Audit 350797

Finding number: 2024-003 Federal agency: U.S. Department of Education Programs: Student Financial Assistance Cluster Assistance listing #: 84.063 and 84.268 Award year: 2024 Compliance requirement: Eligibility Criteria According to 34 CFR 685.303 Processing loan proceeds: (g) Treatment of excess loan proceeds. Before the disbursement of any Direct Subsidized Loan, Direct Unsubsidized Loan, or Direct PLUS Loan proceeds, if a school learns that the borrower will receive or has received financial aid for the period of enrollment for which the loan was intended that exceeds the amount of assistance for which the student is eligible (except for Federal Work-Study Program funds up to $300), the school must reduce or eliminate the overaward by either— (1) Using the student's Direct Unsubsidized Loan, Direct PLUS Loan, or State-sponsored or another non-Federal loan to cover the expected family contribution, if not already done; or (2) Reducing one or more subsequent disbursements to eliminate the overaward. Condition The Federal Government requires institutions to reduce aid given to students if they learn that a borrower will receive financial aid that exceeds the amount of assistance for which the student is eligible to eliminate the overaward. During our testing, we noted 1 student, out of a sample of 40, whose need-based aid exceeded students remaining need. Our sample was not, and was not intended to be, statistically valid. Cause The College did not have adequate internal controls in place to reduce need-based aid awarded below expected need. As a result, the College disbursed subsidized direct loans that exceeded eligible need. Effect The College disbursed loans that exceeded eligible need-based aid. Questioned Costs $5,500 Identification as a Repeat Finding, if applicable Not applicable. Recommendation The College should update their procedures for calculating need. These procedures should include a control to restrict need-based aid to eligible disbursements. View of Responsible Officials The College agrees with the finding.

Finding number: 2024-002 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans Assistance listing #: 84.268 Award year: 2024 Compliance requirement: Eligibility Criteria According to 34 CFR 668.165(a) Notices and authorizations: (2) Except in the case of a post-withdrawal disbursement made in accordance with § 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of— (i) The anticipated date and amount of the disbursement; (ii) The student's or parent's right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing— (i) No earlier than 30 days before, and no later than 30 days after, crediting the student's ledger account at the institution, if the institution obtains affirmative confirmation from the student under paragraph (a)(6)(i) of this section; or (ii) No earlier than 30 days before, and no later than seven days after, crediting the student's ledger account at the institution, if the institution does not obtain affirmative confirmation from the student under paragraph (a)(6)(i) of this section. Condition The Federal Government requires institutions to notify students if the student’s ledger account is credited with a Direct Loan. This notification is to happen within 30 days before and after for affirmative confirmation and no later than seven days after without affirmative confirmation. During our testing, we noted 18 students, out of a sample of 40, whose notifications did not occur within the required time period. Our sample was not, and was not intended to be, statistically valid. Cause The College did not have adequate internal controls in place to notify students or their parents of credits on the students’ accounts. As a result, the College did not send notifications to students during the Fall 2023 semester. Effect The College did not report student account ledger credits to students or parents within the required time frame. Questioned Costs Not applicable Identification as a Repeat Finding, if applicable Not applicable. Recommendation The College should update their procedures for notifying students when loan disbursements are credited to accounts. These procedures should include a timeline that will allow timely notification to students. View of Responsible Officials The College agrees with the finding.

Finding number: 2024-003 Federal agency: U.S. Department of Education Programs: Student Financial Assistance Cluster Assistance listing #: 84.063 and 84.268 Award year: 2024 Compliance requirement: Eligibility Criteria According to 34 CFR 685.303 Processing loan proceeds: (g) Treatment of excess loan proceeds. Before the disbursement of any Direct Subsidized Loan, Direct Unsubsidized Loan, or Direct PLUS Loan proceeds, if a school learns that the borrower will receive or has received financial aid for the period of enrollment for which the loan was intended that exceeds the amount of assistance for which the student is eligible (except for Federal Work-Study Program funds up to $300), the school must reduce or eliminate the overaward by either— (1) Using the student's Direct Unsubsidized Loan, Direct PLUS Loan, or State-sponsored or another non-Federal loan to cover the expected family contribution, if not already done; or (2) Reducing one or more subsequent disbursements to eliminate the overaward. Condition The Federal Government requires institutions to reduce aid given to students if they learn that a borrower will receive financial aid that exceeds the amount of assistance for which the student is eligible to eliminate the overaward. During our testing, we noted 1 student, out of a sample of 40, whose need-based aid exceeded students remaining need. Our sample was not, and was not intended to be, statistically valid. Cause The College did not have adequate internal controls in place to reduce need-based aid awarded below expected need. As a result, the College disbursed subsidized direct loans that exceeded eligible need. Effect The College disbursed loans that exceeded eligible need-based aid. Questioned Costs $5,500 Identification as a Repeat Finding, if applicable Not applicable. Recommendation The College should update their procedures for calculating need. These procedures should include a control to restrict need-based aid to eligible disbursements. View of Responsible Officials The College agrees with the finding.

