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Audit - 1992/1993 A '^ T..., '" tz-Ij Co "''J HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I Annual Contributions Contracts FW-1114 & KC-7015 Project KS 38-2, 3, 4 & 5 & Project KS E38-1 & E38-8 Project KS 38VOOl & Home Ownership Program I I FINANCIAL STATEMENTS Twelve Months Ended June 30, 1993 I I I I I I I I I I I I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I TABLE OF CONTENTS EXHIBIT I Independent Auditor's Report I FINANCIAL STATEMENTS Balance Sheet at June 30, 1993 A I Statement of Income and Expenses - Twelve Months Ended June 30, 1993 B I Analysis of Surplus - Twelve Months Ended June 30, 1993 C I Notes to the Financial Statements Independent Auditor's Report -- Home Ownership Program I FINANCIAL STATEMENTS Balance Sheet at June 30, 1993 I Income Statement Twelve Months Ended June 30, 1993 I Analysis of Surplus - Twelve Months Ended June 30, 1993 I Notes to the Financial Statements SUPPLEMENTARY INFORMATION I Schedule of Federal Financial Assistance for the Twelve Months Ended June 30, 1993 C(l) I Computation of Residual Receipts and Accruing Annual Contributions D I Analysis of Modernization and Development F I Analysis of General Funds Available for Reduction of Annual Contributions G I Report on Compliance to Laws and Regulations Based on an Audit of Financial Statements Performed in Accordance with Government Auditing Standards I I PAGE 1-2 3-4 5-6 7-8 9-11 12 13 14 15 16 17 18-19 20-22 23-24 25 I Single Audit Opinion on Compliance with Specific Requirements Applicable to Major Federal Financial Assistance Programs I I Independent Auditor's Report on the Housing Authority of Salina, Kansas's Complianoe with General Requirements I Independent Auditor's Report on the Housing Authority of Salina, Kansas's Internal Control Structure as an Entity and Over Its Federal Financial Assistance Programs Sohedule of Findings and Questioned Costs I Adjusting Entries I I I I I 'I I I I I I I I I 26 27 28-30 31-33 34-35 I John M. Middleton Certified Public Accountant 3315 W. 91st Street Leawooci, Kansas 66206 913-648-3687 I I I Board of Directors Salina Housing Authority Salina, Kansas 67402-1202 Department of Housing and Urban Development National Review Center 950 N. King's Highway Cherry Hill, New Jersey 08034-1518 I I Independent Auditor's Report I I have audited the accompanying the City of Salina, Kansas as These financial statements are managemen t . My responsibili ty statements based on my audit. financial statements of the Housing Authority of of June 30, 1993 and for the year then ended. the responsibility of the Housing Authori ty' s is to express an opinion on these financial I I conducted my audit in accordance with generally accepted auditing standards, Government Auditing Standards, and OMB Circular A-128. Those standards require that I plan and perform the audit to obtain reasonable assuranoe about whether the financial statements are free from material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion. II I I As described in Note A, these financial statements were prepared with the accounting practices prescribed or permitted by the Housing and Urban Development, which is a comprehensive basis other than generally accepted accounting principles. in conformi ty Departmen t of of accounting I I In my opinion, the financial statements referred to above present fairly, in all material respects, the assets, liabilities, and surplus of the Housing Authority of the City of Salina, Kansas, as of June 30, 1993 and the results of its operations and its changes in surplus for the twelve months then ended, on a basis of accounting described in Note A. I I (con tinued) I I I I I My audi t was made for the purpose of forming an opinion on the financial statements of the Housing Authority of the City of Salina, Kansas taken as a whole. The supplemental finanoial information as listed in the Table of Contents is presented for purposes of additional analysis and is not a required part of the financial statements. This information has been subjeoted to auditing procedures applied in the audit of the financial statements and, in my opinion, is fairly stated in all material respects in relation to the financial statements taken as a whole. I I I This report is intended solely for the information and use of the Board of Directors, Management of the Housing Authority of the City of Salina, and the Department of Housing and Urban Development and should not be used for any other purpose. I ~12 C}, / /),"(, ;? //, . /;"Ul-11U~"~J"'!) L:/,tI- ohn M. Middleton . Certified Public Accountant I I October 21, 1993 Leawood, Kansas 66206 I I I I I I I I I I I I I Exhibit A-1 I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I BALANCE SHEET As of June 30, 1993 Annual Contribution Contract FW-1114 Project KS 38-2, 3, 4 & 5 I ASSETS I Cash Petty Cash AIR -- Tenants AIR -- Other Investments HOD Annual Contributions Receivable Prepaid Insurance Development Costs Development Costs - Contra Land, Structures and Equipment Modernization -- 903z Modernization -- 904z Development 004 Development -- 005 $ 12,163.50' 50.00' 2,595.01' 10,131.47 31,157.29" 67,888.11 5,712.08' 2,497,739.57 ' 2,497,739.57) , 2,522,987.79' 50,000.00 9,205.44 59,754.20 28,815.24 I I I I TOTAL ASSETS $ 2,800,460.13 I LIABILITIES AND SURPLUS TOTAL LIABILITIES $ 9,191.50 1,925.12 9,178.22 849.27 967,444.99 759,625.01 -------------- $ 1,748,214.11 1,052,246.02- -------------- $ 2,800,460.13 I Tenants Security Deposits Other Accounts Payable PILOT Prepaid Rent Permanent Notes - HOD Permanent Notes - FFB I I Surplus - Exhibit C TOTAL LIABILITIES AND SURPLUS I I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS - 3 - I I Exhibi t A-2 I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I BALANCE SHEET As of June 30, 1993 Annual Contribution Contract KC-7015 I I TOTAL ASSETS KS 38V-001 KS 38E-1 KS 38E-8 $ 2,196.36 $ 45,016.25 1,511. 03 3,467.00 33,915.89 799.88 11,348.40 ------------- ------------- ------------- $ 4,507.27 $ 90,280.54 $ 3,467.00 ASSETS I Cash AIR -- Interproject Investments Land, Structures & Equipment I LIABILITIES AND SURPLUS I Alp Alp Alp Interproject $ Other HOD 1,061.22 33.49 2,612.68 $ 13,863.28 229.29 5,271.77 $ 215.29 TOTAL LIABILITIES $ 3,707.39 $ 19,364.34 $ 215.29 I Surplus - Exh. C-2 799.88. 