Deobligate the 101 program obligations totaling $1,967,991.45 identified for deobligation during the fiscal year 2024 OOR that had not been deobligated as of February 28, 2025.

Develop and execute a written agreement with ONDCP on the reporting methodology for the CoC annual numeric targets and actuals that would meet future reporting requirements and comply with the Strategy and timeframe for implementation.

Develop and execute a written agreement with ONDCP on the use of reporting annual numeric targets for the RHP performance measures that would meet future reporting requirements and comply with the Strategy and timeframe for implementation.

Establish and implement formal policies and procedures that include (1) the ONDCP reporting process between HUD’s OCFO and CPD, (2) the process for reporting to ONDCP, (3) references to any written agreements between HUD and ONDCP, and (4) a requirement for periodic reviews of these written agreements to address any changes in administration, roles, responsibilities, reporting programs, reporting requirements, and reporting methodologies.

Develop a policy or update the existing Grants Management Policy to include 1) the process and controls that HUD will use to hold the prime recipients accountable for FFATA compliance and 2) clearly defined roles and responsibilities between OCFO and the program offices to ensure that action is prioritized by the correct responsible parties regarding FFATA compliance.

Work with applicable program offices to develop training materials and tools, such as dashboards, to assist program offices in monitoring their grant portfolios for subaward reporting compliance.

We recommend that the Chief Financial Officer enhance existing policies to establish a formal grant accrual risk management framework to help ensure consistent standards across HUD with regard to the development, review, and execution of the grant accrual and validation. This framework should include 1) identifying grant accrual estimation risk, assessing the magnitude of this risk, and managing the risks that arise when using certain quantitative estimation methods, 2) a governance structure that includes estimation ownership, oversight, and framework assessment, 3) the creation of a committee that is responsible for establishing a holistic approach to estimation risk management, including key stakeholders from OCFO and program offices, such as CPD, and 4) a requirement for documentation of committee meeting agendas, minutes, and key decisions and discussion points which impacts the various grant accrual methodologies across the Department.

Develop and fully implement a departmentwide policy for the monthly transaction review process that requires program office participation and timely completion of the review and certification.

Update OCFO’s travel card monitoring procedures to obtain, review, and monitor the IBA Use report on a regular basis to ensure compliance with purchases required to be made on the government travel card.

Establish an improper payment council within HUD that consists of senior accountable officials from across the Department with a role in the effort that would work to identify risks and challenges to compliance and identify solutions as a collaborative group.

Develop and complete a detailed plan and timeline for completing compliant PIH-TBRA and PBRA program estimates and ensure that the improper payment council prioritizes completion of the plan in time for fiscal year 2023 reporting.

Develop a secure platform for the collection and storage of PIIA data that contain PII and formally assign a staff with adequate training and skillsets to administer the data and application (including maintaining and managing access controls of a chosen application that will be used to store the PIIA data with PII).

Reevaluate the methodology and reassess the weight assigned to each risk factor to ensure that appropriate weight is given to risks associated with non-Federal administrators or consider doing one risk assessment for HUD’s internal payment cycle and another risk assessment for the non-Federal entities that administer HUD’s program funds.

Until program-specific fraud risk assessments are completed, revise the PIIA fraud risk questionnaire process to compensate for the lack of program-specific fraud risk assessments.

Reassess the Homeless Assistance Grants program as part of the fiscal year 2023 risk assessment.

Develop and issue a departmental grant accrual validation policy or update the existing grant accrual policy to include the validation process. The policy should include 1) specific control activities over the grant accrual validation and outline all of the specific roles and responsibilities; 2) a periodic review of the grant accrual validation to evaluate and reassess its continued relevance and control effectiveness, and ensure any changes are designed and implemented appropriately; and 3) a clear communication plan that requires formal and documented communications between appropriate program offices and OCFO to ensure the validation results are used to update the grant accrual methodology and subsequent period’s estimate, as appropriate.

Develop and document internal procedures to ensure the OCFO’s responsibilities specified within the new or updated grant accrual validation policy are addressed.

Develop and implement procedures to ensure that planning for the CPD grant accrual validation is done early in the accounting cycle to allow for: • Sufficient resources to be available to perform the validation of the prior year grant accrual. • Validation efforts to start earlier to allow for follow-up on non-responsive grantees or grantees that provided incomplete information. • Materiality risk to be considered when planning and evaluating the CPD grant accrual validation.

Revise CPD Validation Review Instructions to specify documentation requirements similar to those provided to the grantee and specify verification of dates for when the costs were incurred.

As part of the validation process for CPD’s accrued grant liabilities, review CPD’s accrued grant liabilities estimation methodology to ensure that it is based on verifiable grantee supporting documentation and all assumptions and variables used for the grant accrual estimate were properly established, supported, and documented.