Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Reporting. According to 34 CFR 690.83, Dear Colleague Letter Gen 13-13, and Federal Register Volume 84, Number 212, November 1, 2019 an institution must submit Pell and Direct Loan origination records and disbursement records to the Common Origination and Disbursement (COD) in a timely and accurate manner. Condition - Federal Direct Loan and Pell disbursement dates per the College's billing system did not agree with the reported dates per the Common Origination Disbursement (COD) records. Cost of attendance, transaction numbers, and the Pell award amount did not agree between the student?s files and COD records. Questioned Costs - None. Context - Out of a population of 159 students receiving Direct Loan awards during the year, a sample of 24 students was selected for testing. Out of these 24 students selected for testing, there were three instances in which the student's transaction code per the College's origination records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Out of a population of 251 students receiving Pell awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were nine instances in which the student's Cost of Attendance were not consistent with the COD. There were four instances in which the student's disbursement date per the College's records was not consistent with the COD. Finally, there was one instance in which the student's disbursement amount per the College's records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Effect - The College did not report the accurate data (e.g., disbursement dates, amounts, and cost of attendance) to the COD. Cause - Lack of reconciliation of student origination records to data provided to the COD. Identification as a Repeat Finding - Yes, see 2021-002, 2020-004 and 2019-003. Recommendation - The College should review and update its processes and controls to ensure a formal reconciliation is provided for student origination records to the COD. Views of Responsible Officials and Planned Corrective Actions - This was neglected due to staffing issues and high turnover. Pell and Direct Loan origination records and disbursement records are submitted to the Common Origination Disbursement (COD) either same business day, or next business day. Formal reconciliation process is now completed every 1-2 months in order to verify disbursement dates, amounts, and cost of attendance in COD.
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions - Disbursements To or On Behalf of Students According to 34 CFR section 668.165, the College is required to notify the student, or parent in writing of (1) the date and amount of the disbursement; (2) the student?s right, or parent?s right, to cancel all or a portion of that loan or loan disbursement and have the loan proceeds returned to the holder of that loan; and (3) the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel the loan. Condition - The College did not ensure communication of all three elements to students before disbursement of the direct student loans. Questioned Costs - None. Context - Out of a population of 286 students receiving federal awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were seven instances in which the College did not send notification to the student or parent of the required conditions. The sample was not, and was not intended to be, a statistically valid sample. Effect - Students or parents were not notified of disbursements or notified of their right to cancel all or a portion of the loan disbursement. Cause - The College had a lack of policy, procedure, and follow-up to ensure communications were sent. Identification as a Repeat Finding - Yes, see findings 2021-003 and 2020-006. Recommendation - The College should establish a process and controls to ensure disbursement notification letters are sent when required to ensure ongoing compliance. Views of Responsible Officials and Planned Corrective Actions - This was neglected due to staffing issues and high turnover. Disbursement Letters are sent to students as they request Direct Loan funding amounts. The Disbursement Letter includes the three elements as required by DOE (per FSA handbook).
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions: Enrollment Reporting Pell, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309. Federal regulations require the institution to notify the Department of Education of changes in student enrollment information at the Campus Level and Program Level in a timely and accurate manner. These changes include reductions or increases in attendance levels, withdrawals, graduations, drop outs, or enrolled but never attended during the audit period. Institutions are responsible for timely reporting, whether they report directly or via a third-party service. Additionally, institutions are required to accurately report the student?s Campus-Level and Program-Level enrollment data. Condition - The College did not ensure accurate and timely notification to the National Student Loan Data System (NSLDS) of student status changes and program-level enrollment data. Questioned Costs - None. Context - Out of a population of 400 student enrollment status changes requiring notification, a sample of 40 students was selected for testing. Out of these 40 students selected for testing, there were four instances in which the student's status change was reported after the 60 day requirement. Additionally, there were four students selected where the campus and program-level record information was not in agreement between the NSLDS and the campus level information. The sample was not, and was not intended to be, a statistically valid sample. Effect - The NSLDS was not notified of the student enrollment status or program-level records on a timely and accurate basis. Cause - Lack of communication and oversight when reporting student status changes and program-level records to the NSLDS system. Identification as a Repeat Finding - Yes, see prior year findings 2021-005, 2020-005 and 2019-004. Recommendation - The College should review and update its processes and controls to ensure student status changes for program-level records are reported to the NSLDS in a timely and accurate manner. Additionally, we recommend that a formal reconciliation process is completed to validate the procedure is completed on a regular basis. Views of Responsible Officials and Planned Corrective Actions - Registrar Office automatically reports changes in student enrollment information to National Student Clearinghouse, which then goes into NSLDS on a monthly basis. The four students that failed this test for Audit Finding 2022-004 were due to student completion issues and Donnelly College overriding the add/drop policy to retroactively drop students. Registrar clearly provides the information and application process requirements to students who are graduating, and will not process their graduation until requirements are met. Once Registrar is made aware of a retroactive drop that overrides the add/drop policy, it is reported on the next month?s automatic report sent through National Student Clearinghouse to NSLDS.