70,916.20. 3,251.71 I TOTAL LIABILITIES AND SURPLUS $ 4,507.27 $ 90,280.54 $ 3,467.00 I I II I I I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS - 4 - I Exhibit B-1 HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas STATEMENT OF INCOME AND EXPENSES Twelve Months Ended June 30, 1993 Annual Contribution Contract FW-1114 Project KS 38-2, 3, 4 & 5 OPERATING INCOME Dwelling Rental Interest on General Fund Investments Other Income $ 102,126.00 1,931.49 6,526.90 TOTAL OPERATING INCOME - Exhibi t D $ 110,584.39. OPERATING EXPENSES Administration Utilities Ordinary Maintenance and Operations General Expense Non-Routine Maintenance $ 24,115.86 3,858.40 63,483.44 41,778.01 23,434.04 TOTAL OPERATING EXPENSE - Exhibi t D $ 156,669.75 NET (LOSS) BEFORE OTHER CHARGES $( 46,085.36) OTHER CHARGES Prior Period Adjustment Affecting Residual Receipts Interest on Notes and Bonds Payable $ 7,329.77 51,366.05 TOTAL OTHER CHARGES $ ( 58,695.82) NET (LOSS) - Exhibit C $ (104,781.18) . I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS - 5 - I I Exhibit B-2 I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I STATEMENT OF INCOME AND EXPENSES Twelve Months Ended June 30, 1993 Annual Contribution Contract KC-7015 I KS 38V-001 KS 38E-1 KS 38E-8 OPERATING INCOME I Interest: Operating Reserve General Funds $ 399.07 $ 2,180.58 201. 22 I TOTAL OPERATING INCOME $ 399.07 $ 2,381. 80 $ 0.00 I OPERATING EXPENSES I Audi t E>""pense $ Administrative E>""pense HAP Payments Preliminary Expense 84.00 10,613.86 89,204.11 300.00 $ 672.00 74,603.25 593,759.55 592.57 23,392.00 I TOTAL OPERATING EXPENSES $ 100,201. 97 $ 669,627.37 $ 23,392.00 I NET (LOSS) Before Other Credits & (Charges) $ ( 99,802.90) $( 667,245.57) $( 23,392.00) I OTHER CREDITS & (CHARGE S) Prior Period Adjustment Affecting Residuals $( 1,423.26) I TOTAL $ 0.00 $ ( 1,423.26) $ 0.00 I NET (LOSS) - Ex. C-2 $( 99,802.90). $( 668,668.83) $( 23,392.00). I I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS - 6 - II j Exhibi t C-1 HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas j ANALYSIS OF SURPLUS Twelve Months Ended June 30, 1993 Annual Contribution Contract FW-1114' Project KS 38-2, 3, 4 & 5 I UNRESERVED SURPLUS I I Balance, Audit June 30, 1992 Prior Audit Adjustment Subsequently Posted Transfer to Home Ownership Program Net (Loss) for the Year Ended June 30, 1993 - Exhibit B-1 Provision For Operating Reserve - Exh. D-1 I BALANCE AT JUNE 30, 1993 I RESERVED SURPLUS OPERATING RESERVE I Balance Per Audit at June 30, 1992 Provision for Operating Reserve BALANCE AT JUNE 30, 1993 I CUMULATIVE CONTRIBUTIONS I Balance Per Audit at June 30, 1992 Repaid Contribution Accruing Annual Contributions Year Ended June 30, 1993 - Exhibit D-1 HOD Operating Subsidy - Exhibit D-1 I I BALANCE AT JUNE 30, 1993 I CUMULATIVE GRANTS Balance Per Audit at June 30, 1992 Grants FYE 6/30/93 I BALANCE AT JUNE 30, 1993 I TOTAL SURPLUS - Exhibit A-1 I I I $( 1,715,646.88) ( 498.12) ( 13,753.14) 104,781.18) 9,091.04) $( 1,843,770.36) $ 46,112.90 9,091.04 $ 55,203.94 $ 2,579,850.53 ( 1,750.20) 67,888.11 63 201. 00 $ 2,709,189.44 $ 46,348.00 85,275.00 $ 131,623.00 $ 1,052,246.02 SEE ATTACHED INDEPENDENT AUDITOR'S REPORT NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS - 7 - II ( i ..-; : ! Exhibit C-2 HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas ANALYSIS OF SURPLUS Twelve Months Ended June 30, 1993 Annual Contribution Contract KC-7015 UNRESERVED SURPLUS Balance, Audit June 30, 1992 Prior Audit Adjustment Net (Loss) for the Year Ended June 30, 1993 - Exhibit B-2 Provision for Operating Reserve (Provision For) Reduction of Project Accounts BALANCE AT JUNE 30, 1993 RESERVED SURPLUS OPERATING RESERVE Balance, Audit at June 30, 1992 $( Cash Withdrawal Provision for Operating Reserve BALANCE AT JUNE 30, 1993 PROJECT ACCOUNT Balance, Audit at June 30, 1992 Provision For (Reduction of) Project Account BALANCE AT JUNE 30, 1993 CUMULATIVE CONTRIBUTIONS Balance, Audit at June 30, 1992 HUn Adjustment Housing Assistance Payments Year Ended June 30, 1993 BALANCE AT JUNE 30, 1993 TOTAL SURPLUS KS 38V-001 $( 353,010.12) 1,423.26 KS 38E-8 $( 0.00) KS 38E-1 $( 5,430,918.01) 99,802.90) 751.42) 668,668.83) 8,468.40) 23,392.00) 3,251. 71) 89,211. 56 77,050.27) 7,951.29) $ ( 362,929.62) $( 6,185,105.51) $ ( 34,595.00) 751.42) $ $ 49,897.54 1,201.86 8,468.40 0.00 751.42 3,251.71 $ $ $ 0.00 59,567.80 3,251.71 $ 228,115.25 $ $ 849,467.52 0.00 89,211.56) 77,050.27 7,951.29 $ $ 138,903.69 926,517.79 $ 7,951.29 $ 125,694.75 $ 4,590,503.89 $ 0.00 ( 4,035.94) 103,167.00 679 432.23 26,643.71 --------------- --------------- --------------- $ 224,825.81 $ 5,269,936.12 $ 26,643.71 =============== =============== =============== $ 799.88 $ 70,916.20 $ 3,251.71 SEE ATTACHED INDEPENDENT AUDITOR'S REPORT NOTES ARE AN INTEGRAL PART OF THESE FINANCIAL STATEMENTS - 8 - HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas June 30, 1993 Notes to the Financial Statements NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This summary of the significant accounting policies of the Housing Authority of the City of Salina (RA) is presented to assist in understanding the HA's financial statements. The financial statements and notes are representations of the HA's management, which is responsible for their integrity and objectivity. These accounting policies conform to practices prescribed or permitted by the Department of Housing and Urban Development (HOD) and have been consistently applied in the preparation of the financial statements. Principles Used to Determine Scope of Entity The HA's reporting entity includes the HA's governing board and all related organizations for which the HA exercises oversight responsibility. The HA has developed criteria to determine whether outside agencies should be included wi thin its financial reporting entity. The criteria includes, but is not limited to, whether the HA exercises oversight responsibility (which includes financial interdependency, selection of governing authority, designation of management, ability to significantly influence operations, and accountability for fiscal matters), scope of public service, and special financing relationships. The HA has determined that no other outside agency meets the