FAC Explorer

Audit 328392

FY End
2024-06-30
Total Expended
$8.22M
Findings
6
Programs
7
Organization: McPherson College (KS)
Year: 2024 Accepted: 2024-11-14
Auditor: Swindoll Janzen Hawk & Loyd LLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
507874 2024-001 Significant Deficiency Yes N
507875 2024-002 Significant Deficiency - N
507876 2024-002 Significant Deficiency - N
1084316 2024-001 Significant Deficiency Yes N
1084317 2024-002 Significant Deficiency - N
1084318 2024-002 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $5.50M Yes 0
84.063 Federal Pell Grant Program $1.71M Yes 1
21.027 Covid 19: Coronavirus State and Local Recovery Funds $492,564 Yes 0
84.038 Federal Perkins Loans $358,760 Yes 1
84.007 Federal Supplemental Educational Opportunity Grants $101,549 Yes 1
84.033 Federal Work-Study Program $53,249 Yes 0
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $9,430 Yes 0

Contacts

Name Title Type
PMNRJHMBZZX1 Carol Summervill Auditee
6202420458 Jesse Glazier Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: 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. De Minimis Rate Used: N Rate Explanation: The College has not elected to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Schedule of Expenditures of Federal Awards (the Schedule) includes the federal grant activity of McPherson College (the College) under programs of the federal government for the year ended June 30, 2024. The information in the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) 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 College, it is not intended to and does not present the financial position, changes in net assets, functional expenses or cash flows of the College.
Title: Summary of Significant Accounting Policies Accounting Policies: 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. De Minimis Rate Used: N Rate Explanation: The College has not elected to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. 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. The College has not elected to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.
Title: Federal Perkins Loan Program Accounting Policies: 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. De Minimis Rate Used: N Rate Explanation: The College has not elected to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The Federal Perkins Loan Program is administered directly by the College and the balances and transactions relating to this program are included in the College's basic financial statements. Loans receivable from students under the Federal Perkins Loan Program at the beginning of the year totaled $358,760. No additional loans are permitted under the Federal Perkins Loan Program and none were made for the year ended June 30, 2024. The balance of loans receivable from students under the Federal Perkins Loan Program at June 30, 2024 totaled $173,756.

