Finding No. 2022-008?Special Tests ? Direct Loan Reconciliations Federal Agency: U.S. Department of Education Program: Federal Direct Student Loans: ALN: 84.268 Criteria: Institutions must report all loan disbursements and submit required records to COD within 15 days of disbursement (OMB No. 1845-0021). Each month, COD provides institutions with a School Account Statement (SAS) data file which consists of a Cash Summary, Cash Detail and (optional at the request of the institution) Loan Detail records. The institution is required to reconcile these files to the institution?s financial records. Since up to three Direct Loan program years may be open at any given time, institutions may receive three SAS data files each month (34 CFR 685.102(b), 685.300(b), 685.301, and 303). Condition: Out of two months selected, one month did not have proper documentation to support reconciliation or evidence of review of reconciliation was noted. Questioned Costs: None. Prevalence: One out of two months tested did not have proper support of reconciliation or evidence of review. The sample was not intended to be, and was not, a statistically valid sample. Effect: Lack of a formal reconciliation process and review of the reconciliations could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the people administering the program and records were not properly maintained to support reconciliations performed. Recommendation: We recommend that the Conservatory implement a formal reconciliation process and all records be maintained to support the reconciliation. In addition, we recommend the reconciliation be reviewed by someone other than the person performing the reconciliation procedures. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-010?Special Tests ? Disbursement to or on Behalf of Students Federal Agency: U.S. Department of Education Program: Federal Direct Student Loans: ALN: 84.268 Criteria: The Direct Loan regulations at 34 CFR 685.300(b)(9) requires the institution to implement and document a quality assurance process to ensure that they are complying with program requirements and meeting program objectives. Condition: The institution does not have a documented quality assurance process. Questioned Costs: None Prevalence: There was no documented quality assurance process for the year ended June 30, 2022. Effect: Not following requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of formal documentation and filing of policies and procedures surrounding administering financial aid. Recommendation: We recommend that the Conservatory implement a formal documented quality assurance process, to review this process on a regular basis and document that the process is being used. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-003?Higher Education Emergency Relief Fund (HEERF) Reporting Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: Reporting requirements to the DOE state that the institutional portion of HEERF is reported by quarter in the quarter the funds are drawn from the G5 system and reported for the allowable categories under the grant. The reports filed should include all information about expenditures incurred or lost revenues claimed under the grant. Condition: Amounts reported for the institutional portion by the Conservatory were originally reported in the wrong category (misclassified). Questioned Costs: None. Prevalence: Identified in one out of three institutional quarterly reports tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Improper classifications were reported to the DOE. Improper reporting could result in the DOE withholding payments to the Conservatory. Cause: Changes to the program rules, regulations and reporting for the HEERF programs were evolving throughout the different phases of the program. This issue is the result of improper tracking of those changes as they were occurring which resulted in errors in classification in the original filing. Recommendation: We recommend the Conservatory amend the incorrect reports. The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been taken.
