FAC Explorer

Audit 344161

FY End
2024-05-31
Total Expended
$40.38M
Findings
8
Programs
14
Organization: Mercyhurst University (PA)
Year: 2024 Accepted: 2025-02-27
Auditor: Rsm US LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
524775 2024-002 Significant Deficiency - N
524776 2024-002 Significant Deficiency - N
524777 2024-001 Significant Deficiency - N
524778 2024-003 Significant Deficiency - N
1101217 2024-002 Significant Deficiency - N
1101218 2024-002 Significant Deficiency - N
1101219 2024-001 Significant Deficiency - N
1101220 2024-003 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $19.97M Yes 1
95.001 High Intensity Drug Trafficking Areas Program $14.22M - 0
84.063 Federal Pell Grant Program $4.03M Yes 1
84.287 Twenty-First Century Community Learning Centers $868,361 - 0
84.038 Federal Perkins Loan Program_federal Capital Contributions $600,191 Yes 1
84.033 Federal Work-Study Program $290,611 Yes 0
84.007 Federal Supplemental Educational Opportunity Grants $274,034 Yes 1
14.267 Continuum of Care Program $50,089 - 0
47.076 Stem Education (formerly Education and Human Resources) $33,496 - 0
16.817 Byrne Criminal Justice Innovation Program $21,260 - 0
17.245 Trade Adjustment Assistance $20,002 - 0
93.925 Scholarships for Health Professions Students From Disadvantaged Backgrounds $5,435 - 0
12.620 Troops to Teachers Grant Program $1,072 - 0
23.002 Appalachian Area Development $662 - 0

Contacts

Name Title Type
MJLLQT82EDT1 Michael Heller Auditee
8148242390 Matthew Garvey Auditor
No contacts on file

Notes to SEFA

Title: Note 1. Basis of Presentation Accounting Policies: Expenditures on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Mercyhurst University has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance due to the fact that the University has an existing indirect cost rate. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Mercyhurst University under programs of the federal government for the year ended May 31, 2024. The accompanying notes are an integral part of this Schedule. The information in this 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 for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of Mercyhurst University, it is not intended to, and does not, present the financial position, changes in net assets or cash flows of Mercyhurst University.
Title: Note 2. Summary of Significant Accounting Policies Accounting Policies: Expenditures on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Mercyhurst University has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance due to the fact that the University has an existing indirect cost rate. Expenditures on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Title: Note 3. Indirect Cost Rate Accounting Policies: Expenditures on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Mercyhurst University has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance due to the fact that the University has an existing indirect cost rate. Mercyhurst University has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance due to the fact that the University has an existing indirect cost rate.
Title: Note 4. Federal Perkins Loan Program Accounting Policies: Expenditures on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Mercyhurst University has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance due to the fact that the University has an existing indirect cost rate. During 2024, no Perkins Loans were distributed. The outstanding balance on the Perkins Loans at May 31, 2024, totaled $470,723.
Title: Note 5. Federal Direct Student Loans Accounting Policies: Expenditures on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: Mercyhurst University has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance due to the fact that the University has an existing indirect cost rate. The Federal Direct Lending Program consists of subsidized and unsubsidized Federal Loans (for students) and Federal PLUS Loans (for parents and graduate students). Federal statute requires that proceeds from Federal Direct Lending Loans (subsidized, unsubsidized and PLUS) be disbursed to the University to be directly applied to students’ accounts. New loans processed for students during the year ended May 31, 2024, were as follows: Federal Direct Lending Programs: Subsidized - $4,638,885; Unsubsidized - $8,399,739; Grad PLUS - $1,962,419; PLUS - $4,964,698; Total - $19,965,741. The value of the loans issued for the Federal Direct Student Loan Program is based on disbursed amounts. The University is responsible only for the performance of certain administrative duties with respect to the Federally Guaranteed Student Loan Programs and, accordingly, balances and transactions relating to the loan programs are not included in the University’s basic financial statements. Therefore, it is not practical to determine the balance of loans outstanding to students and former students of Mercyhurst University at May 31, 2024. See report for table.

