FAC Explorer

Finding 58533 (2022-001)

Material Weakness Repeat Finding
Requirement
E
Questioned Costs
-
Year
2022
Accepted
2023-02-27
Audit: 55323
Organization: Catherine Booth Residence INC A Florida Corporation (FL)
Auditor: Cohnrenick LLP

AI Summary

  • Core Issue: Two out of 13 tenant files lacked income verification documentation, violating HUD requirements.
  • Impacted Requirements: Tenant lease files must comply with HUD Handbook 4350.3 for eligibility and security deposit determinations.
  • Recommended Follow-Up: Management should implement and monitor procedures to ensure compliance with HUD guidelines for tenant eligibility and lease file maintenance.

Finding Text

Department of Housing and Urban Development Finding 2022-001 Section 202 Supportive Housing for the Elderly, AL 14.157 Statement of Condition In connection with our lease file review, we noted the following deficiencies: 2 out of 13 tenants tested did not have documentation in their lease file that their income was verified. Criteria Tenant lease files are required to be maintained and tenant eligibility determined in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Effect The procedures for determining tenant security deposits and eligibility and maintaining tenant lease files were not consistently applied in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. This could result in units being rented to ineligible tenants or errors in the rent subsidies paid by HUD. Cause Management's policies with respect to the determination of tenant security deposits and eligibility and the maintenance of tenant lease files in accordance with HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs were not consistently followed. Recommendation Management should establish procedures and monitor compliance with those procedures to ensure that tenant security deposits are correctly recorded, tenant eligibility is correctly determined and that tenant lease files are properly maintained in accordance with the requirements of HUD Handbook 4350.3, Occupancy Requirements of Subsidized Multifamily Housing Programs. Auditor Noncompliance Code: R - Section 8 program administration (REAC); E - Eligibility (UG) Finding Resolution Status: In process. The late completion of our audits for fiscal years 2020 and 2021 has contributed to our not getting our budgets for the new fiscal years submitted and approved timely. Therefore, Management did not have access to the Enterprise Income Verification (EIV) system [the system used to access Social Security information and Health and Human Service information] for a period of time so that they could verify income. This issue is anticipated again in fiscal year 2023 because of the late submission of the fiscal year 2022 budget which required the fiscal year 2021 actual data. Steps are being taken to have the fiscal year 2022 audit completed in a reasonable timeframe, and we do not anticipate the same problem going forward. Reporting Views of Responsible Officials Management agrees with the finding and is taking steps to address the issue that caused it.

Corrective Action Plan

CORRECTIVE ACTION PLAN Project Legal Name: Catherine Booth Towers Orlando, FL (? Project of Catherine Booth Residence, Inc., a Florida Corporation) HUD Project No.: 067-EE054-WAH Audit Firm: CohnReznick LLP Period covered by the audit: 10/1/2021-9/30/2022 Corrective Action Plan prepared by: Name: Sriparna Mitra Position: HUD Specialist, THQ (Legal) Telephone Number: 404-728-6700 A. Current Findings on the Schedule of Findings, Questioned Costs and Recommendations 1. Finding 2022-001 a. Comments on the Finding and Each Recommendation The auditee agrees with the finding. The late completion of the audits for fiscal years 2020 and 2021 has contributed to management not getting the budgets for the new fiscal years submitted and approved by HUD timely. As a result, management did not have access to the EIV system for a period of time so that they could verify income. This issue is anticipated again in fiscal year 2023 because of the late submission of the fiscal year 2022 budget which required the fiscal year 2021 actual data. b. Action(s) Taken or Planned on the Finding The late completion of our audits for fiscal years 2020 and 2021 has contributed to our not getting our budgets for the new fiscal years submitted and approved timely. Therefore, Management did not have access to the Enterprise Income Verification (EIV) system [the system used to access Social Security information and Health and Human Service information] for a period of time so that they could verify income. This issue is anticipated again in fiscal year 2023 because of the late submission of the fiscal year 2022 budget which required the fiscal year 2021 actual data. Steps are being taken to have the fiscal year 2022 audit completed in a reasonable timeframe, and we do not anticipate the same problem going forward. B. Status of Corrective Actions on Findings Reported in the Schedule of the Status of Prior Year Findings, Questioned Costs and Recommendations 1. 2021-001 In process. See finding 2022-001. 2. 2021-002 Cleared.

Categories

HUD Housing Programs Eligibility Reporting

Other Findings in this Audit

  • 58534 2022-001
    Material Weakness Repeat
  • 634975 2022-001
    Material Weakness Repeat
  • 634976 2022-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.157 Supportive Housing for the Elderly $8.15M