Finding No. 2022-004?HEERF Cash Management Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: The Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (ALN 84.425E) should be disbursed within 15 calendar days of the drawdown from DOE?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. Condition: There were two drawdowns from the G5 during the year, one for the institutional portion and one for the student portion. There were $11,340 of funds disbursed after 15 days of the drawdown from DOE?s G5 grants system for student portion and $25,832 of funds disbursed after three days of the drawdown from the DOE?s G5 grant system for the institutional portion. Questioned Costs: None. Prevalence: Identified in two out of two disbursements tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Cash was not disbursed within the required timeframe. Improper cash management could result in the DOE withholding payments to the Conservatory. Cause: This issue is the result of improper tracking of expenditures to ensure that they are expended within the required timeframe or returned to the DOE. Recommendation: We recommend management implement a control to regularly monitor disbursements and reconcile to drawdowns to ensure applicable requirements are met. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-005?HEERF Earmarking Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: The American Rescue Plan (ARP) created a new requirement that a portion of the HEERF III institutional funds must be used to conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid adjustment due to the recent unemployment of a family member or independent student, or other circumstances, described in section 479A of the Higher Education Act. Condition: There was no evidence that the required direct outreach occurred and no costs were charged to the grant. Questioned Costs: None. Prevalence: There was no direct outreach and no costs were charged to the program. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not complying with requirements outlined within applicable grant agreements could result in the DOE withholding payments to the Conservatory. Cause: This issue in the result of a lack of proper understanding of applicable requirements. Recommendation: The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-006?HEERF Procurement (Repeating Finding?2021-001) Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: Procurement standards under the Uniform Guidance 2 CFR 200.317-200.327 require that competitive bids be received for purchases above the micro-purchase level or justification for sole-source providers be documented prior to the purchase. Condition: During fiscal year 2022, certain costs were incurred above the micro-purchase level where there was no evidence of competitive bids received or documentation Questioned Costs: None. Prevalence: There was no direct outreach and no costs were charged to the program. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not complying with requirements outlined within applicable grant agreements could result in the DOE withholding payments to the Conservatory. Cause: This issue in the result of a lack of proper understanding of applicable requirements. Due to the timing of identifying the prior year finding, management was in the process of implementing the policy and procedures around federal compliance as of June 30, 2022. Recommendation: We recommend that the Conservatory follow the guidelines in its procurement policy or document any justification for departure from the policy. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-007?Special Tests ? Perkins Loan Recordkeeping and Record Retention Federal Agency: U.S. Department of Education Program: Federal Perkins Loans: ALN: 84.038 Criteria: Per 34 CFR 674.19(e), an institution shall keep the original promissory notes and repayment schedules until the loans are satisfied. If required to release original documents in order to enforce the loan, the institution must retain certified true copies of those documents. Condition: Based on inspection of 27 student files, it was noted that there were seven files that did not contain original loan documents. Questioned Costs: None. Prevalence: Out of 27 student files tested, seven files did not contain original loan documents. The sample was not intended to be, and was not, a statistically valid sample. Effect: The institution may not be able to assign the loan to the government or enforce the loan without original promissory notes. Cause: The loans date back for several years. There have been several individuals charged with responsibility of administering the program over the years who may have had a lack of proper understanding of applicable requirements. Recommendation: We recommend that the Conservatory review their student files to determine which files do not have original loan documentation to determine total exposure and determine what remediation will be required to ensure compliance with the applicable requirements. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-003?Higher Education Emergency Relief Fund (HEERF) Reporting Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: Reporting requirements to the DOE state that the institutional portion of HEERF is reported by quarter in the quarter the funds are drawn from the G5 system and reported for the allowable categories under the grant. The reports filed should include all information about expenditures incurred or lost revenues claimed under the grant. Condition: Amounts reported for the institutional portion by the Conservatory were originally reported in the wrong category (misclassified). Questioned Costs: None. Prevalence: Identified in one out of three institutional quarterly reports tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Improper classifications were reported to the DOE. Improper reporting could result in the DOE withholding payments to the Conservatory. Cause: Changes to the program rules, regulations and reporting for the HEERF programs were evolving throughout the different phases of the program. This issue is the result of improper tracking of those changes as they were occurring which resulted in errors in classification in the original filing. Recommendation: We recommend the Conservatory amend the incorrect reports. The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been taken.