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions, Verification. In accordance 34 CFR 668.51 through 338.61, the institution shall require each applicant whose application is selected by ED to verify the information required for the Verification Tracking Group to which the applicant is assigned. Additionally, in accordance with Title 2 CFR 200.303, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition - A verification checklist is used by management to validate that a preparer and reviewer both formally signed off on the verification work. For one student selected there was no information regarding their tax returns or supporting schedules for required verification data. Questioned Costs - None Context - Out of a population of 87 students that were selected by ED for verification, a sample of 14 students was selected for testing. One of the 14 students selected for testing did not have records supporting the required verification procedures. The sample was not, and was not intended to be, a statistically valid sample. Effect - College records did not support that the verification was performed for one student. Cause - Management oversight of the control in place. Identification as a Repeat Finding - No Recommendation - Assigned reviewers of the verification worksheet should review for and ensure that all supporting documentation is included within the file. Views of Responsible Officials and Planned Corrective Actions - This was neglected and documents missing due to staffing issues and high turnover. Verification is completed for enrolled students as soon as their ISIR is available to Donnelly through Empower. Verification worksheets are completed by the student and verified by the FA staff as required by DOE (per FSA handbook). All student documents are kept in student's file in the FA office locked cabinet.
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Reporting. According to 34 CFR 690.83, Dear Colleague Letter Gen 13-13, and Federal Register Volume 84, Number 212, November 1, 2019 an institution must submit Pell and Direct Loan origination records and disbursement records to the Common Origination and Disbursement (COD) in a timely and accurate manner. Condition - Federal Direct Loan and Pell disbursement dates per the College's billing system did not agree with the reported dates per the Common Origination Disbursement (COD) records. Cost of attendance, transaction numbers, and the Pell award amount did not agree between the student?s files and COD records. Questioned Costs - None. Context - Out of a population of 159 students receiving Direct Loan awards during the year, a sample of 24 students was selected for testing. Out of these 24 students selected for testing, there were three instances in which the student's transaction code per the College's origination records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Out of a population of 251 students receiving Pell awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were nine instances in which the student's Cost of Attendance were not consistent with the COD. There were four instances in which the student's disbursement date per the College's records was not consistent with the COD. Finally, there was one instance in which the student's disbursement amount per the College's records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Effect - The College did not report the accurate data (e.g., disbursement dates, amounts, and cost of attendance) to the COD. Cause - Lack of reconciliation of student origination records to data provided to the COD. Identification as a Repeat Finding - Yes, see 2021-002, 2020-004 and 2019-003. Recommendation - The College should review and update its processes and controls to ensure a formal reconciliation is provided for student origination records to the COD. Views of Responsible Officials and Planned Corrective Actions - This was neglected due to staffing issues and high turnover. Pell and Direct Loan origination records and disbursement records are submitted to the Common Origination Disbursement (COD) either same business day, or next business day. Formal reconciliation process is now completed every 1-2 months in order to verify disbursement dates, amounts, and cost of attendance in COD.
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions: Enrollment Reporting Pell, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309. Federal regulations require the institution to notify the Department of Education of changes in student enrollment information at the Campus Level and Program Level in a timely and accurate manner. These changes include reductions or increases in attendance levels, withdrawals, graduations, drop outs, or enrolled but never attended during the audit period. Institutions are responsible for timely reporting, whether they report directly or via a third-party service. Additionally, institutions are required to accurately report the student?s Campus-Level and Program-Level enrollment data. Condition - The College did not ensure accurate and timely notification to the National Student Loan Data System (NSLDS) of student status changes and program-level enrollment data. Questioned Costs - None. Context - Out of a population of 400 student enrollment status changes requiring notification, a sample of 40 students was selected for testing. Out of these 40 students selected for testing, there were four instances in which the student's status change was reported after the 60 day requirement. Additionally, there were four students selected where the campus and program-level record information was not in agreement between the NSLDS and the campus level information. The sample was not, and was not intended to be, a statistically valid sample. Effect - The NSLDS was not notified of the student enrollment status or program-level records on a timely and accurate basis. Cause - Lack of communication and oversight when reporting student status changes and program-level records to the NSLDS system. Identification as a Repeat Finding - Yes, see prior year findings 2021-005, 2020-005 and 2019-004. Recommendation - The College should review and update its processes and controls to ensure student status changes for program-level records are reported to the NSLDS in a timely and accurate manner. Additionally, we recommend that a formal reconciliation process is completed to validate the procedure is completed on a regular basis. Views of Responsible Officials and Planned Corrective Actions - Registrar Office automatically reports changes in student enrollment information to National Student Clearinghouse, which then goes into NSLDS on a monthly basis. The four students that failed this test for Audit Finding 2022-004 were due to student completion issues and Donnelly College overriding the add/drop policy to retroactively drop students. Registrar clearly provides the information and application process requirements to students who are graduating, and will not process their graduation until requirements are met. Once Registrar is made aware of a retroactive drop that overrides the add/drop policy, it is reported on the next month?s automatic report sent through National Student Clearinghouse to NSLDS.
