FAC Explorer

Audit 301167

FY End
2023-06-30
Total Expended
$84.68M
Findings
4
Programs
6
Organization: University of Massachusetts Global-9 Month Audit (CA)
Year: 2023 Accepted: 2024-03-29
Auditor: Kpmg LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
390306 2023-001 Significant Deficiency - N
390307 2023-002 Significant Deficiency Yes N
966748 2023-001 Significant Deficiency - N
966749 2023-002 Significant Deficiency Yes N

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $77.74M Yes 2
84.063 Federal Pell Grant Program $5.78M Yes 0
84.365 English Language Acquisition State Grants $472,470 - 0
84.007 Federal Supplemental Educational Opportunity Grants $451,932 Yes 0
84.116 Fund for the Improvement of Postsecondary Education $153,696 - 0
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $81,040 Yes 0

Contacts

Name Title Type
MB5GWJCFBGC7 April Tory Auditee
7148226320 Spencer Endicott Auditor
No contacts on file

Notes to SEFA

Title: Organization Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) presents the activity of all federal award programs of the University. Because the Schedule presents only a selected portion of the operations of the University, it is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the University. For the purposes of the Schedule, federal awards include all grants and contracts entered into directly between the University and agencies and departments of the federal government and pass-through agencies. The awards are classified into major program categories in accordance with the provisions of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), for Audits of States, Local Governments, and Non-Profit Organizations. De Minimis Rate Used: N Rate Explanation: Non-Student Financial Assistance Cluster programs use a pre-determined indirect cost rate, if any. University of Massachusetts Global, a not-for-profit institution of higher learning, and its blended component unit, CBE Educational Services Company, Inc., (CBEESC) a taxable corporation (collectively, the University), are located in Orange County, California, and Washington D.C. respectively. University of Massachusetts Global is a component unit of the University of Massachusetts.
Title: Summary of Significant Accounting Policies Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) presents the activity of all federal award programs of the University. Because the Schedule presents only a selected portion of the operations of the University, it is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the University. For the purposes of the Schedule, federal awards include all grants and contracts entered into directly between the University and agencies and departments of the federal government and pass-through agencies. The awards are classified into major program categories in accordance with the provisions of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), for Audits of States, Local Governments, and Non-Profit Organizations. De Minimis Rate Used: N Rate Explanation: Non-Student Financial Assistance Cluster programs use a pre-determined indirect cost rate, if any. The accompanying schedule of expenditures of federal awards (the Schedule) presents the activity of all federal award programs of the University. Because the Schedule presents only a selected portion of the operations of the University, it is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the University. For the purposes of the Schedule, federal awards include all grants and contracts entered into directly between the University and agencies and departments of the federal government and pass-through agencies. The awards are classified into major program categories in accordance with the provisions of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), for Audits of States, Local Governments, and Non-Profit Organizations.
Title: Basis of Presentation Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) presents the activity of all federal award programs of the University. Because the Schedule presents only a selected portion of the operations of the University, it is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the University. For the purposes of the Schedule, federal awards include all grants and contracts entered into directly between the University and agencies and departments of the federal government and pass-through agencies. The awards are classified into major program categories in accordance with the provisions of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), for Audits of States, Local Governments, and Non-Profit Organizations. De Minimis Rate Used: N Rate Explanation: Non-Student Financial Assistance Cluster programs use a pre-determined indirect cost rate, if any. The information in the Schedule is prepared based on the accrual basis of accounting and is also presented in accordance with the requirements of the Uniform Guidance. Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used in the preparation of, the basic financial statements.
Title: Relationship to Federal Financial Reports Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) presents the activity of all federal award programs of the University. Because the Schedule presents only a selected portion of the operations of the University, it is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the University. For the purposes of the Schedule, federal awards include all grants and contracts entered into directly between the University and agencies and departments of the federal government and pass-through agencies. The awards are classified into major program categories in accordance with the provisions of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), for Audits of States, Local Governments, and Non-Profit Organizations. De Minimis Rate Used: N Rate Explanation: Non-Student Financial Assistance Cluster programs use a pre-determined indirect cost rate, if any. Amounts reported in the Schedule agree in all material respects with the amounts reported in the related federal financial reports.
Title: Federal Direct Loans Accounting Policies: The accompanying schedule of expenditures of federal awards (the Schedule) presents the activity of all federal award programs of the University. Because the Schedule presents only a selected portion of the operations of the University, it is not intended to, and does not, present the financial position, changes in net assets, or cash flows of the University. For the purposes of the Schedule, federal awards include all grants and contracts entered into directly between the University and agencies and departments of the federal government and pass-through agencies. The awards are classified into major program categories in accordance with the provisions of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance), for Audits of States, Local Governments, and Non-Profit Organizations. De Minimis Rate Used: N Rate Explanation: Non-Student Financial Assistance Cluster programs use a pre-determined indirect cost rate, if any. Federal Direct Loans are made by the Department of Education. The University is responsible for the performance of certain administrative duties under the Direct Loan program including origination and disbursement of loans. A summary of these loans for the year ended June 30, 2023 is as follows: (see the Notes to the SEFA for table)

