Audit 341725

Audit Finding Reference Number Questioned Cost 2023 - 002 - Return of Title IV Funds $22,473 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Section (N) (3) specifies that when a student receives Title IV assistance and withdraws from an institution, the institution must determine the amount of Title IV aid earned by the student as of the withdrawal date. The difference between any amounts earned that is less than the amount disbursed must be returned to the Title IV program within the prescribed time frame. ABC is a college that is not required to take attendance. Thus, ABC must determine the student’s withdrawal date as either (1) the date, as determined by the institution, that the student began the withdrawal process prescribed by the institution; (2) the date, as determined by the institution, that the student otherwise provided official notification to the institution, in writing or orally, of his or her intent to withdraw; (3) if the student ceases attendance without providing official notification to the institution of his or her withdrawal, the midpoint of the payment period or, if applicable, the period of enrollment; (4) if the institution determines that a student did not begin the withdrawal process or otherwise notify the institution of the intent to withdraw due to illness, accident, grievous personal loss or other circumstances beyond the student’s control, the date the institution determines is related to that circumstances, (5) if a student does not return from an approved leave of absence, the date that the institution determines the student began the leave of absence; or (6) if the student takes an unapproved leave of absence, the date that the student began the leave of absence. Conditions and Contexts During my audit, I noted the following: • ABC did not return the required Title IV funds for one (1) student out of three (3) tested. The amount required to be returned totaled $3,446, was not returned; • ABC did not return the required Title IV funds within the prescribed timeframe for one (1) student out of three (3) tested; and • ABC was unable to document the last date of attendance or participation in any academic related activity for each of the students’ enrolled courses and received all non-passing grades for five (5) of the eight (8) students selected for testing resulting in $19,028 to be returned by ABC. Cause ABC failed to adhere to established procedures in processing certain refunds. Questioned Costs For purposes of this condition, I have questioned costs totaling $22,473 as follows: Program Amount Federal PELL Grant $ 12,977 Federal Direct Loan 9,496 Total $ 22,473 Effect ABC has not complied with Title IV regulations that specify if a student withdraws from school within a certain time frame, a refund must be processed, calculated properly, and remitted to the Title IV program in accordance with established time frames. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-002. Recommendation I recommend that management immediately make the necessary determination as to whether the students unofficially withdrew from ABC, prepare the Return of Title IV Funds calculation, and return the funds to the Department of Education in a timely manner. Management's Response Management concurs with this finding. The College will keep accurate attendance and participation records. The College will calculate R2T4s accurately and will return the funds in a timely manner. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to R2T4 regulations. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number Questioned Cost 2023 - 002 - Return of Title IV Funds $22,473 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Section (N) (3) specifies that when a student receives Title IV assistance and withdraws from an institution, the institution must determine the amount of Title IV aid earned by the student as of the withdrawal date. The difference between any amounts earned that is less than the amount disbursed must be returned to the Title IV program within the prescribed time frame. ABC is a college that is not required to take attendance. Thus, ABC must determine the student’s withdrawal date as either (1) the date, as determined by the institution, that the student began the withdrawal process prescribed by the institution; (2) the date, as determined by the institution, that the student otherwise provided official notification to the institution, in writing or orally, of his or her intent to withdraw; (3) if the student ceases attendance without providing official notification to the institution of his or her withdrawal, the midpoint of the payment period or, if applicable, the period of enrollment; (4) if the institution determines that a student did not begin the withdrawal process or otherwise notify the institution of the intent to withdraw due to illness, accident, grievous personal loss or other circumstances beyond the student’s control, the date the institution determines is related to that circumstances, (5) if a student does not return from an approved leave of absence, the date that the institution determines the student began the leave of absence; or (6) if the student takes an unapproved leave of absence, the date that the student began the leave of absence. Conditions and Contexts During my audit, I noted the following: • ABC did not return the required Title IV funds for one (1) student out of three (3) tested. The amount required to be returned totaled $3,446, was not returned; • ABC did not return the required Title IV funds within the prescribed timeframe for one (1) student out of three (3) tested; and • ABC was unable to document the last date of attendance or participation in any academic related activity for each of the students’ enrolled courses and received all non-passing grades for five (5) of the eight (8) students selected for testing resulting in $19,028 to be returned by ABC. Cause ABC failed to adhere to established procedures in processing certain refunds. Questioned Costs For purposes of this condition, I have questioned costs totaling $22,473 as follows: Program Amount Federal PELL Grant $ 12,977 Federal Direct Loan 9,496 Total $ 22,473 Effect ABC has not complied with Title IV regulations that specify if a student withdraws from school within a certain time frame, a refund must be processed, calculated properly, and remitted to the Title IV program in accordance with established time frames. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-002. Recommendation I recommend that management immediately make the necessary determination as to whether the students unofficially withdrew from ABC, prepare the Return of Title IV Funds calculation, and return the funds to the Department of Education in a timely manner. Management's Response Management concurs with this finding. The College will keep accurate attendance and participation records. The College will calculate R2T4s accurately and will return the funds in a timely manner. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to R2T4 regulations. