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Document
Document

This report presents the results of our audit of FHA’s principal financial statements and notes for the fiscal years ending September 30, 2019 and 2018, including our report on FHA’s internal control and test of compliance with selected provisions of laws, regulations, contracts, and grant agreements.

In our opinion, FHA’s fiscal years 2019 and 2018 financial statements were presented fairly, in all material respects, in accordance with the U.S. generally accepted accounting principles for the Federal Government. Our opinion is reported in FHA’s Fiscal Year 2019 Annual Management Report. The results of our audit of FHA’s principal financial statements and notes for the fiscal years ending September 30, 2019 and 2018, including our report on FHA’s internal control and test of compliance with selected provisions of laws, regulations, contracts, and grant agreements applicable to FHA, are presented in this report. Our audit disclosed one significant deficiency in internal controls and no instances of noncompliance with applicable laws, regulations, contracts, and grant agreements, which are discussed further in the body of this report.

Recommendations

Key Details
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  Open
  Closed
Funds Put to Better Use
Funds Put to Better Use

Recommendations that funds be put to better use estimate funds that could be used more efficiently. For example, recommendations that funds be put to better use could result in reductions in spending, deobligation of funds, or avoidance of unnecessary spending.

Questioned Costs
Questioned Costs

Recommendations with questioned costs identify costs: (A) resulting from an alleged violation of a law, regulation, contract, grant, or other document or agreement governing the use of Federal funds; (B) that are not supported by adequate documentation (also known as an unsupported cost); or (C) that appear unnecessary or unreasonable.

Sensitive
Sensitive

Sensitive information refers to information that could have a damaging import if released to the public and, therefore, must be restricted from public disclosure.

Priority
Priority

We believe these open recommendations, if implemented, will have the greatest impact on helping HUD achieve its mission to create strong, sustainable, inclusive communities and quality affordable homes for all.

Housing

  •   2020-FO-0001-001-A

    Closed on September 28, 2020

    Ensure that the HECM cash flow model assumptions capture all valid assignments or provide an analysis showing that the model results are not biased due to the exclusion of valid HECM assignments.

  •   2020-FO-0001-001-B

    Closed on September 28, 2020

    Document and implement policies and procedures to ensure that data observations for key assumptions that are inconsistent with FHA’s understanding of program operations are researched and further analyzed and that all results are concurrently documented and included in the model documentation.

  •   2020-FO-0001-001-C

    Closed on March 24, 2020

    Update the posting models to ensure that refunds relating to payments made in prior years are properly recorded in accordance with OMB Circular A-11.

  •   2020-FO-0001-001-D

    Closed on January 30, 2020

    Correct the programming error in the HERMIT system to ensure that the correct insurance-in-force balances are reported on the note disclosures.

  •   2020-FO-0001-001-E

    Closed on January 29, 2020

    Develop policies and procedures to ensure that the line items in the required note disclosures are understood, properly calculated, and properly disclosed in the financial statements in accordance with OMB Circular A-136.