Student Financial Assistance Cluster U.S. Department of Education Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions: Return of Title IV Funds - When a recipient of Title IV grant or loan assistance withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the institution must determine the amount of Title IV aid earned by the student as of the student?s withdrawal date and any refund of aid requirement (34 CFR 668.22(a)(1) through (a)(5)). Condition - The College utilized incorrect dates for calculation of a student?s refund, resulting in a variance in calculation of the student?s post-withdrawal disbursement. Questioned Costs - Error resulted in questioned costs of $9 for the Federal Pell Grant Program (ALN 84.063), calculated by independent recalculation of the student?s post-withdrawal disbursement. Context - Out of a population of nine that withdrew and had received federal aid, a sample of two students was selected for testing. During our testing, one student's refund calculation utilized incorrect dates, causing an error in the refund calculation. One other student?s refund calculation used an incorrect date; however, the student?s refund calculation was not impacted by the error. The sampling method was not, and was not intended to be, a statistically valid sample. Effect - The student?s post-withdrawal disbursement was calculated incorrectly for one student out of the two tested. Cause - Management oversight of the control in place to determine scheduled breaks. Identification as a Repeat Finding - No Recommendation - The College should have a procedure to review and lock down the scheduled breaks each year to determine the proper number of days for any refund calculations. Views of Responsible Officials and Planned Corrective Actions - 21-22 semester dates were input incorrectly by a previous DFA and have now been corrected for the 22-23 school year to reflect DOE (per FSA handbook) requirements.
Student Financial Assistance Cluster U.S. Department of Education Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Eligibility - Each year, based on the maximum Pell Grant established by Congress, ED provides to institutions Payment and Disbursement Schedules for determining Pell awards. The Payment Schedule provides the maximum scheduled award a student would receive for a full academic year as a full-time student based on their EFC and COA. Additionally, students that receive Pell may not receive more than six Scheduled Awards (12 semesters, or the equivalent) as measured by the percentage of ?lifetime eligibility used? (LEU) field in COD (tracked by ED) (20 USC 1070a(c)(5)). The LEU maximum percentage for student eligibility is 600 percent (Chapter 3 in Volume 3, Calculating the Pell and Iraq & Afghanistan Service Grant Awards, of the FSA Handbook). Condition - The amount of a student?s Federal Pell Grant for an academic year is based upon payment and disbursement schedules published by the Secretary of Education for each award year, and the calculation of a Federal Pell Grant is based on the student?s enrollment status from the Payment Schedule for full-time students or the Disbursement Schedule for three-quarter time, half-time, or less than-half time students. The College utilized an incorrect Pell table when calculating the amount of Pell disbursed to a student. Additionally, the College is limited in its Pell Grant funding to be the equivalent of 6 years--600 percent lifetime threshold. Questioned Costs - An error resulted in questioned costs of $2,185 as a result of using the wrong Pell table. There was an additional error in a Pell Grant calculated because the student had exceeded the 600 percent threshold for lifetime Pell resulting in an over award of $3. Context - Out of a population of 286 students receiving federal awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there was one instance in which the College used the incorrect Pell table and one instance in which the Pell award exceeded the 600 percent lifetime threshold. The sample was not, and was not intended to be, a statistically valid sample. Effect - Two students out of the 25 tested received an over-award of Pell. Cause - Management oversight of the control in place to validate the Pell table and Lifetime Maximum table. Identification as a Repeat Finding - No Recommendation - The College should have a procedure to review each students credit hours to determine the proper Pell table. Additionally, review procedures should be implemented to ensure that no student exceeds 600% of their maximum lifetime Pell award. Views of Responsible Officials and Planned Corrective Actions - These Pell recipients are from the 2nd Chance Pell Grant Experiment and guidance has been inconsistent in the awarding process, resulting from staffing issues and high turnover. Student credit hours are now determined using the correct Pell Grant Payment Schedule and awarded accordingly. Verification process includes reviewing student's maximum lifetime Pell award percentage of 600%.
