FAC Explorer

Audit 352586

FY End
2024-06-30
Total Expended
$8.56M
Findings
8
Programs
6
Organization: Atlantic University College, Inc. (PR)
Year: 2024 Accepted: 2025-04-03
Auditor: De Angel & Compañia CPA LLC

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
553920 2024-001 Significant Deficiency - N
553921 2024-001 Significant Deficiency - N
553922 2024-001 Significant Deficiency - N
553923 2024-001 Significant Deficiency - N
1130362 2024-001 Significant Deficiency - N
1130363 2024-001 Significant Deficiency - N
1130364 2024-001 Significant Deficiency - N
1130365 2024-001 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
84.063 Federal Pell Grant Program $6.71M Yes 1
84.268 Federal Direct Student Loan Program $630,147 Yes 1
84.031 Promoting Postbaccalaureate Opportunities for Hispanic Americans Program $494,140 - 0
84.031 Developing Hispanic Serving Institutions Program $450,471 - 0
84.003 Federal Work Study $136,277 Yes 1
84.007 Federal Supplemental Educational Opportunity Grants $134,489 Yes 1

Contacts

Name Title Type
QMUFKL83DM29 Luis Martinez Ebra Auditee
7877201022 CPA Carlos De Angel Ramirez Auditor
No contacts on file

