Financial Statement Audit – Fiscal Year Ended June 30, 2023

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Report Summary

Background

The Delaware State Housing Authority is a component unit of the State of Delaware and is a public corporation that functions to provide home ownership, affordable rental housing and rehabilitation assistance in housing. The Authority’s programs are funded through mortgage-backed security purchases, State & Federal grants and through the State sponsored Housing Development Fund.

The primary objective of a financial statement audit is to provide reasonable assurance that the financial statements present fairly, in all material respects, the financial position of an entity.

This engagement was conducted in accordance with 29 Del. C. §2906.

Key Information and Findings

The financial statement audit contains an unmodified opinion. An unmodified opinion is sometimes referred to as a “clean” opinion. It is one in which the auditor expresses an opinion that the financial statements present fairly, in all material respects, an entity’s financial position, results of operations, and cash flows in conformity with generally accepted accounting principles. In the Auditors’ opinion, the schedule of expenditures of federal awards is fairly stated in all material respects in relation to the basic financial statements as a whole.

Although the overall report contains an unmodified opinion, the audit report documents 3 significant deficiencies in FY2023:

• Six material adjustments were required to the Housing Development Fund and the Federal Programs Enterprise Fund as a result of audit procedures. The net effect of these journal entries was a net increase to assets and a corresponding net decrease of revenue of $877,123. A similar condition was noted during the June 30, 2022 audit. See finding 2022-001.

• Material adjustments were required to the REAC financial data schedule in order to present it without material misstatement in relation to the audited basic financial statements. The REAC financial data schedule should be reconciled prior to submission to the U.S. Department of Housing and Urban Development (HUD). A similar condition was noted during the June 30, 2022 audit. See finding 2022-003.

• Assistance payment’ processing errors were found resulting in overpayments of $7,090, as well as, payments in excess of maximums allowed by the ERA federal regulations. A similar condition was noted during the June 30, 2022 audit. See finding 2022-004