Item 2022-003 Exit Counseling (Significant Deficiency) U.S. Department of Education Federal Direct Student Loans (Assistance Listing Number # 84.268) Compliance requirement: Special Tests and Provisions Criteria According to the Federal Register (34 CFR 685.304 (b) (1)), an institution must ensure exit counseling is conducted with each Federal Direct Loans Program borrower and the institution must maintain in the student borrower's file documents substantiating compliance with these requirements (34 CFR 685.304 (b)(7)). Condition We noted 16 instances where the Institute failed to document exit counseling which should have been conducted with a participating student during the award year. Cause These findings appear to be due to a deficiency in internal controls. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding special tests and provisions for the year ended September 30, 2022. Questioned Costs - None Context Of the 28 participating students subject to exit counseling included in the 40 randomly selected sample of participating students, exit counseling was not documented for 16 participating students. Identification as a repeat finding - No Recommendation We recommend the Institute continue its efforts to ensure all required exit counseling procedures are conducted and documented in compliance with U.S. Department of Education regulations. Views of Responsible Officials and Planned Corrective Actions We agree with both the finding and the recommendation. The instances of missed exit conferences with borrowers under the Federal Direct Loan Program were primarily related to students who had been dropped due to non-payment of tuition and who did not respond to our attempts to contact them for an exit conference. We understand that we failed to properly document our efforts to contact these students to schedule and perform an exit conference. We have amended our procedures to document our efforts to contact any students for which an exit conference is required and we have not been able to schedule one.
Item 2022-004 Enrollment Reporting (Significant Deficiency) U.S. Department of Education Federal Direct Student Loans (Assistance Listing Number # 84.268) Compliance requirement: Special Tests and Provisions Criteria According to the Federal Register (34 CFR 685.309 (b)), an institution is required to report a participating student's enrollment status on the Enrollment Reporting roster file in a timely manner as prescribed by U.S. Department of Education regulations. Condition We noted 2 instances where the enrollment status of a participating student in an applicable Title IV program was not reported in a timely manner. Cause These findings appear to be due to administrative oversights. Effect or Potential Effect: The effect of these findings is noncompliance with U.S. Department of Education regulations regarding special tests and provisions. Questioned Costs - None Context Of the 40 randomly selected sample of participating students, the enrollment status was not reported in a timely manner for 2 students. Identification as a repeat finding - No Recommendation We recommend that the Institute review and revise, if necessary, its current procedures and have controls in place to ensure that participating student's enrollment status on the Enrollment Reporting roster file via the National Student Loan Data System is reported in a timely manner as prescribed by U.S. Department of Education regulations. Views of Responsible Officials and Planned Corrective Actions We agree with both the finding and the recommendation. A system has been implemented to ensure that the National Student Loan Data system is updated on a timely basis as prescribed by U.S. Department of Education regulations.
Item 2022-005 Federal Direct Loan Program Student Notification (Significant Deficiency) U.S. Department of Education Federal Direct Student Loans (Assistance Listing Number # 84.268) Compliance requirement: Special Tests and Provisions Criteria According to the Federal Register (34 CFR 668.165 (a)(3)), an institution must provide notice to a participating student no earlier than 30 days before, and no later than seven days after, crediting the student's account with Federal Direct Loan Program proceeds at the institution, if the institution does not receive affirmative confirmation from the student. Condition We noted that the Institute did not send out the required notifications regarding Federal Direct Student Loan Program proceeds that had been credited to participating student's accounts within prescribed timeframes in accordance with U.S. Department of Education regulations. Cause These findings appear to be due to a deficiency in internal controls. Effect or Potential Effect: The effect of these findings is noncompliance with U.S. Department of Education regulations regarding special tests and provisions. Questioned Costs - None Context A total of 37 students who were credited with Federal Direct Loan Program proceeds during the year were included in the randomly selected sample of 40 participating students. Our testing noted that none of the students with Federal Direct Loan Program proceeds credited to their account were provided with the required notifications. Identification as a repeat finding - No Recommendation We recommend the Institute review and revise, its current procedures and have controls in place to ensure required notifications regarding Federal Direct Loan Program proceeds are provided to participating students. Views of Responsible Officials and Planned Corrective Actions We agree with both the finding and the recommendation. A system has been implemented to send out the required notifications regarding Federal Direct Student Loan Program proceeds that have been applied to a participating student?s account.
