Finding Text
FINDING NUMBER 2022-007
FEDERAL PROGRAM HOUSING VOUCHER CLUSTER:
SECTION 8 HOUSING CHOICE VOUCHERS/ COVID-19 SECTION 8 HOUSING
CHOICE VOUCHERS/ EMERGENCY HOUSING VOUCHERS
(ASSISTANCE LISTING NUMBERS 14.871/ 14.HCC/ 14.EHV)
U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
TYPE OF FINDING COMPLIANCE AND INTERNAL CONTROL
COMPLIANCE
REQUIIREMENT REPORTING
CONDITION The Program did not complied with the financial and special reporting requirements,
as follows:
1. I performed a special reporting test over fifteen (15) participants' files and found
the following situations:
In two (2) cases, I did not find evidence of the submission to HUD of the
Form HUD-50058, Family Report (OMB No. 2577-0083), corresponding to
the reexamination audited.
In one (1) case, the Form HUD-50058, Family Report (OMB No. 2577-
0083) was submitted to HUD 240 days after its effective date.
2. I noted that GAAP-based unaudited and audited financial information for the
fiscal year ended June 30, 2022, were not submitted in time.
CRITERIA Code of Federal Regulations 24, part 908.104 (c), electronic transmission of data,
states that electronic transmission of data consists of submission of all required data
fields (correctly formatted) from the forms HUD-050058 and HUD-50058-FSS
telephonically, in accordance with HUD instructions. Regardless of whether an HA
obtains the ADP system itself or contracts with a service bureau to provide the
system, the software must be periodically updated to incorporate changes or
revisions in legislation, regulations, handbooks, notices, or HUD electronic
transmission data format requirements. Also, CFR 24 982.158 (a), states that the
PHA must maintain complete and accurate accounts and other records for the
program in accordance with HUD requirements, in a manner that permits a speedy
and effective audit. The records must be in the form required by HUD, including
requirements governing computerized or electronic forms of record-keeping. 24 CFR, Section 5.801 (b), submission of financial information. Entities to which this
subpart is applicable must provide to HUD such financial information as required by
HUD. Such information must be provided on an annual basis, except as required
more frequently under paragraph (c) (4) of this section. This information must be: (1)
prepared in accordance with Generally Accepted Accounting Principles; (2)
submitted electronically to HUD through the internet, or in such other electronic
format designated by HUD, or in such non-electronic format as HUD may allow if the
burden or cost of electronic reporting is determined by HUD to be excessive. In
addition, Section 5.801 (d), reporting compliance dates. Unaudited financial
statements will be required 60 days after the PHA's fiscal year end, and audited
financial statements will then be required no later than 9 months after the PHA's
fiscal year end, in accordance with the Single Audit Act and 2 CFR part 200, subpart
F.
CAUSE The internal controls and procedures maintained by the Program failed to ensure the
timely submission to HUD of the Form HUD-50058, Family Report (OMB No. 2577-
0083) and the GAAP based unaudited and audited financial information.
EFFECT The lack of proper filing of required financial reports may lead HUD to impose special
conditions regarding the use of funds to the Municipality. Also, HUD relies on key
line items of the report to determine the reasonableness of the data submitted for
the purposes of calculating funding under the program. Accordingly, future funding
for the Municipality may be affected negatively.
RECOMMENDATION The Municipality should continue strengthening the established internal controls and
procedures to submit to HUD the Form HUD-50058, Family Report (OMB No. 2577-
0083) and the financial reports according to applicable requirements.
QUESTIONED COSTS None
PRIOR YEAR FINDING This finding was presented in prior year Schedule of Findings and Questioned Costs
(2021-004).
VIEWS OF RESPONSIBLE OFFICIALS AND PLANNED
CORRECTIVE ACTION Instructions were given to the Program staff to strengthening existing internal
controls and procedures to ensure the submission of the Form HUD-50058, Family
Report (OMB No. 2577-0083), and the financial reports according to applicable
requirements. The audited financial data schedule for the fiscal year 2021-2022 will
be submitted as soon as the Single Audit Report be finally issued by the external
auditors.