SUFFIELD HOUSING AUTHORITYLocal Government

Noncompliance - Untimely Submission of Federal Single Audit Reporting Package Federal Program: All Federal Programs Criteria: Pursuant to the audit requirements set forth in Title 2 U.S. Code of Federal Regulations Section 200.501, a non‐Federal entity that expends $750,000 or more during its fiscal year in Federal awards is required to have a single or program‐specific audit conducted for that year in accordance with the provisions of the Uniform Guidance. The Federal Single Audit reporting package must be submitted by the auditee to the Federal Audit Clearinghouse within thirty calendar days after receipt of the auditor’s report(s) or nine months after the end of the audit period, whichever is earlier. Extensions of time to submit the reporting package may be granted by the cognizant or oversight agency for audit. Condition: The Authority did not submit its Federal Single Audit reporting package within the required timeframe set forth in Title 2 U.S. Code of Federal Regulations Section 200.512. Questioned Cost: There were no questioned costs. Context: During the process of performing a biannual audit of the Authority’s financial statements, material audit adjustments were identified and recorded that impacted the Authority’s schedule of expenditures of federal awards. As a result of the adjustments, the Authority exceeded the $750,000 expenditure threshold requiring a federal single audit. The determination that a single audit was required was not made until after the applicable reporting deadline had passed. Effect: The Authority was not in compliance with the federal reporting requirements set forth in Title 2 U.S. Code of Federal Regulations Section 200.512. Untimely submission of the reporting package may reduce the effectiveness of federal oversight and monitoring. Cause: The Authority did not have adequate internal control processes in place to identify and monitor financial activity related to grants administered by an external party. The Authority relied on the external party’s administration of the project without implementing procedures to ensure that all related transactions were recorded in its own accounting records in the proper period. Repeat finding: No Auditor Recommendation: We recommend that the Authority implement strengthened internal controls to ensure that all grant funded activities and major capital projects are appropriately identified, monitored, and recorded in the Authority’s accounting records. This should include procedures for reviewing grant agreements to determine financial reporting responsibilities, coordination with external parties and any consultants involved in project administration, and periodic reconciliation and monitoring procedures to ensure all activity is accurate and captured timely. In addition, we recommend that the Authority evaluate the potential need for a single audit at the end of each fiscal year to determine if a mandatory single audit is required for that specific year. Views of Responsible Officials: Management agrees with the finding and intends to take corrective action to address the identified deficiencies.

Material Weakness in Internal Control over Compliance - Inadequate Controls Over Preparation of the Schedule of Expenditures of Federal Awards Federal Program: All Federal Programs Criteria: Management is responsible for the preparation and fair presentation of the schedule of expenditures of federal awards; this includes the design, implementation, and maintenance of internal control relevant to the preparation and fair presentation of the schedule of expenditures of federal awards that is free from material misstatement, whether due to fraud or error. Condition: The Authority did not establish effective internal controls over compliance related to the preparation of the schedule of expenditures of federal awards. Context: During our audit, we identified that the Authority did not properly record the financial activity associated with a grant funded capital project for which it was responsible under the terms of its funding agreements. Although an external party administered the project and paid the contractors directly, the Authority was the accountable subrecipient and beneficiary of project funds. The Authority did not recognize the associated capital asset additions, expenditures, or related grant activity in its general ledger. This resulted in a material audit adjustment to the Authority’s schedule of expenditures of federal awards for the year ended December 31, 2024. Effect: As a result of the control deficiency, the Authority’s schedule of expenditures of federal awards for the year ended December 31, 2024 was materially misstated prior to audit adjustment. Cause: The Authority did not have adequate internal control processes in place to identify and monitor financial activity related to the grant funded capital project administered by an external party. The Authority relied on the external party’s administration of the project without implementing procedures to ensure that all related transactions were recorded in its own accounting records in the proper period. Repeat finding: No Auditor Recommendation: We recommend that the Authority implement strengthened internal controls to ensure that all grant funded activities and major capital projects are appropriately identified, monitored, and recorded in the Authority’s accounting records. This should include procedures for reviewing grant agreements to determine financial reporting responsibilities, coordination with external parties and any consultants involved in project administration, and periodic reconciliation and monitoring procedures to ensure all activity is accurate and captured timely. Views of Responsible Officials: Management agrees with the finding and intends to take corrective action to address the identified deficiencies.