Notes to SEFA

Title: SCHEDULE NOT IN AGREEMENT WITH OTHER FEDERAL AWARDS REPORTING Accounting Policies: The accompanying schedule of expenditures of federal award (the “Schedule”) includes the federal awards activity of Atlantic University Inc., (formerly known as “Atlantic University College, Inc.”) (hereinafter “the Institution”), 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 the Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used, in the preparation of the Institution’s financial statements. Because the Schedule presents only a selected portion of the activities of the Institution, it is not intended to, and does not, present the financial position, changes in net assets, and cash flows of the Institution. Funds received for students’ financial assistance (principally, Federal Grant Programs, and Federal Student Direct Loans) that are awarded directly to students for educational purposes are excluded from revenues and expenses. These grants are applied to the students’ tuition and fees, and any excess is paid to the students. 2. SUMMARY OF SIGNIFICANT 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, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited to reimbursement. a. The Schedule is prepared from the Institution’s accounting records and is not intended to present its financial position or the results of its operations. b. The financial transactions are recorded by the Institution in accordance with the terms and conditions of the grants, which are consistent with accounting principles generally accepted in the United States of America (“USGAAP”). c. Expenditures are recognized in the accounting period in which the liability is incurred, if measurable or when actually paid, whichever occurs first. d. Expenditures are reported on the Schedule following the cost principles contained in the Uniform Guidance, wherein certain types of expenditure may or may not be allowable or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Institution has elected not to use the 10% minimis indirect cost rate allowed under the Uniform Guidance. The information included in the Schedule may not fully agree with other federal awards reports, submitted directly to federal grantor agencies because, among other reasons, the award report may (a) be prepared for a different fiscal period and (b) include cumulative data (from prior years) rather than data from the current year only.
Title: MAJOR FEDERAL PROGRAMS Accounting Policies: The accompanying schedule of expenditures of federal award (the “Schedule”) includes the federal awards activity of Atlantic University Inc., (formerly known as “Atlantic University College, Inc.”) (hereinafter “the Institution”), 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 the Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used, in the preparation of the Institution’s financial statements. Because the Schedule presents only a selected portion of the activities of the Institution, it is not intended to, and does not, present the financial position, changes in net assets, and cash flows of the Institution. Funds received for students’ financial assistance (principally, Federal Grant Programs, and Federal Student Direct Loans) that are awarded directly to students for educational purposes are excluded from revenues and expenses. These grants are applied to the students’ tuition and fees, and any excess is paid to the students. 2. SUMMARY OF SIGNIFICANT 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, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited to reimbursement. a. The Schedule is prepared from the Institution’s accounting records and is not intended to present its financial position or the results of its operations. b. The financial transactions are recorded by the Institution in accordance with the terms and conditions of the grants, which are consistent with accounting principles generally accepted in the United States of America (“USGAAP”). c. Expenditures are recognized in the accounting period in which the liability is incurred, if measurable or when actually paid, whichever occurs first. d. Expenditures are reported on the Schedule following the cost principles contained in the Uniform Guidance, wherein certain types of expenditure may or may not be allowable or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Institution has elected not to use the 10% minimis indirect cost rate allowed under the Uniform Guidance. Major programs are identified in the Summary of Auditors’ Results Section in the Schedule of Findings and Questioned Costs. Federal programs are presented by federal agency.
Title: ASSISTANCE LISTING NUMBER (ALN) Accounting Policies: The accompanying schedule of expenditures of federal award (the “Schedule”) includes the federal awards activity of Atlantic University Inc., (formerly known as “Atlantic University College, Inc.”) (hereinafter “the Institution”), 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 the Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used, in the preparation of the Institution’s financial statements. Because the Schedule presents only a selected portion of the activities of the Institution, it is not intended to, and does not, present the financial position, changes in net assets, and cash flows of the Institution. Funds received for students’ financial assistance (principally, Federal Grant Programs, and Federal Student Direct Loans) that are awarded directly to students for educational purposes are excluded from revenues and expenses. These grants are applied to the students’ tuition and fees, and any excess is paid to the students. 2. SUMMARY OF SIGNIFICANT 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, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited to reimbursement. a. The Schedule is prepared from the Institution’s accounting records and is not intended to present its financial position or the results of its operations. b. The financial transactions are recorded by the Institution in accordance with the terms and conditions of the grants, which are consistent with accounting principles generally accepted in the United States of America (“USGAAP”). c. Expenditures are recognized in the accounting period in which the liability is incurred, if measurable or when actually paid, whichever occurs first. d. Expenditures are reported on the Schedule following the cost principles contained in the Uniform Guidance, wherein certain types of expenditure may or may not be allowable or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Institution has elected not to use the 10% minimis indirect cost rate allowed under the Uniform Guidance. Assistance Listing Number ("ALN") included in the Schedule are determined based on the program name, review of grant contract information and the public description of federal assistance listings published by the U.S. Government on sam.gov. The first two digits identify the federal department or agency that administers the program, and the last three numbers are assigned by numerical sequence.
