Obama’s HUD Received One of the Worst Audit Results in US History!
The 2015 and 2016 Fiscal Years HUD audit needed to be restated and reissued. The auditors were not able to initially perform the audit because there were too many material issues and the audit needed to be redone –
HUD reissued its fiscal years 2016 and 2015 (restated) consolidated financial statements due to pervasive material errors that we identified.
The restated audit report shows the following –
The total amounts of errors corrected in HUD’s notes and consolidated financial statements were $516.4 billion and $3.4 billion, respectively. There were several other unresolved audit matters, which restricted our ability to obtain sufficient, appropriate evidence to express an opinion. These unresolved audit matters relate to (1) the Office of General Counsel’s refusal to sign the management representation letter, (2) HUD’s improper use of cumulative and first-in, first-out budgetary accounting methods of disbursing community planning and development program funds, (3) the $4.2 billion in nonpooled loan assets from Ginnie Mae’s stand-alone financial statements that we could not audit due to inadequate support, (4) the improper accounting for certain HUD assets and liabilities, and (5) material differences between HUD’s subledger and general ledger accounts. This audit report contains 11 material weaknesses, 7 significant deficiencies, and 5 instances of noncompliance with applicable laws and regulations.
These results are shocking. If a US corporation had similar results their stock holders would flee, the stock price would quickly plummet and the company would quickly go bankrupt within days!
Auditors always have enough information to express an opinion and so for the auditors not to be able to express an opinion, the results were terrible. Material weaknesses are unheard of and this audit resulted in 11 material weaknesses.
Plus the Office of General Counsel’s refusal to sign the management representation letter is also appalling. The attorneys inability to sign the management letter is a clear indication that the HUD’s books are in error.
Thank God the Obama years are over!