above criteria and, therefore, no other agency has been included as a component unit in the HA's financial statements. In addition, the HA is not aware of any entity which would exercise such oversight responsibility which would result in the HA being considered a component unit of that entity. Basis of Accounting The accounts of the HA are maintained, and the accompanying financial state- ments have been prepared, on the basis of accounting practices prescribed or permitted by HOD. These practices differ in some respects from generally accepted accounting principles. Revenue is generally recognized when received rather than when earned except for federal financial assistance and tenant rent. Expenses are generally recognized when payments are made rather than when a liability is incurred. Accounts Receivable The HA uses the direct write-off method for bad debts. No allowance for doubtful accounts is used in the valuation of the receivables. - 9 - I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas June 30, 1993 I Notes to the Financial Statements I NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Continued) Land, structures and Equipment I Land, structures and equipment are stated at cost. No provision is made for the decrease in value of structure and equipment because of wear and tear or obsolescence and income is not charged for depreciation of such assets. I Budget and Budgetary Accounting I The BA prepares an annual operating budget Budgeted amounts are as originally adopted, or Commissioners. Individual revisions were not appropriations which were approved. which is approved as revised by the material to the by HOD. Board of original I Vacation and Sick Pay I Vacation time, personal business days and sick leave are considered as ex- penditures in the year paid. I NOTE B - CASH As required by law, the depository is required to have FDIC insurance. As of June 30, 1993 the Housing Authority was fully insured. I NOTE C - LONG TERM DEBT I Permanent Notes - HOD I Construction of the housing project was originally financed by the sale of project notes. During 1987, HOD received budgetary authority to pay the permanent notes and has suspended payments on the annual. contribution contract required for permanent note payments. Therefore, interest on the permanent notes has not been accrued during the year ended June 30, 1993. At June 30, 1993 the amount payable was $967,444.99 and no interest was paid for the year then ended. I I Federal Finance Bank Notes Payable I Federal Finance Bank Notes payable are from a 6.6% issue dated July 8, 1983 in an original amount of $925,523.04. Bonds amounting to $175,898.03 have been retired leaving a balance due at June 30, 1993 of $759,625.01. Interest paid during the year ended June 30, 1993 amounted to $51,366.05. The total annual payment is $67,888.11. This amount is due in each of the next five years and in each subsequent year until 2013. HOD has agreed to make all of these payments. I I I II - 10 - I NOTE D - Pension Plan I Substantially all employees of the PEA participate in the Kansas Employees Public Employees Retirement System, a multiple-employer publio employee retirement system. The payroll for employees covered by the System for the year ended June 30, 1993, was $111,586.89. The total payroll $117,868.56. I Substantially all employees of the PEA are eligible to participate in the System after one year of employment. Employees who retire at or after age 65 are entitled to a retirement benefit, payable monthly for life, equal to 1 percent of their final average salary for each year of "prior" service and 1.25 to 1.5 percent for each year of "participating" service depending upon the number of years of service. Final average salary is the employee's average salary over the highest four years of credited servioe. Benefits fully vest on reaching ten years of service. Vested employees may retire at age 55 to 65 with 10 years of credited service and receive reduoed retirement benefits. Benefits are established by state statutes. I I I Covered employees are required by State statute to contribute 4% of their salary to the plan. The employer is required by the same statute to contribute the remaining amounts necessary to pay benefits when due. The contribution requirement for the year ended June 30,1993, was $6,740.66 which consisted of $2,134.53 from the employer and $4,606.13 from employees. These contributions represented 1.9% and 4% of covered payroll respectively. I I The "pension benefit obligation" is a standardized disclosure method using the present value of pension benefits, adjusted for the effects of projected salary increases and step-rate benefits, estimated to be payable in the future as a result of employee service to date. The measure, which is the actuarial present value of credited projected benefits, is intended to help users assess the System's funding status on a going-concern basis, assess progress made in accumulating sufficient assets to pay benefits when due, and make comparisons among Public Employee Retirement Systems and employers. The System does not make separate measurements of assets and pension benefit obligations for individual employers. The pension benefit obligation at June 30, 1992, for the System as a whole, determined through actuarial valuation performed as of that date, was $4.08 billion. The System's net assets available for benefits on that date were $4.12 billion. There is no "unfunded pension benefit obligation". II I I I I Other information related to the System can be found in the KPERS 1992 CUFR. This report is available through the City of Salina, Kansas, through which the PEA participates in the System. I I I I I - 11 - I I John M. Middleton Certified Public Accountant 3315 W. 91st Street Leawooci, Kansas 66206 913-648-3687 I I I Board of Directors Salina Housing Authority Salina, Kansas 67402-1202 Department of Housing and Urban Development National Review Center 950 N. King's Highway Cherry Hill, New Jersey 08034-1518 I I Independent Auditor's Report I I have audited the accompanying financial statements of the Housing Authority of the City of Salina, Kansas Home Ownership Program as of June 30, 1993 and for the year then ended. These financial statements are the responsibility of the Housing