FAC Explorer

Audit 325887

FY End
2022-06-30
Total Expended
$4.37M
Findings
14
Programs
7
Organization: Southwestern Christian University, Inc. (OK)
Year: 2022 Accepted: 2024-10-24
Auditor: Capincrouse LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
503675 2022-003 Material Weakness - G
503676 2022-004 Significant Deficiency Yes L
503677 2022-004 Significant Deficiency Yes L
503678 2022-005 - - C
503679 2022-005 - - C
503680 2022-006 - Yes N
503681 2022-006 - Yes N
1080117 2022-003 Material Weakness - G
1080118 2022-004 Significant Deficiency Yes L
1080119 2022-004 Significant Deficiency Yes L
1080120 2022-005 - - C
1080121 2022-005 - - C
1080122 2022-006 - Yes N
1080123 2022-006 - Yes N

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $1.76M Yes 3
84.425 Covid-19 Education Stabilization Fund Heerf - Student Aid Portion $1.01M Yes 0
84.063 Federal Pell Grant Program $763,081 Yes 3
84.425 Covid-19 Education Stabilization Fund Heerf - Institutional Portion $690,630 Yes 1
84.425 Covid-19 Education Stabilization Fund Heerf - Strengthening Institutions Program $69,211 Yes 0
84.033 Federal Work-Study Program $43,511 Yes 0
84.007 Federal Supplemental Educational Opportunity Grants $30,000 Yes 0

Contacts

Name Title Type
YCX3TUXBQTZ5 Rita Palmer Auditee
4057897661 Chris Dukate, CPA Auditor
No contacts on file

Notes to SEFA

Title: RELATIONSHIP TO FINANCIAL STATEMENTS Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) includes the federal grant activity of Southwestern Christian University, Inc. (University) under programs of the federal government for the year ending June 30, 2022. The information in the schedule is presented in accordance with the requirements of the Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (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. Expenditures in 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 shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. If the University is required to match certain federal assistance, as defined by the grant agreements, no such matching has been included as expenditures in the schedule. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. See the Notes to the SEFA for chart/table.
Title: SUBRECIPIENTS, NON-CASH ASSISTANCE, FEDERAL INSURANCE, LOANS, AND LOAN GUARANTEES Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) includes the federal grant activity of Southwestern Christian University, Inc. (University) under programs of the federal government for the year ending June 30, 2022. The information in the schedule is presented in accordance with the requirements of the Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (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. Expenditures in 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 shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. If the University is required to match certain federal assistance, as defined by the grant agreements, no such matching has been included as expenditures in the schedule. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The University did not provide any federal funds to subrecipients nor did they receive any federal non-cash assistance, insurance, or loan guarantees. The University did receive a Small Business Administration (SBA) Paycheck Protection Program (PPP) loan in the amount of $799,600. (See Note 2 to the financial statements). The SBA has indicated that PPP loans are not subject to Uniform Guidance audit requirements and therefore, the PPP loan is not included in the schedule.
Title: HEIGHTENED CASH MONITORING COMPLIANCE Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) includes the federal grant activity of Southwestern Christian University, Inc. (University) under programs of the federal government for the year ending June 30, 2022. The information in the schedule is presented in accordance with the requirements of the Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (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. Expenditures in 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 shown on the schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. If the University is required to match certain federal assistance, as defined by the grant agreements, no such matching has been included as expenditures in the schedule. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The University is currently operating under Heightened Cash Monitoring 2 (HCM 2). As part of the audit procedures, the University's compliance with HCM 2 was tested, including the administration of the heightened cash monitoring payment method, disbursing aid and paying out credit balances before requesting reimbursement of Title IV aid funds, and notification requirements. See non-compliance described in finding 2022-005.