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 - 003 - Common Origination and Disbursement (COD) System Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 - Student Financial Assistance Programs, Section (L) (1) Financial Reporting, indicates that schools submit PELL origination records and disbursement records to the COD system. Key items on the origination records are social security number, award amount, enrollment date, verification status code, transaction number, cost of attendance, and academic calendar. Institutions must report student payment data within 30 calendar days after the school makes a payment; or becomes aware of the need to make an adjustment to previously reported student payment data or expected student payment data. Conditions and Contexts I noted the following conditions during my testing of the COD system: • The PELL amount was disbursed in the COD system did not agree to the students’ billing statements for four (4) students out of eighty-eight (88). The billing statements under reported $1.587; • The Direct loan amounts disbursed in the COD system did not agree to the students’ billing statements for three (3) students out of seventy-one (71) tested. The billing statements under reported $3,316; and • The enrollment date was incorrectly reported in COD for seventy-five (75) students out of ninety-three (93) tested. Cause ABC failed to adhere to established procedures in reporting to the COD system. Questioned Costs For purposes of this condition, I have no questioned costs. Effect ABC has not complied with Title IV regulations that require proper and accurate recording to the COD system.   Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-003. Recommendation I recommend that ABC implements controls to ensure that information reported to the COD system is accurate. Management's Response Management concurs with this finding. The College will ensure the accuracy of the data that is input into the COD system and the College will work to apply funds appropriately to students' accounts. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to managing the COD system. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 - 003 - Common Origination and Disbursement (COD) System Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 - Student Financial Assistance Programs, Section (L) (1) Financial Reporting, indicates that schools submit PELL origination records and disbursement records to the COD system. Key items on the origination records are social security number, award amount, enrollment date, verification status code, transaction number, cost of attendance, and academic calendar. Institutions must report student payment data within 30 calendar days after the school makes a payment; or becomes aware of the need to make an adjustment to previously reported student payment data or expected student payment data. Conditions and Contexts I noted the following conditions during my testing of the COD system: • The PELL amount was disbursed in the COD system did not agree to the students’ billing statements for four (4) students out of eighty-eight (88). The billing statements under reported $1.587; • The Direct loan amounts disbursed in the COD system did not agree to the students’ billing statements for three (3) students out of seventy-one (71) tested. The billing statements under reported $3,316; and • The enrollment date was incorrectly reported in COD for seventy-five (75) students out of ninety-three (93) tested. Cause ABC failed to adhere to established procedures in reporting to the COD system. Questioned Costs For purposes of this condition, I have no questioned costs. Effect ABC has not complied with Title IV regulations that require proper and accurate recording to the COD system.   Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-003. Recommendation I recommend that ABC implements controls to ensure that information reported to the COD system is accurate. Management's Response Management concurs with this finding. The College will ensure the accuracy of the data that is input into the COD system and the College will work to apply funds appropriately to students' accounts. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to managing the COD system. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 - 004 - Student Credit Balance Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Student Financial Assistance Programs, Section III Part N – Special Tests and Provisions stipulate that disbursements to students must be made in accordance with required time frames. Title IV regulations 34 CFT 668.164 (e) specifies that whenever a school credits Student Financial Aid (SFA) program funds to a student’s account, and those funds exceed the student’s allowable charges, a SFA credit balance occurs. The school must pay the credit balance to the student as soon as possible, but no later than fourteen (14) days after the later of the date the balance occurred on the student’s account or the first day of classes of the payment period. Conditions and Contexts I noted during my thirty (30) out of ninety-three (93) students audit had student financial aid credit balances but ABC did not refund the credit balances to the students within the fourteen (14) day requirement. Cause It appears that ABC did not ensure the students receive their refunds checks within the prescribed timeframe. Repeat Finding No. Recommendation I recommend that management of ABC take immediate steps to ensure that students receive their refund checks within the required timeframes as required by Title IV regulations. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal regulations as it relates to resolving credit balances. The College will resolve credit balances timely and within the 14-day period as defined in the Federal guidelines. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 - 004 - Student Credit Balance Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Student Financial Assistance Programs, Section III Part N – Special Tests and Provisions stipulate that disbursements to students must be made in accordance with required time frames. Title IV regulations 34 CFT 668.164 (e) specifies that whenever a school credits Student Financial Aid (SFA) program funds to a student’s account, and those funds exceed the student’s allowable charges, a SFA credit balance occurs. The school must pay the credit balance to the student as soon as possible, but no later than fourteen (14) days after the later of the date the balance occurred on the student’s account or the first day of classes of the payment period. Conditions and Contexts I noted during my thirty (30) out of ninety-three (93) students audit had student financial aid credit balances but ABC did not refund the credit balances to the students within the fourteen (14) day requirement. Cause It appears that ABC did not ensure the students receive their refunds checks within the prescribed timeframe. Repeat Finding No. Recommendation I recommend that management of ABC take immediate steps to ensure that students receive their refund checks within the required timeframes as required by Title IV regulations. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal regulations as it relates to resolving credit balances. The College will resolve credit balances timely and within the 14-day period as defined in the Federal guidelines. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 – 005 – Student Status Confirmation Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.268 Federal Direct Student Loans (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV Regulations, 34 CFR Section 682.610 (c) (i) (ii) (iii) stipulated that if a university discovers that a loan has been made to or on behalf of a student who enrolled at that school, but who has ceased to be enrolled on at least a half-time basis; a student who has been accepted for enrollment at that school, but who failed to enroll on at least a half-time basis for the period for which the loan was intended, or a full-time student who has ceased to be enrolled on a full-time basis, ABC must notify the guarantee agency, the National Student Clearinghouse and/or the National Student Loan Data System (NSLDS). Schools are required to report enrollment data at least every sixty (60) days. Conditions and Contexts I noted during my audit twenty-two (22) students out of twenty-seven (27) tested whose change in enrollment status was reported correctly in the NSLDS system; however, the students’ status change was reported greater than the every sixty (60) days timeframe . Cause It appears that ABC did not properly report the student’s enrollment status to the guarantee agency, National Student Clearinghouse, and/or NSLDS. Questioned Costs For purposes of this condition, I do not have any questioned costs. Effect Noncompliance with federal regulations. ABC did not properly report the student’s status to the guarantee agency, National Student Clearinghouse, and/or NSLDS. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-005. Recommendation I recommend that ABC determine the student’s proper enrollment status and report the accurate status to the guarantee agency, National Student Clearinghouse, and/or NSLDS. Management’s Response Management concurs with this finding. The College will set policies, procedures and practices in place and adhere to ensure that changes in students’ enrollment are reported accurately and timely as defined in the Federal guidelines. Responsible Administrators: Director of Financial Aid & Registrar Effective: Immediately and ongoing

Audit Finding Reference Number Questioned Costs 2023 – 006 – Ineligible Aid Recipients $ 31,666 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.268 Federal Direct Student Loans (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV regulations 34 CFR 668.32 (a)(2) stipulates that a student is eligible to receive Title IV Direct Loans if the student is enrolled at least half-time at an eligible institution. Conditions and Contexts I noted during my testing nine (9) students out of seventy-one (71) students tested who was not enrolled at least half-time and received Direct loans. Cause It appears that ABC did not property administer and disburse Title IV aid to eligible recipients. Questioned Costs For purposes of this condition, I have questioned costs totaling $31,666 related to the Direct loan program. Effect ABC disbursed financial aid to an ineligible student. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-006. Recommendation I recommend that management of ABC adhere to established procedures to ensure that all federal funds are disbursed to eligible students. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to disbursing and administering federal aid. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid, Chief Financial Officer & V.P. of Academic Affairs Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Costs 2023 – 007 – Satisfactory Academic Progress $40,110 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV regulations, 34 CFR 668.32 (f) stipulates that students participating in the Title IV Federal Financial Aid program must be maintaining satisfactory progress in the course of study he or she is pursuing, according to the standards and practices of that institution to receive student financial aid. OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Appendix A, Student Financial Assistance – Special Tests and Provisions Compliance Requirement Number 9 – Satisfactory Academic Progress stipulates that a student must maintain good standing, or satisfactory progress. Title IV regulations CFD 668.16 (e) stipulates that an institution must establish, publish and apply reasonable standards for measuring satisfactory academic progress. Conditions and Contexts I noted during my audit that seven (7) students out of ninety-three (93) tested were awarded and received financial, although the students did not meet ABC’s standards for achieving satisfactory academic progress, nor were valid satisfactory academic progress appeals documentation available. Cause It appears that ABC inadvertently disbursed aid to academically ineligible students. Questioned Costs For the purpose of this condition, I have questioned costs totaling $40,110 as follows: Program Amount Federal PELL $24,733 Federal Direct Loan 15,377 Total $40,110 Effect It appears that ABC disbursed financial aid to a student that did not maintain satisfactory academic progress. Repeat Finding No. Recommendation I recommend that ABC adhere to established policies and procedures as documented in the revised satisfactory academic progress policy and monitor the academic standing of all students prior to awarding student financial aid, and ensure all required appeals documented is maintained. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to students meeting satisfactory academic progress. The College has an SAP appeal committee in place to enforce and abide by the College's policy. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Costs 2023 – 007 – Satisfactory Academic Progress $40,110 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV regulations, 34 CFR 668.32 (f) stipulates that students participating in the Title IV Federal Financial Aid program must be maintaining satisfactory progress in the course of study he or she is pursuing, according to the standards and practices of that institution to receive student financial aid. OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Appendix A, Student Financial Assistance – Special Tests and Provisions Compliance Requirement Number 9 – Satisfactory Academic Progress stipulates that a student must maintain good standing, or satisfactory progress. Title IV regulations CFD 668.16 (e) stipulates that an institution must establish, publish and apply reasonable standards for measuring satisfactory academic progress. Conditions and Contexts I noted during my audit that seven (7) students out of ninety-three (93) tested were awarded and received financial, although the students did not meet ABC’s standards for achieving satisfactory academic progress, nor were valid satisfactory academic progress appeals documentation available. Cause It appears that ABC inadvertently disbursed aid to academically ineligible students. Questioned Costs For the purpose of this condition, I have questioned costs totaling $40,110 as follows: Program Amount Federal PELL $24,733 Federal Direct Loan 15,377 Total $40,110 Effect It appears that ABC disbursed financial aid to a student that did not maintain satisfactory academic progress. Repeat Finding No. Recommendation I recommend that ABC adhere to established policies and procedures as documented in the revised satisfactory academic progress policy and monitor the academic standing of all students prior to awarding student financial aid, and ensure all required appeals documented is maintained. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to students meeting satisfactory academic progress. The College has an SAP appeal committee in place to enforce and abide by the College's policy. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Cost 2023 – 008 – Aid in Excess of Documented Need $10,693 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Uniform Guidance Compliance Supplement, Part 5 Section E (Eligibility) specified that the annual award should be calculated based upon certain factors and coordinated among all programs to ensure that the total aid is not awarded in excess of the student’s financial need. Title IV regulations, Section(s) 673.5, 682.603, and 685.301 state that an institution may not award financial aid to a student if the aid, when combined with other resources, exceeds the student’s financial need. Conditions and Contexts During my audit I noted five (5) students out of ninety-three (93) tested received financial aid in excess of their documented need. Cause It appears that ABC did not properly monitor the awarding and disbursing of financial aid to certain students. Questioned Costs For purposes of this condition, I have questioned costs totaling $10,693 as follows: Program Amount Federal Pell Grant $ 4,936 Federal Direct Loan 5,757 Total $10,693 Effect The failure of ABC to consider all available resources resulted in the over awarding of financial aid. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-008. Recommendation I recommend that ABC adhere to established procedures and ensure that the total financial aid received by students does not exceed their documented need. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to over awarding students. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Cost 2023 – 008 – Aid in Excess of Documented Need $10,693 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Uniform Guidance Compliance Supplement, Part 5 Section E (Eligibility) specified that the annual award should be calculated based upon certain factors and coordinated among all programs to ensure that the total aid is not awarded in excess of the student’s financial need. Title IV regulations, Section(s) 673.5, 682.603, and 685.301 state that an institution may not award financial aid to a student if the aid, when combined with other resources, exceeds the student’s financial need. Conditions and Contexts During my audit I noted five (5) students out of ninety-three (93) tested received financial aid in excess of their documented need. Cause It appears that ABC did not properly monitor the awarding and disbursing of financial aid to certain students. Questioned Costs For purposes of this condition, I have questioned costs totaling $10,693 as follows: Program Amount Federal Pell Grant $ 4,936 Federal Direct Loan 5,757 Total $10,693 Effect The failure of ABC to consider all available resources resulted in the over awarding of financial aid. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-008. Recommendation I recommend that ABC adhere to established procedures and ensure that the total financial aid received by students does not exceed their documented need. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to over awarding students. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Cost 2023 – 009 – Pell Grant Calculations $8,608 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV regulations, 34 CFR Section 690.62 (a) stipulates that the amount of a student’s Pell Grant for an academic year is based upon the payment and disbursement schedules published by the Secretary for each year. Each student’s Pell grant is based upon their enrollment status, cost of attendance and expected family contribution. Conditions and Contexts During my audit I noted twenty-four (24) students out of eighty-seven (87) tested whose Pell grant amount was calculated incorrectly. This resulted in ABC over-disbursing Pell in the amount of $8,608. Cause It appears that ABC did not review and verify all components of the Pell grant calculation to ensure the proper amount of Pell was disbursed. Questioned Costs For purposes of this condition, I have questioned costs totaling $8,608. Effect ABC disbursed excess Pell grant funds to students. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-009. Recommendation I recommend that ABC adhere to federal prescribed regulations by calculating and disbursing Pell grants in accordance with the Department of Education’s Pell payment schedule and in accordance with the Lifetime Eligibility Usage limits. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to calculating and awarding Pell. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number Questioned Costs 2023 – 011 – Aggregate Loan Limits $4,804 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.268 Federal Direct Student Loans (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria CFR 685.203 (d) stipulates the aggregate unpaid principal amount of all Direct subsidized loans made to a student but excluding the amount of capitalized interest may not exceed (1) for dependent undergraduate students $31,000, (2) for independent undergraduate student or dependent undergraduate who qualifies for additional eligibility, $57,500 and (3) for graduate or professional students, $138,500. The total amount of Direct subsidized loans but excluding the amount of capitalized interest may not exceed (1) for a dependent undergraduate student $23,000. Conditions and Contexts I noted during my audit three (3) dependent students out of twenty-one (21) tested received direct loans in excess of the aggregate loan limit. Cause It appears that ABC did not ensure that the student was eligible to receive the loan proceeds. Questioned Costs For purposes of this condition, I have questioned costs totaling $4,804 related to the Direct loan program. Effect ABC has not adhered to Title IV regulations regarding the disbursing of loan funds in accordance with the regulations. Repeat Finding No. Recommendation I recommend that the management of ABC take immediate steps to ensure that students receive their loan funds as required by Title IV regulations. Management Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to disbursing loans within aggregate loan limits. Responsible Administrators: Director of Financial Aid Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Cost 2023 - 002 - Return of Title IV Funds $22,473 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Section (N) (3) specifies that when a student receives Title IV assistance and withdraws from an institution, the institution must determine the amount of Title IV aid earned by the student as of the withdrawal date. The difference between any amounts earned that is less than the amount disbursed must be returned to the Title IV program within the prescribed time frame. ABC is a college that is not required to take attendance. Thus, ABC must determine the student’s withdrawal date as either (1) the date, as determined by the institution, that the student began the withdrawal process prescribed by the institution; (2) the date, as determined by the institution, that the student otherwise provided official notification to the institution, in writing or orally, of his or her intent to withdraw; (3) if the student ceases attendance without providing official notification to the institution of his or her withdrawal, the midpoint of the payment period or, if applicable, the period of enrollment; (4) if the institution determines that a student did not begin the withdrawal process or otherwise notify the institution of the intent to withdraw due to illness, accident, grievous personal loss or other circumstances beyond the student’s control, the date the institution determines is related to that circumstances, (5) if a student does not return from an approved leave of absence, the date that the institution determines the student began the leave of absence; or (6) if the student takes an unapproved leave of absence, the date that the student began the leave of absence. Conditions and Contexts During my audit, I noted the following: • ABC did not return the required Title IV funds for one (1) student out of three (3) tested. The amount required to be returned totaled $3,446, was not returned; • ABC did not return the required Title IV funds within the prescribed timeframe for one (1) student out of three (3) tested; and • ABC was unable to document the last date of attendance or participation in any academic related activity for each of the students’ enrolled courses and received all non-passing grades for five (5) of the eight (8) students selected for testing resulting in $19,028 to be returned by ABC. Cause ABC failed to adhere to established procedures in processing certain refunds. Questioned Costs For purposes of this condition, I have questioned costs totaling $22,473 as follows: Program Amount Federal PELL Grant $ 12,977 Federal Direct Loan 9,496 Total $ 22,473 Effect ABC has not complied with Title IV regulations that specify if a student withdraws from school within a certain time frame, a refund must be processed, calculated properly, and remitted to the Title IV program in accordance with established time frames. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-002. Recommendation I recommend that management immediately make the necessary determination as to whether the students unofficially withdrew from ABC, prepare the Return of Title IV Funds calculation, and return the funds to the Department of Education in a timely manner. Management's Response Management concurs with this finding. The College will keep accurate attendance and participation records. The College will calculate R2T4s accurately and will return the funds in a timely manner. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to R2T4 regulations. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number Questioned Cost 2023 - 002 - Return of Title IV Funds $22,473 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Section (N) (3) specifies that when a student receives Title IV assistance and withdraws from an institution, the institution must determine the amount of Title IV aid earned by the student as of the withdrawal date. The difference between any amounts earned that is less than the amount disbursed must be returned to the Title IV program within the prescribed time frame. ABC is a college that is not required to take attendance. Thus, ABC must determine the student’s withdrawal date as either (1) the date, as determined by the institution, that the student began the withdrawal process prescribed by the institution; (2) the date, as determined by the institution, that the student otherwise provided official notification to the institution, in writing or orally, of his or her intent to withdraw; (3) if the student ceases attendance without providing official notification to the institution of his or her withdrawal, the midpoint of the payment period or, if applicable, the period of enrollment; (4) if the institution determines that a student did not begin the withdrawal process or otherwise notify the institution of the intent to withdraw due to illness, accident, grievous personal loss or other circumstances beyond the student’s control, the date the institution determines is related to that circumstances, (5) if a student does not return from an approved leave of absence, the date that the institution determines the student began the leave of absence; or (6) if the student takes an unapproved leave of absence, the date that the student began the leave of absence. Conditions and Contexts During my audit, I noted the following: • ABC did not return the required Title IV funds for one (1) student out of three (3) tested. The amount required to be returned totaled $3,446, was not returned; • ABC did not return the required Title IV funds within the prescribed timeframe for one (1) student out of three (3) tested; and • ABC was unable to document the last date of attendance or participation in any academic related activity for each of the students’ enrolled courses and received all non-passing grades for five (5) of the eight (8) students selected for testing resulting in $19,028 to be returned by ABC. Cause ABC failed to adhere to established procedures in processing certain refunds. Questioned Costs For purposes of this condition, I have questioned costs totaling $22,473 as follows: Program Amount Federal PELL Grant $ 12,977 Federal Direct Loan 9,496 Total $ 22,473 Effect ABC has not complied with Title IV regulations that specify if a student withdraws from school within a certain time frame, a refund must be processed, calculated properly, and remitted to the Title IV program in accordance with established time frames. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-002. Recommendation I recommend that management immediately make the necessary determination as to whether the students unofficially withdrew from ABC, prepare the Return of Title IV Funds calculation, and return the funds to the Department of Education in a timely manner. Management's Response Management concurs with this finding. The College will keep accurate attendance and participation records. The College will calculate R2T4s accurately and will return the funds in a timely manner. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to R2T4 regulations. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 - 003 - Common Origination and Disbursement (COD) System Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 - Student Financial Assistance Programs, Section (L) (1) Financial Reporting, indicates that schools submit PELL origination records and disbursement records to the COD system. Key items on the origination records are social security number, award amount, enrollment date, verification status code, transaction number, cost of attendance, and academic calendar. Institutions must report student payment data within 30 calendar days after the school makes a payment; or becomes aware of the need to make an adjustment to previously reported student payment data or expected student payment data. Conditions and Contexts I noted the following conditions during my testing of the COD system: • The PELL amount was disbursed in the COD system did not agree to the students’ billing statements for four (4) students out of eighty-eight (88). The billing statements under reported $1.587; • The Direct loan amounts disbursed in the COD system did not agree to the students’ billing statements for three (3) students out of seventy-one (71) tested. The billing statements under reported $3,316; and • The enrollment date was incorrectly reported in COD for seventy-five (75) students out of ninety-three (93) tested. Cause ABC failed to adhere to established procedures in reporting to the COD system. Questioned Costs For purposes of this condition, I have no questioned costs. Effect ABC has not complied with Title IV regulations that require proper and accurate recording to the COD system.   Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-003. Recommendation I recommend that ABC implements controls to ensure that information reported to the COD system is accurate. Management's Response Management concurs with this finding. The College will ensure the accuracy of the data that is input into the COD system and the College will work to apply funds appropriately to students' accounts. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to managing the COD system. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 - 003 - Common Origination and Disbursement (COD) System Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 - Student Financial Assistance Programs, Section (L) (1) Financial Reporting, indicates that schools submit PELL origination records and disbursement records to the COD system. Key items on the origination records are social security number, award amount, enrollment date, verification status code, transaction number, cost of attendance, and academic calendar. Institutions must report student payment data within 30 calendar days after the school makes a payment; or becomes aware of the need to make an adjustment to previously reported student payment data or expected student payment data. Conditions and Contexts I noted the following conditions during my testing of the COD system: • The PELL amount was disbursed in the COD system did not agree to the students’ billing statements for four (4) students out of eighty-eight (88). The billing statements under reported $1.587; • The Direct loan amounts disbursed in the COD system did not agree to the students’ billing statements for three (3) students out of seventy-one (71) tested. The billing statements under reported $3,316; and • The enrollment date was incorrectly reported in COD for seventy-five (75) students out of ninety-three (93) tested. Cause ABC failed to adhere to established procedures in reporting to the COD system. Questioned Costs For purposes of this condition, I have no questioned costs. Effect ABC has not complied with Title IV regulations that require proper and accurate recording to the COD system.   Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-003. Recommendation I recommend that ABC implements controls to ensure that information reported to the COD system is accurate. Management's Response Management concurs with this finding. The College will ensure the accuracy of the data that is input into the COD system and the College will work to apply funds appropriately to students' accounts. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to managing the COD system. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 - 004 - Student Credit Balance Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Student Financial Assistance Programs, Section III Part N – Special Tests and Provisions stipulate that disbursements to students must be made in accordance with required time frames. Title IV regulations 34 CFT 668.164 (e) specifies that whenever a school credits Student Financial Aid (SFA) program funds to a student’s account, and those funds exceed the student’s allowable charges, a SFA credit balance occurs. The school must pay the credit balance to the student as soon as possible, but no later than fourteen (14) days after the later of the date the balance occurred on the student’s account or the first day of classes of the payment period. Conditions and Contexts I noted during my thirty (30) out of ninety-three (93) students audit had student financial aid credit balances but ABC did not refund the credit balances to the students within the fourteen (14) day requirement. Cause It appears that ABC did not ensure the students receive their refunds checks within the prescribed timeframe. Repeat Finding No. Recommendation I recommend that management of ABC take immediate steps to ensure that students receive their refund checks within the required timeframes as required by Title IV regulations. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal regulations as it relates to resolving credit balances. The College will resolve credit balances timely and within the 14-day period as defined in the Federal guidelines. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 - 004 - Student Credit Balance Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal Pell Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Student Financial Assistance Programs, Section III Part N – Special Tests and Provisions stipulate that disbursements to students must be made in accordance with required time frames. Title IV regulations 34 CFT 668.164 (e) specifies that whenever a school credits Student Financial Aid (SFA) program funds to a student’s account, and those funds exceed the student’s allowable charges, a SFA credit balance occurs. The school must pay the credit balance to the student as soon as possible, but no later than fourteen (14) days after the later of the date the balance occurred on the student’s account or the first day of classes of the payment period. Conditions and Contexts I noted during my thirty (30) out of ninety-three (93) students audit had student financial aid credit balances but ABC did not refund the credit balances to the students within the fourteen (14) day requirement. Cause It appears that ABC did not ensure the students receive their refunds checks within the prescribed timeframe. Repeat Finding No. Recommendation I recommend that management of ABC take immediate steps to ensure that students receive their refund checks within the required timeframes as required by Title IV regulations. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal regulations as it relates to resolving credit balances. The College will resolve credit balances timely and within the 14-day period as defined in the Federal guidelines. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing

Audit Finding Reference Number 2023 – 005 – Student Status Confirmation Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.268 Federal Direct Student Loans (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV Regulations, 34 CFR Section 682.610 (c) (i) (ii) (iii) stipulated that if a university discovers that a loan has been made to or on behalf of a student who enrolled at that school, but who has ceased to be enrolled on at least a half-time basis; a student who has been accepted for enrollment at that school, but who failed to enroll on at least a half-time basis for the period for which the loan was intended, or a full-time student who has ceased to be enrolled on a full-time basis, ABC must notify the guarantee agency, the National Student Clearinghouse and/or the National Student Loan Data System (NSLDS). Schools are required to report enrollment data at least every sixty (60) days. Conditions and Contexts I noted during my audit twenty-two (22) students out of twenty-seven (27) tested whose change in enrollment status was reported correctly in the NSLDS system; however, the students’ status change was reported greater than the every sixty (60) days timeframe . Cause It appears that ABC did not properly report the student’s enrollment status to the guarantee agency, National Student Clearinghouse, and/or NSLDS. Questioned Costs For purposes of this condition, I do not have any questioned costs. Effect Noncompliance with federal regulations. ABC did not properly report the student’s status to the guarantee agency, National Student Clearinghouse, and/or NSLDS. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-005. Recommendation I recommend that ABC determine the student’s proper enrollment status and report the accurate status to the guarantee agency, National Student Clearinghouse, and/or NSLDS. Management’s Response Management concurs with this finding. The College will set policies, procedures and practices in place and adhere to ensure that changes in students’ enrollment are reported accurately and timely as defined in the Federal guidelines. Responsible Administrators: Director of Financial Aid & Registrar Effective: Immediately and ongoing

