Audit 294539

Criteria According to 34 CFR Section 685.309(b)(2): A school shall, unless it expects to submit its next student status confirmation report to the Secretary within the next sixty days, notify the Secretary within thirty days if it discovers that a Direct Subsidized, Direct Unsubsidized, or Direct PLUS Loan has been made to or on behalf of a student who: 1) Enrolled at that school but has ceased to be enrolled on at least a half-time basis; 2) Has been accepted for enrollment at that school but failed to enroll on at least a half-time basis for the period for which the loan was intended; or 3) Has changed his or her permanent address. The Dear Colleague Letter GEN-12-6 (the “Letter”) issued by the U.S. Department of Education (“ED”) on March 30, 2012 states that in addition to student loan borrowers, Enrollment Reporting files will include two additional groups of students: Pell Grant and Perkins Loan recipients. According to 2 CFR Part 200, Appendix XI Compliance Supplement updated April 2018: Under the Pell Grant and loan programs, institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway mailboxes sent by ED via the National Student Loan Data System (“NSLDS”). The institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every 60 days. Once received, the institution must update for changes in student status, report the date the enrollment status was effective, enter the new anticipated completion date, and submit the changes electronically through the batch method or the NSLDS website. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Condition The Federal Government requires the College to report student enrollment changes to the National Student Loan Data System (“NSLDS”) within sixty days with an accurate effective date. During our testing of forty students with enrollment status changes, we noted the following: • Ten students enrollment status were reported incorrectly to NSLDS. Cause The College reports student enrollment status changes to the NSLDS through the National Student Clearinghouse (“NSC”), a third-party contractor, and is responsible for ensuring that student enrollment status changes are reported to the NSLDS in a timely and accurate manner. It is the responsibility of the Registrar to submit the enrollment status changes to NSC and to ensure that controls are in place to timely submit updates once the Registrar's office receives a student withdrawal form. Although the College has policies and procedures for transmitting information to the NSC on a bimonthly basis to ensure reporting of all students is done in a timely manner, the Registrar's office did not accurately and timely report the student enrollment status changes. The schedule for reporting to NSC is fluid and should be updated each year.   The reason for the delay in reporting was due to a problem with the College’s recently upgraded Student Information System (Campus Café) properly exporting information in required reports. After the Campus Café upgrade from a client-based to cloud system, the registrar ran the report to pull new graduates on June 6th and determined the report was not pulling the data appropriately. The College’s IT department and the vendor were both immediately consulted to resolve the issue. The problem was identified as the original pre-upgrade report could not pull any information post-upgrade, and the new cloud system did not have a similar base report that replicated the pre-upgrade report. Once the issue was identified, the report was fixed and the correct data was pulled in July, but not until after the sixty day period had passed. Effect Student enrollment status changes were not accurately reported, which may result in the students entering repayment status later than the required timeframe. Questioned Costs Not applicable Perspective The audit sample was not, and was not intended to be, statistically valid. Of thirteen students selected for testing, we noted the following ten instances of noncompliance: Number of Instances Percentage of Sample Incorrect status reported 10 77% Identification as a Repeat Finding, if applicable Not applicable. Recommendation Management should continue to strengthen their oversight of the NSLDS reporting to ensure that timely and accurate reporting of enrollment information is made to the NSLDS in order for the College to be in compliance with the requirements. Furthermore, additional emphasis should be made on late reporting. Views of Responsible Officials Montserrat College of Art, Inc. agrees with the finding and has implemented the corrective action plan listed below.

Criteria According to 34 CFR Section 685.309(b)(2): A school shall, unless it expects to submit its next student status confirmation report to the Secretary within the next sixty days, notify the Secretary within thirty days if it discovers that a Direct Subsidized, Direct Unsubsidized, or Direct PLUS Loan has been made to or on behalf of a student who: 1) Enrolled at that school but has ceased to be enrolled on at least a half-time basis; 2) Has been accepted for enrollment at that school but failed to enroll on at least a half-time basis for the period for which the loan was intended; or 3) Has changed his or her permanent address. The Dear Colleague Letter GEN-12-6 (the “Letter”) issued by the U.S. Department of Education (“ED”) on March 30, 2012 states that in addition to student loan borrowers, Enrollment Reporting files will include two additional groups of students: Pell Grant and Perkins Loan recipients. According to 2 CFR Part 200, Appendix XI Compliance Supplement updated April 2018: Under the Pell Grant and loan programs, institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway mailboxes sent by ED via the National Student Loan Data System (“NSLDS”). The institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every 60 days. Once received, the institution must update for changes in student status, report the date the enrollment status was effective, enter the new anticipated completion date, and submit the changes electronically through the batch method or the NSLDS website. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Condition The Federal Government requires the College to report student enrollment changes to the National Student Loan Data System (“NSLDS”) within sixty days with an accurate effective date. During our testing of forty students with enrollment status changes, we noted the following: • Ten students enrollment status were reported incorrectly to NSLDS. Cause The College reports student enrollment status changes to the NSLDS through the National Student Clearinghouse (“NSC”), a third-party contractor, and is responsible for ensuring that student enrollment status changes are reported to the NSLDS in a timely and accurate manner. It is the responsibility of the Registrar to submit the enrollment status changes to NSC and to ensure that controls are in place to timely submit updates once the Registrar's office receives a student withdrawal form. Although the College has policies and procedures for transmitting information to the NSC on a bimonthly basis to ensure reporting of all students is done in a timely manner, the Registrar's office did not accurately and timely report the student enrollment status changes. The schedule for reporting to NSC is fluid and should be updated each year.   The reason for the delay in reporting was due to a problem with the College’s recently upgraded Student Information System (Campus Café) properly exporting information in required reports. After the Campus Café upgrade from a client-based to cloud system, the registrar ran the report to pull new graduates on June 6th and determined the report was not pulling the data appropriately. The College’s IT department and the vendor were both immediately consulted to resolve the issue. The problem was identified as the original pre-upgrade report could not pull any information post-upgrade, and the new cloud system did not have a similar base report that replicated the pre-upgrade report. Once the issue was identified, the report was fixed and the correct data was pulled in July, but not until after the sixty day period had passed. Effect Student enrollment status changes were not accurately reported, which may result in the students entering repayment status later than the required timeframe. Questioned Costs Not applicable Perspective The audit sample was not, and was not intended to be, statistically valid. Of thirteen students selected for testing, we noted the following ten instances of noncompliance: Number of Instances Percentage of Sample Incorrect status reported 10 77% Identification as a Repeat Finding, if applicable Not applicable. Recommendation Management should continue to strengthen their oversight of the NSLDS reporting to ensure that timely and accurate reporting of enrollment information is made to the NSLDS in order for the College to be in compliance with the requirements. Furthermore, additional emphasis should be made on late reporting. Views of Responsible Officials Montserrat College of Art, Inc. agrees with the finding and has implemented the corrective action plan listed below.