Audit 290538

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Disbursements To or On Behalf of Students - Transfer Monitoring - If a student received financial aid while attending one or more other institutions schools are required to request financial aid history using the National Student Loans Data System (“NSLDS”) Student Transfer Monitoring Process. Under this process, a school informs NSLDS about its transfer students. NSLDS will “monitor” those students on the school’s “inform” list and “alert” the school of any relevant financial aid history changes. A school must wait 7 days after it “informs” NSLDS about a transfer student before disbursing Title IV aid to that student (34 CFR section 668.19). Condition: The University did not add the transfer students to the NSLDS ‘alert’ list and was unable to provide documentation supporting those the students’ financial aid history was reviewed prior to disbursing Title IV aid. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with the required federal guidelines over transfer monitoring. Questioned Costs: None. Context: The University was unable to provide an accurate listing of students who transferred into the University during the year and did not appropriately add the students to the NSLDS ‘alert’ list as required. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-013 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures to ensure that all transfer students are appropriately tracked/monitored as required by federal guidelines. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved as the financial aid department can now track transfer students and any changes to their financial aid while informing other institutions of those changes through the National Student Loan Data System (NSLDS). This issue has been resolved with the implementation of Colleague. The Financial Aid Director can now perform transfer monitoring in Colleague to track transfer students and any changes to their financial aid while informing other institutions of those changes. Colleague sends information files to the National Student Loan Data System (NSLDS), which notifies NSLDS of our transfer students and serves as a request to put SAU's transfer students on the NSLDS maintained Transfer Monitoring list. The inform file is also a request for a Financial Aid History file for each student listed. With Colleague, we can determine which students to monitor, send the information to NSLDS, transfer the files, and view students' NSLDS information as necessary. The Financial Aid Director runs transfer monitoring at the beginning of the semester for everyone enrolled and then runs TMXP, which creates a file to monitor those who are newly awarded, Students are run through the process in December for new transfer student can be monitored. With Colleague, the Financial Aid Director/Staff can easily adhere to the "Inform, Monitor, Alert" process since this system can efficiently and effectively run this process. Prior to awarding a transfer for spring the Financial Aid Staff as alternative option review NSLDS and manually add a student to the transfer monitoring file.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Verification - An institution shall require an applicant selected for verification to submit acceptable documentation that will verify or update the following information used to determine the applicant's expected family contribution (“EFC”): adjusted gross income, U.S. income tax paid, aggregate number of family members in the household, number of family members in the household who are enrolled in as at least half-time students in postsecondary educational institutions if that number is greater than one and untaxed income subject to U.S. income tax reporting requirements in the base year which is included on the tax return form, excluding information contained on schedules appended to such forms. Untaxed income and benefits include: Social Security benefits if the institution has reason to believe that those benefits were received and were not reported or were not correctly reported; child support if the institution has reason to believe child support was received; U.S. income tax deductions for a payment made to an individual retirement account or Keough account; interest on tax-free bond; foreign income excluded from U.S. income taxation if the institution has reason to believe that foreign income was received; and all other untaxed income subject to U.S. income tax reporting requirements in the base year included on the tax return form, excluding information contained on schedules appended to such forms. (34 CFR section 668.56). For students whose applications were selected for verification, if the institution has reason to believe that information included in the application is inaccurate, the institution may not (1) disburse any Pell or campus-based aid, (2) employ the applicant in its FWS program, or (3) originate Federal Direct Student Loans (“Direct Loans”) (or process proceeds of previously originated loans) until the applicant verifies or corrects the information. If the institution does not have any reason to believe that the information is inaccurate, the institution may withhold payment of Pell or Campus-based aid, or may make one interim disbursement of Pell or Campus-based aid, employ or allow an employer to employ an eligible student under FWS for the first 60 consecutive days after the student’s enrollment and may originate the Direct Loan, but cannot process the proceeds. If the verification process is not complete within the time period specified, the institution shall return loan proceeds. In addition, the institution is liable for an interim disbursement if verification shows that a student received an overpayment or if the student fails to complete verification (34 CFR sections 668.58, 668.60(b)(3), and 668.61)). Condition: For certain students selected for verification testing, federal awards were disbursed prior to the completion of the required verification procedures. In addition, instances in which verification status was not correctly coded in the COD system were identified. Cause: Administrative oversight. Effect or Potential Effect: Federal awards were not disbursed in accordance with federal regulations and the University was not in compliance with verification compliance requirements. Questioned Costs: Indeterminable. Context: We noted the following exceptions: • For 6 of 60 students tested, the University disbursed federal awards prior to completing appropriate verification procedures. • For 2 of 60 students tested, the University did not correctly code the student’s verification status in the COD system. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-009 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that the required verification procedures are completed prior to disbursement of federal awards. Views of Responsible Officials and Planned Corrective Actions: The University contracted with Inceptia on 2/5/2020, and Inceptia started completing verification for SAU on 2/18/2020. Inceptia' s Verification Gateway platform provides an automated solution to gather information and documentation required for Financial Aid Verification. Inceptia uses innovative technology to apply progressive rules for automatically or manually approving verification. Furthermore, it provides efficient and effective processes to help institutions remain compliant by organizing documents, streamlining award packaging, and allowing staff to manage the verification process. It provides the institution with the internal controls it needs over its Title IV funding. The Financial Aid Staff also can manually verify students if needed. With Colleague and Inceptia, SAU now has a more unified operating system for systematic processes. If a student has been flagged for verification, Colleague will not allow staff to award the student financial aid. One of the award eligibility rules is "Verification Complete." If students fail to pass this rule, they will not be awarded financial aid. Colleague gives the Financial Aid Staff greater control over the disbursal of Title IV funds and prevents the FAO from disbursing aid to students who are ineligible to receive it.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): F. Equipment and Real Property Management - Equipment records shall be maintained, a physical inventory of equipment shall be taken at least once every 2 years and reconciled to the equipment records, an appropriate control system shall be used to safeguard equipment, and equipment shall be adequately maintained. Equipment property records should contain the following information about the equipment: description (including serial number or other identification number), source, who holds title, acquisition date and cost, percentage of Federal participation in the cost, location, condition, and any ultimate disposition data including, the date of disposal and sales price or method used to determine current fair market value. The Uniform Guidance further states that equipment owned by the Federal Government shall be identified (tagged) to indicate Federal ownership. Condition: The University did not comply with the requirements of equipment and real property management. Cause: Lack of internal controls and administrative oversight with respect to equipment and real property management. Effect or Potential Effect: The University did not comply with the requirements of equipment and real property management. Questioned Costs: None. Context: The University noted that a physical inventory of equipment and real property purchased with federal funds was not performed during the current fiscal year. Additionally, the University was unable to provide equipment records and/or an equipment listing of all federally funded equipment. The University was also unable to provide documentation supporting the required tagging of federally funded equipment. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-018 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures over the applicable compliance requirements of the equipment and real property management. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. Staff transitions coupled with the transition from on-site to remote work environment were the primary reasons for this finding. With the implementation of the new ERP system along with extensive training on utilizing the fixed asset module to assist with more accurate tracking of the inventory will reduce the risk of this finding.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Federal Work-Study Program (ALN 84.033), Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - Institutions are permitted to draw down Title IV funds prior to disbursing funds to eligible students and parents. The institution’s request must not exceed the amount immediately needed to disburse funds to students or parents. A disbursement of funds occurs on the date an institution credits a student’s account or pays a student or parent directly with either student financial aid funds or institutional funds. The institution must make the disbursements as soon as administratively feasible, but no later than 3 business days following the receipt of funds. Any amounts not disbursed by the end of the third business day are considered to be excess cash and generally are required to be promptly returned to the U.S. Department of Education (the “ED”) (34 CFR section 668.166(a)(1)). Excess cash includes any funds received from the ED that are deposited or transferred to the institution’s Federal account as a result of an award adjustment, cancellation, or recovery. However, an excess cash balance tolerance is allowed if that balance: (1) is less than one percent of its prior-year drawdowns; and (2) is eliminated within the next 7 calendar days (34 CFR sections 668.166(a) and (b)). Condition: Several instances during the year were identified in which Title IV funds, from each federal award, were drawn and held in excess of the allowable time frame and/or allowable thresholds. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: Title IV funds were overdrawn or held in excess of the allowable time frame and/or allowable thresholds. Questioned Costs: None. Context: Several instances of funds drawn and held in excess of the allowable time frame and/or thresholds were identified throughout the University’s fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-006 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhances its procedures and internal controls to ensure that federal funds are being drawn in accordance with federal regulations and facilitate an account review on the third business date after a federal draw to determine whether amounts were disbursed or require a return to the U.S. Department of Education. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV funds. This will include new workflows that have been added to the policies. Utilizing the workflows prescribed by Colleague the University will be able to work from reports to avoid these finding moving forward. In addition, the University contracted with Colleague for more formal training of all finance and financial aid employees. The FA Director and the Comptroller will work together weekly when disbursing funds. The Financial Aid Director will notify the Comptroller what amount is available to drawdown. Each area will complete their internal reconciliation. Effective June 2023 SAU is HCM2.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Disbursements To or On Behalf of Students - Transfer Monitoring - If a student received financial aid while attending one or more other institutions schools are required to request financial aid history using the National Student Loans Data System (“NSLDS”) Student Transfer Monitoring Process. Under this process, a school informs NSLDS about its transfer students. NSLDS will “monitor” those students on the school’s “inform” list and “alert” the school of any relevant financial aid history changes. A school must wait 7 days after it “informs” NSLDS about a transfer student before disbursing Title IV aid to that student (34 CFR section 668.19). Condition: The University did not add the transfer students to the NSLDS ‘alert’ list and was unable to provide documentation supporting those the students’ financial aid history was reviewed prior to disbursing Title IV aid. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with the required federal guidelines over transfer monitoring. Questioned Costs: None. Context: The University was unable to provide an accurate listing of students who transferred into the University during the year and did not appropriately add the students to the NSLDS ‘alert’ list as required. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-013 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures to ensure that all transfer students are appropriately tracked/monitored as required by federal guidelines. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved as the financial aid department can now track transfer students and any changes to their financial aid while informing other institutions of those changes through the National Student Loan Data System (NSLDS). This issue has been resolved with the implementation of Colleague. The Financial Aid Director can now perform transfer monitoring in Colleague to track transfer students and any changes to their financial aid while informing other institutions of those changes. Colleague sends information files to the National Student Loan Data System (NSLDS), which notifies NSLDS of our transfer students and serves as a request to put SAU's transfer students on the NSLDS maintained Transfer Monitoring list. The inform file is also a request for a Financial Aid History file for each student listed. With Colleague, we can determine which students to monitor, send the information to NSLDS, transfer the files, and view students' NSLDS information as necessary. The Financial Aid Director runs transfer monitoring at the beginning of the semester for everyone enrolled and then runs TMXP, which creates a file to monitor those who are newly awarded, Students are run through the process in December for new transfer student can be monitored. With Colleague, the Financial Aid Director/Staff can easily adhere to the "Inform, Monitor, Alert" process since this system can efficiently and effectively run this process. Prior to awarding a transfer for spring the Financial Aid Staff as alternative option review NSLDS and manually add a student to the transfer monitoring file.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Verification - An institution shall require an applicant selected for verification to submit acceptable documentation that will verify or update the following information used to determine the applicant's expected family contribution (“EFC”): adjusted gross income, U.S. income tax paid, aggregate number of family members in the household, number of family members in the household who are enrolled in as at least half-time students in postsecondary educational institutions if that number is greater than one and untaxed income subject to U.S. income tax reporting requirements in the base year which is included on the tax return form, excluding information contained on schedules appended to such forms. Untaxed income and benefits include: Social Security benefits if the institution has reason to believe that those benefits were received and were not reported or were not correctly reported; child support if the institution has reason to believe child support was received; U.S. income tax deductions for a payment made to an individual retirement account or Keough account; interest on tax-free bond; foreign income excluded from U.S. income taxation if the institution has reason to believe that foreign income was received; and all other untaxed income subject to U.S. income tax reporting requirements in the base year included on the tax return form, excluding information contained on schedules appended to such forms. (34 CFR section 668.56). For students whose applications were selected for verification, if the institution has reason to believe that information included in the application is inaccurate, the institution may not (1) disburse any Pell or campus-based aid, (2) employ the applicant in its FWS program, or (3) originate Federal Direct Student Loans (“Direct Loans”) (or process proceeds of previously originated loans) until the applicant verifies or corrects the information. If the institution does not have any reason to believe that the information is inaccurate, the institution may withhold payment of Pell or Campus-based aid, or may make one interim disbursement of Pell or Campus-based aid, employ or allow an employer to employ an eligible student under FWS for the first 60 consecutive days after the student’s enrollment and may originate the Direct Loan, but cannot process the proceeds. If the verification process is not complete within the time period specified, the institution shall return loan proceeds. In addition, the institution is liable for an interim disbursement if verification shows that a student received an overpayment or if the student fails to complete verification (34 CFR sections 668.58, 668.60(b)(3), and 668.61)). Condition: For certain students selected for verification testing, federal awards were disbursed prior to the completion of the required verification procedures. In addition, instances in which verification status was not correctly coded in the COD system were identified. Cause: Administrative oversight. Effect or Potential Effect: Federal awards were not disbursed in accordance with federal regulations and the University was not in compliance with verification compliance requirements. Questioned Costs: Indeterminable. Context: We noted the following exceptions: • For 6 of 60 students tested, the University disbursed federal awards prior to completing appropriate verification procedures. • For 2 of 60 students tested, the University did not correctly code the student’s verification status in the COD system. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-009 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that the required verification procedures are completed prior to disbursement of federal awards. Views of Responsible Officials and Planned Corrective Actions: The University contracted with Inceptia on 2/5/2020, and Inceptia started completing verification for SAU on 2/18/2020. Inceptia' s Verification Gateway platform provides an automated solution to gather information and documentation required for Financial Aid Verification. Inceptia uses innovative technology to apply progressive rules for automatically or manually approving verification. Furthermore, it provides efficient and effective processes to help institutions remain compliant by organizing documents, streamlining award packaging, and allowing staff to manage the verification process. It provides the institution with the internal controls it needs over its Title IV funding. The Financial Aid Staff also can manually verify students if needed. With Colleague and Inceptia, SAU now has a more unified operating system for systematic processes. If a student has been flagged for verification, Colleague will not allow staff to award the student financial aid. One of the award eligibility rules is "Verification Complete." If students fail to pass this rule, they will not be awarded financial aid. Colleague gives the Financial Aid Staff greater control over the disbursal of Title IV funds and prevents the FAO from disbursing aid to students who are ineligible to receive it.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Federal Work-Study Program (ALN 84.033), Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - Institutions are permitted to draw down Title IV funds prior to disbursing funds to eligible students and parents. The institution’s request must not exceed the amount immediately needed to disburse funds to students or parents. A disbursement of funds occurs on the date an institution credits a student’s account or pays a student or parent directly with either student financial aid funds or institutional funds. The institution must make the disbursements as soon as administratively feasible, but no later than 3 business days following the receipt of funds. Any amounts not disbursed by the end of the third business day are considered to be excess cash and generally are required to be promptly returned to the U.S. Department of Education (the “ED”) (34 CFR section 668.166(a)(1)). Excess cash includes any funds received from the ED that are deposited or transferred to the institution’s Federal account as a result of an award adjustment, cancellation, or recovery. However, an excess cash balance tolerance is allowed if that balance: (1) is less than one percent of its prior-year drawdowns; and (2) is eliminated within the next 7 calendar days (34 CFR sections 668.166(a) and (b)). Condition: Several instances during the year were identified in which Title IV funds, from each federal award, were drawn and held in excess of the allowable time frame and/or allowable thresholds. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: Title IV funds were overdrawn or held in excess of the allowable time frame and/or allowable thresholds. Questioned Costs: None. Context: Several instances of funds drawn and held in excess of the allowable time frame and/or thresholds were identified throughout the University’s fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-006 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhances its procedures and internal controls to ensure that federal funds are being drawn in accordance with federal regulations and facilitate an account review on the third business date after a federal draw to determine whether amounts were disbursed or require a return to the U.S. Department of Education. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV funds. This will include new workflows that have been added to the policies. Utilizing the workflows prescribed by Colleague the University will be able to work from reports to avoid these finding moving forward. In addition, the University contracted with Colleague for more formal training of all finance and financial aid employees. The FA Director and the Comptroller will work together weekly when disbursing funds. The Financial Aid Director will notify the Comptroller what amount is available to drawdown. Each area will complete their internal reconciliation. Effective June 2023 SAU is HCM2.