Authority's management. My responsibility is to eA-press an opinion on these financial statements based on my audit. I I conducted my audi t in accordance with generally accepted auditing standards, Government Auditing Standards, and OMB Circular A-128. Those standards r'equire that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free from material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. I believe that my audit provides a reasonable basis for my opinion. I I I In my opinion, the financial statements referred to above present fairly, in all material respects, the assets, liabilities, and surplus of the Housing Authority of the City of Salina, Kansas Home Ownership Program, as of June 30, 1993 and the results of its operations and its changes in surplus for the twelve months then ended. I I This report ~s intended solely for the information and use of the Board of Directors, Management of the Housing Au thori ty of the City of Salina, and the Department of Housing and Urban Development and should not be used for any other purpose. I I (lac. 10'. ..~ .~ cr/.(..;:LN- ~ - v, ,:"/1. John M. Middleton Certified Public Accountant I I October 21, 1993 Leawood, Kansas 66206 I I I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I Home Ownership Program BALANCE SHEET As of June 30, 1993 I ASSETS Cash $ 25,429.89 I TOTAL ASSETS $ 25,429.89 I SURPLUS I Surplus Grants $ 11,676.75 13,753.14 TOTAL SURPLUS $ 25,429.89 I I I I I I I ,I I I 1 SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 13 - II I I I I I I OPERATING INCOME HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas Home Ownership Program INCOME STATEMENT Twelve Months Ended June 30, 1993 $ 26,000.00 Sale of Dwelling Unit $ 26,000.00 I Gross Revenue Cost Of Sales I Operating Income I OPERATING EXPENSES I Contract Costs Surveys Appraisal Legal Fees Title Fees I 13,753.14) $ 12,246.86 $ 70.00 75.00 250.00 262.00 181. 00 $ 838.00 NET OPERATING INCOME TOTAL OPERATING EXPENSE I OTHER INCOME I Interest Earned NET INCOME I I I I I I II I $ 11,408.86 $ 267.89 $ 11,676.75 SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 14 - I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I Home Ownership Program ANALYSIS OF SURPLUS Twelve Months Ended June 30, 1993 I UNRESERVED SURPLUS I Balance, Audit June 30, 1992 Net Income for the Year Ended June 30, 1993 $ 0.00 I 11,676.75 BALANCE AT JUNE 30, 1993 $ 11 , 676 . 75 I CUMULATIVE CONTRIBUTIONS I Balance Per Audit at June 30, 1992 Dwelling Unit Transferred from Public Housing $ 0.00 13,753.14 I BALANCE AT JUNE 30, 1993 $ 13,753.14 TOTAL SURPLUS $ 25,429.89 I I I I I I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 15 - II I I I I I I I I I I I I I I I I I .1 II HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas June 30, 1993 Notes to the Financial Statements NOTE A - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES This summary of the significant accounting policies of the Housing Authority of the City of Salina Home OWnership Program (HO) is presented to assist in understanding the HO' s financial statements. The financial statements and notes are representations of the HO's management, which is responsible for their integrity and objectivity. Generally accepted accounting principles have been used to prepare the financial statements of this program. Principles Used to Determine Scope of Entity The HO's reporting entity is included as a component unit of the financial statements of the Housing Authority of the City of Salina, Kansas. The HO has developed criteria to determine whether outside agencies should be included wi thin its financial reporting entity. The criteria includes, but is not limited to, whether the HO exercises oversight responsibility (which includes financial interdependency, selection of governing authority, designation of management, ability to significantly influence operations, and accountability for fiscal matters), scope of public service, and special financing relationships. The HA has determined that no other outside agency meets the above criteria and, therefore, no other agency has been included as a component unit in the HA's financial statements. Basis of Accounting The accounts of the HA are maintained, and the accompanying financial state- ments have been prepared, on the accrual basis of accounting. NOTE B - SALES OF DWELLING UNITS This program is authorized as a 5 (h) Home Ownership Program. The sale of portions of HOD Developments is authorized as long as the units sold are replaced. The PHA has begun two Developments which are replacements for the units sold under this program. The dwelling unit that was sold has been recorded in the accounting records as a contribution from Public Housing. The cost was estimated based on an allocation of the development cost for the project. - 16 - I I I I I I I I I I I I I I I I I I I SUPPLEMENTARY INFORMATION I I Exhibit C (1) HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I SCHEDULE OF FEDERAL FINANCIAL ASSISTANCE For the Twelve Months Ended June 30, 1993 I Annual Contributions Contracts FW-1114 & KC-7015 Project KS 38-2, 3, 4 & 5 & Project KS E38-1 & E38-8 Project KS 38V001 I I I Grantor Program CFDA # Receipts Expenditures Major Programs HOD Lower Income HAP 14.156 $ 711,563.00 $ 681,237.66 I Total for Major Programs $ 711,563.00 $ 681,237.66 Nonmajor Programs I HOD Public & Indian Housing 14.850 HOD Section 8 Voucher 14.177 HOD CIAP 14.852 Total for Nonmajor Programs Total Federal Financial Assistance $ 212,712.11 $ 208,471.59 I 103,167.00 100,201.97 3,652.00 9,205.44 I $ 319,531.11 $ 317,897.00 I $ 1,031,094.11 $ 999,116.66 I I I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 17 - I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas COMPUTATION OF RESIDUAL RECEIPTS AND ACCRUING ANNUAL CONTRIBUTIONS Twelve Months Ended June 30, 1993 Annual Contributions Contract FW-1114 Project KS 38-2, 3, 4 & 5 OPERATING RECEIPTS I Operating Income - Exhibit B HOD Subsidy - Exhibi t C TOTAL OPERATING RECEIPTS OPERATING EXPENDITURES Operating Expenses - Exhibit B Capital Expenditures: Replacement of None>..