In accordance with the Chief Financial Officers Act of 1990, as amended, we are required to annually audit the consolidated financial statements of the U.S. Department of Housing and Urban Development (HUD) and the stand-alone financial statements of the Federal Housing Administration and the Government National Mortgage Administration (Ginnie Mae). Our objective was to express an opinion on the fairness of HUD’s consolidated financial statements in accordance with U.S. generally accepted accounting principles applicable to the Federal Government. This report presents our independent auditor’s report on HUD’s fiscal years 2017 and 2016 (restated) consolidated financial statements and reports on internal controls and compliance with laws and regulations. We expressed a disclaimer of opinion on HUD’s fiscal years 2017 and 2016 (restated) consolidated financial statements because of the significant effects of certain unresolved audit matters, which restricted our ability to obtain sufficient, appropriate evidence to express an opinion. These unresolved audit matters relate to (1) HUD’s improper use of cumulative and first-in, first-out budgetary accounting methods of disbursing community planning and development program funds, (2) the $3.6 billion in nonpooled loan assets from Ginnie Mae’s stand-alone financial statements that we could not audit due to inadequate support, (3) unvalidated grant accrual estimates, and (4) the improper accounting for certain HUD assets and liabilities. Additionally, due to weaknesses in its financial reporting process, we were unable to review note 3 and note 7 to the consolidated financial statements. This report contains nine material weaknesses, six significant deficiencies, and three instances of noncompliance with applicable laws and regulations. Additional details of the material weaknesses, significant deficiencies, and instances of noncompliance with laws and regulations and related recommendations are included in separate audit reports entitled (1) Additional Details To Supplement Our Fiscal Years 2017 and 2016 (Restated) U.S. Department of Housing and Urban Development Financial Statement Audit, audit report 2018-FO-0004; (2) Audit of the Federal Housing Administration Financial Statements for Fiscal Years 2017 and 2016 (Restated), audit report 2018-FO-0003, and (3) Audit of the Government National Mortgage Association’s Financial Statements for Fiscal Years 2017 and 2016 (Restated), audit report 2018-FO-0002.