U.S. Department of Education Higher Education Institutional Aid CFDA 84.031 Award Year 2022 Criteria or Specific Requirement - Allowable Costs. According to 2 CFR Section 200.403(b), allowable costs must conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. Condition - The College charged faculty and staff wages unrelated to the Title V program to the grant during the fiscal year ended June 30, 2022. Questioned Costs - Grant Award Number: P031S190265 - 21. Error resulted in questioned costs of $34,056 awarded to the College. During review of the detailed listed of Title V revenue recorded, we identified certain expenses that did not appear consistent with the detailed federal grant schedule provided by management. Context - Out of a population of 26 payroll periods totaling $261,616, we selected one key item for $34,056 and a sample of four payroll periods totaling $27,661 to review the salaries paid to employees and charged to the federal award. The entire balance of the $34,056 key item was drawn down in error for staff wages and fringe benefits which were not related to the approved federal grant services. The sample was not, and was not intended to be, a statistically valid sample. Effect - College records did not support the salary expenses charged to the federal award. Cause - Management oversight when completing salary reconciliation. Identification as a Repeat Finding - Yes, see findings 2021-004 and 2020-009. Recommendation - The College should implement processes and controls to ensure that all employees paid with federal grant funds are compared against the budget amounts provided to the grant administrator. Views of Responsible Officials and Planned Corrective Actions - Adjustments have been made to drawdowns in April and June of 2022 in order to correct for these overdraws. However, even after these corrections, $694.47 was still overdrawn from FY22. This amount will be corrected in a future Title V draw for this amount. Salary drawdowns will be required to have backup payroll documentation for each draw in the future.
Education Stabilization Fund, Higher Education Emergency Relief Fund (HEERF) - Student Portion #84.425E U.S. Department of Education Award Year 2022 Criteria or Specific Requirement - Under the CARES Act 18004(e) and the CRRSAA 314(e), there are three components to reporting HEERF, public reporting on student aid portion, public reporting on the institutional portion, and annual reporting. The public reporting on student aid requires institutions to publicly post certain information no later than 10 days after the end of each calendar quarter. Condition - The College posted one quarterly student aid HEERF report to the website after the required deadline. Questioned Costs - None noted Context - Out of a population of nine reports (one annual, four quarterly public reports for institutional aid and four quarterly public reports for student aid), we selected five reports and noted the one instance of noncompliance with the timely reporting requirement of the student aid report on September 30, 2021. Effect - The College was not in compliance with the reporting requirements of the Education Stabilization Fund program. Cause - Management was not aware of the reporting requirements associated with the HEERF funds. Identification as a Repeat Finding - No Recommendation - We recommend that management review this area and establish procedures to ensure required reports are completed timely and accurately. View of Responsible Official and Planned Corrective Actions ? Initial guidance from the Department of Education did not specify that quarterly reports were required for quarters in which no funds were expended. The late report noted in the audit was for a quarter in which no Student Aid funds were expended. As soon as the Department of Education clarified in a webinar that quarterly reports were required even for quarters where no funds were expended, Donnelly posted the missing report showing zero expenditures.
Education Stabilization Fund, Higher Education Emergency Relief Fund (HEERF) - Institutional Portion #84.425F U.S. Department of Education Award Year 2022 Criteria or Specific Requirement - Allowable Costs. According to 2 CFR Section 200.407 reasonable direct administrative costs and indirect costs at an institution's approved negotiated indirect cost rate may be charged against Assistance Listing 84.425F (Institutional portion). Condition - The College improperly charged an indirect cost to the federal grant for an ineligible expense that was ineligible based on the Indirect Cost Rate Agreement. The College has an approved Indirect Cost rate of 49.90 percent. Under the rate agreement, the College is approved to charge an indirect cost fee based on modified total direct costs. Modified total direct costs include direct salaries and wages, applicable fringe benefits, material and supplies, services, travel and up to the first $25,000 of each subaward. Modified total direct costs shall exclude equipment and capital expenditures if they have a useful life greater than one year and a per-unit acquisition costs which equal or exceeds $5,000. Questioned Costs - Grant Award Number: P425F201877 - 20B. Error resulted in questioned costs of $34,291 awarded to the College. Context - Out of a population of 114 institutional expenses totaling $598,317, we selected 18 institutional expenses for $416,864 to test and trace back to supporting documentation to support the charge to the federal award. For one of 18 institutional expenses selected for testing, the entire balance of the $34,291 was not considered an allowable costs since the expenditure was an indirect fee charge based on a capital expenditure. The sample was not, and was not intended to be, a statistically valid sample. Effect - The College was not in compliance with the allowable costs of the Education Stabilization Fund program. Cause - Management made an error in interpreting the indirect cost agreement associated with the equipment and capital expenditure for one of the items selected for testing. Identification as a Repeat Finding - No. Recommendation - We recommend that management review this area and establish procedures to ensure all requirements are met. View of Responsible Official and Planned Corrective Actions ? In including the questioned indirect cost as a HEERF expense, management only considered the per unit cost threshold, rather than both the per unit cost and the expected life of the items. The audit clarified the regulations and Donnelly promptly notified our program officer, posted a corrected quarterly report and refunded the funds to the Department of Education.
