Finding 572458 (2024-001)

2024-001 ALN 14.871 – Housing Voucher Cluster – Eligibility Condition and Criteria: During our audit, it was determined that significant deficiencies in internal controls existed over the Authority’s Housing Voucher Cluster eligibility process being compliant with HUD regulatory requirements. Housing Assistance payments on 50058 reports should agree to the corresponding HAP register. EIV reports should be ran at least once annually and ran within 120 days for new admissions. Utility allowances reported on the 50058 reports should agree to the Authority's utility allowance calculated sheets. Housing Assistance Payment Contracts should be maintained in the tenant file. HUD form 9886 should be maintained in the tenant file and signed by the tenant annually. Support for income, expenses, and deductions should be maintained in the tenant file. Rent reasonableness determinations should be performed for new admissions. HQS inspections should be performed in accordance with the Authority's policies. Housing Assistance payments on 50058 reports did not agree to the corresponding HAP register. EIV reports were not ran at least once annually and ran within 120 days for new admissions. Utility allowances reported on the 50058 reports did not agree to the Authority's utility allowance calculated sheets. Housing Assistance Payment Contracts were not maintained in the tenant file. HUD form 9886 was not maintained in the tenant files and signed by the tenant annually. Support for income, expenses, and deductions were not maintained in the tenant files. Rent reasonableness determinations were not performed for new admissions. HQS inspections were not performed in accordance with the Authority's policies. Amount of Questioned Costs: None Context: Of the 20 tenant files tested for eligibility, we noted the following exceptions: • 2/20 Housing Assistance payments on 50058 reports did not agree to the corresponding HAP register. • 15/20 EIV reports were not ran at least once annually and ran within 120 days for new admissions. • 12/20 Utility allowances reported on the 50058 reports did not agree to the Authority's utility allowance calculated sheets. • 14/20 Housing Assistance Payment Contracts were not maintained in the tenant file. • 3/20 HUD form 9886 was not maintained in the tenant files and signed by the tenant annually. • 4/20 Support for income, expenses, and deductions were not maintained in the tenant files. • 4/20 Rent reasonableness determinations were not performed for new admissions. • 5/20 HQS inspections were not performed in accordance with the Authority's policies. • 1/20 The Authority was unable to provide any documentation from the tenant file Cause: The Authority under prior management did not utilize adequate internal controls over the HCV program as there is a lack of sufficient documentation that was evident in the prior year and continued over to the current audit period. Effect: Adequate supporting documentation was not maintained in the file. Auditor’s Recommendation: We recommend the Authority implement controls to address all the exceptions noted above. This includes reconciling 50058 reports to HAP registers, reminders to run EIV reports when necessary, reconciling 50058 reports to utility allowance calculation sheets, maintaining HAP contracts, signed HUD 9886 forms, and support for income, expenses, and deductions in the tenant file, and performing rent reasonableness determinations and HQS inspections when necessary/required. Grantee Response: The Executive Director agrees with the finding and will follow the Auditor's recommendation