FAC Explorer

Audit 344059

FY End
2024-05-31
Total Expended
$8.82M
Findings
6
Programs
7
Organization: Keystone College (PA)
Year: 2024 Accepted: 2025-02-27
Auditor: Kohanski & Company PC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
524628 2024-002 Significant Deficiency Yes C
524629 2024-003 Significant Deficiency - C
524630 2024-004 Significant Deficiency - N
1101070 2024-002 Significant Deficiency Yes C
1101071 2024-003 Significant Deficiency - C
1101072 2024-004 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $5.35M Yes 1
84.063 Federal Pell Grant Program $2.25M Yes 1
84.038 Federal Perkins Loan Program_federal Capital Contributions $805,481 Yes 0
23.002 Appalachian Area Development $151,000 - 0
84.033 Federal Work-Study Program $75,769 Yes 0
84.007 Federal Supplemental Educational Opportunity Grants $63,000 Yes 1
10.558 Child and Adult Care Food Program $37,224 - 0

Contacts

Name Title Type
EVNRN16ZFLK4 John F. Pullo Auditee
5709458505 Kelley Lindsay Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule arereported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not alowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The College did not elect to use the 10% de minimis cost rate. The accompanying schedule of expenditures of federal awards (the "Schedule") includes federal award activity of Keystone College (the "College") under programs of the federal government for the year ended May 31, 2024. The information is the Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements of Federal Awards ("Uniform Guidance"). Because this Schedule presents only a select portion of the operations of the College, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the College.
Title: Subrecipients Accounting Policies: Expenditures reported on the Schedule arereported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not alowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The College did not elect to use the 10% de minimis cost rate. The College did not pass through any awards to subrecipients.
Title: Federal Loan Programs Accounting Policies: Expenditures reported on the Schedule arereported on the cash basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not alowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The College did not elect to use the 10% de minimis cost rate. The Federal Perkins Loan Program (84.038) is administered directly by the College, and balances and transactions relating to this program are included in the College's financial statements. Loans outstnding at the beginning of the year and loans made during the year are included in the federal expenditures presented in the Schedule. Federal Perkins loans outstanding as of May 31, 2024 totaled $805,481. Total loans granted under the Federal Direct Student Loan Program, which were not made by the College but were received by its students were $5,352305 for the year ended May 31, 2024. The total outstanding loan balance under the Economic Injury Disaster Loan Program is $2,000,000.

Finding Details

Finding 2024-002
Criteria: When Title IV funds are credited to a student account and they exceed the amount of tuition and fees, room and board, and other authroized charges assessed to the student, a credit balance is created. The institution must pay the resulting credit balance directly to the student or parent borrower within 14 days after (1) the first day of class or a payment period if the credit balance occurred on or before that day, or (2) the balance occured if that was after the first day of class. Condition: For one student out of twenty -five tested, receipt of Title IV funds created an over payment to the students' account which was returned to the student, but not in accordance with the criteria noted above. Cause: Management of the College has implemented procedures to ensure credit balances are returned within the required time frame. This student was identified and corrected after the procedures were implemented. Effect: The College was not in compliance with the requirements and students did not timely receive the Title IV funds to which they were entitled.
Finding 2024-003
Criteria: Under the Heightened Cash Monitoring 1 (HCM1) payment method as stated in 34 CFR 668.162(d), the College must first make distributions to eligible students and parents and pay any remaining credit balances before request or receipt of funds for the amount of those disbursements from the U.S. Department of Education. Condition: During the year ended May 31, 2024 the College disbursed $63,000of SEOG funds to students, but drew down their entire authorized amount of $123,626 resulting in an overdraw of $60,626. Cause: The College did not follow the procedures for requesting federal funds and disbursing them to student accounts timely as required by the HCM1 payment method. Effect: The College was not in compliance with the HCM1 drawdown payment method.
Finding 2024-004
34 CFR 668.22 requires that when a recipient of Title IV grant or loan assistance withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the institution must determine the amount of Title IV grant or loan assistance that the student earned as of the student's withdrawal date in accordance with federal regulations and return the unearned portion of the grant or loan funds to the Title IV programs as soon as possible, but no later than 45 days after the withdrawal date. Condition: For one student out of five selected for testing, the amount of the Title IV refund was calculated incorrectly, resuling in an underpayment of PELL funds of $124. Cause: The College did not apply the correct end date for the semester when performing the calculations. Effect: The College did not refund the correct amount of PELL funds to the Title IV program.
Finding 2024-002
Criteria: When Title IV funds are credited to a student account and they exceed the amount of tuition and fees, room and board, and other authroized charges assessed to the student, a credit balance is created. The institution must pay the resulting credit balance directly to the student or parent borrower within 14 days after (1) the first day of class or a payment period if the credit balance occurred on or before that day, or (2) the balance occured if that was after the first day of class. Condition: For one student out of twenty -five tested, receipt of Title IV funds created an over payment to the students' account which was returned to the student, but not in accordance with the criteria noted above. Cause: Management of the College has implemented procedures to ensure credit balances are returned within the required time frame. This student was identified and corrected after the procedures were implemented. Effect: The College was not in compliance with the requirements and students did not timely receive the Title IV funds to which they were entitled.
Finding 2024-003
Criteria: Under the Heightened Cash Monitoring 1 (HCM1) payment method as stated in 34 CFR 668.162(d), the College must first make distributions to eligible students and parents and pay any remaining credit balances before request or receipt of funds for the amount of those disbursements from the U.S. Department of Education. Condition: During the year ended May 31, 2024 the College disbursed $63,000of SEOG funds to students, but drew down their entire authorized amount of $123,626 resulting in an overdraw of $60,626. Cause: The College did not follow the procedures for requesting federal funds and disbursing them to student accounts timely as required by the HCM1 payment method. Effect: The College was not in compliance with the HCM1 drawdown payment method.
Finding 2024-004
34 CFR 668.22 requires that when a recipient of Title IV grant or loan assistance withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the institution must determine the amount of Title IV grant or loan assistance that the student earned as of the student's withdrawal date in accordance with federal regulations and return the unearned portion of the grant or loan funds to the Title IV programs as soon as possible, but no later than 45 days after the withdrawal date. Condition: For one student out of five selected for testing, the amount of the Title IV refund was calculated incorrectly, resuling in an underpayment of PELL funds of $124. Cause: The College did not apply the correct end date for the semester when performing the calculations. Effect: The College did not refund the correct amount of PELL funds to the Title IV program.