Finding 852 (2022-004)

Significant Deficiency

Requirement

Questioned Costs

Year

2022

Accepted

2023-10-27

Audit: 1622

Organization: Western North Carolina Aids Project, Inc. (NC)

Auditor: Corliss & Solomon PLLC

AI Summary

Core Issue: Missing inspection documentation in 5 out of 22 tenant files indicates a significant deficiency in meeting housing quality standards.
Impacted Requirements: Compliance with federal regulations outlined in 24 CFR sections 574.310(b)(1)-(2) is not being met due to misfiled documentation during the transition to remote work.
Recommended Follow-Up: Strengthen internal controls, provide management training on compliance, improve communication of requirements, and enhance monitoring of tenant files.

Finding Text

2022-004 Housing Quality Standards Significant Deficiency Criteria: All housing that involves acquisition, rehabilitation, conversion, lease, repair of facilities, new construction, project or tenant-based rental assistance, and operating costs must meet various housing quality standards listed in 24 CFR sections 574.310(b)(1)-(2). Condition: During testing of tenant files, there were 5 instances where inspection documentation or HQS documentation was missing. Cause: During this period of switching to remote work due to COVID and incorporating electronic files, documentation was frequently misfiled. Effect: The Program was not in compliance with federal regulations regarding documentation of housing quality standards. Questioned Cost: None Context: A sample of 22 tenant files were selected from a population of 113 tenants. The test found 5 exceptions, as noted above. Recommendation: We recommend that the organization strengthen its internal control procedures related to housing quality standards and inspections and documentation. This should include management training in the applicable compliance requirements and more effective communication of the requirements to staff, as well as improved monitoring of tenant files. Management’s View: We agree with this finding and have outlined our response in our Corrective Action Plan. 2022-004 Housing Quality Standards Significant Deficiency Criteria: All housing that involves acquisition, rehabilitation, conversion, lease, repair of facilities, new construction, project or tenant-based rental assistance, and operating costs must meet various housing quality standards listed in 24 CFR sections 574.310(b)(1)-(2). Condition: During testing of tenant files, there were 5 instances where inspection documentation or HQS documentation was missing. Cause: During this period of switching to remote work due to COVID and incorporating electronic files, documentation was frequently misfiled. Effect: The Program was not in compliance with federal regulations regarding documentation of housing quality standards. Questioned Cost: None Context: A sample of 22 tenant files were selected from a population of 113 tenants. The test found 5 exceptions, as noted above. Recommendation: We recommend that the organization strengthen its internal control procedures related to housing quality standards and inspections and documentation. This should include management training in the applicable compliance requirements and more effective communication of the requirements to staff, as well as improved monitoring of tenant files. Management’s View: We agree with this finding and have outlined our response in our Corrective Action Plan.

Corrective Action Plan

Condition: During testing of tenant files, there were 5 instances where inspection documentation or HQS documentation was missing. Corrective Action: Management has established the proposed controls included in the Recommendations outlined in the Federal Awards Findings and Questioned Costs document: Management created a review tool checklist of all required forms for the frontline staff to use as reference, for the Housing Coordinator to review assistance requests and client charts; and for leadership to conduct randomized internal audits; updated the training curriculum for Housing Department staff; new frontline staff has been hired, and trained to include clarification of compliance elements, the rationale and their importance, and which forms satisfy each one. WNCAP recognizes that the deficiency appears to persist, but this is due to the corrective actions being implemented in the first quarter of 2023, which is when the final audit report for FY 2020-21 was completed, and which time period is not covered by this audit. After implementation, internal review of client records confirms that they addressed this deficiency, as evidenced by the complete, compliant files. This will be reflected in the next Single Audit for FY 2022-23, and going forward.

Other Findings in this Audit

849 2022-001

Significant Deficiency Repeat
850 2022-002

Significant Deficiency Repeat
851 2022-003

Significant Deficiency Repeat
577291 2022-001

Significant Deficiency Repeat
577292 2022-002

Significant Deficiency Repeat
577293 2022-003

Significant Deficiency Repeat
577294 2022-004

Significant Deficiency

Programs in Audit

ALN	Program Name	Expenditures
14.241	Housing Opportunities for Persons with Aids	$785,833
93.917	Hiv Care Formula Grants	$197,823
93.940	Hiv Prevention Activities_health Department Based	$159,113
93.488	National Harm Reduction Technical Assistance and Syringe Services Program (ssp) Monitoring and Evaluation Funding Opportunity	$102,981
93.361	Nursing Research	$54,950