Core Issue: The Housing Authority failed to conduct a required physical count of maintenance inventory for FY20, marking a repeat finding from the previous year.
Impacted Requirements: This violates the Housing Authority’s Maintenance Policy, which mandates an annual physical inventory as part of routine maintenance.
Recommended Follow-Up: Implement quarterly physical counts, track inventory usage, and establish written policies to address discrepancies and improve oversight.
Finding Text
2020-010 Inventory
Significant Deficiency
This is a repeat finding. The prior-year’s auditing finding number is 2019-012.
Condition: The Housing Authority did not perform a physical count of it’s maintenance
inventory during FY20.
Criteria: Part D. Types of Maintenance of the Housing Authority’s Maintenace Policy states that
“In accordance with audit requirements, the Housiing Department will conduct an annual
physical inventory. These procedures shall be part of the routine maintenance scheduling.”
Cause: The Housing Authority did not follow it’s policies for inventory.
Effect: Items of inventory could be stolen and would go undetected by management.
Recommendation: Management should use a quarterly physical count as a starting point,
track purchases and uses of inventory throughout the quarter in order to calculate the
inventory balance that should be on hand at the end of the quarter. Management should then
compare the calculated ending inventory against the related quarterly physical count and
determine if there are any large variances that require further investigation. Written policies
and procedures should be adopted accordingly.
Corrective Action Plan
2020-010 Inventory
Significant Deficiency
Recommendation: Management should use a quarterly physical count as a starting point, track
purchases and uses of inventory throughout the quarter in order to calculate the inventory balance that
should be on hand at the end of the quarter. Management should then compare the calculated ending
inventory against the related quarterly physical count and determine if there are any large variances
that require further investigation. Written policies and procedures should be adopted accordingly.
Action Taken: The Housing Authority agrees with this finding and will implement this
recommendation within 120 days of this audit report.
Categories
Equipment & Real Property ManagementProcurement, Suspension & DebarmentSignificant Deficiency