Finding 628524 (2022-003)

Finding 2022-003: Internal Control Structure - Eligibility Rural Rental Housing Loan - 10.415 Material Weakness Repeat Finding ? Finding 2021-002 Criteria: The Project is responsible for establishing an effective internal control process to ensure the Project complies with the requirements governing the Rural Rental Housing program. Condition: The Project only has one staff which handles the compliance issues which makes it difficult for the Project to have controls beyond the Project Manager?s knowledge and as a result has a lack of segregation of duties over this area. Cause: The Project has limited resources and one staff assigned to this function. Effect or Potential Effect: The control deficiencies result in more than a reasonable possibility that a material noncompliance with program requirements could occur and not be prevented or detected. Recommendation: As noted above, the Project has limited resources and may not be able to correct the deficiencies noted above. The Project should review the condition above and adopt procedures where feasible. Controls and procedures should be documented. View of the Responsible Officials of the Auditee: The auditee?s management agrees with the finding.