Finding 2022-001: Schedule of Federal Awards (Material Weakness) U.S. Department of Education COVID-19 Education Stabilization Fund 84.425E, 84.425F Compliance requirement: Reporting Criteria: The Uniform Guidance requires that the auditee prepare a Schedule of Federal Awards ("SEFA") for the period covered by the auditee's financial statements. The schedule shall provide the total federal awards expended for each individual Federal program and the Assistance Listing number or other identifying number when the Assistance Listing Number information is not available. Condition and Context: During our audit, we noted that the Higher Education Emergency Relief Funds ("HEERF") expended per the SEFA in the Uniform Guidance report and submitted to the Federal Audit Clearinghouse for the year ended September 30, 2021, were not properly recorded. The actual HEERF expended for the year ended September 30, 2021, was $97,066 compared to the HEERF expenditures reflected on the SEFA of $440,450. This resulted in an inaccurate SEFA being submitted to the Federal Audit Clearinghouse and the Department of Education. Cause: Internal controls over the accurate preparation and completeness of the SEFA were not operating effectively. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding reporting for the year ended September 30, 2021. An improper SEFA could result in errors in accounting, revenue recognition, and disallowed costs. Questioned costs: $0 Identification of repeat finding: No. Recommendation: We recommend that the Institute implement a formal policy for preparing the SEFA and reconciling the SEFA for accuracy and completeness to underlying accounting records. View of Responsible Officials: We agree with both the finding and the recommendation. The amount reflected in the year ended September 30,2021 SEFA was misstated due to an incorrect interpretation as to the amount to be reported as an accrual of HEERF expenditures under the Uniform Guidance for SEFA reporting. The correct amount of HEERF expenditures were included in the GAAP financial year ended September 30, 2021 financial statements. HERRF expenditures for the year ended September 30,2022 were reported correctly in both the SEFA report and the GAAP financial statements.
Finding 2022-002: Earmarking (Significant Deficiency) U.S. Department of Education COVID-19 Education Stabilization Fund 84.425E, 84.425F Compliance requirement: Earmarking Criteria: The American Rescue Plan created two new requirements that a portion of HEERF III institutional funds must be used (a) to implement evidence-based practices to monitor and suppress coronavirus in accordance with public health guidelines; and (b) conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid adjustment due to recent unemployment of a family member or independent student, or other circumstances described in section 479A of the Higher Education Act. Institutions must document how the amount of the HEERF grant spent on these two required activities was reasonable and necessary given the unique needs and circumstances of the institution. Condition and Context: During our audit procedures we noted that the entire Institutional amount awarded under ARP HEERF III was used to discharge student debt. The organization failed to earmark a portion of the award toward the two required uses. Cause: These findings appear to be due to a deficiency in internal controls. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding earmarking for the year ended September 30, 2022. Questioned costs: $0 Identification of repeat finding: No. Recommendation: We recommend that the Institute add additional procedures and implement controls to ensure that they are complying with earmarking requirements. View of Responsible Officials: We agree with both the finding and the recommendation. Procedures have been implemented to ensure that a portion of HEERF III institutional funds are used to implement evidence-based practices to monitor and suppress coronavirus in accordance with public health guidelines for the remaining ARP HEERF III award balance and that proper documentation of the funds used is maintained. The following should be noted: a) Approximately 85% of AAMI?s students attend only the school?s on- line program and no mitigation by AAMI for these students was required. b) AAMI moved into its new space which includes its classrooms in November 2020 after the start of the Coronavirus Epidemic. A review of the new space ventilation equipment, which was state of the art equipment, was performed and the ventilation system was determined to be very good and needed no enhancing. c) AAMI consistently purchased masks for students, staff and visitors. Efforts were increased to support a clean and sanitary campus through the purchase of hand sanitizer. Our office expenses increased over $100,000 from 2021 to 2022, not all of which was due to COVID-19 prevention; however, the increase in our cleaning expense which is part of that demonstrates our commitment to consistent cleaning and disinfection. d) Campus class sizes were monitored closely during the pandemic. Although AAMI did not have to alter class sizes due to standard enrollment, AAMI did require classroom occupancy to be reduced so social distancing protocols could be followed. e) Fortunately, all AAMI staff members were vaccinated prior to HEERF III; however, all staff members were urged to work remotely if they had any respiratory illness symptoms. We also provided students with the opportunity to obtain excused absences if respiratory illness treatment could be documented by a doctor. Instructors were advised to use remote learning tools for students who were unable to attend campus due to illness. Additionally, a direct outreach to financial aid applicants about the opportunity to receive financial aid adjustment due to recent unemployment of a family member or being an independent student will be performed.
