Finding 586011 (2023-001)

Significant Deficiency Repeat Finding
Requirement
E
Questioned Costs
$1
Year
2023
Accepted
2024-01-23

AI Summary

  • Core Issue: The Authority has a significant deficiency in internal controls over compliance with HUD regulations regarding income and asset verification.
  • Impacted Requirements: Failure to obtain and document third-party verification for family income, assets, and deductions as required by 24 CFR sections 982.516, 5.212, and 5.230.
  • Recommended Follow-Up: Review and improve processes for eligibility determination and documentation to ensure compliance and proper file maintenance.

Finding Text

Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title: Housing Voucher Cluster Assistance Listing Number: 14.871 Award Period: 7/1/22-6/30/23 Type of Finding: Significant Deficiency in Internal Control Over Compliance Criteria: Per 24 CFR section 982.516, for both family income examinations and reexaminations, obtain and document in the family file third party verification of (1) reported family annual income; (2) the value of assets; (3) expenses related to deductions from annual income; and (4) other factors that affect the determination of adjusted income or other income-based rent. 24 CFR section 982.516 states that the PHA must reexamine family income and composition at least once every 12 months and adjust the tenant rent and housing assistance payment as necessary using the documentation from third party verification. 24 CFR sections 5.212 and 5.230 states that the head of household must sign one or more release forms allowing the Authority to obtain information from third parties, as well as a federally prescribed general release form for employment information. Context: During our testing of 60 files for eligibility requirements, we noted the following in 5 files: - 1 of 60 files did not have proper support for income included on the HUD-50058. - 4 of 60 files did not have proper support for assets included on the HUD-50058. - 1 of 60 files tested did not have properly calculated HAP/TAP due to incorrect income and assets support. Questioned Costs: $60 Cause: The failure to update the 50058 regarding immaterial asset amounts (no effect on HAP/TTP) was a data entry error. The one file where COLA was calculated incorrectly is not a systemic issue. Effect: The Authority is not in compliance with HUD regulations. Repeat Finding: Yes Recommendation: The Authority should review their processes for eligibility determination and documentation to ensure all information is properly documented and maintained in the files. View of Responsible Officials: There is no disagreement with this audit finding.

Categories

Questioned Costs HUD Housing Programs Eligibility Significant Deficiency Internal Control / Segregation of Duties

Other Findings in this Audit

  • 9568 2023-001
    Significant Deficiency Repeat
  • 9569 2023-001
    Significant Deficiency Repeat
  • 9570 2023-002
    Significant Deficiency Repeat
  • 9571 2023-002
    Significant Deficiency Repeat
  • 9572 2023-003
    Material Weakness Repeat
  • 9573 2023-003
    Material Weakness Repeat
  • 586010 2023-001
    Significant Deficiency Repeat
  • 586012 2023-002
    Significant Deficiency Repeat
  • 586013 2023-002
    Significant Deficiency Repeat
  • 586014 2023-003
    Material Weakness Repeat
  • 586015 2023-003
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $554,937
14.856 Lower Income Housing Assistance Program_section 8 Moderate Rehabilitation $307,900
14.182 Section 8 New Construction and Substantial Rehabilitation $249,323
10.415 Rural Rental Housing Loans $88,782
21.027 Coronavirus State and Local Fiscal Recovery Funds $75,000
10.427 Rural Rental Assistance Payments $70,850