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Reporting. According to 34 CFR 690.83, Dear Colleague Letter Gen 13-13, and Federal Register Volume 84, Number 212, November 1, 2019 an institution must submit Pell and Direct Loan origination records and disbursement records to the Common Origination and Disbursement (COD) in a timely and accurate manner. Condition - Federal Direct Loan and Pell disbursement dates per the College's billing system did not agree with the reported dates per the Common Origination Disbursement (COD) records. Cost of attendance, transaction numbers, and the Pell award amount did not agree between the student?s files and COD records. Questioned Costs - None. Context - Out of a population of 159 students receiving Direct Loan awards during the year, a sample of 24 students was selected for testing. Out of these 24 students selected for testing, there were three instances in which the student's transaction code per the College's origination records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Out of a population of 251 students receiving Pell awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were nine instances in which the student's Cost of Attendance were not consistent with the COD. There were four instances in which the student's disbursement date per the College's records was not consistent with the COD. Finally, there was one instance in which the student's disbursement amount per the College's records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Effect - The College did not report the accurate data (e.g., disbursement dates, amounts, and cost of attendance) to the COD. Cause - Lack of reconciliation of student origination records to data provided to the COD. Identification as a Repeat Finding - Yes, see 2021-002, 2020-004 and 2019-003. Recommendation - The College should review and update its processes and controls to ensure a formal reconciliation is provided for student origination records to the COD. Views of Responsible Officials and Planned Corrective Actions - This was neglected due to staffing issues and high turnover. Pell and Direct Loan origination records and disbursement records are submitted to the Common Origination Disbursement (COD) either same business day, or next business day. Formal reconciliation process is now completed every 1-2 months in order to verify disbursement dates, amounts, and cost of attendance in COD.
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions - Disbursements To or On Behalf of Students According to 34 CFR section 668.165, the College is required to notify the student, or parent in writing of (1) the date and amount of the disbursement; (2) the student?s right, or parent?s right, to cancel all or a portion of that loan or loan disbursement and have the loan proceeds returned to the holder of that loan; and (3) the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel the loan. Condition - The College did not ensure communication of all three elements to students before disbursement of the direct student loans. Questioned Costs - None. Context - Out of a population of 286 students receiving federal awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were seven instances in which the College did not send notification to the student or parent of the required conditions. The sample was not, and was not intended to be, a statistically valid sample. Effect - Students or parents were not notified of disbursements or notified of their right to cancel all or a portion of the loan disbursement. Cause - The College had a lack of policy, procedure, and follow-up to ensure communications were sent. Identification as a Repeat Finding - Yes, see findings 2021-003 and 2020-006. Recommendation - The College should establish a process and controls to ensure disbursement notification letters are sent when required to ensure ongoing compliance. Views of Responsible Officials and Planned Corrective Actions - This was neglected due to staffing issues and high turnover. Disbursement Letters are sent to students as they request Direct Loan funding amounts. The Disbursement Letter includes the three elements as required by DOE (per FSA handbook).
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions: Enrollment Reporting Pell, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309. Federal regulations require the institution to notify the Department of Education of changes in student enrollment information at the Campus Level and Program Level in a timely and accurate manner. These changes include reductions or increases in attendance levels, withdrawals, graduations, drop outs, or enrolled but never attended during the audit period. Institutions are responsible for timely reporting, whether they report directly or via a third-party service. Additionally, institutions are required to accurately report the student?s Campus-Level and Program-Level enrollment data. Condition - The College did not ensure accurate and timely notification to the National Student Loan Data System (NSLDS) of student status changes and program-level enrollment data. Questioned Costs - None. Context - Out of a population of 400 student enrollment status changes requiring notification, a sample of 40 students was selected for testing. Out of these 40 students selected for testing, there were four instances in which the student's status change was reported after the 60 day requirement. Additionally, there were four students selected where the campus and program-level record information was not in agreement between the NSLDS and the campus level information. The sample was not, and was not intended to be, a statistically valid sample. Effect - The NSLDS was not notified of the student enrollment status or program-level records on a timely and accurate basis. Cause - Lack of communication and oversight when reporting student status changes and program-level records to the NSLDS system. Identification as a Repeat Finding - Yes, see prior year findings 2021-005, 2020-005 and 2019-004. Recommendation - The College should review and update its processes and controls to ensure student status changes for program-level records are reported to the NSLDS in a timely and accurate manner. Additionally, we recommend that a formal reconciliation process is completed to validate the procedure is completed on a regular basis. Views of Responsible Officials and Planned Corrective Actions - Registrar Office automatically reports changes in student enrollment information to National Student Clearinghouse, which then goes into NSLDS on a monthly basis. The four students that failed this test for Audit Finding 2022-004 were due to student completion issues and Donnelly College overriding the add/drop policy to retroactively drop students. Registrar clearly provides the information and application process requirements to students who are graduating, and will not process their graduation until requirements are met. Once Registrar is made aware of a retroactive drop that overrides the add/drop policy, it is reported on the next month?s automatic report sent through National Student Clearinghouse to NSLDS.
