WWW.CITRINCOOPERMAN.COM J. Michael Stephens Partner 2 Bethesda Metro Center, 11 th Floor Bethesda, Maryland 20814 TEL: 301.654.9000 E : mstephens@citrincooperman.com C I T R I N C O O P E R M A N ’ S P r e s e n t a t i o n o f ALAMEDA HOUSING AUTHORITY AUDIT FOR THE YEAR ENDED JUNE 30, 2018 Board Presentation – March 20, 2019 1
MEETING AGENDA PAGE 3 Engagement Team PAGE 6 Review of Financial Statements and related Reports PAGE 4 PAGE 11 Engagement Scope Required Communications to the Board – SAS 114 PAGE 5 Audit Status PAGE 15 Questions 2
Engagement Team J. Michael Stephens, Engagement Partner Ben Karlin, Manager Vidur Bhala and Robert Friscia, Staff 3
Engagement Scope Audit of Alameda Housing Authority Single Audit in Accordance with Uniform Guidance Submission to REAC/HUD Submission to Federal Audit Clearinghouse 4
Audit Status Presentation of Draft Reports today Finalize with Approval of Board Submission to REAC by 3/31/2019 Submission to Federal Audit Clearinghouse by 3/31/2019 5
Review of Financial Statements and Related Reports • Financial Statements • Unmodified opinion on Financial Statements • Changes in presentation due to new OPEB standards and structure of OPEB Trust • Net Position increased $1.8 Million for the year ended June 30, 2018 • Assets increased $2.2 Million primarily due to increases in cash ($4.6MM) and receivables ($229K), offset by decreases in deferred inflows ($1.0MM) in prepaids ($151K), notes receivable ($965K), and net capital assets ($559K) 6
Review of Financial Statements and Related Reports • Liabilities increased $442K primarily due to increases in accounts payable ($318K) and deferred inflows ($1.2MM) offset by decreases in accrued liabilities ($317K) and noted and bonds payable ($999K) • Net Position increased $1.8MM primarily due to a change in net position for the year ended June 30, 2018 of $3.3MM offset by prior period adjustments related to the implementation of GASB 75 for OPEB of $1.5MM • Changes in components of net position consisted of an increase in invested in capital assets of $440K, a decrease in restricted net assets of $52K, and an increase in unrestricted of $1.4MM 7
Review of Financial Statements and Related Reports • Total revenues decreased $2.3MM primarily due to the absence of the Del Monte Senior Housing gain in the prior year ($7MM), the pension adjustment ($1MM) offset by increases in grants ($2.4MM), rents ($359K), and other income ($2.6MM) • Total expenses increased $2.7MM primarily due to increases in Housing Assistance Payments ($3.0MM), administration ($310K), utilities ($572K), and tenant services ($321K), offset by decreases in maintenance ($729K) and general expenses ($1.2MM) • Most disclosures are consistent with prior years with the exception of the new OPEB disclosure due to the implementation of GASB 75 and revised presentation of the OPEB Trust 8
Review of Financial Statements and Related Reports Single Audit • Unmodified Opinion on single audit compliance (we do not opine on internal controls) • Report on Internal Control has one finding related to adjusting entries required. Repeat from prior year but lowered level of classification (See Response on Next Slide) • Report on Compliance has no findings reported which is consistent with prior years • Tested Housing Choice Voucher Program as Major Program in current year 9
Review of Financial Statements and Related Reports Single Audit Finding Response from Management The accounting staff that did this work are no longer employed with the Authority. The Authority has hired a Controller and is in the process of hiring a new Finance Director. The Authority also has the assistance of a Fee Accountant, the Fee Accountant intends to provide guidance and training to the new Director of Finance. As part of this guidance the Fee Accountant intends to implement a Balance Sheet Analysis (BSA) approach to the yearend financial statement preparation. The BSA approach requires that all fiscal yearend balance sheet accounts have proper documentation to support the balances reported in the yearend financial statements. This approach will provide the auditors documentation to support their audit field work and audit report. Additional automated IT checks in Yardi have been set in place to ensure that journal entries are approved over certain amounts. The Authority will require the Director of Finance to approve all journal entries not created by the Director of Finance directly and any journal entries prepared by the Director of Finance will be provided to the Executive Director for approval. Co-ordination with other departments will be strengthened to ensure timely accurate booking of complex transactions. 10
REQUIRED COMMUNICATIONS TO THE BOARD Communications Required Under SAS 114 Auditor responsibilities under generally • accepted auditing standards Scope and timing of audit • Other findings from audit • Qualitative aspects of significant • accounting policies 11
Required Communications to the Board Communications Required Under SAS 114 • Auditor responsibilities under generally accepted auditing standards • Scope and timing of audit • Other findings from audit • Qualitative aspects of significant accounting policies • Significant difficulties encountered during the audit Reconciliation issues between GL and FDS 12
Required Communications to the Board Communications Required Under SAS 114 • Corrected and uncorrected misstatements Corrected misstatements related to cash, pension, OPEB, debt Uncorrected misstatements related to accounts payable and accrued interest payable • There were no disagreements with management • There were no management consultations with other accountants • No significant issues discussed with management • Independence • Management representations 13
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WWW.CITRINCOOPERMAN.COM J. Michael Stephens Partner 2 Bethesda Metro Center, 11 th Floor Bethesda, Maryland 20814 TEL: 301.654.9000 E : mstephens@citrincooperman.com QUESTIONS? THANK YOU! 15
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