Finding Details

Finding 2024-001
2024-001 Perkin’s Loan Recordkeeping and Record Retention Type of Finding – Significant Deficiency and Noncompliance Student Financial Assistance Cluster: Federal Perkins Loans – CFDA 84.038 Criteria: In accordance with 34 CFR 674.19(e) - Institutions must retain original or true and exact copies of promissory and master promissory notes, repayment records, and cancellation and deferment requests for each Perkins loan made. Internal controls over compliance with direct and material compliance requirements should be sufficient to prevent or detect and correct noncompliance in a timely manner. Condition: One student with a Perkin’s loan in repayment did not have the proper documentation retained in the student’s file in accordance with 34 CFR 674.19(e). Questioned Costs: None identified. Context: Out of a sample of 50 students selected for testing, 25 of the students were in repayment and 25 of the students had a loan that was paid, canceled, or assigned within the previous three years. One student of the 25 who had a loan that was paid, canceled, or assigned was not compliant with the recordkeeping and record retention requirements. Effect: The College was not compliant with Federal requirements of the Student Financial Assistance Program. Cause: The promissory note for the student could not be located. While the College believes this note was misfiled, internal controls over filing and usage of loan files should be sufficient to track and ensure timely refiling after use. Identification as a Repeat Finding: This is a repeat finding of finding 2023-003 that was reported for the year ending June 30, 2023. Recommendation: We recommend the College review the filing processes for loan files to refine controls in place on filing and tracking of such files. Views of Responsible Officials: McPherson College agrees with the finding and the recommendations. The College is reviewing the process and will refine the process as necessary.
Finding 2024-002
2024-002 Disbursements to or on Behalf of Students – Credit Balances Type of Finding – Significant Deficiency and Noncompliance Student Financial Assistance Cluster: Federal Pell Grants – CFDA 84.063 and Federal Supplemental Educational Opportunity Grants – CFDA 84.007 Criteria: In accordance with 34 CFR 668.164, when Title IV funds are credited to a student’s account and exceed the amount of tuition, fees, food, housing, and other authorized charges, a credit balance is created. The institution must pay the resulting credit balance directly to the student or parent borrower within 14 days after (1) the first day of class of a payment period if the credit balance occurred on or before that day, or (2) the balance occurred if that was after the first day of class. Internal controls over compliance with direct and material compliance requirements should be sufficient to prevent or detect and correct noncompliance in a timely manner. Condition: One student selected for testing who received Pell and FSEOG funds with a credit balance did not receive a refund of Title IV aid within the 14-day requirement in accordance with 34 CFR 668.164. Questioned Costs: None identified. Context: Out of a sample of 45 students, ten of the sampled students had a credit balance requiring a refund in accordance with the requirements. One of the ten students had a credit balance that was returned after the 14-day requirement. Effect: The College was not compliant with Federal requirements of the Student Financial Assistance Cluster. Cause: The internal controls over refunds for credit balances were not effective in maintaining compliance with the related compliance. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College review the process and related controls for refunds of student credit balances to ensure credit balances requiring refunds within the 14-day requirements are appropriately identified and resolved. Views of Responsible Officials: McPherson College agrees with the finding and the recommendations. The College is reviewing the process and will refine the process as necessary.
Finding 2024-002
2024-002 Disbursements to or on Behalf of Students – Credit Balances Type of Finding – Significant Deficiency and Noncompliance Student Financial Assistance Cluster: Federal Pell Grants – CFDA 84.063 and Federal Supplemental Educational Opportunity Grants – CFDA 84.007 Criteria: In accordance with 34 CFR 668.164, when Title IV funds are credited to a student’s account and exceed the amount of tuition, fees, food, housing, and other authorized charges, a credit balance is created. The institution must pay the resulting credit balance directly to the student or parent borrower within 14 days after (1) the first day of class of a payment period if the credit balance occurred on or before that day, or (2) the balance occurred if that was after the first day of class. Internal controls over compliance with direct and material compliance requirements should be sufficient to prevent or detect and correct noncompliance in a timely manner. Condition: One student selected for testing who received Pell and FSEOG funds with a credit balance did not receive a refund of Title IV aid within the 14-day requirement in accordance with 34 CFR 668.164. Questioned Costs: None identified. Context: Out of a sample of 45 students, ten of the sampled students had a credit balance requiring a refund in accordance with the requirements. One of the ten students had a credit balance that was returned after the 14-day requirement. Effect: The College was not compliant with Federal requirements of the Student Financial Assistance Cluster. Cause: The internal controls over refunds for credit balances were not effective in maintaining compliance with the related compliance. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College review the process and related controls for refunds of student credit balances to ensure credit balances requiring refunds within the 14-day requirements are appropriately identified and resolved. Views of Responsible Officials: McPherson College agrees with the finding and the recommendations. The College is reviewing the process and will refine the process as necessary.