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions, Verification. In accordance 34 CFR 668.51 through 338.61, the institution shall require each applicant whose application is selected by ED to verify the information required for the Verification Tracking Group to which the applicant is assigned. Additionally, in accordance with Title 2 CFR 200.303, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition - A verification checklist is used by management to validate that a preparer and reviewer both formally signed off on the verification work. For one student selected there was no information regarding their tax returns or supporting schedules for required verification data. Questioned Costs - None Context - Out of a population of 87 students that were selected by ED for verification, a sample of 14 students was selected for testing. One of the 14 students selected for testing did not have records supporting the required verification procedures. The sample was not, and was not intended to be, a statistically valid sample. Effect - College records did not support that the verification was performed for one student. Cause - Management oversight of the control in place. Identification as a Repeat Finding - No Recommendation - Assigned reviewers of the verification worksheet should review for and ensure that all supporting documentation is included within the file. Views of Responsible Officials and Planned Corrective Actions - This was neglected and documents missing due to staffing issues and high turnover. Verification is completed for enrolled students as soon as their ISIR is available to Donnelly through Empower. Verification worksheets are completed by the student and verified by the FA staff as required by DOE (per FSA handbook). All student documents are kept in student's file in the FA office locked cabinet.
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Reporting. According to 34 CFR 690.83, Dear Colleague Letter Gen 13-13, and Federal Register Volume 84, Number 212, November 1, 2019 an institution must submit Pell and Direct Loan origination records and disbursement records to the Common Origination and Disbursement (COD) in a timely and accurate manner. Condition - Federal Direct Loan and Pell disbursement dates per the College's billing system did not agree with the reported dates per the Common Origination Disbursement (COD) records. Cost of attendance, transaction numbers, and the Pell award amount did not agree between the student?s files and COD records. Questioned Costs - None. Context - Out of a population of 159 students receiving Direct Loan awards during the year, a sample of 24 students was selected for testing. Out of these 24 students selected for testing, there were three instances in which the student's transaction code per the College's origination records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Out of a population of 251 students receiving Pell awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were nine instances in which the student's Cost of Attendance were not consistent with the COD. There were four instances in which the student's disbursement date per the College's records was not consistent with the COD. Finally, there was one instance in which the student's disbursement amount per the College's records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Effect - The College did not report the accurate data (e.g., disbursement dates, amounts, and cost of attendance) to the COD. Cause - Lack of reconciliation of student origination records to data provided to the COD. Identification as a Repeat Finding - Yes, see 2021-002, 2020-004 and 2019-003. Recommendation - The College should review and update its processes and controls to ensure a formal reconciliation is provided for student origination records to the COD. Views of Responsible Officials and Planned Corrective Actions - This was neglected due to staffing issues and high turnover. Pell and Direct Loan origination records and disbursement records are submitted to the Common Origination Disbursement (COD) either same business day, or next business day. Formal reconciliation process is now completed every 1-2 months in order to verify disbursement dates, amounts, and cost of attendance in COD.
Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions: Enrollment Reporting Pell, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309. Federal regulations require the institution to notify the Department of Education of changes in student enrollment information at the Campus Level and Program Level in a timely and accurate manner. These changes include reductions or increases in attendance levels, withdrawals, graduations, drop outs, or enrolled but never attended during the audit period. Institutions are responsible for timely reporting, whether they report directly or via a third-party service. Additionally, institutions are required to accurately report the student?s Campus-Level and Program-Level enrollment data. Condition - The College did not ensure accurate and timely notification to the National Student Loan Data System (NSLDS) of student status changes and program-level enrollment data. Questioned Costs - None. Context - Out of a population of 400 student enrollment status changes requiring notification, a sample of 40 students was selected for testing. Out of these 40 students selected for testing, there were four instances in which the student's status change was reported after the 60 day requirement. Additionally, there were four students selected where the campus and program-level record information was not in agreement between the NSLDS and the campus level information. The sample was not, and was not intended to be, a statistically valid sample. Effect - The NSLDS was not notified of the student enrollment status or program-level records on a timely and accurate basis. Cause - Lack of communication and oversight when reporting student status changes and program-level records to the NSLDS system. Identification as a Repeat Finding - Yes, see prior year findings 2021-005, 2020-005 and 2019-004. Recommendation - The College should review and update its processes and controls to ensure student status changes for program-level records are reported to the NSLDS in a timely and accurate manner. Additionally, we recommend that a formal reconciliation process is completed to validate the procedure is completed on a regular basis. Views of Responsible Officials and Planned Corrective Actions - Registrar Office automatically reports changes in student enrollment information to National Student Clearinghouse, which then goes into NSLDS on a monthly basis. The four students that failed this test for Audit Finding 2022-004 were due to student completion issues and Donnelly College overriding the add/drop policy to retroactively drop students. Registrar clearly provides the information and application process requirements to students who are graduating, and will not process their graduation until requirements are met. Once Registrar is made aware of a retroactive drop that overrides the add/drop policy, it is reported on the next month?s automatic report sent through National Student Clearinghouse to NSLDS.