Finding number: 2024-004 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans Assistance listing #: 84.268 Award year: 2024 Compliance requirement: Special Tests Criteria According to 34 CFR 685.309(b)(2): Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. According to 2 CFR Part 200, Appendix XI Compliance Supplement updated April 2022: Under the Pell Grant and loan programs, institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway mailboxes sent by ED via the National Student Loan Data System (“NSLDS”). An institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every 60 days. Once received, the institution must update for changes in the data elements for the Campus record and the Program Record, and submit the changes electronically through the batch method, spreadsheet submittal or the NSLDS website. Condition The Federal Government requires the College to report student enrollment changes to the NSLDS within 60 days. During our testing, 6 out of 16 students were reported late to the NSLDS by 19 to 116 days and 1 out of 16 students reported an incorrect effective date to the NSLDS. Our sample was not, and was not intended to be, statistically valid. Cause The College did not have appropriate internal controls in place to ensure enrollment status changes were being reported to the NSLDS timely and accurately. Effect Late or incorrect effective dates may impact the students’ loan grace periods. Questioned Costs Not applicable. Identification as a Repeat Finding, if applicable See finding 2023-006 included in the summary schedule of prior year findings. Recommendation The College should strengthen their internal controls surrounding the review of the NSLDS reporting process to ensure they are in compliance with federal regulations. View of Responsible Officials The College agrees with the finding.

Finding number: 2024-003 Federal agency: U.S. Department of Education Programs: Student Financial Assistance Cluster Assistance listing #: 84.063 and 84.268 Award year: 2024 Compliance requirement: Eligibility Criteria According to 34 CFR 685.303 Processing loan proceeds: (g) Treatment of excess loan proceeds. Before the disbursement of any Direct Subsidized Loan, Direct Unsubsidized Loan, or Direct PLUS Loan proceeds, if a school learns that the borrower will receive or has received financial aid for the period of enrollment for which the loan was intended that exceeds the amount of assistance for which the student is eligible (except for Federal Work-Study Program funds up to $300), the school must reduce or eliminate the overaward by either— (1) Using the student's Direct Unsubsidized Loan, Direct PLUS Loan, or State-sponsored or another non-Federal loan to cover the expected family contribution, if not already done; or (2) Reducing one or more subsequent disbursements to eliminate the overaward. Condition The Federal Government requires institutions to reduce aid given to students if they learn that a borrower will receive financial aid that exceeds the amount of assistance for which the student is eligible to eliminate the overaward. During our testing, we noted 1 student, out of a sample of 40, whose need-based aid exceeded students remaining need. Our sample was not, and was not intended to be, statistically valid. Cause The College did not have adequate internal controls in place to reduce need-based aid awarded below expected need. As a result, the College disbursed subsidized direct loans that exceeded eligible need. Effect The College disbursed loans that exceeded eligible need-based aid. Questioned Costs $5,500 Identification as a Repeat Finding, if applicable Not applicable. Recommendation The College should update their procedures for calculating need. These procedures should include a control to restrict need-based aid to eligible disbursements. View of Responsible Officials The College agrees with the finding.

