The OIG has determined that the contents of this recommendation would not be appropriate for public disclosure and has therefore limited its distribution to selected officials.

The OIG has determined that the contents of this recommendation would not be appropriate for public disclosure and has therefore limited its distribution to selected officials.

The OIG has determined that the contents of this recommendation would not be appropriate for public disclosure and has therefore limited its distribution to selected officials. 

The OIG has determined that the contents of this recommendation would not be appropriate for public disclosure and has therefore limited its distribution to selected officials. 

The OIG has determined that the contents of this recommendation would not be appropriate for public disclosure and has therefore limited its distribution to selected officials.

Work with program offices through remediation activities to determine the underlying causes of the control deficiencies identified by the AIR program. 

Assess and address barriers to timely and adequate responses from program offices during AIR program internal control testing. This assessment should:a) Identify recurring causes for delayed or incomplete responses from program offices and implement escalation protocols or incentives to ensure timely fulfillment of AIR program requests;b) Identify and implement efficiencies in the testing process to optimize the time program offices spend on the…

Coordinate with the Principal Deputy Assistance Secretary for each Program Office to:a) Define governance protocols to include reassessing HUD’s escalation protocols and enforcement mechanisms for repeated or willful noncompliance with documented controls, such as additional oversight, retraining, or disciplinary action as appropriate. Based on the assessment, update those protocols and mechanisms, as warranted.b) Establish and resource a HUD-…

Re-examine and enhance HUD’s process for evaluating the potential financial impact of control deficiencies identified by the AIR program or other sources to ensure that:a) Assessments of financial impact are initiated promptly upon identification of control deficiencies;b) The evaluation process is structured to deliver clear, actionable conclusions in sufficient time to inform any necessary adjustments to financial statements prior to the…

Require targeted, role-specific training for program office staff and managers in areas where deficiencies were identified, including approvals, segregation of duties, recordkeeping, and delegated authority. This training should reinforce the importance of compliance with internal control requirements and include HUD escalation and enforcement mechanisms.

Based on the causes identified, coordinate with the program offices through remediation activities to develop corrective action plans with defined milestones, responsible parties, and timelines. Progress should be tracked, documented, and periodically reported to senior management. 

Determine which report accurately reflects the status of partial claims without original documentation, certify the completeness and accuracy of the identified report, and provide the report to the General Ledger Division for the reclassification entry.

Issue guidance, including technical assistance, to all disaster recovery grantees that waivers for issues related to a disaster’s impact, like waivers of procurement policies, should be for reasonable and limited time periods after a disaster’s occurrence to ensure full and open competition. 

Develop a standard operating procedure that details the rationale, calculation, and underlying support needed for the amounts and narrative descriptions in the financial statement note disclosures, including borrowing authority.

Implement quality control checks that reconcile financial statement disclosure amounts to the general ledger and other supporting documentation as part of the financial statements review and approval process. 

Implement a procedure to test journal entry posting models and their effect on the financial statements and related note disclosures when there are program changes requiring new journal entries.

Record journal entries to reclassify the HECM cases with missing original first notes for more than 90 days from loans receivable to accounts receivable. 

Ensure the report provided by the NSC to reclassify partial claims from loans receivable to account receivable is appropriate for financial reporting and document the decision. 

Include grantees in the fraud risk identification process and communicate the risks and schemes identified for the disaster recovery program to relevant stakeholders, including, but not limited to, all HUD staff in the CPD Office of  Disaster Recovery, grantees and sub-recipients.

Leverage HUD OIG’s fraud risk inventory and continue using the Office of the Chief Risk Officer’s risk catalog to enhance CPD’s fraud risk management process.