-pendable Equipment Property Betterments & Additions Prior Period Adjustments Affecting Residual Receipts TOTAL OPERATING EXPENDITURES Residual Receipts per Audit Audit Adjustment Added Back Residual Receipts per Books Provision for Operating Reserve - Ex. C RESIDUAL RECEIPTS PER LEA ACCRUING ANNUAL CONTRIBUTIONS Fixed Annual Contributions For Year Ended June 30, 1993 ACCRUING ANNUAL CONTRIBUTION - Exhibit C $ 110,584.39. 63,201.00. $ 173,785.39 $ 156,669.75 298.70 1,382.95 7,329.77 $ 165,681.17 $ 8,104.22 986.82 $ ( 9,091.04 9,091.04) . $ 0.00 $ 67,888.11 $ 67,888.11. SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 18 - Exhibit D-1 I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I COMPUTATION OF RESIDUAL RECEIPTS AND ACCRUING ANNUAL CONTRIBUTIONS Twelve Months Ended June 30, 1993 I Annual Contributions Contract KC-7015 I I I MAXIMUM CONTRIBUTION AVAILABLE Maximum Authorized Project Account Balance Total Available ANNUAL CONTRIBUTION REQUIRED Housing Assistance Payments Administrative Fee Hard-To-House Fee Audi t Fee Preliminary I I TOTAL OF FUNDS REQUIRED Project Receipts Other Than Annual Contributions Total Contribution Required I PROJECT ACCOUNT CHANGE Provision for Project Account I OPERATING RESERVE CHANGE Interest on Operating Reserve Interest on General Fund Annual Contribution Earned I Total Operating Receipts I Operating Expenditures Operating Expenses Capi tal Expendi tures Prior Period Adjustment Affecting Residual Receipts I Total Operating Expenditures I Residual Receipts Per Audi t Provision for Operating Reserve - Exh. C-2 I Residual Receipts per LHA I I KS 38V-001 $ 151,094.00 88,364.01 $ 239,458.01 $ 89,204.11 11,230.28 135.00 84.00 300.00 $ 100,953.39 KS 38E-1 $ 743,802.00 862,148.02 $ 1,605,950.02 $ 593,759.55 84,024.33 585.00 672.00 592.57 $ 679,633.45 201.22 $ 679,432.23 Exhibit D-2 KS 38E-8 $ 34,595.00 $ 34,595.00 $ 23,392.00 3,251.71 $ 26,643.71 399.07 $ 100,554.32 $ 64,369.77 $ 26,643.71 $ 50,539.68 $ 2,180.58 201.22 679,432.23 $ 673,345.63 $ 7,951.29 $ 399.07 100,554.32 26,643.71 $ 100,953.39 $ 681,814.03 $ 26,643.71 $ 100,201.97 $ 669,627.37 $ 23,392.00 2,295.00 1,423.26 -------------- -------------- -------------- $ 100,201.97 $ 8,468.40 8,468.40) $ 0.00 $ 23,392.00 $ 751. 42 751.42). $ 0.00 $ 3,251. 71 3,251.71). $ 0.00 SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 19 - I I I I I I I CLASSIFICATION Administration I Planning Site Acquisition I TOTAL COST I I I CLASSIFICATION Administration I Planning Site Acquisition I Nondwelling Equipment I TOTAL COST I I I I I Exhibi t F (1) HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas ACTUAL DEVELOPMENT COSTS - UNCOMPLETED Twelve Month Period Ended June 30, 1993 Annual Contributions Contract FW-1114 Project KS 38-4 Prior Audi t Period Current Audi t Period $ 23.10 $ 1,452.18 0.00 8,248.74 11,163.86 38,866.32 $ 11,186.96 $ 48,567.24 Project KS 38-5 Prior Audi t Period Current Audi t Period $ 0.00 $ 8,695.90 0.00 12,156.84 0.00 7,750.00 0.00 212.50 ------------ ----------- $ 0.00 $ 28,815.24 SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 20 - Total $ 1,475.28 8,248.74 50,030.18 $ 59,754.20 Total $ 8,695.90 12,156.84 7,750.00 212.50 $ 28,815.24 I Exhibit F(2) I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I RECONCILIATION OF DEVELOPMENT FUNDS ADVANCED ~TH DEVELOPMENT COSTS June 30, 1993 I Annual Contributions Contract FW-1114 I Project KS 38-4 I I The amount of Funds provided for Development Costs are incurred as fo11ows: and the Actual Development DEVELOPMENT FUNDS ADVANCED Permanent Note $ 57,791. 00 I TOTAL FUNDS ADVANCED $ 57,791. 00 Actual Development Costs $ 59,754.20 I Deficit of Funds Provided - Exhibit G $( 1,963.20) I Project KS 38-5 The amount of Funds provided for Development and the Actual Development Costs are incurred as follows: I DEVELOPMENT FUNDS ADVANCED I Permanent Note $ 23,832.00 TOTAL FUNDS ADVANCED $ 23,832.00 I Actual Development Costs $ 28,815.24 Deficit of Funds Provided - Exhibit G $ ( 4,983.24) I I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 21 - I I Exhibi t F (3) HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I I STATEMENT OF MODERNIZATION COSTS As of June 30, 1993 I Annual Contributions Contract FW-1114 Project KS 38-2, 3, 4 & 5 1. The Actual Modernization Costs are as follows: I I I I Funds Approved Funds Expended Project 903z $ 50,000.00 50,000.00 DEFICIT OF FUNDS APPROVED $ 0.00 Funds Advanced - Grant Funds Expended $ 50,000.00 50,000.00 DEFICIT OF FUNDS ADVANCED - Exhibit D $ 0.00 I 2. The distribution of costs as shown on the Final Statement of Modernization Costs dated April 20, 1993 accompanying the Actual Modernization Cost Certificate submitted to HOD for approval agrees with the PEA's records. I 3. All modernization costs have been paid and all related liabilities have been discharged through payment. This modernization project was not closed out after certification. I STATEMENT MODERNIZATION COSTS - UNCOMPLETED As of June 30, 1993 I Annual Contributions Contract FW-1114 Project KS 38-2, 3, 4 & 5 Project 904Z I Funds Approved Funds EA"Pended $ 30,000.00 9,205.44 I EXCESS OF FUNDS APPROVED $ 20,794.56 I Funds Advanced Funds Expended $ 0.00 9,205.44 I DEFICIT OF FUNDS ADVANCED - Exhibit G $( 9,205.44) I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 22 - I I I Exhibit G-1 I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I ANALYSIS OF GENERAL FUNDS AVAILABLE FOR REDUCTION OF ANNUAL CONTRIBUTIONS At June 30, 1993 I Annual Contributions Contract FW-1114 Project KS 38-2, 3, 4 & 5 CASH AND OTHER ASSETS I Cash Tenant Accounts Receivable Other Accounts Receivable Investments Prepaid Insurance CIAP Deficiency Development Deficiency $ 12,213.50 2,595.01 10,131.47 31,157.29 5,712.08 9,205.44 6,946.44 I I TOTAL $ 77,961.23 I LIABILITIES, RESERVES, AND AMOUNTS AVAILABLE FOR CONTRIBUTIONS REDUCTION I Tenants Security Deposits Accounts Payable - Other PILOT Prepaid Rent Operating Reserve Audit Adjustment Added Back $ 9,191. 