Finding No. 2022-004?HEERF Cash Management Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: The Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (ALN 84.425E) should be disbursed within 15 calendar days of the drawdown from DOE?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. Condition: There were two drawdowns from the G5 during the year, one for the institutional portion and one for the student portion. There were $11,340 of funds disbursed after 15 days of the drawdown from DOE?s G5 grants system for student portion and $25,832 of funds disbursed after three days of the drawdown from the DOE?s G5 grant system for the institutional portion. Questioned Costs: None. Prevalence: Identified in two out of two disbursements tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Cash was not disbursed within the required timeframe. Improper cash management could result in the DOE withholding payments to the Conservatory. Cause: This issue is the result of improper tracking of expenditures to ensure that they are expended within the required timeframe or returned to the DOE. Recommendation: We recommend management implement a control to regularly monitor disbursements and reconcile to drawdowns to ensure applicable requirements are met. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-005?HEERF Earmarking Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: The American Rescue Plan (ARP) created a new requirement that a portion of the HEERF III institutional funds must be used to conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid adjustment due to the recent unemployment of a family member or independent student, or other circumstances, described in section 479A of the Higher Education Act. Condition: There was no evidence that the required direct outreach occurred and no costs were charged to the grant. Questioned Costs: None. Prevalence: There was no direct outreach and no costs were charged to the program. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not complying with requirements outlined within applicable grant agreements could result in the DOE withholding payments to the Conservatory. Cause: This issue in the result of a lack of proper understanding of applicable requirements. Recommendation: The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-006?HEERF Procurement (Repeating Finding?2021-001) Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: Procurement standards under the Uniform Guidance 2 CFR 200.317-200.327 require that competitive bids be received for purchases above the micro-purchase level or justification for sole-source providers be documented prior to the purchase. Condition: During fiscal year 2022, certain costs were incurred above the micro-purchase level where there was no evidence of competitive bids received or documentation Questioned Costs: None. Prevalence: There was no direct outreach and no costs were charged to the program. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not complying with requirements outlined within applicable grant agreements could result in the DOE withholding payments to the Conservatory. Cause: This issue in the result of a lack of proper understanding of applicable requirements. Due to the timing of identifying the prior year finding, management was in the process of implementing the policy and procedures around federal compliance as of June 30, 2022. Recommendation: We recommend that the Conservatory follow the guidelines in its procurement policy or document any justification for departure from the policy. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-008?Special Tests ? Direct Loan Reconciliations Federal Agency: U.S. Department of Education Program: Federal Direct Student Loans: ALN: 84.268 Criteria: Institutions must report all loan disbursements and submit required records to COD within 15 days of disbursement (OMB No. 1845-0021). Each month, COD provides institutions with a School Account Statement (SAS) data file which consists of a Cash Summary, Cash Detail and (optional at the request of the institution) Loan Detail records. The institution is required to reconcile these files to the institution?s financial records. Since up to three Direct Loan program years may be open at any given time, institutions may receive three SAS data files each month (34 CFR 685.102(b), 685.300(b), 685.301, and 303). Condition: Out of two months selected, one month did not have proper documentation to support reconciliation or evidence of review of reconciliation was noted. Questioned Costs: None. Prevalence: One out of two months tested did not have proper support of reconciliation or evidence of review. The sample was not intended to be, and was not, a statistically valid sample. Effect: Lack of a formal reconciliation process and review of the reconciliations could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the people administering the program and records were not properly maintained to support reconciliations performed. Recommendation: We recommend that the Conservatory implement a formal reconciliation process and all records be maintained to support the reconciliation. In addition, we recommend the reconciliation be reviewed by someone other than the person performing the reconciliation procedures. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-010?Special Tests ? Disbursement to or on Behalf of Students Federal Agency: U.S. Department of Education Program: Federal Direct Student Loans: ALN: 84.268 Criteria: The Direct Loan regulations at 34 CFR 685.300(b)(9) requires the institution to implement and document a quality assurance process to ensure that they are complying with program requirements and meeting program objectives. Condition: The institution does not have a documented quality assurance process. Questioned Costs: None Prevalence: There was no documented quality assurance process for the year ended June 30, 2022. Effect: Not following requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of formal documentation and filing of policies and procedures surrounding administering financial aid. Recommendation: We recommend that the Conservatory implement a formal documented quality assurance process, to review this process on a regular basis and document that the process is being used. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-003?Higher Education Emergency Relief Fund (HEERF) Reporting Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: Reporting requirements to the DOE state that the institutional portion of HEERF is reported by quarter in the quarter the funds are drawn from the G5 system and reported for the allowable categories under the grant. The reports filed should include all information about expenditures incurred or lost revenues claimed under the grant. Condition: Amounts reported for the institutional portion by the Conservatory were originally reported in the wrong category (misclassified). Questioned Costs: None. Prevalence: Identified in one out of three institutional quarterly reports tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Improper classifications were reported to the DOE. Improper reporting could result in the DOE withholding payments to the Conservatory. Cause: Changes to the program rules, regulations and reporting for the HEERF programs were evolving throughout the different phases of the program. This issue is the result of improper tracking of those changes as they were occurring which resulted in errors in classification in the original filing. Recommendation: We recommend the Conservatory amend the incorrect reports. The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been taken.