Program Information: Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Enrollment Reporting – Institutions are required to report enrollment information under the Pell grant and the Direct and Federal Family Education Loan (“FFEL”) loan programs via the National Student Loan Data System (“NSLDS”) (OMB No. 1845-0035). Although FFEL loans are no longer made or a part of the Student Financial Assistance Cluster, a student may have a FFEL loan from previous years that would require enrollment reporting for that student (Pell, 34 CFR 690.83(b)(2); FFEL, 34 CFR 682.610; Direct Loan, 34 CFR 685.309). Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (“NSLDSFAP”) website. The data on the institution’s Enrollment Reporting Roster, or Enrollment Maintenance page, is what NSLDS has as the most recently certified enrollment information. There are two categories of enrollment information, “Campus Level” and “Program Level,” each with separate record types requiring accurate reporting. The NSLDS Enrollment Reporting Guide provides the requirements and guidance for reporting enrollment details using the NSLDS Enrollment Reporting Process. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway (“SAIG”) (OMB No. 1845-0002) mailboxes sent by ED via NSLDS. After the institution submits the Enrollment Reporting roster to NSLDS, NSLDS evaluates the Enrollment Reporting roster and provides the institution an Error/Acknowledgement file. If errors are identified, institutions have 10 days to correct the errors and resubmit to NSLDS. Condition: For certain students selected for testing who graduated or withdrew during the year, the University did not submit status change notification or failed to submit timely notification to the NSLDS website. Additionally, the University’s fiscal year SCHER1 report, included multiple instances in which error records were not corrected within the required timeframe. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with enrollment reporting requirements. Failure to promptly report accurate and timely changes in enrollment status may adversely impact the repayment status for student loan borrowers. Questioned Costs: None. Context: We noted the following exceptions: • For 9 of 60 campus level records tested, the University failed to notify NSLDS of the change in student enrollment. • For 51 of 60 campus level records tested, the University did not certify the enrollment status within the required timeframe. • For 10 of 60 program level records tested, the University failed to report the enrollment change to NSLDS. • For 50 of 60 program level records tested, the University did not certify the enrollment status within the required timeframe. Additionally, error records identified in Error/Acknowledgment files were not corrected within the required timeframe, resulting in multiple errors during the 2021 fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-011 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University follow its internal controls, policies and procedures over the applicable compliance requirements of the Enrollment Reporting requirement to ensure that all status changes are submitted to the NSLDS website within the required timeframe. Views of Responsible Officials and Planned Corrective Actions: Enrollment reporting is required for all schools participating in Title IV aid programs. Schools are required to certify enrollment for all students included on their roster files. SAU was without a Registrar during the 2019-2020 award year however, in August 2020 this position was filled. In addition more staff was hired to assist in these reporting functions. The Registrar had to submit the missing reports before submitting new ones. This backlog led to late status changes being reported. Primarily, the University implemented a comprehensive ERP software tool, Ellucian Colleague in FY2021 and FY2022 and hired more staff. The built-in internal control structure which includes access to enrollment reports and data coupled with a complete reconciliation process with the Office of Financial Aid, Office of the Registrar and Student Accounts will prevent this from recurring. Professional development is encouraged for the University’s staff to stay current on compliance, regulatory and legal guidelines and adopt industry best practices.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Disbursements To or On Behalf of Students - Transfer Monitoring - If a student received financial aid while attending one or more other institutions schools are required to request financial aid history using the National Student Loans Data System (“NSLDS”) Student Transfer Monitoring Process. Under this process, a school informs NSLDS about its transfer students. NSLDS will “monitor” those students on the school’s “inform” list and “alert” the school of any relevant financial aid history changes. A school must wait 7 days after it “informs” NSLDS about a transfer student before disbursing Title IV aid to that student (34 CFR section 668.19). Condition: The University did not add the transfer students to the NSLDS ‘alert’ list and was unable to provide documentation supporting those the students’ financial aid history was reviewed prior to disbursing Title IV aid. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with the required federal guidelines over transfer monitoring. Questioned Costs: None. Context: The University was unable to provide an accurate listing of students who transferred into the University during the year and did not appropriately add the students to the NSLDS ‘alert’ list as required. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-013 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures to ensure that all transfer students are appropriately tracked/monitored as required by federal guidelines. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved as the financial aid department can now track transfer students and any changes to their financial aid while informing other institutions of those changes through the National Student Loan Data System (NSLDS). This issue has been resolved with the implementation of Colleague. The Financial Aid Director can now perform transfer monitoring in Colleague to track transfer students and any changes to their financial aid while informing other institutions of those changes. Colleague sends information files to the National Student Loan Data System (NSLDS), which notifies NSLDS of our transfer students and serves as a request to put SAU's transfer students on the NSLDS maintained Transfer Monitoring list. The inform file is also a request for a Financial Aid History file for each student listed. With Colleague, we can determine which students to monitor, send the information to NSLDS, transfer the files, and view students' NSLDS information as necessary. The Financial Aid Director runs transfer monitoring at the beginning of the semester for everyone enrolled and then runs TMXP, which creates a file to monitor those who are newly awarded, Students are run through the process in December for new transfer student can be monitored. With Colleague, the Financial Aid Director/Staff can easily adhere to the "Inform, Monitor, Alert" process since this system can efficiently and effectively run this process. Prior to awarding a transfer for spring the Financial Aid Staff as alternative option review NSLDS and manually add a student to the transfer monitoring file.