Finding 2024-001
2024-001 Perkin’s Loan Recordkeeping and Record Retention Type of Finding – Significant Deficiency and Noncompliance Student Financial Assistance Cluster: Federal Perkins Loans – CFDA 84.038 Criteria: In accordance with 34 CFR 674.19(e) - Institutions must retain original or true and exact copies of promissory and master promissory notes, repayment records, and cancellation and deferment requests for each Perkins loan made. Internal controls over compliance with direct and material compliance requirements should be sufficient to prevent or detect and correct noncompliance in a timely manner. Condition: One student with a Perkin’s loan in repayment did not have the proper documentation retained in the student’s file in accordance with 34 CFR 674.19(e). Questioned Costs: None identified. Context: Out of a sample of 50 students selected for testing, 25 of the students were in repayment and 25 of the students had a loan that was paid, canceled, or assigned within the previous three years. One student of the 25 who had a loan that was paid, canceled, or assigned was not compliant with the recordkeeping and record retention requirements. Effect: The College was not compliant with Federal requirements of the Student Financial Assistance Program. Cause: The promissory note for the student could not be located. While the College believes this note was misfiled, internal controls over filing and usage of loan files should be sufficient to track and ensure timely refiling after use. Identification as a Repeat Finding: This is a repeat finding of finding 2023-003 that was reported for the year ending June 30, 2023. Recommendation: We recommend the College review the filing processes for loan files to refine controls in place on filing and tracking of such files. Views of Responsible Officials: McPherson College agrees with the finding and the recommendations. The College is reviewing the process and will refine the process as necessary.
Finding 2024-002
2024-002 Disbursements to or on Behalf of Students – Credit Balances Type of Finding – Significant Deficiency and Noncompliance Student Financial Assistance Cluster: Federal Pell Grants – CFDA 84.063 and Federal Supplemental Educational Opportunity Grants – CFDA 84.007 Criteria: In accordance with 34 CFR 668.164, when Title IV funds are credited to a student’s account and exceed the amount of tuition, fees, food, housing, and other authorized charges, a credit balance is created. The institution must pay the resulting credit balance directly to the student or parent borrower within 14 days after (1) the first day of class of a payment period if the credit balance occurred on or before that day, or (2) the balance occurred if that was after the first day of class. Internal controls over compliance with direct and material compliance requirements should be sufficient to prevent or detect and correct noncompliance in a timely manner. Condition: One student selected for testing who received Pell and FSEOG funds with a credit balance did not receive a refund of Title IV aid within the 14-day requirement in accordance with 34 CFR 668.164. Questioned Costs: None identified. Context: Out of a sample of 45 students, ten of the sampled students had a credit balance requiring a refund in accordance with the requirements. One of the ten students had a credit balance that was returned after the 14-day requirement. Effect: The College was not compliant with Federal requirements of the Student Financial Assistance Cluster. Cause: The internal controls over refunds for credit balances were not effective in maintaining compliance with the related compliance. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College review the process and related controls for refunds of student credit balances to ensure credit balances requiring refunds within the 14-day requirements are appropriately identified and resolved. Views of Responsible Officials: McPherson College agrees with the finding and the recommendations. The College is reviewing the process and will refine the process as necessary.
Finding 2024-002
2024-002 Disbursements to or on Behalf of Students – Credit Balances Type of Finding – Significant Deficiency and Noncompliance Student Financial Assistance Cluster: Federal Pell Grants – CFDA 84.063 and Federal Supplemental Educational Opportunity Grants – CFDA 84.007 Criteria: In accordance with 34 CFR 668.164, when Title IV funds are credited to a student’s account and exceed the amount of tuition, fees, food, housing, and other authorized charges, a credit balance is created. The institution must pay the resulting credit balance directly to the student or parent borrower within 14 days after (1) the first day of class of a payment period if the credit balance occurred on or before that day, or (2) the balance occurred if that was after the first day of class. Internal controls over compliance with direct and material compliance requirements should be sufficient to prevent or detect and correct noncompliance in a timely manner. Condition: One student selected for testing who received Pell and FSEOG funds with a credit balance did not receive a refund of Title IV aid within the 14-day requirement in accordance with 34 CFR 668.164. Questioned Costs: None identified. Context: Out of a sample of 45 students, ten of the sampled students had a credit balance requiring a refund in accordance with the requirements. One of the ten students had a credit balance that was returned after the 14-day requirement. Effect: The College was not compliant with Federal requirements of the Student Financial Assistance Cluster. Cause: The internal controls over refunds for credit balances were not effective in maintaining compliance with the related compliance. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend the College review the process and related controls for refunds of student credit balances to ensure credit balances requiring refunds within the 14-day requirements are appropriately identified and resolved. Views of Responsible Officials: McPherson College agrees with the finding and the recommendations. The College is reviewing the process and will refine the process as necessary.