Finding Text
Criteria: HUD-52681-B is required to be submitted monthly electronically via the VMS. HUD relies on the audit of these key line items below to determine the reasonableness of the data submitted for the purpose of calculating funding under the program.
Condition and Context: We obtained a summary of monthly VMS reporting from management noting that the key line items were unable to be reconciled to the trial balance by management. Specifically, HAP expenses reported on the trial balance are overstated by $3,530,690 relative to the HUD reporting.
Cause and Effect: As described in 2022-001, the Agency has not maintained appropriate internal controls over compliance. Lack of regular reconciliation of HAP expenses to the HUD reporting referenced above resulted in the inability to reconcile at year end.
Recommendation: We recommend that monthly VMS reporting be reconciled to the trial balance to ensure accurate reporting.
This is a repeat finding of 2021-010.
Views of Responsible Officials and Planned Corrective Actions: The Agency agrees with the recommendation. See the Corrective Action Plan for the Agency’s response and planned completion date.