Finding No. 2022-004?HEERF Cash Management Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: The Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (ALN 84.425E) should be disbursed within 15 calendar days of the drawdown from DOE?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. Condition: There were two drawdowns from the G5 during the year, one for the institutional portion and one for the student portion. There were $11,340 of funds disbursed after 15 days of the drawdown from DOE?s G5 grants system for student portion and $25,832 of funds disbursed after three days of the drawdown from the DOE?s G5 grant system for the institutional portion. Questioned Costs: None. Prevalence: Identified in two out of two disbursements tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Cash was not disbursed within the required timeframe. Improper cash management could result in the DOE withholding payments to the Conservatory. Cause: This issue is the result of improper tracking of expenditures to ensure that they are expended within the required timeframe or returned to the DOE. Recommendation: We recommend management implement a control to regularly monitor disbursements and reconcile to drawdowns to ensure applicable requirements are met. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-005?HEERF Earmarking Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: The American Rescue Plan (ARP) created a new requirement that a portion of the HEERF III institutional funds must be used to conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid adjustment due to the recent unemployment of a family member or independent student, or other circumstances, described in section 479A of the Higher Education Act. Condition: There was no evidence that the required direct outreach occurred and no costs were charged to the grant. Questioned Costs: None. Prevalence: There was no direct outreach and no costs were charged to the program. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not complying with requirements outlined within applicable grant agreements could result in the DOE withholding payments to the Conservatory. Cause: This issue in the result of a lack of proper understanding of applicable requirements. Recommendation: The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-006?HEERF Procurement (Repeating Finding?2021-001) Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: Procurement standards under the Uniform Guidance 2 CFR 200.317-200.327 require that competitive bids be received for purchases above the micro-purchase level or justification for sole-source providers be documented prior to the purchase. Condition: During fiscal year 2022, certain costs were incurred above the micro-purchase level where there was no evidence of competitive bids received or documentation Questioned Costs: None. Prevalence: There was no direct outreach and no costs were charged to the program. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not complying with requirements outlined within applicable grant agreements could result in the DOE withholding payments to the Conservatory. Cause: This issue in the result of a lack of proper understanding of applicable requirements. Due to the timing of identifying the prior year finding, management was in the process of implementing the policy and procedures around federal compliance as of June 30, 2022. Recommendation: We recommend that the Conservatory follow the guidelines in its procurement policy or document any justification for departure from the policy. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-007?Special Tests ? Perkins Loan Recordkeeping and Record Retention Federal Agency: U.S. Department of Education Program: Federal Perkins Loans: ALN: 84.038 Criteria: Per 34 CFR 674.19(e), an institution shall keep the original promissory notes and repayment schedules until the loans are satisfied. If required to release original documents in order to enforce the loan, the institution must retain certified true copies of those documents. Condition: Based on inspection of 27 student files, it was noted that there were seven files that did not contain original loan documents. Questioned Costs: None. Prevalence: Out of 27 student files tested, seven files did not contain original loan documents. The sample was not intended to be, and was not, a statistically valid sample. Effect: The institution may not be able to assign the loan to the government or enforce the loan without original promissory notes. Cause: The loans date back for several years. There have been several individuals charged with responsibility of administering the program over the years who may have had a lack of proper understanding of applicable requirements. Recommendation: We recommend that the Conservatory review their student files to determine which files do not have original loan documentation to determine total exposure and determine what remediation will be required to ensure compliance with the applicable requirements. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-009?Special Tests ? Institutional Eligibility Federal Agency: U.S. Department of Education Program: Student Financial Aid Cluster: ALN 84.268, 84.033, 84.063, 84.007, 84.038 Criteria: 34 CFR 600.21(d) requires an eligible institution must report to the Secretary in a manner prescribed by the Secretary no later than 10 days after the change occurs, of any change including a change in the chief financial officer or the individual the institution designates under 34 CFR 668.16(b)(1) as its title IV, HEA Program administrator. Condition: Out of two reportable changes noted during the year, none were reported within 10 days. The chief financial officer and financial aid administrator both changed before or as of June 30, 2022, and were not reported until November 14, 2022. Questioned Costs: None Prevalence: No changes in chief financial officer or financial aid administrator were reported for the year ended June 30, 2022. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not following reporting requirements could result in the DOE withholding payments to the Conservatory. Cause: There was significant turnover in the finance and financial aid department and a lack of understanding of the reporting requirements. Recommendation: We recommend that the Conservatory implement a formal process where, if there is a change in personnel or service providers that are required to be reported as outlined in the CFR, to ensure that the change is reported to the DOE within the required timeframe. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions have been made.
