Finding Text
Finding Reference 2022-006 Federal Agency: U.S. Department of Housing and Urban Development Federal Program Title and ALN: Section 8 Housing Choice Vouchers (ALN 14.871) Compliance Requirement: Special Test ? Rolling Forward Equity Balances Type of finding: Material Weakness in Internal Control (MW), Instance of Noncompliance (NC) Statement of Condition As part of our audit procedures over the monthly submitted reports, Voucher Management System (VMS), we required evidence of how the Administrative Fee Equity and HAP Equity were calculated. The accountant did not provide a monthly detail that reconciled with the information submitted in the VMS. In addition, the amounts presented in the VMS at June 30, 2022, do not reconcile with the amounts presented in the Financial Data Schedule (FDS). Criteria 24 CFR 982.158 (a) states that the PHA must maintain complete and accurate accounts and other records for the program in accordance with HUD requirements, in a manner that permits a speedy and effective audit. The records must be form required by HUD, including requirements governing computerized or electronic forms of record-keeping. The must comply with the financial reporting requirements in 24 CFR Part 5, Subpart H. Cause of Condition The program accountants do not reconcile the HAP and Administrative Fee Equity balances monthly. Effect of Condition The Municipality did not have proper accounting records to allow them maintain complete and accurate to detect and correct accounting errors in a timely manner. Recommendation We recommend management to prepare the bank conciliations timely, and reconcile on a monthly basis the HAP and Administrative Fee equity balances and document it. Questioned Costs None Prior-Year Finding This finding is similar to prior year finding 2021-007 and 2020-010. View of Responsible Official and Planned Corrective Action Plan Corrective action has been taken consisting in the timely preparation of the bank conciliations. However, the corrective actions needed to evidence the HAP and Administrative Fee equity balances calculation will be taken by the Municipal Finance Office and the Program Accountants. Also, adequate measurements addressed to reconcile the VMS with the Financial Data Schedule (FDS) will be taken. Implementation Date March 31, 2024 Responsible Person Mr. Job Bonilla, Federal Program Director