Housing Authority of the City of Deerfield Beach

2023-001 Unaudited Submission Criteria Financial Data Schedule (FDS) submission for unaudited financials are due within 2 months after the fiscal year end (24 CFR section 5.801). Condition Management missed the deadline for its unaudited REAC FDS submission. Context The Authority 's unaudited FDS submission was due on December 15th, 2023. The Authority did not submit the submission until December 28th, 2023. Cause Management misinterpreted the deadline for the unaudited FDS submission for PHA's. Effect The Authority is not in compliant with the reporting guidelines outlined in the HCV compliance supplement. Recommendations The Authority needs to improve its internal controls over financial reporting by submitting its financial data on a timelier basis. Management Views Management agrees with the finding, see Management's corrective action plan.

2023-002 INTERPROGRAM DUE TO/DUE FROM ACTIVITIES Criteria According to PHA Accounting Brief #14 Due To/Due From relationships should not be reported under accrual accounting simply from the result of a PHA using a common checking or working capital account. Because of the basic nature of most Federal and state programs, resources from one program cannot be used to support the costs of another program. HUD views Due To’s and Due From’s reported in a PHA’s Federal programs as possible indicators of non-compliance. Condition The Authority has interfund receivables and payables that have not been repaid as of fiscal year end. This results in certain programs having a negative cash balance as of fiscal year end. Context The Authority reported a material ($134,558 in total, $42,682 in HCV program) amount of interfund receivables and payables, which is a significant red flag for HUD reviewers. Cause The Authority was not effectively monitoring and managing interfund program balances in order to ensure that programs were not spending funds that they do not have. Effect The use of Due to/ Due From transactions reported in the Authority's financials net to some programs having negative cash balances, which could signify to HUD that one or more programs have used resources to cover the costs of another program. Recommendations The Housing Authority should expand it's controls over cash reconciliations to include a step to verify if a program, fund or component unit is accurate along with the entire cash pool. Also interfund should be repaid monthly at a minimum. Management Views Management agrees with the finding, see Management's corrective action plan.

Criteria: PHAs may use HCVP and Mainstream Voucher funds only for Housing Assistance Payments (HAP - to participating owners, and for administrative fees (24 CFR sections 982.151 and 982.152). HAP funding can be used only to support the payment of HAP expenses. Transfers of HAP and administrative fees, even temporarily, to support another program or use are not allowed, and could be considered a breach of the ACC (see III.L.1.e.(3), ?Reporting--Financial Reporting--FDS Transfer Line Items?).Condition: During our audit we noted that the Authority's HCV program (Program) provided non-fungible funds to other non-HCV programs to cover short-term cash shortages for various projects. Questioned Costs: $192,251. Amount derived from REAC FDC line 144 intercompany receivable balance owed to the Program. Context: Per the Authority's electronic Voucher Management System (VMS), net position restricted for HAP payments was reported as $332,242 while the respective cash balance of HAP designated funds was $224,639, resulting in a $107,603 shortfall in cash. An additional $84,648 of the Program's cash designated for the Program's general operations was used in other programs also. Cause: Short-term cash shortages, timing of expenditure reimbursements, and a lack of a timely review of pooled cash account balances. Effect: As a result, the Program was $107,603 short of the required restricted HAP cash balance to cover the excess HAP funding provided to the Program from HUD. Additionally, the net effect of noncompliance was $192,251 used for unallowable being used on unallowable costs and activities. Recommendations: The Authority should replenish the HCV program's HAP cash balance as soon as possible. Additionally, management should design and implement a system to ensure timely and routine monitoring of non-fungible cash balances included in the Authority's pooled cash accounts, ensuring there are no cash shortfalls or unallowable transfers. Management Views: Management concurs with this audit finding. See the Corrective Action Plan for additional information required to be reported.

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION

GSA_MIGRATION