Finding 2022-001: Schedule of Federal Awards (Material Weakness) U.S. Department of Education COVID-19 Education Stabilization Fund 84.425E, 84.425F Compliance requirement: Reporting Criteria: The Uniform Guidance requires that the auditee prepare a Schedule of Federal Awards ("SEFA") for the period covered by the auditee's financial statements. The schedule shall provide the total federal awards expended for each individual Federal program and the Assistance Listing number or other identifying number when the Assistance Listing Number information is not available. Condition and Context: During our audit, we noted that the Higher Education Emergency Relief Funds ("HEERF") expended per the SEFA in the Uniform Guidance report and submitted to the Federal Audit Clearinghouse for the year ended September 30, 2021, were not properly recorded. The actual HEERF expended for the year ended September 30, 2021, was $97,066 compared to the HEERF expenditures reflected on the SEFA of $440,450. This resulted in an inaccurate SEFA being submitted to the Federal Audit Clearinghouse and the Department of Education. Cause: Internal controls over the accurate preparation and completeness of the SEFA were not operating effectively. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding reporting for the year ended September 30, 2021. An improper SEFA could result in errors in accounting, revenue recognition, and disallowed costs. Questioned costs: $0 Identification of repeat finding: No. Recommendation: We recommend that the Institute implement a formal policy for preparing the SEFA and reconciling the SEFA for accuracy and completeness to underlying accounting records. View of Responsible Officials: We agree with both the finding and the recommendation. The amount reflected in the year ended September 30,2021 SEFA was misstated due to an incorrect interpretation as to the amount to be reported as an accrual of HEERF expenditures under the Uniform Guidance for SEFA reporting. The correct amount of HEERF expenditures were included in the GAAP financial year ended September 30, 2021 financial statements. HERRF expenditures for the year ended September 30,2022 were reported correctly in both the SEFA report and the GAAP financial statements.