Program Information: Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting – Common Origination and Disbursement System Reporting: Institutions submit Federal Direct Loan Program, Federal Pell Grant Program, and TEACH Grant origination records and disbursement records to the Common Origination and Disbursement (COD) system. Origination records can be sent well in advance of any disbursements, as early as the institution chooses to submit them for any student the institution reasonably believes will be eligible for a payment. An institution follows up with a disbursement record for that student no earlier than (1) seven calendar days prior to the disbursement date under the Advance or Heightened Cash Monitoring 1 payment methods, or (2) the date of the disbursement under the Reimbursement or Heightened Cash Monitoring 2 Payment Method. The disbursement record reports the actual disbursement date and the amount of the disbursement. The U.S. Department of Education (the “ED”) processes origination and/or disbursement records and returns acknowledgments to the institution. The acknowledgments identify the processing status of each record: Rejected, Accepted with Corrections, or Accepted. Institutions must report student disbursement data within 15 calendar days after the institution makes a disbursement or becomes aware of the need to make an adjustment to previously reported student disbursement data or expected student disbursement data. Institutions may do this by reporting once every 15 calendar days, bi-weekly or weekly, or may set up their own system to ensure that changes are reported in a timely manner. Condition: Certain student disbursements were not reported to COD within 15 calendar days as required. Additionally, during an examination of Federal Direct Student Loan disbursement records, instances in which loan proceeds were disbursed prior to having obtained a legally enforceable promissory note were identified. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with COD reporting requirements. Failure to submit and update COD records in a timely manner could result in improper awards of student funds. Questioned Costs: None. Context: We noted the following exceptions: • For 7 of 60 Federal Pell Grant origination records tested, verification status code was not accurately reported to COD. • For 11 of 60 Federal Pell Grant origination records tested, enrollment date was not accurately reported to COD. • For 30 of 60 Federal Pell Grant disbursement records tested, the University did not report the disbursements to COD within the required time frame. • For 42 of 60 Federal Direct Student Loan disbursement records tested, the University did not report the disbursements to COD within the required time frame. • For 2 of 25 Federal Direct Student Loan disbursement records tested, the University disbursed loan proceeds without having obtained a legally enforceable promissory note. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-007 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its procedures and internal controls over disbursement record submissions to ensure timely reporting to COD. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV programs. COD processes are run through Colleague's CODE (Common Originators Disbursement Ellucian) system, which is used to send origination requests and disbursement information for Pell and Federal loans to COD. Funds are transmitted to a student's account through a two-part process run between the Financial Aid Office (FAO) and the Business Office. The Finanical Aid Office is responsible for sending loan originations and disbursments to COD within 15 days. The data extraction process will be more consistent using the workflows provided by the new ERP system.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Verification - An institution shall require an applicant selected for verification to submit acceptable documentation that will verify or update the following information used to determine the applicant's expected family contribution (“EFC”): adjusted gross income, U.S. income tax paid, aggregate number of family members in the household, number of family members in the household who are enrolled in as at least half-time students in postsecondary educational institutions if that number is greater than one and untaxed income subject to U.S. income tax reporting requirements in the base year which is included on the tax return form, excluding information contained on schedules appended to such forms. Untaxed income and benefits include: Social Security benefits if the institution has reason to believe that those benefits were received and were not reported or were not correctly reported; child support if the institution has reason to believe child support was received; U.S. income tax deductions for a payment made to an individual retirement account or Keough account; interest on tax-free bond; foreign income excluded from U.S. income taxation if the institution has reason to believe that foreign income was received; and all other untaxed income subject to U.S. income tax reporting requirements in the base year included on the tax return form, excluding information contained on schedules appended to such forms. (34 CFR section 668.56). For students whose applications were selected for verification, if the institution has reason to believe that information included in the application is inaccurate, the institution may not (1) disburse any Pell or campus-based aid, (2) employ the applicant in its FWS program, or (3) originate Federal Direct Student Loans (“Direct Loans”) (or process proceeds of previously originated loans) until the applicant verifies or corrects the information. If the institution does not have any reason to believe that the information is inaccurate, the institution may withhold payment of Pell or Campus-based aid, or may make one interim disbursement of Pell or Campus-based aid, employ or allow an employer to employ an eligible student under FWS for the first 60 consecutive days after the student’s enrollment and may originate the Direct Loan, but cannot process the proceeds. If the verification process is not complete within the time period specified, the institution shall return loan proceeds. In addition, the institution is liable for an interim disbursement if verification shows that a student received an overpayment or if the student fails to complete verification (34 CFR sections 668.58, 668.60(b)(3), and 668.61)). Condition: For certain students selected for verification testing, federal awards were disbursed prior to the completion of the required verification procedures. In addition, instances in which verification status was not correctly coded in the COD system were identified. Cause: Administrative oversight. Effect or Potential Effect: Federal awards were not disbursed in accordance with federal regulations and the University was not in compliance with verification compliance requirements. Questioned Costs: Indeterminable. Context: We noted the following exceptions: • For 6 of 60 students tested, the University disbursed federal awards prior to completing appropriate verification procedures. • For 2 of 60 students tested, the University did not correctly code the student’s verification status in the COD system. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-009 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that the required verification procedures are completed prior to disbursement of federal awards. Views of Responsible Officials and Planned Corrective Actions: The University contracted with Inceptia on 2/5/2020, and Inceptia started completing verification for SAU on 2/18/2020. Inceptia' s Verification Gateway platform provides an automated solution to gather information and documentation required for Financial Aid Verification. Inceptia uses innovative technology to apply progressive rules for automatically or manually approving verification. Furthermore, it provides efficient and effective processes to help institutions remain compliant by organizing documents, streamlining award packaging, and allowing staff to manage the verification process. It provides the institution with the internal controls it needs over its Title IV funding. The Financial Aid Staff also can manually verify students if needed. With Colleague and Inceptia, SAU now has a more unified operating system for systematic processes. If a student has been flagged for verification, Colleague will not allow staff to award the student financial aid. One of the award eligibility rules is "Verification Complete." If students fail to pass this rule, they will not be awarded financial aid. Colleague gives the Financial Aid Staff greater control over the disbursal of Title IV funds and prevents the FAO from disbursing aid to students who are ineligible to receive it.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Federal Work-Study Program (ALN 84.033), Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - Institutions are permitted to draw down Title IV funds prior to disbursing funds to eligible students and parents. The institution’s request must not exceed the amount immediately needed to disburse funds to students or parents. A disbursement of funds occurs on the date an institution credits a student’s account or pays a student or parent directly with either student financial aid funds or institutional funds. The institution must make the disbursements as soon as administratively feasible, but no later than 3 business days following the receipt of funds. Any amounts not disbursed by the end of the third business day are considered to be excess cash and generally are required to be promptly returned to the U.S. Department of Education (the “ED”) (34 CFR section 668.166(a)(1)). Excess cash includes any funds received from the ED that are deposited or transferred to the institution’s Federal account as a result of an award adjustment, cancellation, or recovery. However, an excess cash balance tolerance is allowed if that balance: (1) is less than one percent of its prior-year drawdowns; and (2) is eliminated within the next 7 calendar days (34 CFR sections 668.166(a) and (b)). Condition: Several instances during the year were identified in which Title IV funds, from each federal award, were drawn and held in excess of the allowable time frame and/or allowable thresholds. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: Title IV funds were overdrawn or held in excess of the allowable time frame and/or allowable thresholds. Questioned Costs: None. Context: Several instances of funds drawn and held in excess of the allowable time frame and/or thresholds were identified throughout the University’s fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-006 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhances its procedures and internal controls to ensure that federal funds are being drawn in accordance with federal regulations and facilitate an account review on the third business date after a federal draw to determine whether amounts were disbursed or require a return to the U.S. Department of Education. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV funds. This will include new workflows that have been added to the policies. Utilizing the workflows prescribed by Colleague the University will be able to work from reports to avoid these finding moving forward. In addition, the University contracted with Colleague for more formal training of all finance and financial aid employees. The FA Director and the Comptroller will work together weekly when disbursing funds. The Financial Aid Director will notify the Comptroller what amount is available to drawdown. Each area will complete their internal reconciliation. Effective June 2023 SAU is HCM2.

Program Information: Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Enrollment Reporting – Institutions are required to report enrollment information under the Pell grant and the Direct and Federal Family Education Loan (“FFEL”) loan programs via the National Student Loan Data System (“NSLDS”) (OMB No. 1845-0035). Although FFEL loans are no longer made or a part of the Student Financial Assistance Cluster, a student may have a FFEL loan from previous years that would require enrollment reporting for that student (Pell, 34 CFR 690.83(b)(2); FFEL, 34 CFR 682.610; Direct Loan, 34 CFR 685.309). Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (“NSLDSFAP”) website. The data on the institution’s Enrollment Reporting Roster, or Enrollment Maintenance page, is what NSLDS has as the most recently certified enrollment information. There are two categories of enrollment information, “Campus Level” and “Program Level,” each with separate record types requiring accurate reporting. The NSLDS Enrollment Reporting Guide provides the requirements and guidance for reporting enrollment details using the NSLDS Enrollment Reporting Process. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway (“SAIG”) (OMB No. 1845-0002) mailboxes sent by ED via NSLDS. After the institution submits the Enrollment Reporting roster to NSLDS, NSLDS evaluates the Enrollment Reporting roster and provides the institution an Error/Acknowledgement file. If errors are identified, institutions have 10 days to correct the errors and resubmit to NSLDS. Condition: For certain students selected for testing who graduated or withdrew during the year, the University did not submit status change notification or failed to submit timely notification to the NSLDS website. Additionally, the University’s fiscal year SCHER1 report, included multiple instances in which error records were not corrected within the required timeframe. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with enrollment reporting requirements. Failure to promptly report accurate and timely changes in enrollment status may adversely impact the repayment status for student loan borrowers. Questioned Costs: None. Context: We noted the following exceptions: • For 9 of 60 campus level records tested, the University failed to notify NSLDS of the change in student enrollment. • For 51 of 60 campus level records tested, the University did not certify the enrollment status within the required timeframe. • For 10 of 60 program level records tested, the University failed to report the enrollment change to NSLDS. • For 50 of 60 program level records tested, the University did not certify the enrollment status within the required timeframe. Additionally, error records identified in Error/Acknowledgment files were not corrected within the required timeframe, resulting in multiple errors during the 2021 fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-011 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University follow its internal controls, policies and procedures over the applicable compliance requirements of the Enrollment Reporting requirement to ensure that all status changes are submitted to the NSLDS website within the required timeframe. Views of Responsible Officials and Planned Corrective Actions: Enrollment reporting is required for all schools participating in Title IV aid programs. Schools are required to certify enrollment for all students included on their roster files. SAU was without a Registrar during the 2019-2020 award year however, in August 2020 this position was filled. In addition more staff was hired to assist in these reporting functions. The Registrar had to submit the missing reports before submitting new ones. This backlog led to late status changes being reported. Primarily, the University implemented a comprehensive ERP software tool, Ellucian Colleague in FY2021 and FY2022 and hired more staff. The built-in internal control structure which includes access to enrollment reports and data coupled with a complete reconciliation process with the Office of Financial Aid, Office of the Registrar and Student Accounts will prevent this from recurring. Professional development is encouraged for the University’s staff to stay current on compliance, regulatory and legal guidelines and adopt industry best practices.

Program Information: Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): E. Eligibility – Aggregate Loan Limits for Subsidized and Unsubsidized Loans: Aggregate loan limits for subsidized and unsubsidized loans are: $31,000 for a dependent undergraduate student (except for dependent students whose parents cannot borrow a PLUS loan) (subsidized loan portion may not exceed $23,000 of the aggregate limit amount); $57,500 for an independent student and for a dependent student whose parents cannot borrow a PLUS loan (subsidized loan portion may not exceed $23,000 of the aggregate limit amount); and $138,500 for a graduate or professional student (subsidized portion limited to $65,500). This $138,500 limit includes loans for undergraduate study. Condition: Certain students selected for testing were disbursed Federal Direct Student Loan funds in excess of the aggregate Subsidized and Unsubsidized direct loan limit. Cause: Administrative oversight. Effect or Potential Effect: The University is not in compliance with packaging Federal Direct Student Loans within aggregate loan limits. Questioned Costs: Below reporting threshold. Context: For 1 of 60 students selected for testing, the student was packaged and disbursed Federal Direct Student Loans in excess of the aggregate loan limit. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-012 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that Federal Direct Student Loans are awarded/disbursed in accordance with federal guidelines. Views of Responsible Officials and Planned Corrective Actions: The financial aid department has developed a Direct Loan workflow process in accordance with federal guidelines. With the implementation of Colleague, this issue has been resolved. Utilizing Colleague's software, the financial aid office can now accurately assess our students' aid eligibility to ensure they are appropriately awarded. Colleague has Award Eligibility Criteria (AEC) rules invoked at transmittal to determine if the student is eligible to receive loan funds. Items this rule checks for include half-time enrollment, completion of Entrance Interview, Satisfactory Academic Progress, etc. AEC is primarily used as a criterion a student must pass before aid can be transmitted to Accounts Receivable. There are two sets of rules on the AEC form: Eligibility Criteria for Awarding and Eligibility Criteria for Transmitting. These rules monitor students' aggregate loan limits, SAP, as defined by Uniform Guidance rules and requirements for federal awards, and provide SAU with the internal controls needed for their Title IV program. The Financial Aid Director follows Ellucian Colleague’s best practice recommendations.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Disbursements To or On Behalf of Students - Transfer Monitoring - If a student received financial aid while attending one or more other institutions schools are required to request financial aid history using the National Student Loans Data System (“NSLDS”) Student Transfer Monitoring Process. Under this process, a school informs NSLDS about its transfer students. NSLDS will “monitor” those students on the school’s “inform” list and “alert” the school of any relevant financial aid history changes. A school must wait 7 days after it “informs” NSLDS about a transfer student before disbursing Title IV aid to that student (34 CFR section 668.19). Condition: The University did not add the transfer students to the NSLDS ‘alert’ list and was unable to provide documentation supporting those the students’ financial aid history was reviewed prior to disbursing Title IV aid. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with the required federal guidelines over transfer monitoring. Questioned Costs: None. Context: The University was unable to provide an accurate listing of students who transferred into the University during the year and did not appropriately add the students to the NSLDS ‘alert’ list as required. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-013 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures to ensure that all transfer students are appropriately tracked/monitored as required by federal guidelines. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved as the financial aid department can now track transfer students and any changes to their financial aid while informing other institutions of those changes through the National Student Loan Data System (NSLDS). This issue has been resolved with the implementation of Colleague. The Financial Aid Director can now perform transfer monitoring in Colleague to track transfer students and any changes to their financial aid while informing other institutions of those changes. Colleague sends information files to the National Student Loan Data System (NSLDS), which notifies NSLDS of our transfer students and serves as a request to put SAU's transfer students on the NSLDS maintained Transfer Monitoring list. The inform file is also a request for a Financial Aid History file for each student listed. With Colleague, we can determine which students to monitor, send the information to NSLDS, transfer the files, and view students' NSLDS information as necessary. The Financial Aid Director runs transfer monitoring at the beginning of the semester for everyone enrolled and then runs TMXP, which creates a file to monitor those who are newly awarded, Students are run through the process in December for new transfer student can be monitored. With Colleague, the Financial Aid Director/Staff can easily adhere to the "Inform, Monitor, Alert" process since this system can efficiently and effectively run this process. Prior to awarding a transfer for spring the Financial Aid Staff as alternative option review NSLDS and manually add a student to the transfer monitoring file.

Program Information: Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Borrower Data Transmission and Reconciliation - Direct Loans - Each month, the U.S. Department of Education’s Common Origination and Disbursement system (the “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 school) Loan Detail records. The school 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, schools may receive three SAS data files each month (34 CFR sections 685.102(b), 685.301, and 303). Condition: Certain instances were identified during the year where the University was unable to support that a reconciliation was performed between the SAS data files provided from the COD and the University’s financial records. Cause: Lack of internal control and administrative oversight. Effect or Potential Effect: The University is not in compliance with requirements related to the reconciliation of Federal Direct Student Loan Program disbursement information. Questioned Costs: Unknown. Context: For 4 of 4 months selected for testing, the University was unable to provide documentation supporting that a reconciliation had been performed between the University’s financial records and the SAS data files received from the COD. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-014 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that reconciliations between financial records and the COD information are performed at least monthly, and that appropriate documentation is supporting the reconciliation is retained. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved. The financial aid and business offices are directly involved with the COD processes weekly. This process sends originations and disbursement information for PELL and Federal loans to COD. Funds are transmitted to a student’s account through a two-part process called FATR between the two offices. With the implementation of Colleague, we have resolved those issues. Colleague's Financial Aid module provides the tools necessary to maintain, track, process, and report information associated with financial aid applicants and recipients to Colleague. The Financial Aid module helps manage the processing of financial aid, data, and reporting and will give SAU internal controls over their Title IV Student Financial Aid programs. Using this system, SAU can create and modify Grant records for submission to COD and import and reconcile Grant data. The financial aid office did not have these options in CAMS. The financial aid office no longer builds and or disburses aid manually in COD. Colleague and COD work together. The reconciliation process for Pell and Direct Loans to self-audit, ensuring the accuracy and validity of financial data sent and submitted to COD. The reconciliation process in completed monthly and any discrepancies are resolved prior to the next month.