Finding Details

Finding 2023-001
Federal Program: Student Financial Assistance Cluster Assistance Listing Number: 84.268 Federal Direct Student Loans Program Federal Agency: Department of Education Award Year: July 1, 2022 – June 30, 2023 Criteria: Per 34 CFR Section 668.165, before an institution disburses title IV, HEA program funds for any award year, the institution must notify a student of the amount of funds that the student or his or her parent can expect to receive under each title IV, HEA program, and how and when those funds will be disbursed. If those funds include Direct Loan program funds, the notice must indicate which funds are from subsidized loans, which are from unsubsidized loans, and which are from PLUS loans. Condition and Context: During our testwork over 40 students that received title IV funds, HEA program funds during the period, we identified one student who did not receive an award letter prior to their first aid disbursement. Cause and Effect: The University did not have a control in place to confirm the disbursement was sent prior to the award letter. As such, the disbursement was sent to the student prior to the award notification. Questioned Costs: None noted. Whether the sampling was a statistically valid sample: The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding: No. Recommendation: We recommend that the University enhance its internal controls to confirm all award notifications have been sent prior to disbursements of Title IV aid. View of Responsible Officials: University of Massachusetts Global concurs with this finding. To address this, a new control has been added beginning with the 2023-2024 fiscal year. The new step added is for a systems specialist to confirm that the batch process for award notifications has been completed, and that the notifications have been sent to students prior to disbursements of Title IV aid.
Finding 2023-002
Federal Program: Student Financial Assistance Cluster Assistance Listing Number: 84.268 Federal Direct Student Loans Program Federal Agency: Department of Education Award Year: July 1, 2022 – June 30, 2023 Criteria: Per 34 CFR Section 685.309, institutions with direct loan programs must complete and return to the National Student Loan Data System for Students (NSLDS) within 30 days the enrollment reporting roster file provided by NSLDS, unless the school expects to complete the next roster within 60 days, then they must return it within 60 days. The institution must update changes in student status, report the date the enrollment status was effective, enter the new anticipated completion date, and then submit changes electronically to the NSLDS, for the purpose of providing complete and accurate data to lenders regarding enrollment status so they may properly determine when repayment of the loans should begin. Any errors in enrollment information identified and returned by NSLDS in an Error/Acknowledgment file should be corrected and resubmitted within 10 days. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Condition and Context: During our testwork over 40 students that withdrew or graduated during the period, we identified six students for which the University did not accurately and report timely the enrollment status of each student to NSLDS and one student for which the University did not correct and report the enrollment status to NSLDS within 10 days after they appeared in the Error/Acknowledgment file. Cause and Effect: The University’s control failed in detecting that untimely and inaccurate information was reported to NSLDS. Questioned Costs: None noted.Whether the sampling was a statistically valid sample: The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding: Yes. Recommendation: We recommend that the University enhance its internal controls to ensure all information submitted to NSLDS is reviewed for accuracy on a timely basis. View of Responsible Officials: University of Massachusetts Global concurs with this finding. The University utilizes the services of National Student Clearinghouse to report student status data to the NSLDS. There were 6 students reported as graduated beyond the 60 days, and 1 student with an error that was not corrected within 10 days. To address this, the Office of the Registrar now has access to NSLDS to ensure that what is reported to NSC is also updated accurately in NLSDS. The Office of the Registrar will also change the reporting dates so that it best aligns with the conferral dates. In addition, the Office of the Registrar will have an additional QA process so that any time status changes are compared against the NSC report that is generated and submitted.