Finding 2022-002: Earmarking (Significant Deficiency) U.S. Department of Education COVID-19 Education Stabilization Fund 84.425E, 84.425F Compliance requirement: Earmarking Criteria: The American Rescue Plan created two new requirements that a portion of HEERF III institutional funds must be used (a) to implement evidence-based practices to monitor and suppress coronavirus in accordance with public health guidelines; and (b) conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid adjustment due to recent unemployment of a family member or independent student, or other circumstances described in section 479A of the Higher Education Act. Institutions must document how the amount of the HEERF grant spent on these two required activities was reasonable and necessary given the unique needs and circumstances of the institution. Condition and Context: During our audit procedures we noted that the entire Institutional amount awarded under ARP HEERF III was used to discharge student debt. The organization failed to earmark a portion of the award toward the two required uses. Cause: These findings appear to be due to a deficiency in internal controls. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding earmarking for the year ended September 30, 2022. Questioned costs: $0 Identification of repeat finding: No. Recommendation: We recommend that the Institute add additional procedures and implement controls to ensure that they are complying with earmarking requirements. View of Responsible Officials: We agree with both the finding and the recommendation. Procedures have been implemented to ensure that a portion of HEERF III institutional funds are used to implement evidence-based practices to monitor and suppress coronavirus in accordance with public health guidelines for the remaining ARP HEERF III award balance and that proper documentation of the funds used is maintained. The following should be noted: a) Approximately 85% of AAMI?s students attend only the school?s on- line program and no mitigation by AAMI for these students was required. b) AAMI moved into its new space which includes its classrooms in November 2020 after the start of the Coronavirus Epidemic. A review of the new space ventilation equipment, which was state of the art equipment, was performed and the ventilation system was determined to be very good and needed no enhancing. c) AAMI consistently purchased masks for students, staff and visitors. Efforts were increased to support a clean and sanitary campus through the purchase of hand sanitizer. Our office expenses increased over $100,000 from 2021 to 2022, not all of which was due to COVID-19 prevention; however, the increase in our cleaning expense which is part of that demonstrates our commitment to consistent cleaning and disinfection. d) Campus class sizes were monitored closely during the pandemic. Although AAMI did not have to alter class sizes due to standard enrollment, AAMI did require classroom occupancy to be reduced so social distancing protocols could be followed. e) Fortunately, all AAMI staff members were vaccinated prior to HEERF III; however, all staff members were urged to work remotely if they had any respiratory illness symptoms. We also provided students with the opportunity to obtain excused absences if respiratory illness treatment could be documented by a doctor. Instructors were advised to use remote learning tools for students who were unable to attend campus due to illness. Additionally, a direct outreach to financial aid applicants about the opportunity to receive financial aid adjustment due to recent unemployment of a family member or being an independent student will be performed.
Item 2022-003 Exit Counseling (Significant Deficiency) U.S. Department of Education Federal Direct Student Loans (Assistance Listing Number # 84.268) Compliance requirement: Special Tests and Provisions Criteria According to the Federal Register (34 CFR 685.304 (b) (1)), an institution must ensure exit counseling is conducted with each Federal Direct Loans Program borrower and the institution must maintain in the student borrower's file documents substantiating compliance with these requirements (34 CFR 685.304 (b)(7)). Condition We noted 16 instances where the Institute failed to document exit counseling which should have been conducted with a participating student during the award year. Cause These findings appear to be due to a deficiency in internal controls. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding special tests and provisions for the year ended September 30, 2022. Questioned Costs - None Context Of the 28 participating students subject to exit counseling included in the 40 randomly selected sample of participating students, exit counseling was not documented for 16 participating students. Identification as a repeat finding - No Recommendation We recommend the Institute continue its efforts to ensure all required exit counseling procedures are conducted and documented in compliance with U.S. Department of Education regulations. Views of Responsible Officials and Planned Corrective Actions We agree with both the finding and the recommendation. The instances of missed exit conferences with borrowers under the Federal Direct Loan Program were primarily related to students who had been dropped due to non-payment of tuition and who did not respond to our attempts to contact them for an exit conference. We understand that we failed to properly document our efforts to contact these students to schedule and perform an exit conference. We have amended our procedures to document our efforts to contact any students for which an exit conference is required and we have not been able to schedule one.