Finding Details

Finding 2022-003
Higher Education Emergency Relief Fund (HEERF) Earmarking Material Weakness DEPARTMENT OF EDUCATION ALN #: 84.425E and 84.425F Federal Award Identification #: P425F202243 Condition: The University had drawn all their authorized HEERF institutional funds by the end of the performance period but did not fully spend the student portion, therefore the University did not meet the earmarking requirements for the minimum amount of HEERF funds spent on student grants. Criteria: CARES Act section 18004 (a) (1), CRRSAA Act section 314 (a) (1), ARP Act Questioned Costs: $94,893 Context: The University did not have support for providing $76,991 of grants to students from the HEERF student portion (84.425E) which represents the University's remaining available authorization at the end of the performance period. Due to not fully spending this student portion, this disallowed a prorated amount totaling $94,893 of the institutional portion (84.425F) given the conditions and earmarking requirements for HEERF. Cause: Inadequate reconciliation of expenditures and drawdowns and lack of review at the end of the period of performance. Effect: Since the student emergency grant minimum was not met, the University is not eligible for the full allocation of the institutional portion of the HEERF funds. Identification as repeat finding, if applicable: N/A Recommendation: We recommend the University return funds as applicable and as directed by the Department of Education. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-004
Common Origination and Disbursement (COD) Reporting Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The anticipated disbursement dates in COD were not updated with the actual dates of disbursement when reporting disbursement records for Pell and FDL to COD. Criteria: 34CFR 668.164(a) Questioned Costs: $-0- Context: Out of 60 students tested, including both Pell and FDL disbursements, 10 students had COD records that did not reflect the actual disbursement date per the student account statement for Spring 2022 disbursements. Due to the error rate, this is classified as a significant deficiency. Cause: The anticipated disbursement dates in COD were not updated to the actual dates that Pell and FDL were disbursed to the students' accounts. Effect: Inaccurate FDL reporting can impact a student's interest accumulating period based on the dates of the loan disbursement dates as well as the monitoring of FDL aggregate limits. Inaccurate Pell reporting could allow a student to exceed their lifetime limit. Identification as repeat finding, if applicable: 2021-003 Recommendation: We recommend that procedures be implemented to ensure that disbursement reporting to COD be reflective of the actual disbursement dates. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-004
Common Origination and Disbursement (COD) Reporting Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The anticipated disbursement dates in COD were not updated with the actual dates of disbursement when reporting disbursement records for Pell and FDL to COD. Criteria: 34CFR 668.164(a) Questioned Costs: $-0- Context: Out of 60 students tested, including both Pell and FDL disbursements, 10 students had COD records that did not reflect the actual disbursement date per the student account statement for Spring 2022 disbursements. Due to the error rate, this is classified as a significant deficiency. Cause: The anticipated disbursement dates in COD were not updated to the actual dates that Pell and FDL were disbursed to the students' accounts. Effect: Inaccurate FDL reporting can impact a student's interest accumulating period based on the dates of the loan disbursement dates as well as the monitoring of FDL aggregate limits. Inaccurate Pell reporting could allow a student to exceed their lifetime limit. Identification as repeat finding, if applicable: 2021-003 Recommendation: We recommend that procedures be implemented to ensure that disbursement reporting to COD be reflective of the actual disbursement dates. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-005
Credit Balances and Heightened Cash Monitoring 2 (HCM2) Compliance DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The College is required to pay out credit balances created by federal aid before submitting requests for reimbursement to the Department of Education (ED) under HCM2. Criteria: 34 CFR 668.164(h)(2) Questioned Costs: $-0- Context: Out of 40 students tested for holding credit balances, there were 2 students who had a credit balance created by federal direct loans and federal pell grants that were not paid out to the student before submitting reimbursement requests to ED. Cause: There was not an adequate process in place to identify credit balances created by federal aid and paying them before reimbursement requests were submitted. Effect: Noncompliance with the Department of Education's cash management and heightened cash monitoring regulations. Identification as repeat finding, if applicable: N/A Recommendation: We recommend the College design and implement a process to identify credit balances created by federal aid and disburse them to students within the required timeframe. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-005
