Finding 618125 (2022-001)

Material Weakness Repeat Finding
Requirement
B
Questioned Costs
-
Year
2022
Accepted
2023-06-26
Audit: 39945
Organization: Anthony Housing Authority (TX)
Auditor: Mike Estes PC

AI Summary

  • Core Issue: The Low Rent Program owes the Housing Choice Voucher Program $165,833, creating a significant interfund balance that violates federal regulations.
  • Impacted Requirements: Small and medium-sized PHAs must allocate expenses properly and minimize interfund balances to avoid one fund covering another's expenses.
  • Recommended Follow-Up: Ensure the interfund balance is paid off promptly; the entire amount was settled after the year-end.

Finding Text

The former Executive Director was terminated effective January 9, 2022. The current Executive Director was named to this position effective November 2, 2021. Section 8 Housing Choice Voucher Program Program-CDFA#14.871, Low Rent Program-CDFA#14.850-Allowable Cost/Principles 2022-001-Significantly large interfund account needs to be reduced Criteria and specific requirement In small and medium-sized PHAs, there is a required allocation of expenses between programs. It is often not practical to maintain separate bank accounts and pay each program?s expenses out of its individual bank account. As a result, usually there are interfund payables and receivables between the accounts/programs. Ideally, the interfund amounts should be kept to a minimal amount, if not paid in full at the start of every month. The danger is that the larger the interfund amount is and/or grows, the more difficult it may be to pay off the interfund payable amount. The practical effect is if this happens, one fund is paying the expenses of another fund on a permanent basis. This results in a ?transfer? between the Housing Choice Voucher and Low Rent programs, which federal regulations do not allow. Condition Found At September 30, 2022, the Low Rent Program owes the Housing Choice Voucher Program $165,833. Context The significant interfund balance has existed for several years. Cause Apparent oversight. Effect The possibility exists that the fund that owes the funds might be unable to repay the balance. Recommendation to prevent future occurrences The interfund balance should be paid off as soon as possible. View or Responsible Official The entire balance was paid off subsequent to year-end. Section 8 Housing Choice Voucher Program-CDFA#14.871-Special Tests

Categories

HUD Housing Programs Allowable Costs / Cost Principles

Other Findings in this Audit

  • 41680 2022-001
    Material Weakness Repeat
  • 41681 2022-002
    Material Weakness Repeat
  • 41682 2022-001
    Material Weakness Repeat
  • 41683 2022-001
    Material Weakness Repeat
  • 618122 2022-001
    Material Weakness Repeat
  • 618123 2022-002
    Material Weakness Repeat
  • 618124 2022-001
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
14.871 Section 8 Housing Choice Vouchers $2.64M
14.850 Public and Indian Housing $103,730
14.870 Resident Opportunity and Supportive Services - Service Coordinators $27,333
14.850 Covid-19-Public and Indian Housing $4,302
14.872 Public Housing Capital Fund $1,709