FAC Explorer

Audit 300119

FY End
2023-06-30
Total Expended
$46.64M
Findings
6
Programs
8
Organization: Limestone University (SC)
Year: 2023 Accepted: 2024-03-28
Auditor: Cherry Bekaert LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
388329 2023-002 - - N
388330 2023-002 - - N
388331 2023-003 - - P
964771 2023-002 - - N
964772 2023-002 - - N
964773 2023-003 - - P

Programs

ALN Program Spent Major Findings
10.766 Community Facilities Loans and Grants $27.59M Yes 1
84.268 Federal Direct Student Loans $12.74M Yes 1
84.063 Federal Pell Grant Program $3.87M Yes 1
84.425 Education Stabilization Fund $552,393 Yes 0
84.111 Funds for the Improvement of Postsecondary Education (lab Grant) $423,196 - 0
84.031 Higher Education_institutional Aid $173,397 - 0
84.007 Federal Supplemental Educational Opportunity Grants $171,917 Yes 0
84.033 Federal Work-Study Program $158,451 Yes 0

Contacts

Name Title Type
ZE7BFE5NNDC3 Jeremy Whitaker Auditee
8644884539 Roselle Bonnoitt Auditor
No contacts on file

Notes to SEFA

Title: Note 1- Basis of presentation Accounting Policies: Basis of Accounting - Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: Indirect Cost Rate – The University has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of Limestone University (the “University”) under programs of the federal government for the year ended June 30, 2023. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). Because the Schedule presents only a selected portion of the operations of the University, it is not intended to and does not present the statements of financial position, activities, and cash flows of the University.
Title: Note 3- Federal Direct Student Loans Accounting Policies: Basis of Accounting - Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: Indirect Cost Rate – The University has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The Federal Direct Student Loan program provides loan capital directly from the federal government (rather than through private lenders) to vocational, undergraduate, and graduate students and their parents. The loans are made directly from the federal government; therefore, there is no loan balance recorded at the University level.
Title: Note 4- Higher Education Emergency Relief Fund Accounting Policies: Basis of Accounting - Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Negative amounts, if any, shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: Indirect Cost Rate – The University has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The CARES Act created a Higher Education Emergency Relief Fund (“HEERF”) to provide financial relief to students and institutions who were impacted by the COVID-19 pandemic. The Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA) and the American Rescue Plan (ARP) provided additional rounds of HEERF (II and III). The HEERF funds contained three components, an institutional award, a student aid award, and a strengthening institution program award. The following cumulative amounts have been awarded as HEERF as of June 30, 2023: See notes to SEFA for the table/chart. HEERF funds expended during the year ended June 30, 2023 are as follows: See notes to SEFA for the table/chart.

