WASHINGTON COUNTY COMMUNITY ACTION COUNCIL, INC.

Material Weakness in Internal Control over Compliance; Material Noncompliance - Special Tests and Provisions - Housing Quality Standards Criteria Management is required to perform on-site inspections and maintain adequate documentation to determine compliance with property standards and verify the information submitted by the owners. Condition As a result of our testing, we found the Council did not maintain sufficient documentation to support that required inspections were performed in accordance with program requirements. In addition, controls over documenting and retaining evidence of inspections were not operating effectively. Accordingly, we identified both an instance of noncompliance and a related deficiency in internal control over compliance. Cause Management did not maintain or retain complete inspection documentation and did not have adequate procedures in place to ensure inspection records were consistently prepared, reviewed, and retained. Effect Without sufficient documentation, the Council is unable to demonstrate compliance with inspection requirements and the operation of related internal controls. This increases the risk that noncompliance, errors, or deficiencies may not be identified or corrected in a timely manner. Recommendation We recommend management strengthen its documentation retention and monitoring procedures to ensure inspection activities are consistently performed, documented, and retained in support of compliance and control requirements. Questioned Costs None. Management's Response Management has implemented new procedures to ensure monthly inspections are formally documented and maintained.

Material Weaknesses in Internal Control over Compliance; Material Noncompliance - Eligibility Criteria Management is required to determine if each family is income eligible by determining the family’s annual income and maintaining records of annual recertifications for each family assisted. Condition During our testing, management could not locate updated annual recertification documentation for certain residents selected for review. As a result, we were unable to verify that annual recertifications were completed in accordance with applicable program requirements. Cause Management did not have adequate procedures in place to ensure annual recertification records were consistently completed, properly maintained, and retained. Effect As a result of the missing annual recertification documentation, the Council could not demonstrate compliance with applicable program requirements for all residents tested. This increases the risk that resident eligibility or continued participation may not be properly supported and that noncompliance may not be prevented or detected timely. Recommendation We recommend the Council strengthen its internal controls over the annual recertification process to ensure required recertifications are completed timely. We further recommend that management implement periodic reviews to verify that annual recertification documentation is completed annually and on file for each resident. Questioned Costs None. Management's Response Management has implemented new procedures to ensure annual recertifications are completed annually for all residents and formal document is maintained in each resident file.