Audit 349380

2024-006 Department of Education Student Financial Aid Cluster Federal Financial Assistance Listing 84.268 – Federal Direct Student Loans 2023-2024 Award Year Special Tests and Provision – Disbursements to or on Behalf of Students Significant Deficiency in Internal Controls over Compliance and Noncompliance Criteria: When Title IV funds are credited to a student account and they exceed the amount of tuition and fees, food and housing, and other authorized charges assessed 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 of a payment period if the credit balance occurred on or before that day, or (2) the balance occurred if that was after the first day of class. Also, as allowed under 34 CFR 668.164(c)(3), a school may pay prior award year charges up to $200. If over $200, student authorization is required to apply the payments to a prior-year balance. Condition: During testing over credit balances, 1) one student did not receive the refund on a timely basis; and 2) two students had amounts applied to a prior-year balance over $200. Cause: The student was awarded aid at an off time in the semester, and the refund was not provided within the 14-day window. Also, turnover in staffing in the fall 2023 allowed disbursements to be applied to students prioryear accounts receivable balances relating to tuition and fees or other charges. Effect: The students were not given the refund in a timely manner or given the proper refund related to the current award period. Questioned Costs: None. Context/Sampling: A nonstatistical sample of 61 students who received Title IV disbursements out of 1,491 students who received aid. Repeat Finding from Prior Year(s): No. Recommendation: We recommend disbursements made be reviewed to ensure that the refunds are being provided to students on a timely basis. We also recommend controls be put into place to ensure that, if a student has a balance over $200 from a prior award year, those accounts are reviewed to ensure that currentyear aid is not applied to prior-year balances. Views of Responsible Officials: Management agrees with the finding.

2024-007 Department of Education Student Financial Aid Cluster Federal Financial Assistance Listing 84.268 – Federal Direct Student Loans 2023-2024 Award Year Special Tests and Provision – Enrollment Reporting Significant Deficiency in Internal Controls over Compliance and Non-Compliance Criteria: 34 CFR section 685.309 sets forth the criteria for administrative and fiscal control and fund accounting requirements for schools participating in the Direct Loan Program in regard to enrollment reporting requirements. Condition: The following instances were identified through our testing over enrollment reporting: • 16 instances in which the student’s status change was certified outside the 60-day reporting requirement. Cause: For the students with certification dates outside of the required 60-day timeframe, information files were not provided timely to the third-party provider to submit to NSLDS for reporting. The late reporting was specific to the July 2023 and December 2023 graduation dates. Effect: The errors in reporting resulted in reporting dates outside of the required reporting timeframe which could impact the timing of required loan payments to be made. Questioned Costs: None. Context/Sampling: A nonstatistical sample of 60 students with a change in status out of approximately 693 students with a change in status were selected for testing of enrollment reporting requirements. Repeat Finding from Prior Year(s): Yes. Recommendation: We recommend the financial aid and registrar’s offices review controls over information being entered into the software for dates and other academic information that is required to be reported to ensure that status changes and other academic information are certified within 60 days of the effective date. We also recommend that a monitoring system be put in place to track status changes and reporting of those status changes that can be monitored by financial aid or the registrar’s offices. Views of Responsible Officials: Management agrees with the finding.

Department of Education Education Stabilization Fund: Higher Education Emergency Relief Find (HEERF) Federal Financial Assistance Listing 84.425F Institutional Portion Award Number P425F202657, Award Years 2020 and 2021 Period of Performance Material Weakness in Internal Controls over Compliance and Material Non-Compliance Criteria: In the CRRSSA and ARP Certification and Agreement, all institutions were given one calendar year from the date of the Grant Award Notification to complete period of performance which was subsequently extended to June 30, 2023. Department of Education provided guidance in Frequently Asked Questions #51 specific to period of performance noting, “institutions now have 120 calendar days to liquidate all financial obligations incurred under the award after the period of performance.” The 2024 compliance supplement also notes specific to lost revenue, “For lost revenue, the obligation occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period.” Condition: Two errors were noted related to period of performance: 1) the lost revenue calculation was completed in October 2023, which was after the June 30, 2023, period of performance date; and 2) the School District also spent money on expenses for the program in November 2023 and January 2024, which was after the 120-day liquidation period. Cause: The School did not apply for a no cost extension to be able to obligate the funding after June 30, 2023. For error #1, the School District was waiting to claim lost revenue until all expenses under the program were incurred to be able to use any remaining funding available. For error #2, the School District believed that the purchase orders that were outstanding after the 120-day liquidation period would be allowed to be paid when items purchased were received. Effect: The School received grant funding on allowable costs which were paid for or obligated after the period of performance and liquidation period ended. Questioned Costs: $539,358 specific to lost revenue and $179,409 for expenses paid for in November 2023 and January 2024. Context/Sampling: All lost revenue calculation reports were tested. We tested 40 out of 410 total expenses from the program for other expenses. Total questioned costs for expenses was obtained from general ledger detail for expenses paid after October 26, 2023. Repeat Finding from Prior Year(s): No Recommendation: We recommend a tracking schedule monitored by multiple people be maintained with all required spending deadlines to ensure that funding is spent in the required timeframe. We also recommend review of the grant agreements and grant funding information to ensure that knowledge of the requirements is known by multiple people to ensure requirements are met. Views of Responsible Officials: Management agrees with the finding.

