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Glenn Hegar  ·  Texas Comptroller of Public Accounts

Fiscal Management Post-Payment Audit Report Summary
Texas Department of Housing and Community Affairs
Fiscal 2013 First Quarter

Audit scope

A sample of the Texas Department of Housing and Community Affairs’ (Department’s) purchase, travel and payroll transactions that processed through the Uniform Statewide Accounting System (USAS) and the Uniform Statewide Payroll/Personnel System (USPS) during the period from June 1, 2011 through May 31, 2012 was audited to determine compliance with applicable state laws. In addition, a limited review of refund of revenue and grant transactions was conducted.

Payroll transactions and deductions

Payroll transactions were audited for compliance with the General Appropriations Act (GAA), the Texas Payroll/Personnel Resource and other pertinent statutes.

The audit identified:

  • An incorrect longevity payment amount paid to an employee.
  • Three personnel files missing prior state service documentation.

A limited sample of voluntary contributions was reviewed.

  • No errors were identified.

Purchase transactions

These transactions were audited for compliance with the GAA, eXpendit, the State of Texas Procurement Manual and other pertinent statutes.

The audit identified:

  • No errors were identified.

Travel transactions

Travel transactions were audited for compliance with the GAA, Textravel and other pertinent statutes.

The audit identified:

  • Seven transactions paid early resulting in interest loss to the state treasury.

Internal control structure

The Department’s internal control structure was reviewed. The review was limited to obtaining an understanding of the Department’s controls sufficient to plan the audit and did not include tests of control policies and procedures.

The review identified two issues:

  • One employee had the ability to adjust payee instructions in the Texas Identification Number System (TINS) and approve paper vouchers.
  • The Confidential Treatment of Information Acknowledgement (CTIA) form was not signed in a timely manner for one employee.

Refund of revenue transactions

The audit included a limited review of the Department’s transactions relating to refunds of revenue. This review consisted of verifying that the documentation provided reconciled with the payment amount in the sample.

  • No errors were identified.

Grant transactions

The audit included a limited review of the Department’s transactions relating to grant payments. This review consisted of verifying that the payments did not exceed the authorized amounts. The review of these payments did not include an investigation of the Department’s procedures for awarding the grants or monitoring payments made to grantees; therefore, no opinion is offered on those procedures.

  • No errors were identified.

Fixed assets

The audit included a limited number of fixed assets acquired by expenditures during our audit period to test for accurate reporting in the State Property Accounting system (SPA) and to verify existence of the assets.

  • All of the assets tested were in their intended location and properly recorded in SPA.

Other auditor observations

A review was conducted of the Department’s procedures to comply with the federal mandate to properly identify and handle payments involving the movement of funds internationally. Two instances were noted where the Department used an outdated version of the direct deposit setup form which did not adhere to the National Automated Clearing House Association rules requiring the identification of a direct deposit payment if it is an International Automated Clearing House Transaction. The Department was unaware of the new required form.

It is recommended that the Department return to the payee any form that does not comply with the federal mandate regarding foreign payments and instruct the payee to resubmit the corrected form. Additionally, if the Department receives an outdated version of an authorization form that does not include the foreign payment question, the form should be sent back to the payee along with an updated form or the payee should be directed to the online version of the form or https://comptroller.texas.gov/programs/systems/direct-deposit/.

Prior post-payment audit and current audit recurring errors

A prior post-payment audit of the Department’s payroll, purchase and travel transactions was concluded on Dec. 22, 2008.

During the current audit, there were three recurring errors:

  • Missing prior state service documentation.
  • Incorrect longevity payment.
Glenn Hegar
Texas Comptroller of Public Accounts
Questions? Contact statewide.accounting@cpa.texas.gov
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