Finding Text
Finding No. 2024-002 - Special Tests and Provisions - Material Weakness
Name of Federal Agency: The United States Department of Housing and Urban Development
Federal Program Name: Section 8 Housing Assistance Payments
Assistance Listing Number: 14.195
Federal Award Identification Number and Year: MD06L000037. Program year is 2024.
Name of Pass-through Entity (if applicable): N/A
Criteria
According to 4-14.195-11 of Appendix XI to 2 CFR, Part 200 of the United States Office of
Management and Budget, the Project must reduce claims for assistance on vacant units under
certain circumstances.
Condition
In a sample of 6 move out tenant files tested, there were exceptions noted in 6 files. In 6 out of 6
files, the Project did not maintain appropriate documentation to support the move-out and it could
not be determined if move out procedures were performed in accordance with HUD.
Cause
The Project failed to follow the policies and procedures which have been established for proper
move out procedures and tenant file maintenance.
Effect
The Project is not in compliance with federal regulations regarding special tests and provisions. The
HAP calculation may be inaccurate resulting in an underpayment or overpayment of HAP.
Questioned Costs
N/A
Context
A sample of 6 move out tenants were selected from a population of 22. We identified exceptions in
6 out of 6 move out tenants tested. The sample was not statistically valid.
Identification as a Repeat Finding
This finding is not a repeat finding.
Recommendation
We recommend that management reviews its internal controls over obtaining and maintaining
tenant file documentation to ensure compliance with special test and provision requirements.
Management should establish procedures and monitor compliance with those procedures to ensure
that the procedures around move out tenants are in accordance with guidelines specified by federal
regulations.