Program Information: Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Test and Provisions – Disbursements To or On Behalf of Students - Award Notification - Federal regulations (34 CFR section 668.165 (a)(6)(i)) require that the institution 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 or the TEACH Grant payments returned to the U.S. Department of Education; 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, TEACH Grant, or TEACH Grant disbursement. Institutions that implement an affirmative confirmation process (as described in 34 CFR section 668.165 (a)(6)(i)) must make this notification to the student or parent no earlier than 30 days before, and no later than 30 days after, crediting the student’s account at the institution with Direct Loan, FPL funds, or TEACH Grants. Condition: For certain students who received disbursements of Federal Direct Student Loan funds, the University was unable to provide evidence that the student or parent was notified of their award disbursement within the required time frame after crediting the student’s account. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: Students were not properly notified of award disbursements and/or their right to cancel/decline loan awards. Questioned Costs: None. Context: For 60 of 60 loan disbursements tested, the University was unable to provide evidence that parents and/or students received award notifications within the required time frame. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-010 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures and internal controls to ensure that federal awards are disbursed in accordance with federal guidelines. Views of Responsible Officials and Planned Corrective Actions: Primarily, the University implemented a comprehensive ERP software tool, Ellucian Colleague in FY2022 going forward. The built in internal control will readily provide data on those students who are eligible for aid and notify them of their opportunity to accept or decline aid. In addition, the notification documents will be stored in the ERP system and be available to retrieve. Within 15 days after disbursements students and parents are sent an email notifying them their loan has been disbursed to their account.