Audit Finding Reference Number Questioned Costs 2023 – 006 – Ineligible Aid Recipients $ 31,666 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.268 Federal Direct Student Loans (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV regulations 34 CFR 668.32 (a)(2) stipulates that a student is eligible to receive Title IV Direct Loans if the student is enrolled at least half-time at an eligible institution. Conditions and Contexts I noted during my testing nine (9) students out of seventy-one (71) students tested who was not enrolled at least half-time and received Direct loans. Cause It appears that ABC did not property administer and disburse Title IV aid to eligible recipients. Questioned Costs For purposes of this condition, I have questioned costs totaling $31,666 related to the Direct loan program. Effect ABC disbursed financial aid to an ineligible student. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-006. Recommendation I recommend that management of ABC adhere to established procedures to ensure that all federal funds are disbursed to eligible students. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to disbursing and administering federal aid. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid, Chief Financial Officer & V.P. of Academic Affairs Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Costs 2023 – 007 – Satisfactory Academic Progress $40,110 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV regulations, 34 CFR 668.32 (f) stipulates that students participating in the Title IV Federal Financial Aid program must be maintaining satisfactory progress in the course of study he or she is pursuing, according to the standards and practices of that institution to receive student financial aid. OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Appendix A, Student Financial Assistance – Special Tests and Provisions Compliance Requirement Number 9 – Satisfactory Academic Progress stipulates that a student must maintain good standing, or satisfactory progress. Title IV regulations CFD 668.16 (e) stipulates that an institution must establish, publish and apply reasonable standards for measuring satisfactory academic progress. Conditions and Contexts I noted during my audit that seven (7) students out of ninety-three (93) tested were awarded and received financial, although the students did not meet ABC’s standards for achieving satisfactory academic progress, nor were valid satisfactory academic progress appeals documentation available. Cause It appears that ABC inadvertently disbursed aid to academically ineligible students. Questioned Costs For the purpose of this condition, I have questioned costs totaling $40,110 as follows: Program Amount Federal PELL $24,733 Federal Direct Loan 15,377 Total $40,110 Effect It appears that ABC disbursed financial aid to a student that did not maintain satisfactory academic progress. Repeat Finding No. Recommendation I recommend that ABC adhere to established policies and procedures as documented in the revised satisfactory academic progress policy and monitor the academic standing of all students prior to awarding student financial aid, and ensure all required appeals documented is maintained. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to students meeting satisfactory academic progress. The College has an SAP appeal committee in place to enforce and abide by the College's policy. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Costs 2023 – 007 – Satisfactory Academic Progress $40,110 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loan (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV regulations, 34 CFR 668.32 (f) stipulates that students participating in the Title IV Federal Financial Aid program must be maintaining satisfactory progress in the course of study he or she is pursuing, according to the standards and practices of that institution to receive student financial aid. OMB 2 CFR 200, Subpart F Compliance Supplement, Part 5 Appendix A, Student Financial Assistance – Special Tests and Provisions Compliance Requirement Number 9 – Satisfactory Academic Progress stipulates that a student must maintain good standing, or satisfactory progress. Title IV regulations CFD 668.16 (e) stipulates that an institution must establish, publish and apply reasonable standards for measuring satisfactory academic progress. Conditions and Contexts I noted during my audit that seven (7) students out of ninety-three (93) tested were awarded and received financial, although the students did not meet ABC’s standards for achieving satisfactory academic progress, nor were valid satisfactory academic progress appeals documentation available. Cause It appears that ABC inadvertently disbursed aid to academically ineligible students. Questioned Costs For the purpose of this condition, I have questioned costs totaling $40,110 as follows: Program Amount Federal PELL $24,733 Federal Direct Loan 15,377 Total $40,110 Effect It appears that ABC disbursed financial aid to a student that did not maintain satisfactory academic progress. Repeat Finding No. Recommendation I recommend that ABC adhere to established policies and procedures as documented in the revised satisfactory academic progress policy and monitor the academic standing of all students prior to awarding student financial aid, and ensure all required appeals documented is maintained. Management’s Response Management concurs with this finding. The College will review and adhere to its practices, policies, and procedures along with federal guidelines as it relates to students meeting satisfactory academic progress. The College has an SAP appeal committee in place to enforce and abide by the College's policy. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Cost 2023 – 008 – Aid in Excess of Documented Need $10,693 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Uniform Guidance Compliance Supplement, Part 5 Section E (Eligibility) specified that the annual award should be calculated based upon certain factors and coordinated among all programs to ensure that the total aid is not awarded in excess of the student’s financial need. Title IV regulations, Section(s) 673.5, 682.603, and 685.301 state that an institution may not award financial aid to a student if the aid, when combined with other resources, exceeds the student’s financial need. Conditions and Contexts During my audit I noted five (5) students out of ninety-three (93) tested received financial aid in excess of their documented need. Cause It appears that ABC did not properly monitor the awarding and disbursing of financial aid to certain students. Questioned Costs For purposes of this condition, I have questioned costs totaling $10,693 as follows: Program Amount Federal Pell Grant $ 4,936 Federal Direct Loan 5,757 Total $10,693 Effect The failure of ABC to consider all available resources resulted in the over awarding of financial aid. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-008. Recommendation I recommend that ABC adhere to established procedures and ensure that the total financial aid received by students does not exceed their documented need. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to over awarding students. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Cost 2023 – 008 – Aid in Excess of Documented Need $10,693 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Uniform Guidance Compliance Supplement, Part 5 Section E (Eligibility) specified that the annual award should be calculated based upon certain factors and coordinated among all programs to ensure that the total aid is not awarded in excess of the student’s financial need. Title IV regulations, Section(s) 673.5, 682.603, and 685.301 state that an institution may not award financial aid to a student if the aid, when combined with other resources, exceeds the student’s financial need. Conditions and Contexts During my audit I noted five (5) students out of ninety-three (93) tested received financial aid in excess of their documented need. Cause It appears that ABC did not properly monitor the awarding and disbursing of financial aid to certain students. Questioned Costs For purposes of this condition, I have questioned costs totaling $10,693 as follows: Program Amount Federal Pell Grant $ 4,936 Federal Direct Loan 5,757 Total $10,693 Effect The failure of ABC to consider all available resources resulted in the over awarding of financial aid. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-008. Recommendation I recommend that ABC adhere to established procedures and ensure that the total financial aid received by students does not exceed their documented need. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to over awarding students. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing.

