Finding Text
Statement of Condition: During the review of low rent tenant files, it was noted there was insufficient documentation of a second party review on all files, one tenant file could not be located, 2 out of 10 files selected for testing lacked the signature of the head of household, 2 out of 10 files selected for testing lacked sufficient support for a zero income individual, 2 out of 10 files selected for testing did not report state amounts for SSI. Criteria: 2 CFR Part 200 Subpart F requires the Commission to determine income eligibility and calculate the tenant?s rent payment using the documentation from third party verification. 2 CFR Part 200 Subpart F requires the Commission to have effective internal controls and accountability must be maintained for all funds. Perspective Information: Asset accounts, sources of income, and medical expenses are required to be verified with the third party annually. Additionally, the Commission did not have adequate policies and procedures in place for accountability of its tenant files. Questioned Costs: Projection of net errors identified in sample: $2,043. Effect: Tenant annual certifications and interim re-examinations may be calculated incorrectly. Cause: Ineffective review process over the certification of tenant files and/or lack of knowledge of HUD regulation regarding rent certifications. Recommendation: The Commission should consider reviewing its current policy regarding rent certifications. The Commission should ensure all persons involved in the certification process are properly trained and understand regulations in order to accurately identify errors. The Commission should adopt policies and procedures that would require a second person to be involved in the certification process to ensure the accountability of tenant files. The reviewer should sign and date the verification form, evidencing the control is being performed. Management?s Response: New management has taken over the Commission subsequent to the period under audit and will ensure all staff members involved in the annual recertification and interim examinations are properly trained with respect to the rules and regulations pertaining to this process. Management will also implement stronger internal controls and policies regarding rent certifications.