Finding 778 (2023-002)

Section 8 Housing Choice Vouchers AL #14.871 Material Weakness Internal Control Over Compliance Rent Reasonableness 2023-002 Condition: During audit fieldwork, we identified three instances in which there was no rent reasonableness documentation maintained to verify that the rent reasonableness comparison was performed prior to issuing housing assistance payments. Criteria: Rent reasonableness comparisons are required prior to issuing housing assistance payments. Cause: The Commission has experienced turnover in Section 8 caseworker positions. The Commission did not document the determination of rent reasonableness prior to issuing housing assistance payments. Effect: Housing assistance payments could have been paid on units when rent charged was not first determined to be reasonable. Context: We identified 3 instances of rent reasonableness documentation not maintained in our testing of rent comparisons for 70 tenants during the year from a population of 1,576 tenants. Nonstatistical sampling and haphazard sample selection was used. After the fact documentation was provided to show that rent charged was reasonable. 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 the Commission provide further training for program staff and implement periodic reviews of tenant files to ensure rent reasonableness documentation is maintained appropriately. View of Management: Management agrees with the finding. A response can be found in the Corrective Action Plan.