Finding 2023-001
Federal Program: Student Financial Assistance Cluster Assistance Listing Number: 84.268 Federal Direct Student Loans Program Federal Agency: Department of Education Award Year: July 1, 2022 – June 30, 2023 Criteria: Per 34 CFR Section 668.165, before an institution disburses title IV, HEA program funds for any award year, the institution must notify a student of the amount of funds that the student or his or her parent can expect to receive under each title IV, HEA program, and how and when those funds will be disbursed. If those funds include Direct Loan program funds, the notice must indicate which funds are from subsidized loans, which are from unsubsidized loans, and which are from PLUS loans. Condition and Context: During our testwork over 40 students that received title IV funds, HEA program funds during the period, we identified one student who did not receive an award letter prior to their first aid disbursement. Cause and Effect: The University did not have a control in place to confirm the disbursement was sent prior to the award letter. As such, the disbursement was sent to the student prior to the award notification. Questioned Costs: None noted. Whether the sampling was a statistically valid sample: The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding: No. Recommendation: We recommend that the University enhance its internal controls to confirm all award notifications have been sent prior to disbursements of Title IV aid. View of Responsible Officials: University of Massachusetts Global concurs with this finding. To address this, a new control has been added beginning with the 2023-2024 fiscal year. The new step added is for a systems specialist to confirm that the batch process for award notifications has been completed, and that the notifications have been sent to students prior to disbursements of Title IV aid.
Finding 2023-002
Federal Program: Student Financial Assistance Cluster Assistance Listing Number: 84.268 Federal Direct Student Loans Program Federal Agency: Department of Education Award Year: July 1, 2022 – June 30, 2023 Criteria: Per 34 CFR Section 685.309, institutions with direct loan programs must complete and return to the National Student Loan Data System for Students (NSLDS) within 30 days the enrollment reporting roster file provided by NSLDS, unless the school expects to complete the next roster within 60 days, then they must return it within 60 days. The institution must update changes in student status, report the date the enrollment status was effective, enter the new anticipated completion date, and then submit changes electronically to the NSLDS, for the purpose of providing complete and accurate data to lenders regarding enrollment status so they may properly determine when repayment of the loans should begin. Any errors in enrollment information identified and returned by NSLDS in an Error/Acknowledgment file should be corrected and resubmitted within 10 days. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Condition and Context: During our testwork over 40 students that withdrew or graduated during the period, we identified six students for which the University did not accurately and report timely the enrollment status of each student to NSLDS and one student for which the University did not correct and report the enrollment status to NSLDS within 10 days after they appeared in the Error/Acknowledgment file. Cause and Effect: The University’s control failed in detecting that untimely and inaccurate information was reported to NSLDS. Questioned Costs: None noted.Whether the sampling was a statistically valid sample: The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding: Yes. Recommendation: We recommend that the University enhance its internal controls to ensure all information submitted to NSLDS is reviewed for accuracy on a timely basis. View of Responsible Officials: University of Massachusetts Global concurs with this finding. The University utilizes the services of National Student Clearinghouse to report student status data to the NSLDS. There were 6 students reported as graduated beyond the 60 days, and 1 student with an error that was not corrected within 10 days. To address this, the Office of the Registrar now has access to NSLDS to ensure that what is reported to NSC is also updated accurately in NLSDS. The Office of the Registrar will also change the reporting dates so that it best aligns with the conferral dates. In addition, the Office of the Registrar will have an additional QA process so that any time status changes are compared against the NSC report that is generated and submitted.