Finding Details

Finding 2024-002
Program Title: Student Financial Assistance Cluster Assistance Listing Numbers: 84.063 and 84.007 Federal Award Number: None Federal Agencies: United States Department of Education Criteria: According to 34 CFR 668.22, the University is required to implement procedures to appropriately administer funding under the Student Financial Assistance Cluster and to return Title IV funds in the appropriate time required by regulations. Condition: During the course of our testing, we identified one student from a sample of ten whose return of Title IV aid was not calculated correctly and, therefore, the amount of aid returned was not correct. Cause: Administrative oversight by personnel in refund process. Effect: The University has not complied with certain requirements of FSA Handbook and Federal Code of Regulations to return aid properly to the students. Questioned Costs: $2,610 Context: During testing of return of Title IV funds, we identified that the calculation for the return of funds was not correct for one student. Repeat Finding: No Recommendation: The University should implement and document an overall quality assurance process including adequate controls to prevent overall noncompliance. View of responsible individuals: Management agrees with the finding.
Finding 2024-002
Program Title: Student Financial Assistance Cluster Assistance Listing Numbers: 84.063 and 84.007 Federal Award Number: None Federal Agencies: United States Department of Education Criteria: According to 34 CFR 668.22, the University is required to implement procedures to appropriately administer funding under the Student Financial Assistance Cluster and to return Title IV funds in the appropriate time required by regulations. Condition: During the course of our testing, we identified one student from a sample of ten whose return of Title IV aid was not calculated correctly and, therefore, the amount of aid returned was not correct. Cause: Administrative oversight by personnel in refund process. Effect: The University has not complied with certain requirements of FSA Handbook and Federal Code of Regulations to return aid properly to the students. Questioned Costs: $2,610 Context: During testing of return of Title IV funds, we identified that the calculation for the return of funds was not correct for one student. Repeat Finding: No Recommendation: The University should implement and document an overall quality assurance process including adequate controls to prevent overall noncompliance. View of responsible individuals: Management agrees with the finding.
Finding 2024-001
Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.038 Federal Award Number: None Federal Agencies: United States Department of Education Criteria: According to federal regulations 34 CFR 674.19, the University must retain an original or electronically signed Master Promissory Note for at least three years after all loans made under the Master Promissory Note are satisfied. Condition: During testing of Perkins Loan Recordkeeping and Record Retention, we identified that the University could not provide a signed promissory note for three out of four loans selected for testing. Cause: The absence of signed forms may be due to inadequate oversight in the loan documentation process or a lapse in following established procedures for collecting and retaining signed forms. Effect: The lack of signed Perkins Loan forms in the files could result in non-compliance with federal regulations and creates challenges in enforcing loan agreements. Questioned Costs: None Context: During testing of Perkins Loan Recordkeeping and Record Retention we identified that the University could not provide a signed promissory note for three out of four loans selected for testing. Repeat Finding: No Recommendation: It is recommended that the University reviews and strengthens its procedures for collecting and retaining signed promissory notes. This may include a review of all outstanding Perkins loan borrowers and review of related documentation to ensure a Master Promissory Note has been signed and retained. View of responsible individuals: Management agrees with the finding.
Finding 2024-003
Program Title: Student Financial Assistance Cluster, Federal Perkins Loan Program Assistance Listing Number: 84.268 Federal Award Number: None Federal Agencies: United States Department of Education Criteria: According to 34 CFR 685.309, the University is required to report a change in student status (withdrawal or graduation) within sixty days to NSLDS. Condition: During the course of our testing, we identified seven students from a sample of fifty whose change in status was not communicated within the required sixty days. Cause: Administrative oversight by personnel in refund process. Effect: The University has not complied with certain requirements of FSA Handbook and Federal Code of Regulations. Questioned Costs: None Context: During testing enrollment reporting, we identified instances where a student change in status was not timely communicated to NSLDS. Repeat Finding: No Recommendation: The University should implement and document an overall quality assurance process including adequate controls to prevent overall noncompliance. View of responsible individuals: Management agrees with the finding.