Finding Details

Finding 2023-002
Finding 2023-002 – Student Financial Aid Cluster, Assistance Listing # 84.063 and 84.268 Compliance Requirement: Special Test and Provisions – Enrollment Reporting Condition: The University is required to send changes in attendance levels, graduated, withdrew, dropped out, or enrolled changes to the NSLDS within 60 days of the change. Criteria: The University is required to send changes in attendance levels, graduated, withdrew, dropped out, or enrolled changes to the NSLDS within 60 days of the change. Cause: The University had not reported changes of withdrawn students to the NSLDS as required under the Uniform Grant Guidance for the year ended June 30, 2023. The status information reported in the University’s system, Jenzabar (withdrawal date and last date of academic activity), was incorrectly extracted for the submission to the National Student Clearinghouse and NSLDS, which created discrepancies between the statuses. The University was unaware of this technical issue and did not have another monitoring mechanism in place that would have alerted them to this deficiency in the system reporting. Context: The University did not send status changes related to seven withdrawn students, had four incorrect status effective dates, and sent two changes related to withdrawn students to the National Student Loan Data System (“NSLDS”) with incorrect effective dates and after 60 days. Nine of the thirteen findings occurred during the paused data reporting period of July 20, 2022 through February 28, 2023 as stated within the 2023 Compliance Supplement. Effect: The University did not report withdraw changes to the NSLDS timely. Recommendation: The University should put in place a process to timely capture withdrawn student changes so that they can be reported to the NSLDS. Management Response: The University concurs with this finding. Corrective Action Plan: See attached management’s corrective action plan.
Finding 2023-002
Finding 2023-002 – Student Financial Aid Cluster, Assistance Listing # 84.063 and 84.268 Compliance Requirement: Special Test and Provisions – Enrollment Reporting Condition: The University is required to send changes in attendance levels, graduated, withdrew, dropped out, or enrolled changes to the NSLDS within 60 days of the change. Criteria: The University is required to send changes in attendance levels, graduated, withdrew, dropped out, or enrolled changes to the NSLDS within 60 days of the change. Cause: The University had not reported changes of withdrawn students to the NSLDS as required under the Uniform Grant Guidance for the year ended June 30, 2023. The status information reported in the University’s system, Jenzabar (withdrawal date and last date of academic activity), was incorrectly extracted for the submission to the National Student Clearinghouse and NSLDS, which created discrepancies between the statuses. The University was unaware of this technical issue and did not have another monitoring mechanism in place that would have alerted them to this deficiency in the system reporting. Context: The University did not send status changes related to seven withdrawn students, had four incorrect status effective dates, and sent two changes related to withdrawn students to the National Student Loan Data System (“NSLDS”) with incorrect effective dates and after 60 days. Nine of the thirteen findings occurred during the paused data reporting period of July 20, 2022 through February 28, 2023 as stated within the 2023 Compliance Supplement. Effect: The University did not report withdraw changes to the NSLDS timely. Recommendation: The University should put in place a process to timely capture withdrawn student changes so that they can be reported to the NSLDS. Management Response: The University concurs with this finding. Corrective Action Plan: See attached management’s corrective action plan.
Finding 2023-003
Finding 2023-003 – U.S. Department of Agriculture – Community Facilities Loan and Grant, CFDA# 10.766 Compliance Requirement: Other Information Condition: U.S. Department of Agriculture (“USDA”) covenants and requirements were not adhered to. Criteria: Borrowers are required to fund reserves, maintain insurance, deposit funds in Federally insured banks, meet financial covenants, maintain sufficient debt service ratios, and in some cases comply with additional requirements established as part of the loan approval process. These requirements indicate the continuing compliance requirements that borrowers must meet. Cause: The University had turnover in the business department and non-quantitative requirements were not closely monitored. Context: The University was not able to meet covenants during the year but obtained a covenant waiver through fiscal year 2024. Additionally, the University did not meet the all the requirements per the USDA loan agreement dated as of December 16, 2021. The following requirements were not met during the fiscal year ended June 30, 2023: 1. Internally produced financial statements within 45 days (Article V, 5.8 (b)) 2. Compliance certificate (Article V, 5.8 (c)) 3. Budget provided 30 days prior to the beginning of the new fiscal year (Article V, 5.8 (d)) 4. Student housing rent roll (Article V, 5.16) Effect: Lack of compliance with loan covenants and requirements. Recommendation: The University’s management should read and follow all USDA loan covenants and requirements. Management Response: The University concurs with this finding. Corrective Action Plan: See attached management’s corrective action plan.