Program Information: Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting – Common Origination and Disbursement System Reporting: Institutions submit Federal Direct Loan Program, Federal Pell Grant Program, and TEACH Grant origination records and disbursement records to the Common Origination and Disbursement (COD) system. Origination records can be sent well in advance of any disbursements, as early as the institution chooses to submit them for any student the institution reasonably believes will be eligible for a payment. An institution follows up with a disbursement record for that student no earlier than (1) seven calendar days prior to the disbursement date under the Advance or Heightened Cash Monitoring 1 payment methods, or (2) the date of the disbursement under the Reimbursement or Heightened Cash Monitoring 2 Payment Method. The disbursement record reports the actual disbursement date and the amount of the disbursement. The U.S. Department of Education (the “ED”) processes origination and/or disbursement records and returns acknowledgments to the institution. The acknowledgments identify the processing status of each record: Rejected, Accepted with Corrections, or Accepted. Institutions must report student disbursement data within 15 calendar days after the institution makes a disbursement or becomes aware of the need to make an adjustment to previously reported student disbursement data or expected student disbursement data. Institutions may do this by reporting once every 15 calendar days, bi-weekly or weekly, or may set up their own system to ensure that changes are reported in a timely manner. Condition: Certain student disbursements were not reported to COD within 15 calendar days as required. Additionally, during an examination of Federal Direct Student Loan disbursement records, instances in which loan proceeds were disbursed prior to having obtained a legally enforceable promissory note were identified. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with COD reporting requirements. Failure to submit and update COD records in a timely manner could result in improper awards of student funds. Questioned Costs: None. Context: We noted the following exceptions: • For 7 of 60 Federal Pell Grant origination records tested, verification status code was not accurately reported to COD. • For 11 of 60 Federal Pell Grant origination records tested, enrollment date was not accurately reported to COD. • For 30 of 60 Federal Pell Grant disbursement records tested, the University did not report the disbursements to COD within the required time frame. • For 42 of 60 Federal Direct Student Loan disbursement records tested, the University did not report the disbursements to COD within the required time frame. • For 2 of 25 Federal Direct Student Loan disbursement records tested, the University disbursed loan proceeds without having obtained a legally enforceable promissory note. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-007 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its procedures and internal controls over disbursement record submissions to ensure timely reporting to COD. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV programs. COD processes are run through Colleague's CODE (Common Originators Disbursement Ellucian) system, which is used to send origination requests and disbursement information for Pell and Federal loans to COD. Funds are transmitted to a student's account through a two-part process run between the Financial Aid Office (FAO) and the Business Office. The Finanical Aid Office is responsible for sending loan originations and disbursments to COD within 15 days. The data extraction process will be more consistent using the workflows provided by the new ERP system.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Verification - An institution shall require an applicant selected for verification to submit acceptable documentation that will verify or update the following information used to determine the applicant's expected family contribution (“EFC”): adjusted gross income, U.S. income tax paid, aggregate number of family members in the household, number of family members in the household who are enrolled in as at least half-time students in postsecondary educational institutions if that number is greater than one and untaxed income subject to U.S. income tax reporting requirements in the base year which is included on the tax return form, excluding information contained on schedules appended to such forms. Untaxed income and benefits include: Social Security benefits if the institution has reason to believe that those benefits were received and were not reported or were not correctly reported; child support if the institution has reason to believe child support was received; U.S. income tax deductions for a payment made to an individual retirement account or Keough account; interest on tax-free bond; foreign income excluded from U.S. income taxation if the institution has reason to believe that foreign income was received; and all other untaxed income subject to U.S. income tax reporting requirements in the base year included on the tax return form, excluding information contained on schedules appended to such forms. (34 CFR section 668.56). For students whose applications were selected for verification, if the institution has reason to believe that information included in the application is inaccurate, the institution may not (1) disburse any Pell or campus-based aid, (2) employ the applicant in its FWS program, or (3) originate Federal Direct Student Loans (“Direct Loans”) (or process proceeds of previously originated loans) until the applicant verifies or corrects the information. If the institution does not have any reason to believe that the information is inaccurate, the institution may withhold payment of Pell or Campus-based aid, or may make one interim disbursement of Pell or Campus-based aid, employ or allow an employer to employ an eligible student under FWS for the first 60 consecutive days after the student’s enrollment and may originate the Direct Loan, but cannot process the proceeds. If the verification process is not complete within the time period specified, the institution shall return loan proceeds. In addition, the institution is liable for an interim disbursement if verification shows that a student received an overpayment or if the student fails to complete verification (34 CFR sections 668.58, 668.60(b)(3), and 668.61)). Condition: For certain students selected for verification testing, federal awards were disbursed prior to the completion of the required verification procedures. In addition, instances in which verification status was not correctly coded in the COD system were identified. Cause: Administrative oversight. Effect or Potential Effect: Federal awards were not disbursed in accordance with federal regulations and the University was not in compliance with verification compliance requirements. Questioned Costs: Indeterminable. Context: We noted the following exceptions: • For 6 of 60 students tested, the University disbursed federal awards prior to completing appropriate verification procedures. • For 2 of 60 students tested, the University did not correctly code the student’s verification status in the COD system. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-009 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that the required verification procedures are completed prior to disbursement of federal awards. Views of Responsible Officials and Planned Corrective Actions: The University contracted with Inceptia on 2/5/2020, and Inceptia started completing verification for SAU on 2/18/2020. Inceptia' s Verification Gateway platform provides an automated solution to gather information and documentation required for Financial Aid Verification. Inceptia uses innovative technology to apply progressive rules for automatically or manually approving verification. Furthermore, it provides efficient and effective processes to help institutions remain compliant by organizing documents, streamlining award packaging, and allowing staff to manage the verification process. It provides the institution with the internal controls it needs over its Title IV funding. The Financial Aid Staff also can manually verify students if needed. With Colleague and Inceptia, SAU now has a more unified operating system for systematic processes. If a student has been flagged for verification, Colleague will not allow staff to award the student financial aid. One of the award eligibility rules is "Verification Complete." If students fail to pass this rule, they will not be awarded financial aid. Colleague gives the Financial Aid Staff greater control over the disbursal of Title IV funds and prevents the FAO from disbursing aid to students who are ineligible to receive it.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Disbursements To or On Behalf of Students - Transfer Monitoring - If a student received financial aid while attending one or more other institutions schools are required to request financial aid history using the National Student Loans Data System (“NSLDS”) Student Transfer Monitoring Process. Under this process, a school informs NSLDS about its transfer students. NSLDS will “monitor” those students on the school’s “inform” list and “alert” the school of any relevant financial aid history changes. A school must wait 7 days after it “informs” NSLDS about a transfer student before disbursing Title IV aid to that student (34 CFR section 668.19). Condition: The University did not add the transfer students to the NSLDS ‘alert’ list and was unable to provide documentation supporting those the students’ financial aid history was reviewed prior to disbursing Title IV aid. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with the required federal guidelines over transfer monitoring. Questioned Costs: None. Context: The University was unable to provide an accurate listing of students who transferred into the University during the year and did not appropriately add the students to the NSLDS ‘alert’ list as required. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-013 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures to ensure that all transfer students are appropriately tracked/monitored as required by federal guidelines. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved as the financial aid department can now track transfer students and any changes to their financial aid while informing other institutions of those changes through the National Student Loan Data System (NSLDS). This issue has been resolved with the implementation of Colleague. The Financial Aid Director can now perform transfer monitoring in Colleague to track transfer students and any changes to their financial aid while informing other institutions of those changes. Colleague sends information files to the National Student Loan Data System (NSLDS), which notifies NSLDS of our transfer students and serves as a request to put SAU's transfer students on the NSLDS maintained Transfer Monitoring list. The inform file is also a request for a Financial Aid History file for each student listed. With Colleague, we can determine which students to monitor, send the information to NSLDS, transfer the files, and view students' NSLDS information as necessary. The Financial Aid Director runs transfer monitoring at the beginning of the semester for everyone enrolled and then runs TMXP, which creates a file to monitor those who are newly awarded, Students are run through the process in December for new transfer student can be monitored. With Colleague, the Financial Aid Director/Staff can easily adhere to the "Inform, Monitor, Alert" process since this system can efficiently and effectively run this process. Prior to awarding a transfer for spring the Financial Aid Staff as alternative option review NSLDS and manually add a student to the transfer monitoring file.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Verification - An institution shall require an applicant selected for verification to submit acceptable documentation that will verify or update the following information used to determine the applicant's expected family contribution (“EFC”): adjusted gross income, U.S. income tax paid, aggregate number of family members in the household, number of family members in the household who are enrolled in as at least half-time students in postsecondary educational institutions if that number is greater than one and untaxed income subject to U.S. income tax reporting requirements in the base year which is included on the tax return form, excluding information contained on schedules appended to such forms. Untaxed income and benefits include: Social Security benefits if the institution has reason to believe that those benefits were received and were not reported or were not correctly reported; child support if the institution has reason to believe child support was received; U.S. income tax deductions for a payment made to an individual retirement account or Keough account; interest on tax-free bond; foreign income excluded from U.S. income taxation if the institution has reason to believe that foreign income was received; and all other untaxed income subject to U.S. income tax reporting requirements in the base year included on the tax return form, excluding information contained on schedules appended to such forms. (34 CFR section 668.56). For students whose applications were selected for verification, if the institution has reason to believe that information included in the application is inaccurate, the institution may not (1) disburse any Pell or campus-based aid, (2) employ the applicant in its FWS program, or (3) originate Federal Direct Student Loans (“Direct Loans”) (or process proceeds of previously originated loans) until the applicant verifies or corrects the information. If the institution does not have any reason to believe that the information is inaccurate, the institution may withhold payment of Pell or Campus-based aid, or may make one interim disbursement of Pell or Campus-based aid, employ or allow an employer to employ an eligible student under FWS for the first 60 consecutive days after the student’s enrollment and may originate the Direct Loan, but cannot process the proceeds. If the verification process is not complete within the time period specified, the institution shall return loan proceeds. In addition, the institution is liable for an interim disbursement if verification shows that a student received an overpayment or if the student fails to complete verification (34 CFR sections 668.58, 668.60(b)(3), and 668.61)). Condition: For certain students selected for verification testing, federal awards were disbursed prior to the completion of the required verification procedures. In addition, instances in which verification status was not correctly coded in the COD system were identified. Cause: Administrative oversight. Effect or Potential Effect: Federal awards were not disbursed in accordance with federal regulations and the University was not in compliance with verification compliance requirements. Questioned Costs: Indeterminable. Context: We noted the following exceptions: • For 6 of 60 students tested, the University disbursed federal awards prior to completing appropriate verification procedures. • For 2 of 60 students tested, the University did not correctly code the student’s verification status in the COD system. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-009 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that the required verification procedures are completed prior to disbursement of federal awards. Views of Responsible Officials and Planned Corrective Actions: The University contracted with Inceptia on 2/5/2020, and Inceptia started completing verification for SAU on 2/18/2020. Inceptia' s Verification Gateway platform provides an automated solution to gather information and documentation required for Financial Aid Verification. Inceptia uses innovative technology to apply progressive rules for automatically or manually approving verification. Furthermore, it provides efficient and effective processes to help institutions remain compliant by organizing documents, streamlining award packaging, and allowing staff to manage the verification process. It provides the institution with the internal controls it needs over its Title IV funding. The Financial Aid Staff also can manually verify students if needed. With Colleague and Inceptia, SAU now has a more unified operating system for systematic processes. If a student has been flagged for verification, Colleague will not allow staff to award the student financial aid. One of the award eligibility rules is "Verification Complete." If students fail to pass this rule, they will not be awarded financial aid. Colleague gives the Financial Aid Staff greater control over the disbursal of Title IV funds and prevents the FAO from disbursing aid to students who are ineligible to receive it.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): F. Equipment and Real Property Management - Equipment records shall be maintained, a physical inventory of equipment shall be taken at least once every 2 years and reconciled to the equipment records, an appropriate control system shall be used to safeguard equipment, and equipment shall be adequately maintained. Equipment property records should contain the following information about the equipment: description (including serial number or other identification number), source, who holds title, acquisition date and cost, percentage of Federal participation in the cost, location, condition, and any ultimate disposition data including, the date of disposal and sales price or method used to determine current fair market value. The Uniform Guidance further states that equipment owned by the Federal Government shall be identified (tagged) to indicate Federal ownership. Condition: The University did not comply with the requirements of equipment and real property management. Cause: Lack of internal controls and administrative oversight with respect to equipment and real property management. Effect or Potential Effect: The University did not comply with the requirements of equipment and real property management. Questioned Costs: None. Context: The University noted that a physical inventory of equipment and real property purchased with federal funds was not performed during the current fiscal year. Additionally, the University was unable to provide equipment records and/or an equipment listing of all federally funded equipment. The University was also unable to provide documentation supporting the required tagging of federally funded equipment. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-018 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures over the applicable compliance requirements of the equipment and real property management. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. Staff transitions coupled with the transition from on-site to remote work environment were the primary reasons for this finding. With the implementation of the new ERP system along with extensive training on utilizing the fixed asset module to assist with more accurate tracking of the inventory will reduce the risk of this finding.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Federal Work-Study Program (ALN 84.033), Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - Institutions are permitted to draw down Title IV funds prior to disbursing funds to eligible students and parents. The institution’s request must not exceed the amount immediately needed to disburse funds to students or parents. A disbursement of funds occurs on the date an institution credits a student’s account or pays a student or parent directly with either student financial aid funds or institutional funds. The institution must make the disbursements as soon as administratively feasible, but no later than 3 business days following the receipt of funds. Any amounts not disbursed by the end of the third business day are considered to be excess cash and generally are required to be promptly returned to the U.S. Department of Education (the “ED”) (34 CFR section 668.166(a)(1)). Excess cash includes any funds received from the ED that are deposited or transferred to the institution’s Federal account as a result of an award adjustment, cancellation, or recovery. However, an excess cash balance tolerance is allowed if that balance: (1) is less than one percent of its prior-year drawdowns; and (2) is eliminated within the next 7 calendar days (34 CFR sections 668.166(a) and (b)). Condition: Several instances during the year were identified in which Title IV funds, from each federal award, were drawn and held in excess of the allowable time frame and/or allowable thresholds. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: Title IV funds were overdrawn or held in excess of the allowable time frame and/or allowable thresholds. Questioned Costs: None. Context: Several instances of funds drawn and held in excess of the allowable time frame and/or thresholds were identified throughout the University’s fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-006 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhances its procedures and internal controls to ensure that federal funds are being drawn in accordance with federal regulations and facilitate an account review on the third business date after a federal draw to determine whether amounts were disbursed or require a return to the U.S. Department of Education. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV funds. This will include new workflows that have been added to the policies. Utilizing the workflows prescribed by Colleague the University will be able to work from reports to avoid these finding moving forward. In addition, the University contracted with Colleague for more formal training of all finance and financial aid employees. The FA Director and the Comptroller will work together weekly when disbursing funds. The Financial Aid Director will notify the Comptroller what amount is available to drawdown. Each area will complete their internal reconciliation. Effective June 2023 SAU is HCM2.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Disbursements To or On Behalf of Students - Transfer Monitoring - If a student received financial aid while attending one or more other institutions schools are required to request financial aid history using the National Student Loans Data System (“NSLDS”) Student Transfer Monitoring Process. Under this process, a school informs NSLDS about its transfer students. NSLDS will “monitor” those students on the school’s “inform” list and “alert” the school of any relevant financial aid history changes. A school must wait 7 days after it “informs” NSLDS about a transfer student before disbursing Title IV aid to that student (34 CFR section 668.19). Condition: The University did not add the transfer students to the NSLDS ‘alert’ list and was unable to provide documentation supporting those the students’ financial aid history was reviewed prior to disbursing Title IV aid. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with the required federal guidelines over transfer monitoring. Questioned Costs: None. Context: The University was unable to provide an accurate listing of students who transferred into the University during the year and did not appropriately add the students to the NSLDS ‘alert’ list as required. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-013 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures to ensure that all transfer students are appropriately tracked/monitored as required by federal guidelines. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved as the financial aid department can now track transfer students and any changes to their financial aid while informing other institutions of those changes through the National Student Loan Data System (NSLDS). This issue has been resolved with the implementation of Colleague. The Financial Aid Director can now perform transfer monitoring in Colleague to track transfer students and any changes to their financial aid while informing other institutions of those changes. Colleague sends information files to the National Student Loan Data System (NSLDS), which notifies NSLDS of our transfer students and serves as a request to put SAU's transfer students on the NSLDS maintained Transfer Monitoring list. The inform file is also a request for a Financial Aid History file for each student listed. With Colleague, we can determine which students to monitor, send the information to NSLDS, transfer the files, and view students' NSLDS information as necessary. The Financial Aid Director runs transfer monitoring at the beginning of the semester for everyone enrolled and then runs TMXP, which creates a file to monitor those who are newly awarded, Students are run through the process in December for new transfer student can be monitored. With Colleague, the Financial Aid Director/Staff can easily adhere to the "Inform, Monitor, Alert" process since this system can efficiently and effectively run this process. Prior to awarding a transfer for spring the Financial Aid Staff as alternative option review NSLDS and manually add a student to the transfer monitoring file.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Verification - An institution shall require an applicant selected for verification to submit acceptable documentation that will verify or update the following information used to determine the applicant's expected family contribution (“EFC”): adjusted gross income, U.S. income tax paid, aggregate number of family members in the household, number of family members in the household who are enrolled in as at least half-time students in postsecondary educational institutions if that number is greater than one and untaxed income subject to U.S. income tax reporting requirements in the base year which is included on the tax return form, excluding information contained on schedules appended to such forms. Untaxed income and benefits include: Social Security benefits if the institution has reason to believe that those benefits were received and were not reported or were not correctly reported; child support if the institution has reason to believe child support was received; U.S. income tax deductions for a payment made to an individual retirement account or Keough account; interest on tax-free bond; foreign income excluded from U.S. income taxation if the institution has reason to believe that foreign income was received; and all other untaxed income subject to U.S. income tax reporting requirements in the base year included on the tax return form, excluding information contained on schedules appended to such forms. (34 CFR section 668.56). For students whose applications were selected for verification, if the institution has reason to believe that information included in the application is inaccurate, the institution may not (1) disburse any Pell or campus-based aid, (2) employ the applicant in its FWS program, or (3) originate Federal Direct Student Loans (“Direct Loans”) (or process proceeds of previously originated loans) until the applicant verifies or corrects the information. If the institution does not have any reason to believe that the information is inaccurate, the institution may withhold payment of Pell or Campus-based aid, or may make one interim disbursement of Pell or Campus-based aid, employ or allow an employer to employ an eligible student under FWS for the first 60 consecutive days after the student’s enrollment and may originate the Direct Loan, but cannot process the proceeds. If the verification process is not complete within the time period specified, the institution shall return loan proceeds. In addition, the institution is liable for an interim disbursement if verification shows that a student received an overpayment or if the student fails to complete verification (34 CFR sections 668.58, 668.60(b)(3), and 668.61)). Condition: For certain students selected for verification testing, federal awards were disbursed prior to the completion of the required verification procedures. In addition, instances in which verification status was not correctly coded in the COD system were identified. Cause: Administrative oversight. Effect or Potential Effect: Federal awards were not disbursed in accordance with federal regulations and the University was not in compliance with verification compliance requirements. Questioned Costs: Indeterminable. Context: We noted the following exceptions: • For 6 of 60 students tested, the University disbursed federal awards prior to completing appropriate verification procedures. • For 2 of 60 students tested, the University did not correctly code the student’s verification status in the COD system. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-009 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that the required verification procedures are completed prior to disbursement of federal awards. Views of Responsible Officials and Planned Corrective Actions: The University contracted with Inceptia on 2/5/2020, and Inceptia started completing verification for SAU on 2/18/2020. Inceptia' s Verification Gateway platform provides an automated solution to gather information and documentation required for Financial Aid Verification. Inceptia uses innovative technology to apply progressive rules for automatically or manually approving verification. Furthermore, it provides efficient and effective processes to help institutions remain compliant by organizing documents, streamlining award packaging, and allowing staff to manage the verification process. It provides the institution with the internal controls it needs over its Title IV funding. The Financial Aid Staff also can manually verify students if needed. With Colleague and Inceptia, SAU now has a more unified operating system for systematic processes. If a student has been flagged for verification, Colleague will not allow staff to award the student financial aid. One of the award eligibility rules is "Verification Complete." If students fail to pass this rule, they will not be awarded financial aid. Colleague gives the Financial Aid Staff greater control over the disbursal of Title IV funds and prevents the FAO from disbursing aid to students who are ineligible to receive it.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Federal Work-Study Program (ALN 84.033), Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - Institutions are permitted to draw down Title IV funds prior to disbursing funds to eligible students and parents. The institution’s request must not exceed the amount immediately needed to disburse funds to students or parents. A disbursement of funds occurs on the date an institution credits a student’s account or pays a student or parent directly with either student financial aid funds or institutional funds. The institution must make the disbursements as soon as administratively feasible, but no later than 3 business days following the receipt of funds. Any amounts not disbursed by the end of the third business day are considered to be excess cash and generally are required to be promptly returned to the U.S. Department of Education (the “ED”) (34 CFR section 668.166(a)(1)). Excess cash includes any funds received from the ED that are deposited or transferred to the institution’s Federal account as a result of an award adjustment, cancellation, or recovery. However, an excess cash balance tolerance is allowed if that balance: (1) is less than one percent of its prior-year drawdowns; and (2) is eliminated within the next 7 calendar days (34 CFR sections 668.166(a) and (b)). Condition: Several instances during the year were identified in which Title IV funds, from each federal award, were drawn and held in excess of the allowable time frame and/or allowable thresholds. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: Title IV funds were overdrawn or held in excess of the allowable time frame and/or allowable thresholds. Questioned Costs: None. Context: Several instances of funds drawn and held in excess of the allowable time frame and/or thresholds were identified throughout the University’s fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-006 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhances its procedures and internal controls to ensure that federal funds are being drawn in accordance with federal regulations and facilitate an account review on the third business date after a federal draw to determine whether amounts were disbursed or require a return to the U.S. Department of Education. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV funds. This will include new workflows that have been added to the policies. Utilizing the workflows prescribed by Colleague the University will be able to work from reports to avoid these finding moving forward. In addition, the University contracted with Colleague for more formal training of all finance and financial aid employees. The FA Director and the Comptroller will work together weekly when disbursing funds. The Financial Aid Director will notify the Comptroller what amount is available to drawdown. Each area will complete their internal reconciliation. Effective June 2023 SAU is HCM2.