Finding No. 2022-003?Higher Education Emergency Relief Fund (HEERF) Reporting Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: Reporting requirements to the DOE state that the institutional portion of HEERF is reported by quarter in the quarter the funds are drawn from the G5 system and reported for the allowable categories under the grant. The reports filed should include all information about expenditures incurred or lost revenues claimed under the grant. Condition: Amounts reported for the institutional portion by the Conservatory were originally reported in the wrong category (misclassified). Questioned Costs: None. Prevalence: Identified in one out of three institutional quarterly reports tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Improper classifications were reported to the DOE. Improper reporting could result in the DOE withholding payments to the Conservatory. Cause: Changes to the program rules, regulations and reporting for the HEERF programs were evolving throughout the different phases of the program. This issue is the result of improper tracking of those changes as they were occurring which resulted in errors in classification in the original filing. Recommendation: We recommend the Conservatory amend the incorrect reports. The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been taken.
Finding No. 2022-004?HEERF Cash Management Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: The Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (ALN 84.425E) should be disbursed within 15 calendar days of the drawdown from DOE?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. Condition: There were two drawdowns from the G5 during the year, one for the institutional portion and one for the student portion. There were $11,340 of funds disbursed after 15 days of the drawdown from DOE?s G5 grants system for student portion and $25,832 of funds disbursed after three days of the drawdown from the DOE?s G5 grant system for the institutional portion. Questioned Costs: None. Prevalence: Identified in two out of two disbursements tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Cash was not disbursed within the required timeframe. Improper cash management could result in the DOE withholding payments to the Conservatory. Cause: This issue is the result of improper tracking of expenditures to ensure that they are expended within the required timeframe or returned to the DOE. Recommendation: We recommend management implement a control to regularly monitor disbursements and reconcile to drawdowns to ensure applicable requirements are met. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-005?HEERF Earmarking Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: The American Rescue Plan (ARP) created a new requirement that a portion of the HEERF III institutional funds must be used to conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid adjustment due to the recent unemployment of a family member or independent student, or other circumstances, described in section 479A of the Higher Education Act. Condition: There was no evidence that the required direct outreach occurred and no costs were charged to the grant. Questioned Costs: None. Prevalence: There was no direct outreach and no costs were charged to the program. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not complying with requirements outlined within applicable grant agreements could result in the DOE withholding payments to the Conservatory. Cause: This issue in the result of a lack of proper understanding of applicable requirements. Recommendation: The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.
Finding No. 2022-006?HEERF Procurement (Repeating Finding?2021-001) Federal Agency: U.S. Department of Education Program: COVID-19 Education Stabilization Fund: ALN: 84.425 Criteria: Procurement standards under the Uniform Guidance 2 CFR 200.317-200.327 require that competitive bids be received for purchases above the micro-purchase level or justification for sole-source providers be documented prior to the purchase. Condition: During fiscal year 2022, certain costs were incurred above the micro-purchase level where there was no evidence of competitive bids received or documentation Questioned Costs: None. Prevalence: There was no direct outreach and no costs were charged to the program. The sample was not intended to be, and was not, a statistically valid sample. Effect: Not complying with requirements outlined within applicable grant agreements could result in the DOE withholding payments to the Conservatory. Cause: This issue in the result of a lack of proper understanding of applicable requirements. Due to the timing of identifying the prior year finding, management was in the process of implementing the policy and procedures around federal compliance as of June 30, 2022. Recommendation: We recommend that the Conservatory follow the guidelines in its procurement policy or document any justification for departure from the policy. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.