Student Financial Assistance Cluster U.S. Department of Education Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions: Return of Title IV Funds - When a recipient of Title IV grant or loan assistance withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the institution must determine the amount of Title IV aid earned by the student as of the student?s withdrawal date and any refund of aid requirement (34 CFR 668.22(a)(1) through (a)(5)). Condition - The College utilized incorrect dates for calculation of a student?s refund, resulting in a variance in calculation of the student?s post-withdrawal disbursement. Questioned Costs - Error resulted in questioned costs of $9 for the Federal Pell Grant Program (ALN 84.063), calculated by independent recalculation of the student?s post-withdrawal disbursement. Context - Out of a population of nine that withdrew and had received federal aid, a sample of two students was selected for testing. During our testing, one student's refund calculation utilized incorrect dates, causing an error in the refund calculation. One other student?s refund calculation used an incorrect date; however, the student?s refund calculation was not impacted by the error. The sampling method was not, and was not intended to be, a statistically valid sample. Effect - The student?s post-withdrawal disbursement was calculated incorrectly for one student out of the two tested. Cause - Management oversight of the control in place to determine scheduled breaks. Identification as a Repeat Finding - No Recommendation - The College should have a procedure to review and lock down the scheduled breaks each year to determine the proper number of days for any refund calculations. Views of Responsible Officials and Planned Corrective Actions - 21-22 semester dates were input incorrectly by a previous DFA and have now been corrected for the 22-23 school year to reflect DOE (per FSA handbook) requirements.
Student Financial Assistance Cluster U.S. Department of Education Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Eligibility - Each year, based on the maximum Pell Grant established by Congress, ED provides to institutions Payment and Disbursement Schedules for determining Pell awards. The Payment Schedule provides the maximum scheduled award a student would receive for a full academic year as a full-time student based on their EFC and COA. Additionally, students that receive Pell may not receive more than six Scheduled Awards (12 semesters, or the equivalent) as measured by the percentage of ?lifetime eligibility used? (LEU) field in COD (tracked by ED) (20 USC 1070a(c)(5)). The LEU maximum percentage for student eligibility is 600 percent (Chapter 3 in Volume 3, Calculating the Pell and Iraq & Afghanistan Service Grant Awards, of the FSA Handbook). Condition - The amount of a student?s Federal Pell Grant for an academic year is based upon payment and disbursement schedules published by the Secretary of Education for each award year, and the calculation of a Federal Pell Grant is based on the student?s enrollment status from the Payment Schedule for full-time students or the Disbursement Schedule for three-quarter time, half-time, or less than-half time students. The College utilized an incorrect Pell table when calculating the amount of Pell disbursed to a student. Additionally, the College is limited in its Pell Grant funding to be the equivalent of 6 years--600 percent lifetime threshold. Questioned Costs - An error resulted in questioned costs of $2,185 as a result of using the wrong Pell table. There was an additional error in a Pell Grant calculated because the student had exceeded the 600 percent threshold for lifetime Pell resulting in an over award of $3. Context - Out of a population of 286 students receiving federal awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there was one instance in which the College used the incorrect Pell table and one instance in which the Pell award exceeded the 600 percent lifetime threshold. The sample was not, and was not intended to be, a statistically valid sample. Effect - Two students out of the 25 tested received an over-award of Pell. Cause - Management oversight of the control in place to validate the Pell table and Lifetime Maximum table. Identification as a Repeat Finding - No Recommendation - The College should have a procedure to review each students credit hours to determine the proper Pell table. Additionally, review procedures should be implemented to ensure that no student exceeds 600% of their maximum lifetime Pell award. Views of Responsible Officials and Planned Corrective Actions - These Pell recipients are from the 2nd Chance Pell Grant Experiment and guidance has been inconsistent in the awarding process, resulting from staffing issues and high turnover. Student credit hours are now determined using the correct Pell Grant Payment Schedule and awarded accordingly. Verification process includes reviewing student's maximum lifetime Pell award percentage of 600%.
