Finding Text
Federal Agency: U.S. Department of Housing and Urban Development
Federal Program Name: Public and Indian Housing
Assistance Listing Number: 14.850
Award Period: April 1, 2022 – March 31, 2023
Type of Finding:
• Significant Deficiency in Internal Control over Compliance
• Other Matters
Criteria or specific requirement: As a condition of admission or continued occupancy, tenant and other family members must provide necessary information, documentation, and releases for the PHA to verify income eligibility (24 CFR sections 5.230, 5.609, and 960.259).
For both family income examinations and reexaminations, the PHA must obtain and document in the family file third party verification of (a) reported family annual income, (b) the value of assets, (c) expenses related to deductions from annual income, and (d) other factors that affect the determination of adjusted income or income-based rent (24 CFR section 960.259).
Condition: Exceptions were noted in 1 out of 40 tenant files tested. Annual income was not calculated utilizing all underlying supporting documentation maintained in the file.
Questioned costs: Unable to determine.
Context: 40 tenant files were selected from a population of over 250.
Cause: Income was inadvertently excluded from the calculation. The Authority’s internal control did not identify the error.
Effect: The Authority is not in compliance with eligibility compliance requirements. The tenant’s portion of rent may not be calculated correctly.
Repeat Finding: No
Recommendation: We recommend that the Authority reviews its internal controls over review of annual income calculations to ensure compliance with eligibility requirements.
Views of responsible officials: There is no disagreement with the audit finding.