Finding Text
Information on the federal program ? 14.181 Supporting Housing for Persons with Disabilities (Section 811), U.S. Department of Housing and Urban Development (HUD). Criteria or specific requirement ? Activities Allowed or Unallowed and Allowable Costs / Cost Principles. In accordance with 2 CFR 200.303, the entity must establish and maintain effective internal control over federal awards to evaluate and monitor compliance with federal statutes, regulations, and the terms and conditions of the federal awards. Condition ? Invoices were missing signoffs or indication of review and certain samples selected for testing were missing backup (copies of the checks/payment and/or invoices). Questioned costs ? None. Context ? A sample of 32 invoices were selected from the 209 expenses incurred during the year to test if there was review of the purchase requisition or invoice in accordance with VCO1's policy. 16 of the 32 invoices had no approval documented on the purchase requisition or invoice to indicate review that the expenses were appropriate under the federal program. The sample was not a statistically valid sample. Effect ? Formal approval was not noted on a sample of invoices paid and backup documentation was not maintained for all items paid. Cause ? VCO1 did not have a process in place to review utilities invoices and invoices from vendors with contracted agreements and did not have controls in place to ensure other invoices were formally signed off prior to payment. The approval is a final review of all documentation prior to signing the actual check for payment. There was a changeover of management agents and invoices could not be located. Identification as a repeat finding, if applicable: Not applicable. Recommendation ? We recommend that VCO1 establish proper internal controls in order to properly indicate approval on invoices prior to payment and maintain documentation for the items paid. Views of responsible officials and planned corrective actions ? Please see the attached corrective action plan as submitted by management. VCO1 agrees with the finding.