2024-003 Department of Education Education Stabilization Fund: Higher Education Emergency Relief Find (HEERF) Federal Financial Assistance Listing 84.425F Institutional Portion Award Number P425F202657, Award Years 2020 and 2021 Activities Allowed or Unallowed and Allowable Costs/Cost Principles Material Weakness in Internal Controls over Compliance and Material Non-Compliance Criteria: The CARES Act, CRRSSA and the American Rescue Plan Act (ARP) sets forth the criteria for allowable costs and activities. Condition: During testing over the requirements, we noted that, in 28 of 40 expenses tested, reimbursement was received for expenses for items that were never purchased. The total for these 28 items was $10,682. Additional review noted a total of $132,071 for total funding received but not spent. Cause: The School District used outstanding purchase obligations to request reimbursement at the end of the liquidation period, but did not spend all of the money. Effect: The School received reimbursement for items that were never purchased. Questioned Costs: $132,071 Context/Sampling: A nonstatistical sample of 60 expenses submitted for reimbursement out of 410 total expenses. Repeat Finding from Prior Year(s): No. Recommendation: We recommend a review be completed to ensure that all reimbursements have proper expenses to back up the request submitted. We also recommend that, if new funding is received, a committee be set up by the School District to be able to review expenses and ensure that funding is spent on proper items and requests for reimbursement are only made once expenses have been paid. Views of Responsible Officials: Management agrees with the finding.

2024-004 Department of Education Education Stabilization Fund: Higher Education Emergency Relief Find (HEERF) Federal Financial Assistance Listing 84.425F Institutional Portion Award Number P425F202657, Award Years 2020 and 2021 Cash Management Material Weakness in Internal Controls over Compliance and Material Non-Compliance Criteria: For CRRSSA HEERF II and ARP HEERF III, the certification and agreements indicate the institutional aid portion of funding should be disbursed within three calendar days from the drawdown from G5. Condition: During testing over the requirement, it was noted that the amount drawn on October 25, 2023, was not spent until November 2023, January 2024, or was never spent. Cause: The School District was at the end of the 120-day liquidation period of performance so drew all remaining available funding based on open purchase orders. Effect: The School District received, but did not disburse, the funds within the allowed three-day timeframe. Questioned Costs: $311,480 Context/Sampling: A nonstatistical sample of two draw requests out of five total draw requests were tested. Of the $311,480 received, $179,409 was spent in November 2023 and April 2024 (also reported under period of performance) and $132,071 was never spent (also reported under allowable costs). Repeat Finding from Prior Year(s): No. Recommendation: We recommend that reimbursement requests be submitted at the time of or after payments for the expenses are made to ensure that timing of the reimbursement is received at the same time or after payments are made. Views of Responsible Officials: Management agrees with the finding.

2024-005 Department of Education Education Stabilization Fund: Higher Education Emergency Relief Find (HEERF) Federal Financial Assistance Listing 84.425F Institutional Portion Award Number P425F202657, Award Years 2020 and 2021 Reporting Significant Deficiency in Internal Controls over Compliance Criteria: CRRSSA section 314 (e) and CARES Act 18004 (e) sets forth the criteria for reporting requirements. Condition: There was no review of quarterly or annual HEERF reports prior to their submission. Cause: Inadequate controls implemented to ensure compliance with HEERF reporting requirements. Effect: Reports could be submitted with incorrect information. Questioned Costs: None. Context/Sampling: The one required quarterly report for the September 2023 quarter was tested and the annual report for calendar year 2024 was tested. Repeat Finding from Prior Year(s): Yes. Recommendation: We recommend there is a separate, documented reviewer of the reports prior to their submission. Views of Responsible Officials: Management agrees with the finding.