Credit Balances and Heightened Cash Monitoring 2 (HCM2) Compliance DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The College is required to pay out credit balances created by federal aid before submitting requests for reimbursement to the Department of Education (ED) under HCM2. Criteria: 34 CFR 668.164(h)(2) Questioned Costs: $-0- Context: Out of 40 students tested for holding credit balances, there were 2 students who had a credit balance created by federal direct loans and federal pell grants that were not paid out to the student before submitting reimbursement requests to ED. Cause: There was not an adequate process in place to identify credit balances created by federal aid and paying them before reimbursement requests were submitted. Effect: Noncompliance with the Department of Education's cash management and heightened cash monitoring regulations. Identification as repeat finding, if applicable: N/A Recommendation: We recommend the College design and implement a process to identify credit balances created by federal aid and disburse them to students within the required timeframe. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-006
Return of Title IV (R2T4) Calculations DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for two modular student withdrawals that did not require funds to be returned based on the completion rate. Both students completed past the 49% required by the modular withdrawal regulations. Criteria: 34 CFR 668.22 Questioned Costs: $-0- Context: Out of 5 R2T4s tested, 1 student had $2,722 in federal direct loans and $249 in Pell grant returned and 1 student had $1,732 in subsidized federal direct loans and $633 in Pell grant returned although the students were eligible to retain their Title IV funds. Cause: This was an oversight by the University due to the complexity of the new modular withdrawal regulations. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: 2021-004 Recommendation: We recommend the University review and fully understand the modular withdrawal regulations and improve policies and procedures to follow these new regulations. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-006
Return of Title IV (R2T4) Calculations DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for two modular student withdrawals that did not require funds to be returned based on the completion rate. Both students completed past the 49% required by the modular withdrawal regulations. Criteria: 34 CFR 668.22 Questioned Costs: $-0- Context: Out of 5 R2T4s tested, 1 student had $2,722 in federal direct loans and $249 in Pell grant returned and 1 student had $1,732 in subsidized federal direct loans and $633 in Pell grant returned although the students were eligible to retain their Title IV funds. Cause: This was an oversight by the University due to the complexity of the new modular withdrawal regulations. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: 2021-004 Recommendation: We recommend the University review and fully understand the modular withdrawal regulations and improve policies and procedures to follow these new regulations. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-003
Higher Education Emergency Relief Fund (HEERF) Earmarking Material Weakness DEPARTMENT OF EDUCATION ALN #: 84.425E and 84.425F Federal Award Identification #: P425F202243 Condition: The University had drawn all their authorized HEERF institutional funds by the end of the performance period but did not fully spend the student portion, therefore the University did not meet the earmarking requirements for the minimum amount of HEERF funds spent on student grants. Criteria: CARES Act section 18004 (a) (1), CRRSAA Act section 314 (a) (1), ARP Act Questioned Costs: $94,893 Context: The University did not have support for providing $76,991 of grants to students from the HEERF student portion (84.425E) which represents the University's remaining available authorization at the end of the performance period. Due to not fully spending this student portion, this disallowed a prorated amount totaling $94,893 of the institutional portion (84.425F) given the conditions and earmarking requirements for HEERF. Cause: Inadequate reconciliation of expenditures and drawdowns and lack of review at the end of the period of performance. Effect: Since the student emergency grant minimum was not met, the University is not eligible for the full allocation of the institutional portion of the HEERF funds. Identification as repeat finding, if applicable: N/A Recommendation: We recommend the University return funds as applicable and as directed by the Department of Education. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-004
Common Origination and Disbursement (COD) Reporting Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The anticipated disbursement dates in COD were not updated with the actual dates of disbursement when reporting disbursement records for Pell and FDL to COD. Criteria: 34CFR 668.164(a) Questioned Costs: $-0- Context: Out of 60 students tested, including both Pell and FDL disbursements, 10 students had COD records that did not reflect the actual disbursement date per the student account statement for Spring 2022 disbursements. Due to the error rate, this is classified as a significant deficiency. Cause: The anticipated disbursement dates in COD were not updated to the actual dates that Pell and FDL were disbursed to the students' accounts. Effect: Inaccurate FDL reporting can impact a student's interest accumulating period based on the dates of the loan disbursement dates as well as the monitoring of FDL aggregate limits. Inaccurate Pell reporting could allow a student to exceed their lifetime limit. Identification as repeat finding, if applicable: 2021-003 Recommendation: We recommend that procedures be implemented to ensure that disbursement reporting to COD be reflective of the actual disbursement dates. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-004
