FAC Explorer

Audit 20555

FY End
2022-05-31
Total Expended
$10.26M
Findings
8
Programs
7
Organization: Howard Payne University (TX)
Year: 2022 Accepted: 2022-10-25
Auditor: Capincrouse LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
22404 2022-001 Significant Deficiency Yes N
22405 2022-002 - - N
22406 2022-001 Significant Deficiency Yes N
22407 2022-001 Significant Deficiency Yes N
598846 2022-001 Significant Deficiency Yes N
598847 2022-002 - - N
598848 2022-001 Significant Deficiency Yes N
598849 2022-001 Significant Deficiency Yes N

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $5.40M Yes 2
84.063 Federal Pell Grant Program $1.59M Yes 1
84.425 Covid-19 Education Stabilization Fund Heerf - Student Aid Portion $1.28M Yes 0
84.425 Covid-19 Education Stabilization Fund Heerf - Institutional Portion $1.26M Yes 0
84.038 Federal Perkins Loan Program $435,588 Yes 0
84.007 Federal Supplemental Educational Opportunity Grants $194,465 Yes 1
84.033 Federal Work-Study Program $107,365 Yes 0

Contacts

Name Title Type
F4KEMCA9Y4P3 Karen Laquey Auditee
3256498805 Dan Campbell, CPA Auditor
No contacts on file

Notes to SEFA

Title: RELATIONSHIP TO FINANCIAL STATEMENTS Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) includes the federal grant activity of Howard Payne University (University) under programs of the federal government for the year ending May 31, 2022. The information in the schedule is presented in accordance with the requirements of the Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in the schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. Expenditures in the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. If the University is required to match certain federal assistance, as defined by the grant agreements, no such matching has been included as expenditures in the schedule. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. See table in SEFA Note 3.
Title: SUBRECIPIENTS, NON-CASH ASSISTANCE, FEDERAL INSURANCE, LOANS, AND LOAN GUAR Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) includes the federal grant activity of Howard Payne University (University) under programs of the federal government for the year ending May 31, 2022. The information in the schedule is presented in accordance with the requirements of the Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in the schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. Expenditures in the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. If the University is required to match certain federal assistance, as defined by the grant agreements, no such matching has been included as expenditures in the schedule. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The University did not provide any federal funds to subrecipients nor did they receive any federal non-cash assistance, insurance, or loan guarantees. The University did receive a Small Business Administration (SBA) Paycheck Protection Program (PPP) loan in the amount of $1,907,500. (See Note 16 to the financial statements) The SBA has indicated that PPP loans are not subject to Uniform Guidance audit requirements and therefore, the PPP loan is not included in the SEFA.
Title: FEDERAL PERKINS LOAN PROGRAM Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) includes the federal grant activity of Howard Payne University (University) under programs of the federal government for the year ending May 31, 2022. The information in the schedule is presented in accordance with the requirements of the Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in the schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements. Expenditures in the schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. If the University is required to match certain federal assistance, as defined by the grant agreements, no such matching has been included as expenditures in the schedule. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. See table in SEFA Note 5.