U.S. Department of Education Higher Education Institutional Aid CFDA 84.031 Award Year 2022 Criteria or Specific Requirement - Allowable Costs. According to 2 CFR Section 200.403(b), allowable costs must conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. Condition - The College charged faculty and staff wages unrelated to the Title V program to the grant during the fiscal year ended June 30, 2022. Questioned Costs - Grant Award Number: P031S190265 - 21. Error resulted in questioned costs of $34,056 awarded to the College. During review of the detailed listed of Title V revenue recorded, we identified certain expenses that did not appear consistent with the detailed federal grant schedule provided by management. Context - Out of a population of 26 payroll periods totaling $261,616, we selected one key item for $34,056 and a sample of four payroll periods totaling $27,661 to review the salaries paid to employees and charged to the federal award. The entire balance of the $34,056 key item was drawn down in error for staff wages and fringe benefits which were not related to the approved federal grant services. The sample was not, and was not intended to be, a statistically valid sample. Effect - College records did not support the salary expenses charged to the federal award. Cause - Management oversight when completing salary reconciliation. Identification as a Repeat Finding - Yes, see findings 2021-004 and 2020-009. Recommendation - The College should implement processes and controls to ensure that all employees paid with federal grant funds are compared against the budget amounts provided to the grant administrator. Views of Responsible Officials and Planned Corrective Actions - Adjustments have been made to drawdowns in April and June of 2022 in order to correct for these overdraws. However, even after these corrections, $694.47 was still overdrawn from FY22. This amount will be corrected in a future Title V draw for this amount. Salary drawdowns will be required to have backup payroll documentation for each draw in the future.
Education Stabilization Fund, Higher Education Emergency Relief Fund (HEERF) - Student Portion #84.425E U.S. Department of Education Award Year 2022 Criteria or Specific Requirement - Under the CARES Act 18004(e) and the CRRSAA 314(e), there are three components to reporting HEERF, public reporting on student aid portion, public reporting on the institutional portion, and annual reporting. The public reporting on student aid requires institutions to publicly post certain information no later than 10 days after the end of each calendar quarter. Condition - The College posted one quarterly student aid HEERF report to the website after the required deadline. Questioned Costs - None noted Context - Out of a population of nine reports (one annual, four quarterly public reports for institutional aid and four quarterly public reports for student aid), we selected five reports and noted the one instance of noncompliance with the timely reporting requirement of the student aid report on September 30, 2021. Effect - The College was not in compliance with the reporting requirements of the Education Stabilization Fund program. Cause - Management was not aware of the reporting requirements associated with the HEERF funds. Identification as a Repeat Finding - No Recommendation - We recommend that management review this area and establish procedures to ensure required reports are completed timely and accurately. View of Responsible Official and Planned Corrective Actions ? Initial guidance from the Department of Education did not specify that quarterly reports were required for quarters in which no funds were expended. The late report noted in the audit was for a quarter in which no Student Aid funds were expended. As soon as the Department of Education clarified in a webinar that quarterly reports were required even for quarters where no funds were expended, Donnelly posted the missing report showing zero expenditures.
Education Stabilization Fund, Higher Education Emergency Relief Fund (HEERF) - Institutional Portion #84.425F U.S. Department of Education Award Year 2022 Criteria or Specific Requirement - Allowable Costs. According to 2 CFR Section 200.407 reasonable direct administrative costs and indirect costs at an institution's approved negotiated indirect cost rate may be charged against Assistance Listing 84.425F (Institutional portion). Condition - The College improperly charged an indirect cost to the federal grant for an ineligible expense that was ineligible based on the Indirect Cost Rate Agreement. The College has an approved Indirect Cost rate of 49.90 percent. Under the rate agreement, the College is approved to charge an indirect cost fee based on modified total direct costs. Modified total direct costs include direct salaries and wages, applicable fringe benefits, material and supplies, services, travel and up to the first $25,000 of each subaward. Modified total direct costs shall exclude equipment and capital expenditures if they have a useful life greater than one year and a per-unit acquisition costs which equal or exceeds $5,000. Questioned Costs - Grant Award Number: P425F201877 - 20B. Error resulted in questioned costs of $34,291 awarded to the College. Context - Out of a population of 114 institutional expenses totaling $598,317, we selected 18 institutional expenses for $416,864 to test and trace back to supporting documentation to support the charge to the federal award. For one of 18 institutional expenses selected for testing, the entire balance of the $34,291 was not considered an allowable costs since the expenditure was an indirect fee charge based on a capital expenditure. The sample was not, and was not intended to be, a statistically valid sample. Effect - The College was not in compliance with the allowable costs of the Education Stabilization Fund program. Cause - Management made an error in interpreting the indirect cost agreement associated with the equipment and capital expenditure for one of the items selected for testing. Identification as a Repeat Finding - No. Recommendation - We recommend that management review this area and establish procedures to ensure all requirements are met. View of Responsible Official and Planned Corrective Actions ? In including the questioned indirect cost as a HEERF expense, management only considered the per unit cost threshold, rather than both the per unit cost and the expected life of the items. The audit clarified the regulations and Donnelly promptly notified our program officer, posted a corrected quarterly report and refunded the funds to the Department of Education.