Finding 777 (2023-001)

Section 8 Housing Choice Vouchers AL #14.871 Significant Deficiency Internal Control Over Compliance Incorrect Voucher Payment Standards 2023-001 Condition: The Commission enters approved voucher payment standards into their property management software, which automatically populates default values in tenant certifications. Caseworkers have had the ability to override default values for the number of bedrooms exceeding the defaults entered. During audit fieldwork, we identified five instances of overrides not being applied correctly to tenants, which caused errors in housing assistant payment (HAP) calculations. Criteria: Overrides should be verified prior to calculating HAP. Cause: The Commission has experienced turnover in Section 8 caseworker positions. The Commission did not have an internal control system in place to limit caseworkers’ ability to perform overrides or require approval of overrides. Effect: Housing assistance payments were calculated incorrectly due to improper voucher payment standard values being used. Context: In our testing of the entire population of 10 overrides made during the year, there were 3 instances of HAP underpayment, totaling $2,711, or instances in which the tenant overpaid, and 2 instances of HAP underpayment, totaling $368, or instances in which the tenant underpaid. The control deficiency and incorrect HAP calculations did not result in a material impact on the program and did not reach the threshold for reporting questioned costs. Repeat of Prior Year Finding: No Auditor’s Recommendation: We recommend implementing an internal control for approval of any system override to ensure they are appropriately applied. View of Management: Management agrees with the finding. A response can be found in the Corrective Action Plan.