Finding Details

Finding 2022-001
Incorrect Modular Return of Title IV Funding Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268, 84.063, and 84.007 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for one modular student withdrawal that did not require funds to be returned based on the completion rate. The student completed past the 49% required by the new modular withdrawal guidance so no R2T4 should have been done. Criteria: 34 CFR 668.22(j) Questioned Costs: $-0- Context: One student out of eight was correctly identified as an unofficial withdrawal. The exemptions were not accurately applied and an incorrect return of $4,339 was initially made. This was discovered and corrected during the audit process. Cause: The new R2T4 regulations regarding withdrawals from modular programs which were effective July 1, 2021, were not correctly applied to this student. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: Yes, 2021-001. Recommendation: We recommend when the University runs the listings of all withdrawals and all 0 credits each semester that the NAFSAA decision tree related to modular students be applied and retained with each student. We also recommend an individual in financial aid with the appropriate level of experience periodically review modular students? R2T4 calculations and returns to help ensure that internal controls over such process can operate effectively and achieve compliance. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-002
Enrollment Reporting to National Student Loan Data System (NSLDS) DEPARTMENT OF EDUCATION ALN #: 84.268 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The correct NSLDS enrollment status effective date for withdrawals was not sent to NSLDS from the system. Additionally, students who completed undergraduate programs were not reported when continuing in a new program. Criteria: 34 CFR 685.309(b) Questioned Costs: $-0- Context: Out of 60 students tested, 7 were not correctly reported. Four of the students were unofficial withdrawals, and 3 students completed undergraduate programs and continued their studies but were not reported. The University is in the process of correcting these students. Cause: The University?s extraction of data from the system did not include students who had graduated and then reenrolled. Additionally, for unofficial withdrawals, the last date of attendance was not used as the withdrawal date. All 4 of those students were traditional students. Effect: Inaccurate reporting can impact a student?s loan grace period in school deferment eligibility, beginning loan repayments, appropriate interest charges, etc. Identification as repeat finding, if applicable: Not applicable. Recommendation: We recommend the University continue to work with the registrar to accurately report enrollment. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-001
Incorrect Modular Return of Title IV Funding Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268, 84.063, and 84.007 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for one modular student withdrawal that did not require funds to be returned based on the completion rate. The student completed past the 49% required by the new modular withdrawal guidance so no R2T4 should have been done. Criteria: 34 CFR 668.22(j) Questioned Costs: $-0- Context: One student out of eight was correctly identified as an unofficial withdrawal. The exemptions were not accurately applied and an incorrect return of $4,339 was initially made. This was discovered and corrected during the audit process. Cause: The new R2T4 regulations regarding withdrawals from modular programs which were effective July 1, 2021, were not correctly applied to this student. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: Yes, 2021-001. Recommendation: We recommend when the University runs the listings of all withdrawals and all 0 credits each semester that the NAFSAA decision tree related to modular students be applied and retained with each student. We also recommend an individual in financial aid with the appropriate level of experience periodically review modular students? R2T4 calculations and returns to help ensure that internal controls over such process can operate effectively and achieve compliance. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-001
Incorrect Modular Return of Title IV Funding Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268, 84.063, and 84.007 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for one modular student withdrawal that did not require funds to be returned based on the completion rate. The student completed past the 49% required by the new modular withdrawal guidance so no R2T4 should have been done. Criteria: 34 CFR 668.22(j) Questioned Costs: $-0- Context: One student out of eight was correctly identified as an unofficial withdrawal. The exemptions were not accurately applied and an incorrect return of $4,339 was initially made. This was discovered and corrected during the audit process. Cause: The new R2T4 regulations regarding withdrawals from modular programs which were effective July 1, 2021, were not correctly applied to this student. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: Yes, 2021-001. Recommendation: We recommend when the University runs the listings of all withdrawals and all 0 credits each semester that the NAFSAA decision tree related to modular students be applied and retained with each student. We also recommend an individual in financial aid with the appropriate level of experience periodically review modular students? R2T4 calculations and returns to help ensure that internal controls over such process can operate effectively and achieve compliance. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-001
Incorrect Modular Return of Title IV Funding Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268, 84.063, and 84.007 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for one modular student withdrawal that did not require funds to be returned based on the completion rate. The student completed past the 49% required by the new modular withdrawal guidance so no R2T4 should have been done. Criteria: 34 CFR 668.22(j) Questioned Costs: $-0- Context: One student out of eight was correctly identified as an unofficial withdrawal. The exemptions were not accurately applied and an incorrect return of $4,339 was initially made. This was discovered and corrected during the audit process. Cause: The new R2T4 regulations regarding withdrawals from modular programs which were effective July 1, 2021, were not correctly applied to this student. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: Yes, 2021-001. Recommendation: We recommend when the University runs the listings of all withdrawals and all 0 credits each semester that the NAFSAA decision tree related to modular students be applied and retained with each student. We also recommend an individual in financial aid with the appropriate level of experience periodically review modular students? R2T4 calculations and returns to help ensure that internal controls over such process can operate effectively and achieve compliance. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-002
Enrollment Reporting to National Student Loan Data System (NSLDS) DEPARTMENT OF EDUCATION ALN #: 84.268 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The correct NSLDS enrollment status effective date for withdrawals was not sent to NSLDS from the system. Additionally, students who completed undergraduate programs were not reported when continuing in a new program. Criteria: 34 CFR 685.309(b) Questioned Costs: $-0- Context: Out of 60 students tested, 7 were not correctly reported. Four of the students were unofficial withdrawals, and 3 students completed undergraduate programs and continued their studies but were not reported. The University is in the process of correcting these students. Cause: The University?s extraction of data from the system did not include students who had graduated and then reenrolled. Additionally, for unofficial withdrawals, the last date of attendance was not used as the withdrawal date. All 4 of those students were traditional students. Effect: Inaccurate reporting can impact a student?s loan grace period in school deferment eligibility, beginning loan repayments, appropriate interest charges, etc. Identification as repeat finding, if applicable: Not applicable. Recommendation: We recommend the University continue to work with the registrar to accurately report enrollment. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-001
Incorrect Modular Return of Title IV Funding Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268, 84.063, and 84.007 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for one modular student withdrawal that did not require funds to be returned based on the completion rate. The student completed past the 49% required by the new modular withdrawal guidance so no R2T4 should have been done. Criteria: 34 CFR 668.22(j) Questioned Costs: $-0- Context: One student out of eight was correctly identified as an unofficial withdrawal. The exemptions were not accurately applied and an incorrect return of $4,339 was initially made. This was discovered and corrected during the audit process. Cause: The new R2T4 regulations regarding withdrawals from modular programs which were effective July 1, 2021, were not correctly applied to this student. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: Yes, 2021-001. Recommendation: We recommend when the University runs the listings of all withdrawals and all 0 credits each semester that the NAFSAA decision tree related to modular students be applied and retained with each student. We also recommend an individual in financial aid with the appropriate level of experience periodically review modular students? R2T4 calculations and returns to help ensure that internal controls over such process can operate effectively and achieve compliance. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-001
Incorrect Modular Return of Title IV Funding Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268, 84.063, and 84.007 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for one modular student withdrawal that did not require funds to be returned based on the completion rate. The student completed past the 49% required by the new modular withdrawal guidance so no R2T4 should have been done. Criteria: 34 CFR 668.22(j) Questioned Costs: $-0- Context: One student out of eight was correctly identified as an unofficial withdrawal. The exemptions were not accurately applied and an incorrect return of $4,339 was initially made. This was discovered and corrected during the audit process. Cause: The new R2T4 regulations regarding withdrawals from modular programs which were effective July 1, 2021, were not correctly applied to this student. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: Yes, 2021-001. Recommendation: We recommend when the University runs the listings of all withdrawals and all 0 credits each semester that the NAFSAA decision tree related to modular students be applied and retained with each student. We also recommend an individual in financial aid with the appropriate level of experience periodically review modular students? R2T4 calculations and returns to help ensure that internal controls over such process can operate effectively and achieve compliance. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.