Finding number: 2024-002 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans Assistance listing #: 84.268 Award year: 2024 Compliance requirement: Eligibility Criteria According to 34 CFR 668.165(a) Notices and authorizations: (2) Except in the case of a post-withdrawal disbursement made in accordance with § 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of— (i) The anticipated date and amount of the disbursement; (ii) The student's or parent's right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing— (i) No earlier than 30 days before, and no later than 30 days after, crediting the student's ledger account at the institution, if the institution obtains affirmative confirmation from the student under paragraph (a)(6)(i) of this section; or (ii) No earlier than 30 days before, and no later than seven days after, crediting the student's ledger account at the institution, if the institution does not obtain affirmative confirmation from the student under paragraph (a)(6)(i) of this section. Condition The Federal Government requires institutions to notify students if the student’s ledger account is credited with a Direct Loan. This notification is to happen within 30 days before and after for affirmative confirmation and no later than seven days after without affirmative confirmation. During our testing, we noted 18 students, out of a sample of 40, whose notifications did not occur within the required time period. Our sample was not, and was not intended to be, statistically valid. Cause The College did not have adequate internal controls in place to notify students or their parents of credits on the students’ accounts. As a result, the College did not send notifications to students during the Fall 2023 semester. Effect The College did not report student account ledger credits to students or parents within the required time frame. Questioned Costs Not applicable Identification as a Repeat Finding, if applicable Not applicable. Recommendation The College should update their procedures for notifying students when loan disbursements are credited to accounts. These procedures should include a timeline that will allow timely notification to students. View of Responsible Officials The College agrees with the finding.

Finding number: 2024-003 Federal agency: U.S. Department of Education Programs: Student Financial Assistance Cluster Assistance listing #: 84.063 and 84.268 Award year: 2024 Compliance requirement: Eligibility Criteria According to 34 CFR 685.303 Processing loan proceeds: (g) Treatment of excess loan proceeds. Before the disbursement of any Direct Subsidized Loan, Direct Unsubsidized Loan, or Direct PLUS Loan proceeds, if a school learns that the borrower will receive or has received financial aid for the period of enrollment for which the loan was intended that exceeds the amount of assistance for which the student is eligible (except for Federal Work-Study Program funds up to $300), the school must reduce or eliminate the overaward by either— (1) Using the student's Direct Unsubsidized Loan, Direct PLUS Loan, or State-sponsored or another non-Federal loan to cover the expected family contribution, if not already done; or (2) Reducing one or more subsequent disbursements to eliminate the overaward. Condition The Federal Government requires institutions to reduce aid given to students if they learn that a borrower will receive financial aid that exceeds the amount of assistance for which the student is eligible to eliminate the overaward. During our testing, we noted 1 student, out of a sample of 40, whose need-based aid exceeded students remaining need. Our sample was not, and was not intended to be, statistically valid. Cause The College did not have adequate internal controls in place to reduce need-based aid awarded below expected need. As a result, the College disbursed subsidized direct loans that exceeded eligible need. Effect The College disbursed loans that exceeded eligible need-based aid. Questioned Costs $5,500 Identification as a Repeat Finding, if applicable Not applicable. Recommendation The College should update their procedures for calculating need. These procedures should include a control to restrict need-based aid to eligible disbursements. View of Responsible Officials The College agrees with the finding.

Finding number: 2024-004 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans Assistance listing #: 84.268 Award year: 2024 Compliance requirement: Special Tests Criteria According to 34 CFR 685.309(b)(2): Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. According to 2 CFR Part 200, Appendix XI Compliance Supplement updated April 2022: Under the Pell Grant and loan programs, institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway mailboxes sent by ED via the National Student Loan Data System (“NSLDS”). An institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every 60 days. Once received, the institution must update for changes in the data elements for the Campus record and the Program Record, and submit the changes electronically through the batch method, spreadsheet submittal or the NSLDS website. Condition The Federal Government requires the College to report student enrollment changes to the NSLDS within 60 days. During our testing, 6 out of 16 students were reported late to the NSLDS by 19 to 116 days and 1 out of 16 students reported an incorrect effective date to the NSLDS. Our sample was not, and was not intended to be, statistically valid. Cause The College did not have appropriate internal controls in place to ensure enrollment status changes were being reported to the NSLDS timely and accurately. Effect Late or incorrect effective dates may impact the students’ loan grace periods. Questioned Costs Not applicable. Identification as a Repeat Finding, if applicable See finding 2023-006 included in the summary schedule of prior year findings. Recommendation The College should strengthen their internal controls surrounding the review of the NSLDS reporting process to ensure they are in compliance with federal regulations. View of Responsible Officials The College agrees with the finding.