Program Information: Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Enrollment Reporting – Institutions are required to report enrollment information under the Pell grant and the Direct and Federal Family Education Loan (“FFEL”) loan programs via the National Student Loan Data System (“NSLDS”) (OMB No. 1845-0035). Although FFEL loans are no longer made or a part of the Student Financial Assistance Cluster, a student may have a FFEL loan from previous years that would require enrollment reporting for that student (Pell, 34 CFR 690.83(b)(2); FFEL, 34 CFR 682.610; Direct Loan, 34 CFR 685.309). Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (“NSLDSFAP”) website. The data on the institution’s Enrollment Reporting Roster, or Enrollment Maintenance page, is what NSLDS has as the most recently certified enrollment information. There are two categories of enrollment information, “Campus Level” and “Program Level,” each with separate record types requiring accurate reporting. The NSLDS Enrollment Reporting Guide provides the requirements and guidance for reporting enrollment details using the NSLDS Enrollment Reporting Process. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway (“SAIG”) (OMB No. 1845-0002) mailboxes sent by ED via NSLDS. After the institution submits the Enrollment Reporting roster to NSLDS, NSLDS evaluates the Enrollment Reporting roster and provides the institution an Error/Acknowledgement file. If errors are identified, institutions have 10 days to correct the errors and resubmit to NSLDS. Condition: For certain students selected for testing who graduated or withdrew during the year, the University did not submit status change notification or failed to submit timely notification to the NSLDS website. Additionally, the University’s fiscal year SCHER1 report, included multiple instances in which error records were not corrected within the required timeframe. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with enrollment reporting requirements. Failure to promptly report accurate and timely changes in enrollment status may adversely impact the repayment status for student loan borrowers. Questioned Costs: None. Context: We noted the following exceptions: • For 9 of 60 campus level records tested, the University failed to notify NSLDS of the change in student enrollment. • For 51 of 60 campus level records tested, the University did not certify the enrollment status within the required timeframe. • For 10 of 60 program level records tested, the University failed to report the enrollment change to NSLDS. • For 50 of 60 program level records tested, the University did not certify the enrollment status within the required timeframe. Additionally, error records identified in Error/Acknowledgment files were not corrected within the required timeframe, resulting in multiple errors during the 2021 fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-011 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University follow its internal controls, policies and procedures over the applicable compliance requirements of the Enrollment Reporting requirement to ensure that all status changes are submitted to the NSLDS website within the required timeframe. Views of Responsible Officials and Planned Corrective Actions: Enrollment reporting is required for all schools participating in Title IV aid programs. Schools are required to certify enrollment for all students included on their roster files. SAU was without a Registrar during the 2019-2020 award year however, in August 2020 this position was filled. In addition more staff was hired to assist in these reporting functions. The Registrar had to submit the missing reports before submitting new ones. This backlog led to late status changes being reported. Primarily, the University implemented a comprehensive ERP software tool, Ellucian Colleague in FY2021 and FY2022 and hired more staff. The built-in internal control structure which includes access to enrollment reports and data coupled with a complete reconciliation process with the Office of Financial Aid, Office of the Registrar and Student Accounts will prevent this from recurring. Professional development is encouraged for the University’s staff to stay current on compliance, regulatory and legal guidelines and adopt industry best practices.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Disbursements To or On Behalf of Students - Transfer Monitoring - If a student received financial aid while attending one or more other institutions schools are required to request financial aid history using the National Student Loans Data System (“NSLDS”) Student Transfer Monitoring Process. Under this process, a school informs NSLDS about its transfer students. NSLDS will “monitor” those students on the school’s “inform” list and “alert” the school of any relevant financial aid history changes. A school must wait 7 days after it “informs” NSLDS about a transfer student before disbursing Title IV aid to that student (34 CFR section 668.19). Condition: The University did not add the transfer students to the NSLDS ‘alert’ list and was unable to provide documentation supporting those the students’ financial aid history was reviewed prior to disbursing Title IV aid. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with the required federal guidelines over transfer monitoring. Questioned Costs: None. Context: The University was unable to provide an accurate listing of students who transferred into the University during the year and did not appropriately add the students to the NSLDS ‘alert’ list as required. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-013 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures to ensure that all transfer students are appropriately tracked/monitored as required by federal guidelines. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved as the financial aid department can now track transfer students and any changes to their financial aid while informing other institutions of those changes through the National Student Loan Data System (NSLDS). This issue has been resolved with the implementation of Colleague. The Financial Aid Director can now perform transfer monitoring in Colleague to track transfer students and any changes to their financial aid while informing other institutions of those changes. Colleague sends information files to the National Student Loan Data System (NSLDS), which notifies NSLDS of our transfer students and serves as a request to put SAU's transfer students on the NSLDS maintained Transfer Monitoring list. The inform file is also a request for a Financial Aid History file for each student listed. With Colleague, we can determine which students to monitor, send the information to NSLDS, transfer the files, and view students' NSLDS information as necessary. The Financial Aid Director runs transfer monitoring at the beginning of the semester for everyone enrolled and then runs TMXP, which creates a file to monitor those who are newly awarded, Students are run through the process in December for new transfer student can be monitored. With Colleague, the Financial Aid Director/Staff can easily adhere to the "Inform, Monitor, Alert" process since this system can efficiently and effectively run this process. Prior to awarding a transfer for spring the Financial Aid Staff as alternative option review NSLDS and manually add a student to the transfer monitoring file.

Program Information: Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting – Common Origination and Disbursement System Reporting: Institutions submit Federal Direct Loan Program, Federal Pell Grant Program, and TEACH Grant origination records and disbursement records to the Common Origination and Disbursement (COD) system. Origination records can be sent well in advance of any disbursements, as early as the institution chooses to submit them for any student the institution reasonably believes will be eligible for a payment. An institution follows up with a disbursement record for that student no earlier than (1) seven calendar days prior to the disbursement date under the Advance or Heightened Cash Monitoring 1 payment methods, or (2) the date of the disbursement under the Reimbursement or Heightened Cash Monitoring 2 Payment Method. The disbursement record reports the actual disbursement date and the amount of the disbursement. The U.S. Department of Education (the “ED”) processes origination and/or disbursement records and returns acknowledgments to the institution. The acknowledgments identify the processing status of each record: Rejected, Accepted with Corrections, or Accepted. Institutions must report student disbursement data within 15 calendar days after the institution makes a disbursement or becomes aware of the need to make an adjustment to previously reported student disbursement data or expected student disbursement data. Institutions may do this by reporting once every 15 calendar days, bi-weekly or weekly, or may set up their own system to ensure that changes are reported in a timely manner. Condition: Certain student disbursements were not reported to COD within 15 calendar days as required. Additionally, during an examination of Federal Direct Student Loan disbursement records, instances in which loan proceeds were disbursed prior to having obtained a legally enforceable promissory note were identified. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with COD reporting requirements. Failure to submit and update COD records in a timely manner could result in improper awards of student funds. Questioned Costs: None. Context: We noted the following exceptions: • For 7 of 60 Federal Pell Grant origination records tested, verification status code was not accurately reported to COD. • For 11 of 60 Federal Pell Grant origination records tested, enrollment date was not accurately reported to COD. • For 30 of 60 Federal Pell Grant disbursement records tested, the University did not report the disbursements to COD within the required time frame. • For 42 of 60 Federal Direct Student Loan disbursement records tested, the University did not report the disbursements to COD within the required time frame. • For 2 of 25 Federal Direct Student Loan disbursement records tested, the University disbursed loan proceeds without having obtained a legally enforceable promissory note. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-007 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its procedures and internal controls over disbursement record submissions to ensure timely reporting to COD. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV programs. COD processes are run through Colleague's CODE (Common Originators Disbursement Ellucian) system, which is used to send origination requests and disbursement information for Pell and Federal loans to COD. Funds are transmitted to a student's account through a two-part process run between the Financial Aid Office (FAO) and the Business Office. The Finanical Aid Office is responsible for sending loan originations and disbursments to COD within 15 days. The data extraction process will be more consistent using the workflows provided by the new ERP system.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Verification - An institution shall require an applicant selected for verification to submit acceptable documentation that will verify or update the following information used to determine the applicant's expected family contribution (“EFC”): adjusted gross income, U.S. income tax paid, aggregate number of family members in the household, number of family members in the household who are enrolled in as at least half-time students in postsecondary educational institutions if that number is greater than one and untaxed income subject to U.S. income tax reporting requirements in the base year which is included on the tax return form, excluding information contained on schedules appended to such forms. Untaxed income and benefits include: Social Security benefits if the institution has reason to believe that those benefits were received and were not reported or were not correctly reported; child support if the institution has reason to believe child support was received; U.S. income tax deductions for a payment made to an individual retirement account or Keough account; interest on tax-free bond; foreign income excluded from U.S. income taxation if the institution has reason to believe that foreign income was received; and all other untaxed income subject to U.S. income tax reporting requirements in the base year included on the tax return form, excluding information contained on schedules appended to such forms. (34 CFR section 668.56). For students whose applications were selected for verification, if the institution has reason to believe that information included in the application is inaccurate, the institution may not (1) disburse any Pell or campus-based aid, (2) employ the applicant in its FWS program, or (3) originate Federal Direct Student Loans (“Direct Loans”) (or process proceeds of previously originated loans) until the applicant verifies or corrects the information. If the institution does not have any reason to believe that the information is inaccurate, the institution may withhold payment of Pell or Campus-based aid, or may make one interim disbursement of Pell or Campus-based aid, employ or allow an employer to employ an eligible student under FWS for the first 60 consecutive days after the student’s enrollment and may originate the Direct Loan, but cannot process the proceeds. If the verification process is not complete within the time period specified, the institution shall return loan proceeds. In addition, the institution is liable for an interim disbursement if verification shows that a student received an overpayment or if the student fails to complete verification (34 CFR sections 668.58, 668.60(b)(3), and 668.61)). Condition: For certain students selected for verification testing, federal awards were disbursed prior to the completion of the required verification procedures. In addition, instances in which verification status was not correctly coded in the COD system were identified. Cause: Administrative oversight. Effect or Potential Effect: Federal awards were not disbursed in accordance with federal regulations and the University was not in compliance with verification compliance requirements. Questioned Costs: Indeterminable. Context: We noted the following exceptions: • For 6 of 60 students tested, the University disbursed federal awards prior to completing appropriate verification procedures. • For 2 of 60 students tested, the University did not correctly code the student’s verification status in the COD system. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-009 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that the required verification procedures are completed prior to disbursement of federal awards. Views of Responsible Officials and Planned Corrective Actions: The University contracted with Inceptia on 2/5/2020, and Inceptia started completing verification for SAU on 2/18/2020. Inceptia' s Verification Gateway platform provides an automated solution to gather information and documentation required for Financial Aid Verification. Inceptia uses innovative technology to apply progressive rules for automatically or manually approving verification. Furthermore, it provides efficient and effective processes to help institutions remain compliant by organizing documents, streamlining award packaging, and allowing staff to manage the verification process. It provides the institution with the internal controls it needs over its Title IV funding. The Financial Aid Staff also can manually verify students if needed. With Colleague and Inceptia, SAU now has a more unified operating system for systematic processes. If a student has been flagged for verification, Colleague will not allow staff to award the student financial aid. One of the award eligibility rules is "Verification Complete." If students fail to pass this rule, they will not be awarded financial aid. Colleague gives the Financial Aid Staff greater control over the disbursal of Title IV funds and prevents the FAO from disbursing aid to students who are ineligible to receive it.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Federal Work-Study Program (ALN 84.033), Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - Institutions are permitted to draw down Title IV funds prior to disbursing funds to eligible students and parents. The institution’s request must not exceed the amount immediately needed to disburse funds to students or parents. A disbursement of funds occurs on the date an institution credits a student’s account or pays a student or parent directly with either student financial aid funds or institutional funds. The institution must make the disbursements as soon as administratively feasible, but no later than 3 business days following the receipt of funds. Any amounts not disbursed by the end of the third business day are considered to be excess cash and generally are required to be promptly returned to the U.S. Department of Education (the “ED”) (34 CFR section 668.166(a)(1)). Excess cash includes any funds received from the ED that are deposited or transferred to the institution’s Federal account as a result of an award adjustment, cancellation, or recovery. However, an excess cash balance tolerance is allowed if that balance: (1) is less than one percent of its prior-year drawdowns; and (2) is eliminated within the next 7 calendar days (34 CFR sections 668.166(a) and (b)). Condition: Several instances during the year were identified in which Title IV funds, from each federal award, were drawn and held in excess of the allowable time frame and/or allowable thresholds. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: Title IV funds were overdrawn or held in excess of the allowable time frame and/or allowable thresholds. Questioned Costs: None. Context: Several instances of funds drawn and held in excess of the allowable time frame and/or thresholds were identified throughout the University’s fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-006 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhances its procedures and internal controls to ensure that federal funds are being drawn in accordance with federal regulations and facilitate an account review on the third business date after a federal draw to determine whether amounts were disbursed or require a return to the U.S. Department of Education. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV funds. This will include new workflows that have been added to the policies. Utilizing the workflows prescribed by Colleague the University will be able to work from reports to avoid these finding moving forward. In addition, the University contracted with Colleague for more formal training of all finance and financial aid employees. The FA Director and the Comptroller will work together weekly when disbursing funds. The Financial Aid Director will notify the Comptroller what amount is available to drawdown. Each area will complete their internal reconciliation. Effective June 2023 SAU is HCM2.