50 1,925.12 9,178.22 849.27 55,203.94 1,613.18 I I TOTAL $ 77,961.23 I I I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 23 - I I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I ANALYSIS OF GENERAL FUNDS AVAILABLE FOR REDUCTION OF ANNUAL CONTRIBUTIONS Twelve Months Ended June 30, 1993 I Annual Contributions Contract KC-7015 I KS 38E-1 KS 38V-001 CASH AND OTHER ASSETS I $ $ 45,016.25 2,196.36 1,511.03 Cash Accounts Receivable Investments 33,915.89 I Total $ 3,707.39 $ 78,932.14 I LIABILITIES, RESERVES, AND AMOUNTS AVAILABLE FOR CONTRIBUTIONS REDUCTION I $ $ 19,364.34 59,567.80 3,707.39 0.00 Accounts Payable Operating Reserve I Total $ 78,932.14 $ 3,707.39 I I I I I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 24 - I Exhibit G-2 KS 38E-8 $ 3,467.00 $ 3,467.00 $ 215.29 3,251.71 $ 3,467.00 I I I I I I I I I I I I I I I I I I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas REPORT ON COMPLIANCE TO LAWS AND REGULATIONS BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS Twelve Months Ended June 30, 1993 Annual Contributions Contract FW-1114 Project KS 38-2, 3, 4 & 5 I have audited the financial statements of the Housing Authority of the City of Salina, Kansas as of June 30, 1993, and for the year then ended, and have issued my report thereon dated October 21, 1993. I conducted my audit in accordance with generally accepted auditing standards and Government Auditing Standards (1988 Revision), issued by the Comptroller General of the United States. Those standards require that I plan and perform the audit to obtain reasonable assurance about whether the' financial statements are free from material misstatement. Compliance with laws, regulations, contracts and grants applicable to the Housing Authority of Salina, Kansas is the responsibility of the PEA's management. As part of obtaining reasonable assurance about whether the financial statements are free of material misstatement I performed tests of the PEA's compliance with certain provisions of laws, regula tions , contracts, and grants. However, my objective was not to provide an opinion on overall compliance with such provisions. Accordingly, I do not express, such an opinion. The results of my tests indicate that, with respect to the items tested, the PEA complied in all material respects, with the provisions referred to in the preceding paragraph. With respect to items not tested, nothing came to my attention that caused me to believe that the PEA had not complied, in all material respects, with those provisions. This report managemen t , restriction is a matter is intended for the information of the Board of Directors, and the Department of Housing and Urban Development. This is not intended to limit the distribution of this report, which of public record. (J~ C:'> ;1, !.), . ....{ ,.'. (t" 't-f'l';" '-' ..;<-, . John Middleton Certified Public October 21, 1993 \. ;- Accountant - 25 - I I I I I I I I I I I I I I I I II I II HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas SINGLE AUDIT OPINION ON COMPLIANCE WITH SPECIFIC REQUIREMENTS APPLICABLE TO MAJOR FEDERAL FINANCIAL ASSISTANCE PROGRAMS Twelve Months Ended June 30, 1993 Annual Contributions Contract FW-1114 Project KS 38-2, 3, 4 & 5 I have audited the financial statements of the Housing Authority of the City of Salina, Kansas, as of and for the year ended June 30, 1993 and have issued my report thereon dated October 21, 1993. I have also audited the Housing Authority of the City of Salina, Kansas's, compliance with the requirements governing types of services allowed or unallowed, eligibili ty, matching, reporting, and special tests and provisions that are applicable to each of its major federal financial assistance programs, which are identified in the accompanying schedule of federal financial assistance, for the year ended June 30, 1993. The management of the Housing Authority of the City of Salina, Kansas is responsible for the Housing Authority of the City of Salina, Kansas's compliance with those requirements. My responsibility is to e"'-press an opinion on compliance with those requirements based on my audit. I conducted my audit of compliance with those requirements in accordance with generally accepted auditing standards, Government Auditing Standards, issued by the Comptroller General of the United States, and OMB Circular A- 128, "Audits of State and Local Governments." Those standards and OMB Circular A-128 require that I plan and perform the audit to obtain reasonable assurance about whether material noncompliance with the requirements referred to above occurred. An audit includes examining, on a test basis, evidence about whether the Housing Authority of the City of Salina, Kansas's compliance with those requirements. I believe that my audit provides a reasonable basis for my opinion. In my opinion, the Housing Authority of the City of Salina, Kansas, complied in all material respects with the requirements governing types of services allowed or unallowed, eligibility, matching, reporting, and special tests and provisions that are applicable to each of its major federal financial assistance programs for the year ended June 30, 1993. This report is intended for the information Department of Housing and Urban Development. matter of public record and its distribution is of the management and the However, this report is a not limited. "e'l ( J)f2:c._/.. /. Il.fU(..,. .lj{;~~~::,c.:, I ' John Middleton Certified Public Accountant October 21, 1993 - 26 - I I I I I I I I I I I I I I I I I I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas SINGLE AUDIT REPORT ON THE HOUSING AUTHORITY OF SALINA, KANSAS'S COMPLIANCE WITH GENERAL REQUIREMENTS Twelve Months Ended June 30, 1993 Annual Contributions Contract FW-1114 Project KS 38-2, 3, 4 & 5 I have audited the financial statements of the Housing Authority of the City of Salina, Kansas, as of and for the year ended June 30, 1993, and have issued my report thereon dated October 21, 1993. I have also applied procedures to test the Housing Authority of the City of Salina, Kansas's compliance with the following requirements applicable to each of its major federal financial assistance programs, which are identified in the schedule of federal financial assistance, for the year' ended June 30, 1993: political activity, Davis-Bacon, civil rights, cash management, relocation assistance, federal financial reports, drug free workplace, and administrative requirements. My procedures were limi ted to the applicable procedures described in the Office of Management and Budget's Co~~iance ~~ement for Sing~e Audits of State and Loca~ Governments. My procedures were substantially less in scope that an audit, the objective of which is to express an opinion on the Housing Authority of the City of Salina, Kansas's compliance