Item 2022-004 Enrollment Reporting (Significant Deficiency) U.S. Department of Education Federal Direct Student Loans (Assistance Listing Number # 84.268) Compliance requirement: Special Tests and Provisions Criteria According to the Federal Register (34 CFR 685.309 (b)), an institution is required to report a participating student's enrollment status on the Enrollment Reporting roster file in a timely manner as prescribed by U.S. Department of Education regulations. Condition We noted 2 instances where the enrollment status of a participating student in an applicable Title IV program was not reported in a timely manner. Cause These findings appear to be due to administrative oversights. Effect or Potential Effect: The effect of these findings is noncompliance with U.S. Department of Education regulations regarding special tests and provisions. Questioned Costs - None Context Of the 40 randomly selected sample of participating students, the enrollment status was not reported in a timely manner for 2 students. Identification as a repeat finding - No Recommendation We recommend that the Institute review and revise, if necessary, its current procedures and have controls in place to ensure that participating student's enrollment status on the Enrollment Reporting roster file via the National Student Loan Data System is reported in a timely manner as prescribed by U.S. Department of Education regulations. Views of Responsible Officials and Planned Corrective Actions We agree with both the finding and the recommendation. A system has been implemented to ensure that the National Student Loan Data system is updated on a timely basis as prescribed by U.S. Department of Education regulations.
Item 2022-005 Federal Direct Loan Program Student Notification (Significant Deficiency) U.S. Department of Education Federal Direct Student Loans (Assistance Listing Number # 84.268) Compliance requirement: Special Tests and Provisions Criteria According to the Federal Register (34 CFR 668.165 (a)(3)), an institution must provide notice to a participating student no earlier than 30 days before, and no later than seven days after, crediting the student's account with Federal Direct Loan Program proceeds at the institution, if the institution does not receive affirmative confirmation from the student. Condition We noted that the Institute did not send out the required notifications regarding Federal Direct Student Loan Program proceeds that had been credited to participating student's accounts within prescribed timeframes in accordance with U.S. Department of Education regulations. Cause These findings appear to be due to a deficiency in internal controls. Effect or Potential Effect: The effect of these findings is noncompliance with U.S. Department of Education regulations regarding special tests and provisions. Questioned Costs - None Context A total of 37 students who were credited with Federal Direct Loan Program proceeds during the year were included in the randomly selected sample of 40 participating students. Our testing noted that none of the students with Federal Direct Loan Program proceeds credited to their account were provided with the required notifications. Identification as a repeat finding - No Recommendation We recommend the Institute review and revise, its current procedures and have controls in place to ensure required notifications regarding Federal Direct Loan Program proceeds are provided to participating students. Views of Responsible Officials and Planned Corrective Actions We agree with both the finding and the recommendation. A system has been implemented to send out the required notifications regarding Federal Direct Student Loan Program proceeds that have been applied to a participating student?s account.
Finding 2022-001: Schedule of Federal Awards (Material Weakness) U.S. Department of Education COVID-19 Education Stabilization Fund 84.425E, 84.425F Compliance requirement: Reporting Criteria: The Uniform Guidance requires that the auditee prepare a Schedule of Federal Awards ("SEFA") for the period covered by the auditee's financial statements. The schedule shall provide the total federal awards expended for each individual Federal program and the Assistance Listing number or other identifying number when the Assistance Listing Number information is not available. Condition and Context: During our audit, we noted that the Higher Education Emergency Relief Funds ("HEERF") expended per the SEFA in the Uniform Guidance report and submitted to the Federal Audit Clearinghouse for the year ended September 30, 2021, were not properly recorded. The actual HEERF expended for the year ended September 30, 2021, was $97,066 compared to the HEERF expenditures reflected on the SEFA of $440,450. This resulted in an inaccurate SEFA being submitted to the Federal Audit Clearinghouse and the Department of Education. Cause: Internal controls over the accurate preparation and completeness of the SEFA were not operating effectively. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding reporting for the year ended September 30, 2021. An improper SEFA could result in errors in accounting, revenue recognition, and disallowed costs. Questioned costs: $0 Identification of repeat finding: No. Recommendation: We recommend that the Institute implement a formal policy for preparing the SEFA and reconciling the SEFA for accuracy and completeness to underlying accounting records. View of Responsible Officials: We agree with both the finding and the recommendation. The amount reflected in the year ended September 30,2021 SEFA was misstated due to an incorrect interpretation as to the amount to be reported as an accrual of HEERF expenditures under the Uniform Guidance for SEFA reporting. The correct amount of HEERF expenditures were included in the GAAP financial year ended September 30, 2021 financial statements. HERRF expenditures for the year ended September 30,2022 were reported correctly in both the SEFA report and the GAAP financial statements.