Finding 2024-002
Program Title: Student Financial Assistance Cluster Assistance Listing Numbers: 84.063 and 84.007 Federal Award Number: None Federal Agencies: United States Department of Education Criteria: According to 34 CFR 668.22, the University is required to implement procedures to appropriately administer funding under the Student Financial Assistance Cluster and to return Title IV funds in the appropriate time required by regulations. Condition: During the course of our testing, we identified one student from a sample of ten whose return of Title IV aid was not calculated correctly and, therefore, the amount of aid returned was not correct. Cause: Administrative oversight by personnel in refund process. Effect: The University has not complied with certain requirements of FSA Handbook and Federal Code of Regulations to return aid properly to the students. Questioned Costs: $2,610 Context: During testing of return of Title IV funds, we identified that the calculation for the return of funds was not correct for one student. Repeat Finding: No Recommendation: The University should implement and document an overall quality assurance process including adequate controls to prevent overall noncompliance. View of responsible individuals: Management agrees with the finding.
Finding 2024-002
Program Title: Student Financial Assistance Cluster Assistance Listing Numbers: 84.063 and 84.007 Federal Award Number: None Federal Agencies: United States Department of Education Criteria: According to 34 CFR 668.22, the University is required to implement procedures to appropriately administer funding under the Student Financial Assistance Cluster and to return Title IV funds in the appropriate time required by regulations. Condition: During the course of our testing, we identified one student from a sample of ten whose return of Title IV aid was not calculated correctly and, therefore, the amount of aid returned was not correct. Cause: Administrative oversight by personnel in refund process. Effect: The University has not complied with certain requirements of FSA Handbook and Federal Code of Regulations to return aid properly to the students. Questioned Costs: $2,610 Context: During testing of return of Title IV funds, we identified that the calculation for the return of funds was not correct for one student. Repeat Finding: No Recommendation: The University should implement and document an overall quality assurance process including adequate controls to prevent overall noncompliance. View of responsible individuals: Management agrees with the finding.
Finding 2024-001
Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.038 Federal Award Number: None Federal Agencies: United States Department of Education Criteria: According to federal regulations 34 CFR 674.19, the University must retain an original or electronically signed Master Promissory Note for at least three years after all loans made under the Master Promissory Note are satisfied. Condition: During testing of Perkins Loan Recordkeeping and Record Retention, we identified that the University could not provide a signed promissory note for three out of four loans selected for testing. Cause: The absence of signed forms may be due to inadequate oversight in the loan documentation process or a lapse in following established procedures for collecting and retaining signed forms. Effect: The lack of signed Perkins Loan forms in the files could result in non-compliance with federal regulations and creates challenges in enforcing loan agreements. Questioned Costs: None Context: During testing of Perkins Loan Recordkeeping and Record Retention we identified that the University could not provide a signed promissory note for three out of four loans selected for testing. Repeat Finding: No Recommendation: It is recommended that the University reviews and strengthens its procedures for collecting and retaining signed promissory notes. This may include a review of all outstanding Perkins loan borrowers and review of related documentation to ensure a Master Promissory Note has been signed and retained. View of responsible individuals: Management agrees with the finding.
Finding 2024-003
Program Title: Student Financial Assistance Cluster, Federal Perkins Loan Program Assistance Listing Number: 84.268 Federal Award Number: None Federal Agencies: United States Department of Education Criteria: According to 34 CFR 685.309, the University is required to report a change in student status (withdrawal or graduation) within sixty days to NSLDS. Condition: During the course of our testing, we identified seven students from a sample of fifty whose change in status was not communicated within the required sixty days. Cause: Administrative oversight by personnel in refund process. Effect: The University has not complied with certain requirements of FSA Handbook and Federal Code of Regulations. Questioned Costs: None Context: During testing enrollment reporting, we identified instances where a student change in status was not timely communicated to NSLDS. Repeat Finding: No Recommendation: The University should implement and document an overall quality assurance process including adequate controls to prevent overall noncompliance. View of responsible individuals: Management agrees with the finding.