with the requirements listed in the preceding paragraph. Accordingly, I do not eA~ress such an opinion. With respect to the items tested, the results of those procedures disclosed no material instances of noncompliance with the requirements listed in the first paragraph of this report. With respect to the items not tested, nothing came to my attention that caused me to believe that the Housing Authority of the City of Salina, Kansas, had not complied, in all material respects, with those requirements. This report is intended for the information of the management and the Department of Housing and Urban Development. However, this report is a matter of public record and its distribution is not limited. (~4 .. ~/i~~(J~; , i l John Middleton Certified Public Accountant October 21, 1993 - 27 - I I I I I I I I I I I I I I I I I I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas INDEPENDENT AUDITOR'S REPORT ON THE HOUSING AUTHORITY OF SALINA, KANSAS'S INTERNAL CONTROL STRUCTURE AS AN ENTITY AND OVER ITS FEDERAL FINANCIAL ASSISTANCE PROGRAMS Twelve Months Ended June 30, 1993 Annual Contributions Contract FW-1114 Project KS 38-2, 3, 4 & 5 I have audited the financial statements of the Housing Authority of the City of Salina, Kansas, as of and for the year ended June 30, 1993, and have issued my report thereon dated October 21, 1993. I conducted my audits in accordance with generally accepted auditing stand~ ards; Govermnent Auditing Standards, issued by the Comptroller General of the United States; and the Office of Management and Budget(OMB) Circular A- 128, Audits of state and Loca~ Govermnents. Those standards and OMB Circular A-128 require that I plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. In planning and performing my audit for the year ended June 30, 1993, I considered the Housing Authority's internal control structure in order t4l determine my auditing procedures for the purpose of e~~ressing my opinion on the Housing Authority's financial statements and not to provide assurance on the internal control structure. The management of the Housing Authority of the City of Salina, Kansas i$ responsible for establishing and maintaining an internal control structure. In fulfilling this responsibility, estimates and judgments by management are required to assess the expected benefits and related costs of internal control structure and procedures. The objectives of internal control structure are to provide management with reasonable, but not absolute t assurance that assets are safeguarded against loss from unauthorized use o~ disposition, that transactions are executed in accordance with management's authorization and recorded properly to permit the preparation of financial statements, and that federal financial assistance programs are managed in accordance with applicable laws and regulations. Because of inherent limitations in any internal control system, errors, irregularities, or instances of non-compliance may nevertheless occur and not be detected. Also, projection of any evaluation of the structure to future periods is subject to the risk that p~ocedures may become inadequate because of changes in conditions or that the degree of compliance with the procedures may deteriorate. For the purpose of this report, I have classified the significant internal control structure policies and procedures in the following categories: - 28 - I I I I I I I I I II I I I I I I I I I 1. Accounting Controls a. Cash and cash equivalents b. Receivables c. Land, structures and equipment d. Payables and accrued liabilities e. Debt service f. Surplus g. Revenue h. Expendi tures i. Payroll j. Purchasing 2. Administrative Controls a. Political activity b. Davis-Baoon Act c. Civil rights d. Cash management e. Federal financial reports f. Budgets g. Relocation assistance and Real Property Acquisition h. Drug Free Workplace 3. Special Requirements For all of the internal control structure categories listed above, I obtained an understanding of the design of relevant policies and procedures and determined whether they have been placed in operation, and I assessed the control risk. During the year ended June 30, 1993, the PEA had no major federal financial assistance programs and expended 67.24% of its total federal financial assistance under the following major federal financial assistance program: Lower Income Housing Assistance Payments. I performed tests of controls, as required by OMB Circular A-128, to evaluate the effectiveness of the design and operation of internal control structure polioies and procedures that I have considered relevant to preventing or detecting material non-compliance with specific requirements, general requirements, and requirements governing claims for advances and reimbursements and amounts claimed or used for matching that are applicable to the aforementioned nonmajor programs. My procedures were less in scope than would be necessary to render an opinion on these internal control structure policies and procedures. Accordingly, I do not eA-press such an opinion. I noted certain matters involving the internal control structure and its operation that I consider to be reportable conditions under standards estab- lished by the American Institute of Certified Public Accountants. Reportable conditions involve matters coming to my attention relating to significant deficiencies in the design or operation of the internal control structure that, in my judgment, could adversely affect the Housing Authority'S ability to record, process, summarize, and report financial data consistent with the assertions of management in the financial statements or to administer federal financial assistance programs in accordance with applicable laws and regulations. I noted a weakness in internal control in that separation of duties is not maintained for reoeipts, deposits, eA-penses, and bookkeeping. One person has control andlor access to all of the above functions and a separation of duties is not possible. Other controls that are in place to compensate for this weakness are prenumbered receipts, two signatures on a check, with one being a member of the Board of Directors, and all expenditures being - 29 - I I I I I 1 I I I I I II I I I I I I I reviewed by the Board of Directors. A material weakness is