Program Information: Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Enrollment Reporting – Institutions are required to report enrollment information under the Pell grant and the Direct and Federal Family Education Loan (“FFEL”) loan programs via the National Student Loan Data System (“NSLDS”) (OMB No. 1845-0035). Although FFEL loans are no longer made or a part of the Student Financial Assistance Cluster, a student may have a FFEL loan from previous years that would require enrollment reporting for that student (Pell, 34 CFR 690.83(b)(2); FFEL, 34 CFR 682.610; Direct Loan, 34 CFR 685.309). Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (“NSLDSFAP”) website. The data on the institution’s Enrollment Reporting Roster, or Enrollment Maintenance page, is what NSLDS has as the most recently certified enrollment information. There are two categories of enrollment information, “Campus Level” and “Program Level,” each with separate record types requiring accurate reporting. The NSLDS Enrollment Reporting Guide provides the requirements and guidance for reporting enrollment details using the NSLDS Enrollment Reporting Process. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway (“SAIG”) (OMB No. 1845-0002) mailboxes sent by ED via NSLDS. After the institution submits the Enrollment Reporting roster to NSLDS, NSLDS evaluates the Enrollment Reporting roster and provides the institution an Error/Acknowledgement file. If errors are identified, institutions have 10 days to correct the errors and resubmit to NSLDS. Condition: For certain students selected for testing who graduated or withdrew during the year, the University did not submit status change notification or failed to submit timely notification to the NSLDS website. Additionally, the University’s fiscal year SCHER1 report, included multiple instances in which error records were not corrected within the required timeframe. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with enrollment reporting requirements. Failure to promptly report accurate and timely changes in enrollment status may adversely impact the repayment status for student loan borrowers. Questioned Costs: None. Context: We noted the following exceptions: • For 9 of 60 campus level records tested, the University failed to notify NSLDS of the change in student enrollment. • For 51 of 60 campus level records tested, the University did not certify the enrollment status within the required timeframe. • For 10 of 60 program level records tested, the University failed to report the enrollment change to NSLDS. • For 50 of 60 program level records tested, the University did not certify the enrollment status within the required timeframe. Additionally, error records identified in Error/Acknowledgment files were not corrected within the required timeframe, resulting in multiple errors during the 2021 fiscal year. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-011 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University follow its internal controls, policies and procedures over the applicable compliance requirements of the Enrollment Reporting requirement to ensure that all status changes are submitted to the NSLDS website within the required timeframe. Views of Responsible Officials and Planned Corrective Actions: Enrollment reporting is required for all schools participating in Title IV aid programs. Schools are required to certify enrollment for all students included on their roster files. SAU was without a Registrar during the 2019-2020 award year however, in August 2020 this position was filled. In addition more staff was hired to assist in these reporting functions. The Registrar had to submit the missing reports before submitting new ones. This backlog led to late status changes being reported. Primarily, the University implemented a comprehensive ERP software tool, Ellucian Colleague in FY2021 and FY2022 and hired more staff. The built-in internal control structure which includes access to enrollment reports and data coupled with a complete reconciliation process with the Office of Financial Aid, Office of the Registrar and Student Accounts will prevent this from recurring. Professional development is encouraged for the University’s staff to stay current on compliance, regulatory and legal guidelines and adopt industry best practices.

Program Information: Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): E. Eligibility – Aggregate Loan Limits for Subsidized and Unsubsidized Loans: Aggregate loan limits for subsidized and unsubsidized loans are: $31,000 for a dependent undergraduate student (except for dependent students whose parents cannot borrow a PLUS loan) (subsidized loan portion may not exceed $23,000 of the aggregate limit amount); $57,500 for an independent student and for a dependent student whose parents cannot borrow a PLUS loan (subsidized loan portion may not exceed $23,000 of the aggregate limit amount); and $138,500 for a graduate or professional student (subsidized portion limited to $65,500). This $138,500 limit includes loans for undergraduate study. Condition: Certain students selected for testing were disbursed Federal Direct Student Loan funds in excess of the aggregate Subsidized and Unsubsidized direct loan limit. Cause: Administrative oversight. Effect or Potential Effect: The University is not in compliance with packaging Federal Direct Student Loans within aggregate loan limits. Questioned Costs: Below reporting threshold. Context: For 1 of 60 students selected for testing, the student was packaged and disbursed Federal Direct Student Loans in excess of the aggregate loan limit. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-012 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that Federal Direct Student Loans are awarded/disbursed in accordance with federal guidelines. Views of Responsible Officials and Planned Corrective Actions: The financial aid department has developed a Direct Loan workflow process in accordance with federal guidelines. With the implementation of Colleague, this issue has been resolved. Utilizing Colleague's software, the financial aid office can now accurately assess our students' aid eligibility to ensure they are appropriately awarded. Colleague has Award Eligibility Criteria (AEC) rules invoked at transmittal to determine if the student is eligible to receive loan funds. Items this rule checks for include half-time enrollment, completion of Entrance Interview, Satisfactory Academic Progress, etc. AEC is primarily used as a criterion a student must pass before aid can be transmitted to Accounts Receivable. There are two sets of rules on the AEC form: Eligibility Criteria for Awarding and Eligibility Criteria for Transmitting. These rules monitor students' aggregate loan limits, SAP, as defined by Uniform Guidance rules and requirements for federal awards, and provide SAU with the internal controls needed for their Title IV program. The Financial Aid Director follows Ellucian Colleague’s best practice recommendations.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Disbursements To or On Behalf of Students - Transfer Monitoring - If a student received financial aid while attending one or more other institutions schools are required to request financial aid history using the National Student Loans Data System (“NSLDS”) Student Transfer Monitoring Process. Under this process, a school informs NSLDS about its transfer students. NSLDS will “monitor” those students on the school’s “inform” list and “alert” the school of any relevant financial aid history changes. A school must wait 7 days after it “informs” NSLDS about a transfer student before disbursing Title IV aid to that student (34 CFR section 668.19). Condition: The University did not add the transfer students to the NSLDS ‘alert’ list and was unable to provide documentation supporting those the students’ financial aid history was reviewed prior to disbursing Title IV aid. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with the required federal guidelines over transfer monitoring. Questioned Costs: None. Context: The University was unable to provide an accurate listing of students who transferred into the University during the year and did not appropriately add the students to the NSLDS ‘alert’ list as required. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-013 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and procedures to ensure that all transfer students are appropriately tracked/monitored as required by federal guidelines. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved as the financial aid department can now track transfer students and any changes to their financial aid while informing other institutions of those changes through the National Student Loan Data System (NSLDS). This issue has been resolved with the implementation of Colleague. The Financial Aid Director can now perform transfer monitoring in Colleague to track transfer students and any changes to their financial aid while informing other institutions of those changes. Colleague sends information files to the National Student Loan Data System (NSLDS), which notifies NSLDS of our transfer students and serves as a request to put SAU's transfer students on the NSLDS maintained Transfer Monitoring list. The inform file is also a request for a Financial Aid History file for each student listed. With Colleague, we can determine which students to monitor, send the information to NSLDS, transfer the files, and view students' NSLDS information as necessary. The Financial Aid Director runs transfer monitoring at the beginning of the semester for everyone enrolled and then runs TMXP, which creates a file to monitor those who are newly awarded, Students are run through the process in December for new transfer student can be monitored. With Colleague, the Financial Aid Director/Staff can easily adhere to the "Inform, Monitor, Alert" process since this system can efficiently and effectively run this process. Prior to awarding a transfer for spring the Financial Aid Staff as alternative option review NSLDS and manually add a student to the transfer monitoring file.

Program Information: Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Borrower Data Transmission and Reconciliation - Direct Loans - Each month, the U.S. Department of Education’s Common Origination and Disbursement system (the “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 school) Loan Detail records. The school 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, schools may receive three SAS data files each month (34 CFR sections 685.102(b), 685.301, and 303). Condition: Certain instances were identified during the year where the University was unable to support that a reconciliation was performed between the SAS data files provided from the COD and the University’s financial records. Cause: Lack of internal control and administrative oversight. Effect or Potential Effect: The University is not in compliance with requirements related to the reconciliation of Federal Direct Student Loan Program disbursement information. Questioned Costs: Unknown. Context: For 4 of 4 months selected for testing, the University was unable to provide documentation supporting that a reconciliation had been performed between the University’s financial records and the SAS data files received from the COD. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-014 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that reconciliations between financial records and the COD information are performed at least monthly, and that appropriate documentation is supporting the reconciliation is retained. Views of Responsible Officials and Planned Corrective Actions: With the implementation of Ellucian Colleague this issue has been resolved. The financial aid and business offices are directly involved with the COD processes weekly. This process sends originations and disbursement information for PELL and Federal loans to COD. Funds are transmitted to a student’s account through a two-part process called FATR between the two offices. With the implementation of Colleague, we have resolved those issues. Colleague's Financial Aid module provides the tools necessary to maintain, track, process, and report information associated with financial aid applicants and recipients to Colleague. The Financial Aid module helps manage the processing of financial aid, data, and reporting and will give SAU internal controls over their Title IV Student Financial Aid programs. Using this system, SAU can create and modify Grant records for submission to COD and import and reconcile Grant data. The financial aid office did not have these options in CAMS. The financial aid office no longer builds and or disburses aid manually in COD. Colleague and COD work together. The reconciliation process for Pell and Direct Loans to self-audit, ensuring the accuracy and validity of financial data sent and submitted to COD. The reconciliation process in completed monthly and any discrepancies are resolved prior to the next month.

Program Information: Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Test and Provisions – Disbursements To or On Behalf of Students - Award Notification - Federal regulations (34 CFR section 668.165 (a)(6)(i)) require that the institution 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 or the TEACH Grant payments returned to the U.S. Department of Education; 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, TEACH Grant, or TEACH Grant disbursement. Institutions that implement an affirmative confirmation process (as described in 34 CFR section 668.165 (a)(6)(i)) must make this notification to the student or parent no earlier than 30 days before, and no later than 30 days after, crediting the student’s account at the institution with Direct Loan, FPL funds, or TEACH Grants. Condition: For certain students who received disbursements of Federal Direct Student Loan funds, the University was unable to provide evidence that the student or parent was notified of their award disbursement within the required time frame after crediting the student’s account. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: Students were not properly notified of award disbursements and/or their right to cancel/decline loan awards. Questioned Costs: None. Context: For 60 of 60 loan disbursements tested, the University was unable to provide evidence that parents and/or students received award notifications within the required time frame. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-010 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures and internal controls to ensure that federal awards are disbursed in accordance with federal guidelines. Views of Responsible Officials and Planned Corrective Actions: Primarily, the University implemented a comprehensive ERP software tool, Ellucian Colleague in FY2022 going forward. The built in internal control will readily provide data on those students who are eligible for aid and notify them of their opportunity to accept or decline aid. In addition, the notification documents will be stored in the ERP system and be available to retrieve. Within 15 days after disbursements students and parents are sent an email notifying them their loan has been disbursed to their account.

Program Information: Federal Pell Grant Program (ALN 84.063) and Federal Direct Student Loan Program (ALN 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting – Common Origination and Disbursement System Reporting: Institutions submit Federal Direct Loan Program, Federal Pell Grant Program, and TEACH Grant origination records and disbursement records to the Common Origination and Disbursement (COD) system. Origination records can be sent well in advance of any disbursements, as early as the institution chooses to submit them for any student the institution reasonably believes will be eligible for a payment. An institution follows up with a disbursement record for that student no earlier than (1) seven calendar days prior to the disbursement date under the Advance or Heightened Cash Monitoring 1 payment methods, or (2) the date of the disbursement under the Reimbursement or Heightened Cash Monitoring 2 Payment Method. The disbursement record reports the actual disbursement date and the amount of the disbursement. The U.S. Department of Education (the “ED”) processes origination and/or disbursement records and returns acknowledgments to the institution. The acknowledgments identify the processing status of each record: Rejected, Accepted with Corrections, or Accepted. Institutions must report student disbursement data within 15 calendar days after the institution makes a disbursement or becomes aware of the need to make an adjustment to previously reported student disbursement data or expected student disbursement data. Institutions may do this by reporting once every 15 calendar days, bi-weekly or weekly, or may set up their own system to ensure that changes are reported in a timely manner. Condition: Certain student disbursements were not reported to COD within 15 calendar days as required. Additionally, during an examination of Federal Direct Student Loan disbursement records, instances in which loan proceeds were disbursed prior to having obtained a legally enforceable promissory note were identified. Cause: Lack of internal controls and administrative oversight. Effect or Potential Effect: The University is not in compliance with COD reporting requirements. Failure to submit and update COD records in a timely manner could result in improper awards of student funds. Questioned Costs: None. Context: We noted the following exceptions: • For 7 of 60 Federal Pell Grant origination records tested, verification status code was not accurately reported to COD. • For 11 of 60 Federal Pell Grant origination records tested, enrollment date was not accurately reported to COD. • For 30 of 60 Federal Pell Grant disbursement records tested, the University did not report the disbursements to COD within the required time frame. • For 42 of 60 Federal Direct Student Loan disbursement records tested, the University did not report the disbursements to COD within the required time frame. • For 2 of 25 Federal Direct Student Loan disbursement records tested, the University disbursed loan proceeds without having obtained a legally enforceable promissory note. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-007 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its procedures and internal controls over disbursement record submissions to ensure timely reporting to COD. Views of Responsible Officials and Planned Corrective Actions: Primarily the University implemented a robust ERP tool Ellucian Colleague that will assist in the administration and management of Title IV programs. COD processes are run through Colleague's CODE (Common Originators Disbursement Ellucian) system, which is used to send origination requests and disbursement information for Pell and Federal loans to COD. Funds are transmitted to a student's account through a two-part process run between the Financial Aid Office (FAO) and the Business Office. The Finanical Aid Office is responsible for sending loan originations and disbursments to COD within 15 days. The data extraction process will be more consistent using the workflows provided by the new ERP system.

