THE HOUSING AUTHORITY OF THE TOWN OF GORDOLocal Government

Finding 2021-001 ? Insufficient Collateralization of Deposits Public Housing Program ? CFDA No. 14.850, Year ended December 31, 2021 Criteria: PIH notice 96-33 requires all funds in excess of FDIC coverage be collateralized with specific approved governmental securities held in the Authority?s name. Condition: The Authority did not have collateralization for $8,232 invested as of December 31, 2021,which was not insured by FDIC or invested in U.S. Treasury Obligations. Cause: Due to a large outstanding check at the end of the year the Authority?s bank balance exceeded the $250,000 FDIC limit by $8,232 on December 31, 2021, while the book balance was less than $250,000. Potential Effect: Had there been a bank failure or theft the Authority may not have recovered up to $8,232 in federal funds. Perspective Information: This was an isolated instance related to a check that was expected to clear the bank by December 31, 2021 but did not clear. Recommendation: We recommend the Authority monitor their bank balances with financial institutions on a monthly basis to assure the banks have sufficient collateral pledged at all times. Reply and Corrective Action Plan: The Authority?s Executive Director, Bud Blakney, has assumed the responsibility of maintaining sufficient collateral and will monitor account balances regularly.