Audit 349584

FY End
2024-06-30
Total Expended
$6.12M
Findings
2
Programs
9
Organization: Erikson Institute (IL)
Year: 2024 Accepted: 2025-03-28
Auditor: Rsm US LLP

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
538857 2024-001 Significant Deficiency - N
1115299 2024-001 Significant Deficiency - N

Contacts

Name Title Type
LMGWHNUKM2C5 Christine Frankhauser Auditee
3128937121 Craig Wories Auditor
No contacts on file

Notes to SEFA

Title: Note 1. Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The Institute has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The Institute has federally-approved negotiated indirect cost rates of 40.60% for on-campus and 20% for off campus costs. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Erikson Institute (the Institute) under programs of the federal government for the year ended June 30, 2024. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the Institute, it is not intended to and does not present the financial position, changes in net assets or cash flows of the Institute. There were no federal awards expended for non-cash assistance or insurance for the year ended June 30, 2024.
Title: Note 2. Summary of Significant Accounting Policies Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The Institute has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The Institute has federally-approved negotiated indirect cost rates of 40.60% for on-campus and 20% for off campus costs. Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Pass-through entity identifying numbers are presented where available.
Title: Note 3. Indirect Cost Rate Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The Institute has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The Institute has federally-approved negotiated indirect cost rates of 40.60% for on-campus and 20% for off campus costs. The Institute has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The Institute has federally-approved negotiated indirect cost rates of 40.60% for on-campus and 20% for off campus costs.
Title: Note 4. Federal Direct Student Loan Program Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Pass-through entity identifying numbers are presented where available. De Minimis Rate Used: N Rate Explanation: The Institute has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The Institute has federally-approved negotiated indirect cost rates of 40.60% for on-campus and 20% for off campus costs. During the fiscal year ended June 30, 2024, the Institute issued new loans to students under the Federal Direct Student Loan Program (FDLP). The value of loans issued for the FDLP is based on disbursed amounts. The loan amounts issued during the year are disclosed on the Schedule. The Institute 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 these loan programs are not included in the Institute’s basic financial statements. Therefore, it is not practicable to determine the balance of loans outstanding made to students and former students of the Institute at June 30, 2024.

Finding Details

Finding 2024-001 – Return of Title IV Funds Repeat Finding: No Federal Program Title – U.S. Department of Education Student Financial Assistance Cluster Federal Direct Student Loans: 84.268 Federal Award Year 2023-2024 Condition For one out of three students tested (33%) who withdrew from the Institute, the Institute could not provide evidence that the Institute reviewed the return of Title IV funds calculation. Further, the calculation that was originally performed failed to identify $480 of aid to be disbursed as post-withdrawal. Criteria CFR section 668.22 requires the Institute to determine the amount of title IV grant or loan assistance that the student earned as of the student's withdrawal date. 2 CFR Section 200.303 requires entities receiving Federal awards establish and maintain internal controls deigned to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures in place to ensure accurate reporting of enrollment status changes. Questioned Costs There is a questioned cost of $480 for the amount of aid to be disbursed as post-withdrawal. Cause During transition of Registrar staffing in Fall of 2023 enrollment status changes were delayed and thus the Financial Aid office did not have timely information to determine correct return of Title IV fund calculations. Once the enrollment status change for the student was reviewed and return of Title IV funds was determined, the correct amount of aid to be disbursed as post-withdrawal was processed. The Institute reviewed all student withdrawals during the fiscal year and no other discrepancies in Title IV fund calculations were found. Context The finding related to one out of three students selected for testing (33%). Effect Failure to accurately determine the amount of title IV grant or loan assistance that the student earned as of the student's withdrawal date is noncompliance with Federal regulation and could result in heightened monitoring by the U.S. Department of Education. Recommendation We recommend the Institute improve internal controls in order to correctly determine the amount of title IV grant or loan assistance that the student earned as of the student's withdrawal date timely and accurately. Views of responsible officials We agree with this finding. See corrective action plan.
Finding 2024-001 – Return of Title IV Funds Repeat Finding: No Federal Program Title – U.S. Department of Education Student Financial Assistance Cluster Federal Direct Student Loans: 84.268 Federal Award Year 2023-2024 Condition For one out of three students tested (33%) who withdrew from the Institute, the Institute could not provide evidence that the Institute reviewed the return of Title IV funds calculation. Further, the calculation that was originally performed failed to identify $480 of aid to be disbursed as post-withdrawal. Criteria CFR section 668.22 requires the Institute to determine the amount of title IV grant or loan assistance that the student earned as of the student's withdrawal date. 2 CFR Section 200.303 requires entities receiving Federal awards establish and maintain internal controls deigned to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures in place to ensure accurate reporting of enrollment status changes. Questioned Costs There is a questioned cost of $480 for the amount of aid to be disbursed as post-withdrawal. Cause During transition of Registrar staffing in Fall of 2023 enrollment status changes were delayed and thus the Financial Aid office did not have timely information to determine correct return of Title IV fund calculations. Once the enrollment status change for the student was reviewed and return of Title IV funds was determined, the correct amount of aid to be disbursed as post-withdrawal was processed. The Institute reviewed all student withdrawals during the fiscal year and no other discrepancies in Title IV fund calculations were found. Context The finding related to one out of three students selected for testing (33%). Effect Failure to accurately determine the amount of title IV grant or loan assistance that the student earned as of the student's withdrawal date is noncompliance with Federal regulation and could result in heightened monitoring by the U.S. Department of Education. Recommendation We recommend the Institute improve internal controls in order to correctly determine the amount of title IV grant or loan assistance that the student earned as of the student's withdrawal date timely and accurately. Views of responsible officials We agree with this finding. See corrective action plan.