Finding Text
Finding 2022-003 ? Assistance #14.871 ? Section 8 Housing Choice Vouchers ? Special Tests: Selection from the Waiting List (Material Weakness): Condition: A secondary review of waiting list decisions was not being performed. In addition, it was noted that the wait list is only maintained for 3 years so evidence of wait list position for tenants that have been in the program for longer than 3 years could not be provided. Criteria: Tenant selection must include requirements for applications and waiting lists, a description of the policies for selection of applicant from the waiting list, and policies for verification and documentation of information relevant to acceptance or rejections of an applicant. Questioned Costs: N/A Context: Although the Housing Authority implemented a new policy in October 2022 to ensure quality control reviews were performed for all waitlist decisions going forward, 46 of the 60 files selected for testing were for tenants that entered the program more than 3 years ago and therefore wait list support could not be provided. In addition, none of the tenant files contained evidence of review of the waitlist decision. The sample size was determined based upon guidelines provided by the AICPA which is not a statistically valid sample. Cause: The Housing Authority did not have a policy that required a secondary review or approval of wait list documentation. Effect: Improper wait list decisions could be made. Recommendations: We recommend that the Housing Authority follow the new quality control policies and procedures implemented in the 4th quarter of 2022 to ensure that wait list documentation is being reviewed and approved, and also that a copy of the waitlist documentation be kept in each tenant file so that there is a historical record of the wait list process once the actual wait list is no longer being maintained. Views of Responsible Officials (Unaudited): Management agrees that this finding has already been addressed as noted in the recommendation. This is the same exact finding as 2021-007 in the prior year?s audit, which included a recommendation to add secondary review, which the Olathe Housing Authority implemented in 4Q 2022. While the new recommended control was implemented for all 4Q waiting list determinations, management understands that the files pulled for review were instead HCV files of voucher holders who began receiving rental assistance in 2022. Any eligible applicant pulled from the Waiting List in 4Q 2022 did not begin receiving assistance until after receiving a voucher, signing a lease, and moving in, which did not occur until 1Q 2023. It is unfortunate that the auditors are required to once again choose files of HCV participants who were pulled from the Waiting List prior to implementing the recommended procedure change. Management understands that most of the HCV participant files that the auditors chose to review were from the exact same time period used during the prior year?s audit which made this finding a foregone conclusion. Management agrees that the control recommended in 2022 was not implemented until 2022, and so it remains just as true today as it was last year that files from many years ago continue to lack the control implemented in 2022. Management recommends that if files from prior to 2022 will continue to be reviewed for this control, and that if this finding is going to be repeatedly included, that auditor staff always review the prior year?s audit and always include an acknowledgement that the new secondary review control was implemented in 4Q 2022.