Audit Finding Reference Number Questioned Cost 2023 – 009 – Pell Grant Calculations $8,608 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.063 Federal PELL Grant Program (PELL) Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Title IV regulations, 34 CFR Section 690.62 (a) stipulates that the amount of a student’s Pell Grant for an academic year is based upon the payment and disbursement schedules published by the Secretary for each year. Each student’s Pell grant is based upon their enrollment status, cost of attendance and expected family contribution. Conditions and Contexts During my audit I noted twenty-four (24) students out of eighty-seven (87) tested whose Pell grant amount was calculated incorrectly. This resulted in ABC over-disbursing Pell in the amount of $8,608. Cause It appears that ABC did not review and verify all components of the Pell grant calculation to ensure the proper amount of Pell was disbursed. Questioned Costs For purposes of this condition, I have questioned costs totaling $8,608. Effect ABC disbursed excess Pell grant funds to students. Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-009. Recommendation I recommend that ABC adhere to federal prescribed regulations by calculating and disbursing Pell grants in accordance with the Department of Education’s Pell payment schedule and in accordance with the Lifetime Eligibility Usage limits. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to calculating and awarding Pell. The College will return any ineligible funds accordingly. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective: Immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number 2023 – 010 – Late Submission of Audit Report Federal Program and Specific Federal Award Identification CFDA Title and Number 84.007 Federal Supplemental Educational Opportunity Grants (SEOG) 84.033 Federal Work-Study Program (FWS) 84.063 Federal PELL Grant Program (PELL) 84.268 Federal Direct Student Loans (Direct) 84.425E Education Stabilization Fund – Student Aid 84.425F Education Stabilization Fund – Institutional Aid 84.425J Education Stabilization Fund – Historic Black Colleges and Universities Federal Award Number June 30, 2023 Federal Agencies U.S. Department of Education Pass-Through Entity Not applicable Criteria Pursuant to the requirement of Uniform Guidance 2 CFR Part 200.512(a), Single audits are required to be completed and the data collection form and reporting package submitted within the earlier of thirty (30) days after receipt of the auditor’s report, or nine (9) months after the end of the audit period. If the due date falls on a Saturday, Sunday, or federal Holiday, the reporting package is due the next business day. Conditions and Contexts The June 30, 2023 audit report was not submitted within the prescribed time frame. Required by federal regulations. The audit report was outstanding nine (9) months after the entity’s fiscal year. Cause Management failed to ensure the audit report was issued within the prescribed time frame. Questioned Costs For purposes of this condition, I have no questioned cost. Effect ABC. has not complied with the audit requirement of Uniform Guidance 2 CFR Part 200.512(a). Repeat Finding Yes. See Schedule of Prior Year Audit Finding 2022-010. Recommendation I recommend that the management of ABC take steps to ensure that the Single Audit is submitted within the prescribed deadlines. Management’s Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to competing and submitting the audit. The College has a new CFO and Controller. These measures will ensure stability and a timely audit. Responsible Administrators: Director of Financial Aid & Chief Financial Officer Effective immediately and ongoing.

Audit Finding Reference Number Questioned Costs 2023 – 011 – Aggregate Loan Limits $4,804 Federal Program and Specific Federal Award Identification CFDA Title and Number 84.268 Federal Direct Student Loans (Direct) Federal Award Year June 30, 2023 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria CFR 685.203 (d) stipulates the aggregate unpaid principal amount of all Direct subsidized loans made to a student but excluding the amount of capitalized interest may not exceed (1) for dependent undergraduate students $31,000, (2) for independent undergraduate student or dependent undergraduate who qualifies for additional eligibility, $57,500 and (3) for graduate or professional students, $138,500. The total amount of Direct subsidized loans but excluding the amount of capitalized interest may not exceed (1) for a dependent undergraduate student $23,000. Conditions and Contexts I noted during my audit three (3) dependent students out of twenty-one (21) tested received direct loans in excess of the aggregate loan limit. Cause It appears that ABC did not ensure that the student was eligible to receive the loan proceeds. Questioned Costs For purposes of this condition, I have questioned costs totaling $4,804 related to the Direct loan program. Effect ABC has not adhered to Title IV regulations regarding the disbursing of loan funds in accordance with the regulations. Repeat Finding No. Recommendation I recommend that the management of ABC take immediate steps to ensure that students receive their loan funds as required by Title IV regulations. Management Response Management concurs with this finding. The College will adhere to its policies, procedures, processes, and federal guidelines as it relates to disbursing loans within aggregate loan limits. Responsible Administrators: Director of Financial Aid Effective: Immediately and ongoing.