a reportable condition in which the design or operation of one or more of the internal control structure elements does not reduce to a relatively low level the risk that errors or irregularities in amounts that would be material in relation to the financial statements being audited or that noncompliance with laws and regulations that would be material to a federal financial assistance program may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions. My consideration of the internal control structure would not necessarily disclose all matters in the internal control structure that might be report- able conditions and, accordingly, would not necessarily disclose all report- able conditions that are also considered to be material weaknesses as defined above. However, I believe, that none of the reportable conditions described above is a material weakness. This report managemen t , restriction is a matter is intended for the information of the Board of Directors, and the Department of Housing and Urban Development. This is not intended to limit the distribution of this report, which of public record. ~).. . /J c: ' . Ut(..~;t4:;~~. John Middleton Certified Public Accountant October 21, 1993 - 30 - - I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I SCHEDULE OF FINDINGS AND QUESTIONED COSTS Twelve Months Period Ended June 30, 1993 I Annual Contributions Contracts FW-1114 & KC-7015 Project KS 38-2, 3, 4 & 5 Project KS E38-1 & 8 Project KS 38V-001 I I. Findings and Questioned Costs Program CFDA 14.850 I 1. FINDING I Condi tion The PEA does not maintain separate bonding insurance for Board members who sign checks. The banks will accept the signatures of the two board members. I Cri teria - HOD regulations require that all persons who have access to cash be adequately bonded. Effect - None noted. I Cause - Not determined. I Recommendation members or revise signature and one Management acquire bonding insurance on the board the signature cards to require the Executive Director's of the Board members. I Reply - We will do so. 2. FINDING I Condition - The PEA purchased one unbudgeted capital equipment item. I Criteria - Capital purchases must be approved in advance by the funding agency. Effect - None noted. I Cause - This item was overlooked in the preparation of a revised budget. I Recommendation - Management and the Board devise procedures to adequately supervise the preparation of budget revisions. I Reply - We will do so. I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 31 - I I 3. FINDING I Condition - Overhead expenses attributable to the Home Ownership project have not been allocated. An undetermined amount of time and resources have been spent on the Home Ownership Program and charged to Public Housing. I I Criteria The costs of each program activity are required to be identified and reported. I Effect - Public Housing has been charged with an undetermined amount that should be properly charged to Home Ownership. Cause There appears to be uncertainty about the proper accounting procedures to be used for the Home Ownership Program. I Recommendation procedures. Management confer with HOD to determine the proper I Reply - We will do so. 4. FINDING I Condition - I reviewed 9 tenant files. Two of the files did not have Form 50058 attached and the lease amendment had not been signed by the tenant. I Criteria HMG 7576.1 requires that form 50058 be completed for each recertification and retained in the tenant file. Kansas law requires that any modification to a real estate contract by made in writing and signed by both parties. I Effect - None noted. I Cause - The 50058 form was prepared but sent to HOD. Management felt that a change in the lease could be made by notifying the tenant in writing. I Recommendation - Copies of Form 50058 be maintained in all tenant files and all lease amendments be initialed by both the PEA and the tenant. I Reply - We will do so. Program 14.156 I 1. FINDING Condition - 2 of 13 tenant files did not have Form 50058 attached. I See Finding #4 above. I II. STATUS OF PRIOR YEAR FINDINGS 1. Budget Overruns and unbudgeted capital eA~enditures. See Finding #2 above. I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 32 - I I I 2. Monitoring of Davis-Bacon complianoe was inadequate. This has been corrected. 3. Insurance on Non-Owned autos was inadequate. This has been corrected. I III. REFERENCE TO MATERIAL FINDINGS PRESENTED IN REPORTS OF OTHER AUDITORS OR INSPECTORS GENERAL I I I I I I I I I I I II I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 33 - II I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I Journal Entries Twelve Month Period Ended June 30, 1993 I Annual Contributions Contracts FW-1114 & KC-7015 Project KS 38-2, 3, 4 & 5 Project KS E38-1 & 8 Project KS 38V-001 I Public Housing I 1. Tenant Accounts Receivable' 1122 Prior Period Adjustments Affecting Residual Receipts 6010 I $ 849.27 $ 849.27 Adjust Tenant Accounts Receivable to observed balance. I 2. Cumulative BUD Contributions Deposits with BUD 2840 1177 $ 1,750.20 $ 1,750.20 Adjust balance to amount actually on deposit. This amount was offset in prior years. I 3. Development - 005 Development - 004 Deferred Charges 1400 1400 1290 I $ 300.00 $ 225.00 75.00 Correct postings to Development and Home OWnership account. I 4. Unreserved Surplus Land, structures & Equipment 2810 1400 I $13,753.14 $13,753.14 Transfer one dwelling unit to Home Ownership Program for sale. I 5. Prior Period Adjustment Affecting Residual Receipts Development - 004 Development - 005 Modernization - 904z 6010 1400 1400 1400 I $ 1,836.09 658.16 23.05 $ 2,517.30 I Section 8 -- Existing 01 Correct allocation of expenditures to development and modernization. 1. Prior Period Adjustment Residual Receipts Land, Structures & Equipment I Affecting 6010 1400 $ 192.57 $ 192.57 Correct posting of items under the capitalization limit. I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 34 - I I HOUSING AUTHORITY OF THE CITY OF SALINA Salina, Kansas I Home Ownership Program Journal Entries Twelve Month Period Ended June 30, 1993 I I Home Ownership Program I 1. Accounts Payable Surveying Expense $ 75.00 $ 75.00 Adjust expense to correct duplicate posting. I I I I I I I I I I I I I SEE ATTACHED INDEPENDENT AUDITOR'S REPORT - 35 - I