Finding 2023-002
Finding 2023-002 – Student Financial Aid Cluster, Assistance Listing # 84.063 and 84.268 Compliance Requirement: Special Test and Provisions – Enrollment Reporting Condition: The University is required to send changes in attendance levels, graduated, withdrew, dropped out, or enrolled changes to the NSLDS within 60 days of the change. Criteria: The University is required to send changes in attendance levels, graduated, withdrew, dropped out, or enrolled changes to the NSLDS within 60 days of the change. Cause: The University had not reported changes of withdrawn students to the NSLDS as required under the Uniform Grant Guidance for the year ended June 30, 2023. The status information reported in the University’s system, Jenzabar (withdrawal date and last date of academic activity), was incorrectly extracted for the submission to the National Student Clearinghouse and NSLDS, which created discrepancies between the statuses. The University was unaware of this technical issue and did not have another monitoring mechanism in place that would have alerted them to this deficiency in the system reporting. Context: The University did not send status changes related to seven withdrawn students, had four incorrect status effective dates, and sent two changes related to withdrawn students to the National Student Loan Data System (“NSLDS”) with incorrect effective dates and after 60 days. Nine of the thirteen findings occurred during the paused data reporting period of July 20, 2022 through February 28, 2023 as stated within the 2023 Compliance Supplement. Effect: The University did not report withdraw changes to the NSLDS timely. Recommendation: The University should put in place a process to timely capture withdrawn student changes so that they can be reported to the NSLDS. Management Response: The University concurs with this finding. Corrective Action Plan: See attached management’s corrective action plan.
Finding 2023-002
Finding 2023-002 – Student Financial Aid Cluster, Assistance Listing # 84.063 and 84.268 Compliance Requirement: Special Test and Provisions – Enrollment Reporting Condition: The University is required to send changes in attendance levels, graduated, withdrew, dropped out, or enrolled changes to the NSLDS within 60 days of the change. Criteria: The University is required to send changes in attendance levels, graduated, withdrew, dropped out, or enrolled changes to the NSLDS within 60 days of the change. Cause: The University had not reported changes of withdrawn students to the NSLDS as required under the Uniform Grant Guidance for the year ended June 30, 2023. The status information reported in the University’s system, Jenzabar (withdrawal date and last date of academic activity), was incorrectly extracted for the submission to the National Student Clearinghouse and NSLDS, which created discrepancies between the statuses. The University was unaware of this technical issue and did not have another monitoring mechanism in place that would have alerted them to this deficiency in the system reporting. Context: The University did not send status changes related to seven withdrawn students, had four incorrect status effective dates, and sent two changes related to withdrawn students to the National Student Loan Data System (“NSLDS”) with incorrect effective dates and after 60 days. Nine of the thirteen findings occurred during the paused data reporting period of July 20, 2022 through February 28, 2023 as stated within the 2023 Compliance Supplement. Effect: The University did not report withdraw changes to the NSLDS timely. Recommendation: The University should put in place a process to timely capture withdrawn student changes so that they can be reported to the NSLDS. Management Response: The University concurs with this finding. Corrective Action Plan: See attached management’s corrective action plan.
Finding 2023-003
Finding 2023-003 – U.S. Department of Agriculture – Community Facilities Loan and Grant, CFDA# 10.766 Compliance Requirement: Other Information Condition: U.S. Department of Agriculture (“USDA”) covenants and requirements were not adhered to. Criteria: Borrowers are required to fund reserves, maintain insurance, deposit funds in Federally insured banks, meet financial covenants, maintain sufficient debt service ratios, and in some cases comply with additional requirements established as part of the loan approval process. These requirements indicate the continuing compliance requirements that borrowers must meet. Cause: The University had turnover in the business department and non-quantitative requirements were not closely monitored. Context: The University was not able to meet covenants during the year but obtained a covenant waiver through fiscal year 2024. Additionally, the University did not meet the all the requirements per the USDA loan agreement dated as of December 16, 2021. The following requirements were not met during the fiscal year ended June 30, 2023: 1. Internally produced financial statements within 45 days (Article V, 5.8 (b)) 2. Compliance certificate (Article V, 5.8 (c)) 3. Budget provided 30 days prior to the beginning of the new fiscal year (Article V, 5.8 (d)) 4. Student housing rent roll (Article V, 5.16) Effect: Lack of compliance with loan covenants and requirements. Recommendation: The University’s management should read and follow all USDA loan covenants and requirements. Management Response: The University concurs with this finding. Corrective Action Plan: See attached management’s corrective action plan.