Finding 2022-002: Earmarking (Significant Deficiency) U.S. Department of Education COVID-19 Education Stabilization Fund 84.425E, 84.425F Compliance requirement: Earmarking Criteria: The American Rescue Plan created two new requirements that a portion of HEERF III institutional funds must be used (a) to implement evidence-based practices to monitor and suppress coronavirus in accordance with public health guidelines; and (b) conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid adjustment due to recent unemployment of a family member or independent student, or other circumstances described in section 479A of the Higher Education Act. Institutions must document how the amount of the HEERF grant spent on these two required activities was reasonable and necessary given the unique needs and circumstances of the institution. Condition and Context: During our audit procedures we noted that the entire Institutional amount awarded under ARP HEERF III was used to discharge student debt. The organization failed to earmark a portion of the award toward the two required uses. Cause: These findings appear to be due to a deficiency in internal controls. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding earmarking for the year ended September 30, 2022. Questioned costs: $0 Identification of repeat finding: No. Recommendation: We recommend that the Institute add additional procedures and implement controls to ensure that they are complying with earmarking requirements. View of Responsible Officials: We agree with both the finding and the recommendation. Procedures have been implemented to ensure that a portion of HEERF III institutional funds are used to implement evidence-based practices to monitor and suppress coronavirus in accordance with public health guidelines for the remaining ARP HEERF III award balance and that proper documentation of the funds used is maintained. The following should be noted: a) Approximately 85% of AAMI?s students attend only the school?s on- line program and no mitigation by AAMI for these students was required. b) AAMI moved into its new space which includes its classrooms in November 2020 after the start of the Coronavirus Epidemic. A review of the new space ventilation equipment, which was state of the art equipment, was performed and the ventilation system was determined to be very good and needed no enhancing. c) AAMI consistently purchased masks for students, staff and visitors. Efforts were increased to support a clean and sanitary campus through the purchase of hand sanitizer. Our office expenses increased over $100,000 from 2021 to 2022, not all of which was due to COVID-19 prevention; however, the increase in our cleaning expense which is part of that demonstrates our commitment to consistent cleaning and disinfection. d) Campus class sizes were monitored closely during the pandemic. Although AAMI did not have to alter class sizes due to standard enrollment, AAMI did require classroom occupancy to be reduced so social distancing protocols could be followed. e) Fortunately, all AAMI staff members were vaccinated prior to HEERF III; however, all staff members were urged to work remotely if they had any respiratory illness symptoms. We also provided students with the opportunity to obtain excused absences if respiratory illness treatment could be documented by a doctor. Instructors were advised to use remote learning tools for students who were unable to attend campus due to illness. Additionally, a direct outreach to financial aid applicants about the opportunity to receive financial aid adjustment due to recent unemployment of a family member or being an independent student will be performed.
