We audited the Housing Authority of East Baton Rouge Parish's (Authority) American Recovery and Reinvestment Act of 2009 (Recovery Act) Public Housing Capital Fund obligations. Our audit objective was to determine whether the Authority met HUD and Recovery Act requirements when obligating and expending funds it received under the Recovery Act. We initiated the audit as part of our audit plan and goal to review funds provided under the Recovery Act.
Overall, the Authority generally ensured that it met HUD and Recovery Act requirements. Specifically, it obligated Recovery Act capital funds for eligible projects, maintained proper support for its obligations, and ensured that it had adequate management controls over its obligation process. In addition, the Authority's Recovery Act projects were in progress, and it appeared that the Authority would spend its Recovery Act funds within the required timeframes. However, it did not always ensure that Recovery Act expenditures were eligible. This condition occurred because the Authority wanted to exhaust all of its Recovery Act funds before charging expenditures to its regular capital funds and it had not developed adequate written accounting policies and procedures. As a result, the Authority spent $13,561 for ineligible costs.
The Authority corrected the transaction which generated the $13,561 of ineligible costs, and charged it to the appropriate funding source. However, we recommend that HUD's Director of Public Housing require the Authority to develop and implement adequate written accounting policies, which include procedures for processing and paying invoices, to ensure that Recovery Act funds are properly spent and accounted for.