2024-006 Department of Education Student Financial Aid Cluster Federal Financial Assistance Listing 84.268 – Federal Direct Student Loans 2023-2024 Award Year Special Tests and Provision – Disbursements to or on Behalf of Students Significant Deficiency in Internal Controls over Compliance and Noncompliance Criteria: When Title IV funds are credited to a student account and they exceed the amount of tuition and fees, food and housing, and other authorized charges assessed 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 of a payment period if the credit balance occurred on or before that day, or (2) the balance occurred if that was after the first day of class. Also, as allowed under 34 CFR 668.164(c)(3), a school may pay prior award year charges up to $200. If over $200, student authorization is required to apply the payments to a prior-year balance. Condition: During testing over credit balances, 1) one student did not receive the refund on a timely basis; and 2) two students had amounts applied to a prior-year balance over $200. Cause: The student was awarded aid at an off time in the semester, and the refund was not provided within the 14-day window. Also, turnover in staffing in the fall 2023 allowed disbursements to be applied to students prioryear accounts receivable balances relating to tuition and fees or other charges. Effect: The students were not given the refund in a timely manner or given the proper refund related to the current award period. Questioned Costs: None. Context/Sampling: A nonstatistical sample of 61 students who received Title IV disbursements out of 1,491 students who received aid. Repeat Finding from Prior Year(s): No. Recommendation: We recommend disbursements made be reviewed to ensure that the refunds are being provided to students on a timely basis. We also recommend controls be put into place to ensure that, if a student has a balance over $200 from a prior award year, those accounts are reviewed to ensure that currentyear aid is not applied to prior-year balances. Views of Responsible Officials: Management agrees with the finding.

2024-007 Department of Education Student Financial Aid Cluster Federal Financial Assistance Listing 84.268 – Federal Direct Student Loans 2023-2024 Award Year Special Tests and Provision – Enrollment Reporting Significant Deficiency in Internal Controls over Compliance and Non-Compliance Criteria: 34 CFR section 685.309 sets forth the criteria for administrative and fiscal control and fund accounting requirements for schools participating in the Direct Loan Program in regard to enrollment reporting requirements. Condition: The following instances were identified through our testing over enrollment reporting: • 16 instances in which the student’s status change was certified outside the 60-day reporting requirement. Cause: For the students with certification dates outside of the required 60-day timeframe, information files were not provided timely to the third-party provider to submit to NSLDS for reporting. The late reporting was specific to the July 2023 and December 2023 graduation dates. Effect: The errors in reporting resulted in reporting dates outside of the required reporting timeframe which could impact the timing of required loan payments to be made. Questioned Costs: None. Context/Sampling: A nonstatistical sample of 60 students with a change in status out of approximately 693 students with a change in status were selected for testing of enrollment reporting requirements. Repeat Finding from Prior Year(s): Yes. Recommendation: We recommend the financial aid and registrar’s offices review controls over information being entered into the software for dates and other academic information that is required to be reported to ensure that status changes and other academic information are certified within 60 days of the effective date. We also recommend that a monitoring system be put in place to track status changes and reporting of those status changes that can be monitored by financial aid or the registrar’s offices. Views of Responsible Officials: Management agrees with the finding.

Department of Education Education Stabilization Fund: Higher Education Emergency Relief Find (HEERF) Federal Financial Assistance Listing 84.425F Institutional Portion Award Number P425F202657, Award Years 2020 and 2021 Period of Performance Material Weakness in Internal Controls over Compliance and Material Non-Compliance Criteria: In the CRRSSA and ARP Certification and Agreement, all institutions were given one calendar year from the date of the Grant Award Notification to complete period of performance which was subsequently extended to June 30, 2023. Department of Education provided guidance in Frequently Asked Questions #51 specific to period of performance noting, “institutions now have 120 calendar days to liquidate all financial obligations incurred under the award after the period of performance.” The 2024 compliance supplement also notes specific to lost revenue, “For lost revenue, the obligation occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period.” Condition: Two errors were noted related to period of performance: 1) the lost revenue calculation was completed in October 2023, which was after the June 30, 2023, period of performance date; and 2) the School District also spent money on expenses for the program in November 2023 and January 2024, which was after the 120-day liquidation period. Cause: The School did not apply for a no cost extension to be able to obligate the funding after June 30, 2023. For error #1, the School District was waiting to claim lost revenue until all expenses under the program were incurred to be able to use any remaining funding available. For error #2, the School District believed that the purchase orders that were outstanding after the 120-day liquidation period would be allowed to be paid when items purchased were received. Effect: The School received grant funding on allowable costs which were paid for or obligated after the period of performance and liquidation period ended. Questioned Costs: $539,358 specific to lost revenue and $179,409 for expenses paid for in November 2023 and January 2024. Context/Sampling: All lost revenue calculation reports were tested. We tested 40 out of 410 total expenses from the program for other expenses. Total questioned costs for expenses was obtained from general ledger detail for expenses paid after October 26, 2023. Repeat Finding from Prior Year(s): No Recommendation: We recommend a tracking schedule monitored by multiple people be maintained with all required spending deadlines to ensure that funding is spent in the required timeframe. We also recommend review of the grant agreements and grant funding information to ensure that knowledge of the requirements is known by multiple people to ensure requirements are met. Views of Responsible Officials: Management agrees with the finding.