Finding 2022-001: Schedule of Federal Awards (Material Weakness) U.S. Department of Education COVID-19 Education Stabilization Fund 84.425E, 84.425F Compliance requirement: Reporting Criteria: The Uniform Guidance requires that the auditee prepare a Schedule of Federal Awards ("SEFA") for the period covered by the auditee's financial statements. The schedule shall provide the total federal awards expended for each individual Federal program and the Assistance Listing number or other identifying number when the Assistance Listing Number information is not available. Condition and Context: During our audit, we noted that the Higher Education Emergency Relief Funds ("HEERF") expended per the SEFA in the Uniform Guidance report and submitted to the Federal Audit Clearinghouse for the year ended September 30, 2021, were not properly recorded. The actual HEERF expended for the year ended September 30, 2021, was $97,066 compared to the HEERF expenditures reflected on the SEFA of $440,450. This resulted in an inaccurate SEFA being submitted to the Federal Audit Clearinghouse and the Department of Education. Cause: Internal controls over the accurate preparation and completeness of the SEFA were not operating effectively. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding reporting for the year ended September 30, 2021. An improper SEFA could result in errors in accounting, revenue recognition, and disallowed costs. Questioned costs: $0 Identification of repeat finding: No. Recommendation: We recommend that the Institute implement a formal policy for preparing the SEFA and reconciling the SEFA for accuracy and completeness to underlying accounting records. View of Responsible Officials: We agree with both the finding and the recommendation. The amount reflected in the year ended September 30,2021 SEFA was misstated due to an incorrect interpretation as to the amount to be reported as an accrual of HEERF expenditures under the Uniform Guidance for SEFA reporting. The correct amount of HEERF expenditures were included in the GAAP financial year ended September 30, 2021 financial statements. HERRF expenditures for the year ended September 30,2022 were reported correctly in both the SEFA report and the GAAP financial statements.
Finding 2022-002: Earmarking (Significant Deficiency) U.S. Department of Education COVID-19 Education Stabilization Fund 84.425E, 84.425F Compliance requirement: Earmarking Criteria: The American Rescue Plan created two new requirements that a portion of HEERF III institutional funds must be used (a) to implement evidence-based practices to monitor and suppress coronavirus in accordance with public health guidelines; and (b) conduct direct outreach to financial aid applicants about the opportunity to receive a financial aid adjustment due to recent unemployment of a family member or independent student, or other circumstances described in section 479A of the Higher Education Act. Institutions must document how the amount of the HEERF grant spent on these two required activities was reasonable and necessary given the unique needs and circumstances of the institution. Condition and Context: During our audit procedures we noted that the entire Institutional amount awarded under ARP HEERF III was used to discharge student debt. The organization failed to earmark a portion of the award toward the two required uses. Cause: These findings appear to be due to a deficiency in internal controls. Effect or Potential Effect: The institute was not in compliance with federal regulations regarding earmarking for the year ended September 30, 2022. Questioned costs: $0 Identification of repeat finding: No. Recommendation: We recommend that the Institute add additional procedures and implement controls to ensure that they are complying with earmarking requirements. View of Responsible Officials: We agree with both the finding and the recommendation. Procedures have been implemented to ensure that a portion of HEERF III institutional funds are used to implement evidence-based practices to monitor and suppress coronavirus in accordance with public health guidelines for the remaining ARP HEERF III award balance and that proper documentation of the funds used is maintained. The following should be noted: a) Approximately 85% of AAMI?s students attend only the school?s on- line program and no mitigation by AAMI for these students was required. b) AAMI moved into its new space which includes its classrooms in November 2020 after the start of the Coronavirus Epidemic. A review of the new space ventilation equipment, which was state of the art equipment, was performed and the ventilation system was determined to be very good and needed no enhancing. c) AAMI consistently purchased masks for students, staff and visitors. Efforts were increased to support a clean and sanitary campus through the purchase of hand sanitizer. Our office expenses increased over $100,000 from 2021 to 2022, not all of which was due to COVID-19 prevention; however, the increase in our cleaning expense which is part of that demonstrates our commitment to consistent cleaning and disinfection. d) Campus class sizes were monitored closely during the pandemic. Although AAMI did not have to alter class sizes due to standard enrollment, AAMI did require classroom occupancy to be reduced so social distancing protocols could be followed. e) Fortunately, all AAMI staff members were vaccinated prior to HEERF III; however, all staff members were urged to work remotely if they had any respiratory illness symptoms. We also provided students with the opportunity to obtain excused absences if respiratory illness treatment could be documented by a doctor. Instructors were advised to use remote learning tools for students who were unable to attend campus due to illness. Additionally, a direct outreach to financial aid applicants about the opportunity to receive financial aid adjustment due to recent unemployment of a family member or being an independent student will be performed.