Criteria
According to 34 CFR 690.83(b):
(1) An institution shall report to the Secretary any change for which a student qualifies, including any related Payment Data changes, by submitting to the Secretary the student’s Payment Data that discloses the basis and result of the change in award for each student. The institution shall submit the student’s Payment Data reporting to the Secretary by the reporting deadlines published by the Secretary in the Federal Register.
(2) An institution shall submit, in accordance with the deadline dates established by the Secretary, through publication in the Federal Register, other reports and information the Secretary requires and shall comply with the procedures the Secretary finds necessary to ensure that the reports are correct.
According to the Federal Register (Volume 83, Number 233):
An institution must submit Pell Grant, Iraq and Afghanistan Service Grant, Direct Loan, and TEACH Grant disbursement records to COD, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. In accordance with 34 CFR 668.164(a), Title IV, Higher Education Act (“HEA”) program funds are disbursed on the date that the institution:
(a) Credits those funds to a student’s account in the institution’s general ledger or any subledger of the general ledger; or
(b) pays those funds to a student directly.
Title IV, HEA program funds are disbursed even if an institution uses its own funds in advance of receiving program funds from the Department.
Condition
Federal regulations require the College to report to the Federal Government’s Common Origination and Disbursement System (“COD”) Federal Pell Grant disbursements made to students within 15 days of the funds being disbursed to the student. During our testing, we noted 1 student, out of a sample of 38 Pell Grant recipients, was not reported within the required timeframe by 17 days.
Cause
The College has policies and procedures in place to report the disbursement records to the Department of Education through the COD system within the required fifteen calendar days; however, in this case the procedures were not completed properly.
Effect
The error identified above relates to Pell Grant disbursement reporting; however, if a similar error related to Direct Loan disbursement reporting occurred, it could result in skewed interest calculations as student interest accrues based on the disbursement date reported to COD.
Questioned Costs
Not applicable
Perspective
Our sample was not, and was not intended to be, statistically valid. Of the 38 students selected for testing, 1 student, or 2.6% of our sample, was determined to be reported late to the COD.
Identification as a Repeat Finding, if applicable
Identified as a repeat of finding 2023-002 in the prior year single audit report.
Recommendation
We recommend that management of the College review, and if necessary, update the policies and procedures to ensure all Pell Grant funds are reported within the required timeframe.
View of Responsible Officials
The College agrees with the finding.
Criteria
Uniform Guidance Subpart E §200.430 contains the federal regulatory requirements for internal controls over certifying time expended on sponsored awards. The College’s practice is to utilize an after‐the‐fact effort reporting system to certify that salaries charged, or cost‐shared to sponsored awards, are reasonable and consistent with the work performed. Section §200.430(c) states, “It is recognized that teaching, research, service, and administration are often inextricably intermingled in an academic setting. When recording salaries and wages charged to Federal awards for IHEs (Institutions of Higher Education) a precise assessment of factors that contribute to costs is therefore, not always feasible, nor expected.”
Condition
During our testing of payroll disbursements as part of allowable cost compliance testing, we identified one employee whose time was not accurately allocated to the grant program for the period of July to September 2023. The employee’s time and effort was inadvertently allocated at a rate of 75% when it should have been allocated fully at 100% of hours worked for that portion of the grant period.
Cause
The employee’s profile in the Massachusetts state accounting system was inadvertently set up with the incorrect employee’s time and effort allocation. The employee was coded time and effort of 75% instead of the 100% they should have been, causing an underreporting of expenditures charged to the grant.
Effect
Incorrect time and effort allocations can result in over or underreporting of related expenditures to a federal grant program.
Questioned Costs
The identified error resulted in a total of $5,590 in salary costs that were not properly charged to the grant program.
Perspective
Our sample was not, and was not intended to be, statistically valid. Of the 40 payroll disbursements sampled, 5 disbursements related to the same employee had incorrect time and effort allocations applied to the grant.
Identification as a Repeat Finding, if applicable
Not applicable
Recommendation
We recommend the College review monthly grant expenditures alongside certifying employee time and effort to ensure personnel costs are accurately recorded to federal grant programs.
View of Responsible Officials
The discrepancy was identified, and the personnel profile was corrected in fiscal year 2024. The corrective action has already been implemented as per the above guidance to avoid any future error in effort allocation.
