Finding 980413 (2023-004)

2023-004 Original Operating Budget Not approved until after the beginning of the fiscal year and Operating Budget Revision Not approved by Board of Commissioners for Operating Expenses that exceeded the Originally Approved Budget (Special Tests and Provisions) Criteria: In accordance with the Authority’s Annual Contributions Contract (ACC), the Authority is required to prepare and approve a Public Housing Operating Budget before the beginning of its fiscal year and approve an Operating Budget Revision for any operating expenses not previously budgeted for. Condition: The Board of Commissioners did not approve the fiscal year 2023 operating budget until October 18, 2022. The Authority’s actual expenditures exceeded its budgeted expenditures by $37,013. Questioned Costs: None. Effect: The Authority was not in compliance with the requirements of its ACC and the Authority had $37,013 in unbudgeted operating expenditures. Cause: The Authority did not have procedures in place to review actual expenditures for the year as compared to the amount of budgeted expenditures nor ensure operating budgets are approved before the beginning of its fiscal year. Recommendation: The Authority should establish a process whereby the operating expenditures are reviewed by the Authority’s Board of Commissioners to determine if a budget revision is necessary for approval before the end of its fiscal year and to ensure that operating budgets are approved before the beginning of the Authority’s fiscal year. Management Response: The Board could not meet due to personal circumstances of some of the Board members until October 2022 to approve the budget. The Board was made aware of the costs that exceeded the budgeted amounts but a format budget revision was not prepared. This issue was dealt with at the Board meeting in January 2024 where a budget policy was adopted.