Program Information: Student Financial Assistance Cluster (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions – Verification - An institution shall require an applicant selected for verification to submit acceptable documentation that will verify or update the following information used to determine the applicant's expected family contribution (“EFC”): adjusted gross income, U.S. income tax paid, aggregate number of family members in the household, number of family members in the household who are enrolled in as at least half-time students in postsecondary educational institutions if that number is greater than one and untaxed income subject to U.S. income tax reporting requirements in the base year which is included on the tax return form, excluding information contained on schedules appended to such forms. Untaxed income and benefits include: Social Security benefits if the institution has reason to believe that those benefits were received and were not reported or were not correctly reported; child support if the institution has reason to believe child support was received; U.S. income tax deductions for a payment made to an individual retirement account or Keough account; interest on tax-free bond; foreign income excluded from U.S. income taxation if the institution has reason to believe that foreign income was received; and all other untaxed income subject to U.S. income tax reporting requirements in the base year included on the tax return form, excluding information contained on schedules appended to such forms. (34 CFR section 668.56). For students whose applications were selected for verification, if the institution has reason to believe that information included in the application is inaccurate, the institution may not (1) disburse any Pell or campus-based aid, (2) employ the applicant in its FWS program, or (3) originate Federal Direct Student Loans (“Direct Loans”) (or process proceeds of previously originated loans) until the applicant verifies or corrects the information. If the institution does not have any reason to believe that the information is inaccurate, the institution may withhold payment of Pell or Campus-based aid, or may make one interim disbursement of Pell or Campus-based aid, employ or allow an employer to employ an eligible student under FWS for the first 60 consecutive days after the student’s enrollment and may originate the Direct Loan, but cannot process the proceeds. If the verification process is not complete within the time period specified, the institution shall return loan proceeds. In addition, the institution is liable for an interim disbursement if verification shows that a student received an overpayment or if the student fails to complete verification (34 CFR sections 668.58, 668.60(b)(3), and 668.61)). Condition: For certain students selected for verification testing, federal awards were disbursed prior to the completion of the required verification procedures. In addition, instances in which verification status was not correctly coded in the COD system were identified. Cause: Administrative oversight. Effect or Potential Effect: Federal awards were not disbursed in accordance with federal regulations and the University was not in compliance with verification compliance requirements. Questioned Costs: Indeterminable. Context: We noted the following exceptions: • For 6 of 60 students tested, the University disbursed federal awards prior to completing appropriate verification procedures. • For 2 of 60 students tested, the University did not correctly code the student’s verification status in the COD system. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-009 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its procedures to ensure that the required verification procedures are completed prior to disbursement of federal awards. Views of Responsible Officials and Planned Corrective Actions: The University contracted with Inceptia on 2/5/2020, and Inceptia started completing verification for SAU on 2/18/2020. Inceptia' s Verification Gateway platform provides an automated solution to gather information and documentation required for Financial Aid Verification. Inceptia uses innovative technology to apply progressive rules for automatically or manually approving verification. Furthermore, it provides efficient and effective processes to help institutions remain compliant by organizing documents, streamlining award packaging, and allowing staff to manage the verification process. It provides the institution with the internal controls it needs over its Title IV funding. The Financial Aid Staff also can manually verify students if needed. With Colleague and Inceptia, SAU now has a more unified operating system for systematic processes. If a student has been flagged for verification, Colleague will not allow staff to award the student financial aid. One of the award eligibility rules is "Verification Complete." If students fail to pass this rule, they will not be awarded financial aid. Colleague gives the Financial Aid Staff greater control over the disbursal of Title IV funds and prevents the FAO from disbursing aid to students who are ineligible to receive it.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): A. Activities Allowed or Unallowed, B. Allowable Cost and Cost Principles, C. Cash Management, E. Eligibility, F. Equipment and Real Property Management, G. Matching, Level of Effort and Earmarking, H. Period of Performance, I. Procurement, Suspension and Debarment, L. Reporting, and N. Special Tests and Provisions - Federal regulations require that the University implement internal controls and policies and procedures over compliance with respect to all federal funding requirements. Condition: During the current year, the University did not have appropriate internal controls in place to ensure federal programs are properly administered in accordance with the respective Federal compliance requirements. Given the overall lack of internal controls surrounding the administration of federal programs during the year, federal expenditure reconciliations were not performed, and management was unable to provide documentation supporting the University’s compliance with certain requirements that are considered direct and material to the University’s major federal programs. Cause: Insufficient internal controls and lack of administrative oversight regarding the compliance and administration over federal funding. Effect or Potential Effect: We were unable to determine whether the University was in compliance with certain compliance requirements for the year ended June 30, 2021. This resulted in a disclaimer of opinion on all 4 major federal programs for the year ended June 30, 2021. Questioned Costs: Indeterminable. Context: During our audit procedures, we noted the following: • Sufficient, appropriate documentation supporting certain expenditures incurred (including whether incurred during the period of performance), as well as the approval and disbursement of federal funds expended could not be provided by management. • The University was unable to appropriately reconcile federal drawdowns to expenditures incurred within the general ledger. • Documentation supporting the appropriate eligibility of students under certain federal awards could not be provided by management. • Equipment and property purchased with federal funds were not appropriately tagged, tracked and inventoried as required. • Documentation supporting that level of effort requirements were met for identified key personnel could not be provided by management. Additionally, supporting documentation for matching and earmarking could not be provided by management, as applicable. • Effort certifications for payroll costs charged to certain federal awards were not completed by personnel as required. • Sufficient, appropriate documentation supporting compliance with appropriate federal procurement, suspension and debarment requirements could not be provided by management. • Sufficient, appropriate documentation supporting compliance with reporting requirements could not be provided for certain federal programs. • Documentation supporting compliance with certain special tests and provision requirements could not be provided by management. Repeat Finding: No similar findings identified in the prior year.   Recommendation: We recommend that the University evaluates its procedures and internal controls and implement changes to ensure that federal funds are being administered in accordance with federal regulations and that the appropriate documentation supporting its compliance is formally prepared, reviewed and retained. Views of Responsible Officials and Planned Corrective Actions: University administration recognizes the significant role of internal controls throughout the institution including fiscal, administrative and programmatic operations. The university’s internal control objectives and related risks can be broadly classified into one or more of the following three categories: • Operations - Effectiveness and efficiency of operations • Reporting - Reliability of reporting for internal and external use • Compliance - Compliance with applicable laws and regulations Based on the institutions internal control objective’s, the Office of Sponsored Program has prepared its internal control plan in a framework which addresses the five components and 17 principles of internal controls as outlined in GAO’s Standard for Internal Controls. Additionally, retention policies have been put in place to ensure all drawdowns are supported by allowable expenditures and the records are maintained in accordance with the standards of the granting agencies. The grants accountant in coordination with the office of sponsored programs manages external grants awards through the creation of internal spending accounts, performs quarterly monitoring of financial activity in Colleague Finance (or more frequently when dictated by reporting requirements), obtains grant payments from sponsors, and creates and submits financial reports. The Office of Sponsored Programs has updated the External Award Policy and Procedures Manual which outlines the process for conducting reconciliations of grants for reporting and yearend processes. Updated policy and procedures manuals, Internal control policies and retention control policies as it relates to sponsored programs have been established to ensure the reliability and integrity of financial information. The Institutions internal control policy will ensure that management has accurate, timely, and complete information, including accounting records, in order to plan, monitor and report grant awards accurately.

Federal Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - Per Uniform Guidance, §200.510(b), the auditee shall also prepare a schedule of expenditures of Federal awards (“Schedule”) for the period covered by the auditee's financial statements. While not required, the auditee may choose to provide information requested by Federal awarding agencies and pass-through entities to make the schedule easier to use. For example, when a Federal program has multiple award years, the auditee may list the amount of Federal awards expended for each award year separately. At a minimum, the Schedule shall: • List individual Federal programs by Federal agency. For a cluster of programs, provide the cluster name, list individual Federal programs within the cluster of programs, and provide the applicable Federal agency name. For the Research and Development Cluster, total Federal awards expended must be shown either by individual Federal award or by Federal agency and major subdivision within the Federal agency. • For Federal awards received as a subrecipient, the name of the pass-through entity and identifying number assigned by the pass-through entity must be included. • Provide total Federal awards expended for each individual Federal program and the Assistance Listings Number (“ALN”) or other identifying number when the Assistance Listings information is not available. For a cluster of programs also provide the total for the cluster. • Include the total amount provided to subrecipients from each Federal program. • For loan or loan guarantee programs, identify in the notes to the schedule the balances outstanding at the end of the audit period. This is in addition to including the total Federal awards expended for loan or loan guarantee programs in the schedule. Condition: During our audit procedures, we noted that the University did not complete the Schedule timely or accurately and the Schedule was also not properly reviewed by management prior to being provided for audit purposes. Cause: Insufficient internal controls and administrative oversight with respect to the timely preparation and review of Schedule. Effect: The University is not in compliance with reporting requirements. Questioned Costs: Indeterminable. Context: The initial Schedule received by management excluded certain federal programs and expenditures that were applicable to the current year. Additionally, the Schedule did not include appropriate federal program names, ALNs, cluster identification, pass through entity identifiers or subrecipient information. Identification as a Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend that the University enhance its internal controls, policies and procedures to ensure that the Schedule is appropriately prepared and properly reviewed during the year-end financial statement close process. Views of Responsible Officials and Planned Corrective Actions: The enhanced internal controls and policies and procedures now in place over the financial reporting process will aid current management in the accurate and timely completion of the Schedule of Expenditures of Federal Awards (SEFA). Additionally, current management has reviewed the reporting requirements for the SEFA and going forward, grant setup procedures will include a checklist that will identify the correct federal grant name (and cluster, if applicable), assistance listing number and total expenditure amount per program to ensure accuracy in reporting on the SEFA. Additionally, further review will be conducted by the Controller and Vice President of Finance to ensure accuracy.

Program Information: Student Financial Assistance Cluster (ALN: Various), Title III Strengthening Historically Black Colleges and Universities Program (ALN: 84.031B), TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: Various) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting - The Office of Management and Budget (“OMB”) requires recipients and subrecipients with fiscal year ends of June 30, 2021 to submit Single Audit reports to the Federal Audit Clearinghouse within the required time frame. Condition: The University did not submit the June 30, 2021 Single Audit to the Federal Audit Clearinghouse by the required deadline. Cause: Insufficient internal controls and lack of administrative oversight with respect to maintaining adequate documentation needed to complete the University’s financial statement audit and Single Audit. Effect or Potential Effect: The University is not in compliance with Single Audit reporting deadlines. Questioned Costs: None. Context: The University did not submit the Single Audit report as of June 30, 2021 within the required timeframe. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-015 in the prior year schedule of findings and questioned costs. Recommendation: We recommend the University enhance its internal controls and procedures to ensure that adequate and accurate documentation is maintained in order to complete financial and compliance audits by the required deadline. Views of Responsible Officials and Planned Corrective Actions: Given the challenges that current management faced in regard to the lack of proper accounting, document retention and internal controls over financial reporting that took place during fiscal year 2021, there were significant delays in the audit. With the implementation of the new ERP system and new internal policies being put in place this should keep future delays at a minimum. New policies and procedures are being developed to ensure the timeliness of documentation to meet required deadlines.

Program Information: Title III Strengthening Historically Black Colleges and Universities Program (“Title III”) (ALN: 84.031B),TRIO Cluster (ALN: Various) and Education Stabilization Fund - Higher Education Emergency Relief Fund (ALN: 84.425) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): C. Cash Management - When awards provide for advance payments, recipients must follow procedures to minimize the time elapsing between the transfer of funds from the U.S. Treasury and disbursement. Cash advances to a recipient organization shall be limited to the minimum amounts needed and be timed to be in accordance with the actual, immediate cash requirements of the recipient organization in carrying out the purpose of the approved program or project. The timing and amount of cash advances shall be as close as is administratively feasible to the actual disbursements by the recipient organization for direct program or project costs (2 CFR 215.22). Condition: Instance were identified during the year where the University was unable to provide a reconciliation and/or expenditure detail (which would represent the immediate cash need of the University) for cash drawdowns requested. Cause: Lack of internal controls and administrative oversight with respect to cash management requirements. Effect or Potential Effect: The University was not in compliance with the applicable requirements of the cash management compliance requirements. Federal funds were drawn in excess of program expenditures, thus not representing the actual, immediate cash requirements of the University, as required. Questioned Costs: None. Context: For federal funds drawdowns that occurred between during the current fiscal year, the cumulative amount drawn down exceeded cumulative expenditures. Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2020-017 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls to comply with cash management requirements associated with its drawdowns of federal funds. Views of Responsible Officials and Planned Corrective Actions: Significant steps have been taken to remediate this finding. A process to implement a monthly reconciliation of Title III funds and TRIO Cluster to ensure that the amount drawn down does not exceed the allowable costs. Additionally, more robust communication protocols, policies and procedures have been developed between the Grant Accounting division and the Office of Sponsored Programs, to reduce the risk of this recurring.