Criteria
According to 34 CFR 690.83(b):
(1) An institution shall report to the Secretary any change for which a student qualifies, including any related Payment Data changes, by submitting to the Secretary the student’s Payment Data that discloses the basis and result of the change in award for each student. The institution shall submit the student’s Payment Data reporting to the Secretary by the reporting deadlines published by the Secretary in the Federal Register.
(2) An institution shall submit, in accordance with the deadline dates established by the Secretary, through publication in the Federal Register, other reports and information the Secretary requires and shall comply with the procedures the Secretary finds necessary to ensure that the reports are correct.
According to the Federal Register (Volume 83, Number 233):
An institution must submit Pell Grant, Iraq and Afghanistan Service Grant, Direct Loan, and TEACH Grant disbursement records to COD, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. In accordance with 34 CFR 668.164(a), Title IV, Higher Education Act (“HEA”) program funds are disbursed on the date that the institution:
(a) Credits those funds to a student’s account in the institution’s general ledger or any subledger of the general ledger; or
(b) pays those funds to a student directly.
Title IV, HEA program funds are disbursed even if an institution uses its own funds in advance of receiving program funds from the Department.
Condition
Federal regulations require the College to report to the Federal Government’s Common Origination and Disbursement System (“COD”) Federal Pell Grant disbursements made to students within 15 days of the funds being disbursed to the student. During our testing, we noted 1 student, out of a sample of 38 Pell Grant recipients, was not reported within the required timeframe by 17 days.
Cause
The College has policies and procedures in place to report the disbursement records to the Department of Education through the COD system within the required fifteen calendar days; however, in this case the procedures were not completed properly.
Effect
The error identified above relates to Pell Grant disbursement reporting; however, if a similar error related to Direct Loan disbursement reporting occurred, it could result in skewed interest calculations as student interest accrues based on the disbursement date reported to COD.
Questioned Costs
Not applicable
Perspective
Our sample was not, and was not intended to be, statistically valid. Of the 38 students selected for testing, 1 student, or 2.6% of our sample, was determined to be reported late to the COD.
Identification as a Repeat Finding, if applicable
Identified as a repeat of finding 2023-002 in the prior year single audit report.
Recommendation
We recommend that management of the College review, and if necessary, update the policies and procedures to ensure all Pell Grant funds are reported within the required timeframe.
View of Responsible Officials
The College agrees with the finding.
Criteria
Uniform Guidance Subpart E §200.430 contains the federal regulatory requirements for internal controls over certifying time expended on sponsored awards. The College’s practice is to utilize an after‐the‐fact effort reporting system to certify that salaries charged, or cost‐shared to sponsored awards, are reasonable and consistent with the work performed. Section §200.430(c) states, “It is recognized that teaching, research, service, and administration are often inextricably intermingled in an academic setting. When recording salaries and wages charged to Federal awards for IHEs (Institutions of Higher Education) a precise assessment of factors that contribute to costs is therefore, not always feasible, nor expected.”
Condition
During our testing of payroll disbursements as part of allowable cost compliance testing, we identified one employee whose time was not accurately allocated to the grant program for the period of July to September 2023. The employee’s time and effort was inadvertently allocated at a rate of 75% when it should have been allocated fully at 100% of hours worked for that portion of the grant period.
Cause
The employee’s profile in the Massachusetts state accounting system was inadvertently set up with the incorrect employee’s time and effort allocation. The employee was coded time and effort of 75% instead of the 100% they should have been, causing an underreporting of expenditures charged to the grant.
Effect
Incorrect time and effort allocations can result in over or underreporting of related expenditures to a federal grant program.
Questioned Costs
The identified error resulted in a total of $5,590 in salary costs that were not properly charged to the grant program.
Perspective
Our sample was not, and was not intended to be, statistically valid. Of the 40 payroll disbursements sampled, 5 disbursements related to the same employee had incorrect time and effort allocations applied to the grant.
Identification as a Repeat Finding, if applicable
Not applicable
Recommendation
We recommend the College review monthly grant expenditures alongside certifying employee time and effort to ensure personnel costs are accurately recorded to federal grant programs.
View of Responsible Officials
The discrepancy was identified, and the personnel profile was corrected in fiscal year 2024. The corrective action has already been implemented as per the above guidance to avoid any future error in effort allocation.