliance in regard to eligibility. The Authority needs to correct the deficiencies noted in the tested files and consider the impact to the rest of the population of tenant files that were not selected as part of the auditor’s sample.
Management Response: See Corrective Action Plan.