Common Origination and Disbursement (COD) Reporting Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The anticipated disbursement dates in COD were not updated with the actual dates of disbursement when reporting disbursement records for Pell and FDL to COD. Criteria: 34CFR 668.164(a) Questioned Costs: $-0- Context: Out of 60 students tested, including both Pell and FDL disbursements, 10 students had COD records that did not reflect the actual disbursement date per the student account statement for Spring 2022 disbursements. Due to the error rate, this is classified as a significant deficiency. Cause: The anticipated disbursement dates in COD were not updated to the actual dates that Pell and FDL were disbursed to the students' accounts. Effect: Inaccurate FDL reporting can impact a student's interest accumulating period based on the dates of the loan disbursement dates as well as the monitoring of FDL aggregate limits. Inaccurate Pell reporting could allow a student to exceed their lifetime limit. Identification as repeat finding, if applicable: 2021-003 Recommendation: We recommend that procedures be implemented to ensure that disbursement reporting to COD be reflective of the actual disbursement dates. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-005
Credit Balances and Heightened Cash Monitoring 2 (HCM2) Compliance DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The College is required to pay out credit balances created by federal aid before submitting requests for reimbursement to the Department of Education (ED) under HCM2. Criteria: 34 CFR 668.164(h)(2) Questioned Costs: $-0- Context: Out of 40 students tested for holding credit balances, there were 2 students who had a credit balance created by federal direct loans and federal pell grants that were not paid out to the student before submitting reimbursement requests to ED. Cause: There was not an adequate process in place to identify credit balances created by federal aid and paying them before reimbursement requests were submitted. Effect: Noncompliance with the Department of Education's cash management and heightened cash monitoring regulations. Identification as repeat finding, if applicable: N/A Recommendation: We recommend the College design and implement a process to identify credit balances created by federal aid and disburse them to students within the required timeframe. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-005
Credit Balances and Heightened Cash Monitoring 2 (HCM2) Compliance DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The College is required to pay out credit balances created by federal aid before submitting requests for reimbursement to the Department of Education (ED) under HCM2. Criteria: 34 CFR 668.164(h)(2) Questioned Costs: $-0- Context: Out of 40 students tested for holding credit balances, there were 2 students who had a credit balance created by federal direct loans and federal pell grants that were not paid out to the student before submitting reimbursement requests to ED. Cause: There was not an adequate process in place to identify credit balances created by federal aid and paying them before reimbursement requests were submitted. Effect: Noncompliance with the Department of Education's cash management and heightened cash monitoring regulations. Identification as repeat finding, if applicable: N/A Recommendation: We recommend the College design and implement a process to identify credit balances created by federal aid and disburse them to students within the required timeframe. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-006
Return of Title IV (R2T4) Calculations DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for two modular student withdrawals that did not require funds to be returned based on the completion rate. Both students completed past the 49% required by the modular withdrawal regulations. Criteria: 34 CFR 668.22 Questioned Costs: $-0- Context: Out of 5 R2T4s tested, 1 student had $2,722 in federal direct loans and $249 in Pell grant returned and 1 student had $1,732 in subsidized federal direct loans and $633 in Pell grant returned although the students were eligible to retain their Title IV funds. Cause: This was an oversight by the University due to the complexity of the new modular withdrawal regulations. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: 2021-004 Recommendation: We recommend the University review and fully understand the modular withdrawal regulations and improve policies and procedures to follow these new regulations. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.
Finding 2022-006
Return of Title IV (R2T4) Calculations DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The University returned Title IV funds for two modular student withdrawals that did not require funds to be returned based on the completion rate. Both students completed past the 49% required by the modular withdrawal regulations. Criteria: 34 CFR 668.22 Questioned Costs: $-0- Context: Out of 5 R2T4s tested, 1 student had $2,722 in federal direct loans and $249 in Pell grant returned and 1 student had $1,732 in subsidized federal direct loans and $633 in Pell grant returned although the students were eligible to retain their Title IV funds. Cause: This was an oversight by the University due to the complexity of the new modular withdrawal regulations. Effect: Noncompliance with new R2T4 regulations regarding withdrawals from modular programs. Identification as repeat finding, if applicable: 2021-004 Recommendation: We recommend the University review and fully understand the modular withdrawal regulations and improve policies and procedures to follow these new regulations. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.