2024-003 Department of Education Education Stabilization Fund: Higher Education Emergency Relief Find (HEERF) Federal Financial Assistance Listing 84.425F Institutional Portion Award Number P425F202657, Award Years 2020 and 2021 Activities Allowed or Unallowed and Allowable Costs/Cost Principles Material Weakness in Internal Controls over Compliance and Material Non-Compliance Criteria: The CARES Act, CRRSSA and the American Rescue Plan Act (ARP) sets forth the criteria for allowable costs and activities. Condition: During testing over the requirements, we noted that, in 28 of 40 expenses tested, reimbursement was received for expenses for items that were never purchased. The total for these 28 items was $10,682. Additional review noted a total of $132,071 for total funding received but not spent. Cause: The School District used outstanding purchase obligations to request reimbursement at the end of the liquidation period, but did not spend all of the money. Effect: The School received reimbursement for items that were never purchased. Questioned Costs: $132,071 Context/Sampling: A nonstatistical sample of 60 expenses submitted for reimbursement out of 410 total expenses. Repeat Finding from Prior Year(s): No. Recommendation: We recommend a review be completed to ensure that all reimbursements have proper expenses to back up the request submitted. We also recommend that, if new funding is received, a committee be set up by the School District to be able to review expenses and ensure that funding is spent on proper items and requests for reimbursement are only made once expenses have been paid. Views of Responsible Officials: Management agrees with the finding.

2024-004 Department of Education Education Stabilization Fund: Higher Education Emergency Relief Find (HEERF) Federal Financial Assistance Listing 84.425F Institutional Portion Award Number P425F202657, Award Years 2020 and 2021 Cash Management Material Weakness in Internal Controls over Compliance and Material Non-Compliance Criteria: For CRRSSA HEERF II and ARP HEERF III, the certification and agreements indicate the institutional aid portion of funding should be disbursed within three calendar days from the drawdown from G5. Condition: During testing over the requirement, it was noted that the amount drawn on October 25, 2023, was not spent until November 2023, January 2024, or was never spent. Cause: The School District was at the end of the 120-day liquidation period of performance so drew all remaining available funding based on open purchase orders. Effect: The School District received, but did not disburse, the funds within the allowed three-day timeframe. Questioned Costs: $311,480 Context/Sampling: A nonstatistical sample of two draw requests out of five total draw requests were tested. Of the $311,480 received, $179,409 was spent in November 2023 and April 2024 (also reported under period of performance) and $132,071 was never spent (also reported under allowable costs). Repeat Finding from Prior Year(s): No. Recommendation: We recommend that reimbursement requests be submitted at the time of or after payments for the expenses are made to ensure that timing of the reimbursement is received at the same time or after payments are made. Views of Responsible Officials: Management agrees with the finding.

2024-005 Department of Education Education Stabilization Fund: Higher Education Emergency Relief Find (HEERF) Federal Financial Assistance Listing 84.425F Institutional Portion Award Number P425F202657, Award Years 2020 and 2021 Reporting Significant Deficiency in Internal Controls over Compliance Criteria: CRRSSA section 314 (e) and CARES Act 18004 (e) sets forth the criteria for reporting requirements. Condition: There was no review of quarterly or annual HEERF reports prior to their submission. Cause: Inadequate controls implemented to ensure compliance with HEERF reporting requirements. Effect: Reports could be submitted with incorrect information. Questioned Costs: None. Context/Sampling: The one required quarterly report for the September 2023 quarter was tested and the annual report for calendar year 2024 was tested. Repeat Finding from Prior Year(s): Yes. Recommendation: We recommend there is a separate, documented reviewer of the reports prior to their submission. Views of Responsible Officials: Management agrees with the finding.