Title: ACCOUNTING POLICIES FOR LOANS AND LOAN GUARANTEES Accounting Policies: The accompanying schedule of expenditures of federal award (the “Schedule”) includes the federal awards activity of Atlantic University Inc., (formerly known as “Atlantic University College, Inc.”) (hereinafter “the Institution”), 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 the Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used, in the preparation of the Institution’s financial statements. Because the Schedule presents only a selected portion of the activities of the Institution, it is not intended to, and does not, present the financial position, changes in net assets, and cash flows of the Institution. Funds received for students’ financial assistance (principally, Federal Grant Programs, and Federal Student Direct Loans) that are awarded directly to students for educational purposes are excluded from revenues and expenses. These grants are applied to the students’ tuition and fees, and any excess is paid to the students. 2. SUMMARY OF SIGNIFICANT 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, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited to reimbursement. a. The Schedule is prepared from the Institution’s accounting records and is not intended to present its financial position or the results of its operations. b. The financial transactions are recorded by the Institution in accordance with the terms and conditions of the grants, which are consistent with accounting principles generally accepted in the United States of America (“USGAAP”). c. Expenditures are recognized in the accounting period in which the liability is incurred, if measurable or when actually paid, whichever occurs first. d. Expenditures are reported on the Schedule following the cost principles contained in the Uniform Guidance, wherein certain types of expenditure may or may not be allowable or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Institution has elected not to use the 10% minimis indirect cost rate allowed under the Uniform Guidance. The Institution participates in the Federal Direct Student Loans (Direct Loans) Program (ALN 84.268) of the U.S. Department of Education (USDE). Under the Direct Loans program, the Institution is responsible only for certain administrative duties, accordingly, the disbursements under the program and the outstanding loan balances are excluded from the financial statements of the Institution. However, Direct Loans are considered a component of the student financial assistance programs of the Intitution, as such, new loans processed during the year ended June 30, 2024, amounting to $630,147were included in the Schedule. Federal expenditures for Direct Loans are determined when loans are made to the students, accordingly, the balance of Direct Loans from previous years is not considered federal expenditures of the current year.
Title: PASS-THROUGH Accounting Policies: The accompanying schedule of expenditures of federal award (the “Schedule”) includes the federal awards activity of Atlantic University Inc., (formerly known as “Atlantic University College, Inc.”) (hereinafter “the Institution”), 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 the Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used, in the preparation of the Institution’s financial statements. Because the Schedule presents only a selected portion of the activities of the Institution, it is not intended to, and does not, present the financial position, changes in net assets, and cash flows of the Institution. Funds received for students’ financial assistance (principally, Federal Grant Programs, and Federal Student Direct Loans) that are awarded directly to students for educational purposes are excluded from revenues and expenses. These grants are applied to the students’ tuition and fees, and any excess is paid to the students. 2. SUMMARY OF SIGNIFICANT 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, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited to reimbursement. a. The Schedule is prepared from the Institution’s accounting records and is not intended to present its financial position or the results of its operations. b. The financial transactions are recorded by the Institution in accordance with the terms and conditions of the grants, which are consistent with accounting principles generally accepted in the United States of America (“USGAAP”). c. Expenditures are recognized in the accounting period in which the liability is incurred, if measurable or when actually paid, whichever occurs first. d. Expenditures are reported on the Schedule following the cost principles contained in the Uniform Guidance, wherein certain types of expenditure may or may not be allowable or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Institution has elected not to use the 10% minimis indirect cost rate allowed under the Uniform Guidance. No federal grant dollar has been passed through to sub-recipient.
Title: SUBSEQUENT EVENT Accounting Policies: The accompanying schedule of expenditures of federal award (the “Schedule”) includes the federal awards activity of Atlantic University Inc., (formerly known as “Atlantic University College, Inc.”) (hereinafter “the Institution”), 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 the Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). Therefore, some amounts presented in the Schedule may differ from amounts presented in, or used, in the preparation of the Institution’s financial statements. Because the Schedule presents only a selected portion of the activities of the Institution, it is not intended to, and does not, present the financial position, changes in net assets, and cash flows of the Institution. Funds received for students’ financial assistance (principally, Federal Grant Programs, and Federal Student Direct Loans) that are awarded directly to students for educational purposes are excluded from revenues and expenses. These grants are applied to the students’ tuition and fees, and any excess is paid to the students. 2. SUMMARY OF SIGNIFICANT 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, Cost Principles for Non-profit Organizations, wherein certain types of expenditures are not allowable or are limited to reimbursement. a. The Schedule is prepared from the Institution’s accounting records and is not intended to present its financial position or the results of its operations. b. The financial transactions are recorded by the Institution in accordance with the terms and conditions of the grants, which are consistent with accounting principles generally accepted in the United States of America (“USGAAP”). c. Expenditures are recognized in the accounting period in which the liability is incurred, if measurable or when actually paid, whichever occurs first. d. Expenditures are reported on the Schedule following the cost principles contained in the Uniform Guidance, wherein certain types of expenditure may or may not be allowable or may be limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The Institution has elected not to use the 10% minimis indirect cost rate allowed under the Uniform Guidance. On January 27, 2025, the OMB of the United States Federal Government instituted a pause (freeze)on the disbursement of federal grant and loan funds, which became effective on January 28, 2025. The extent to which the funding freeze impacts our operations, financial results, and cash flows, both current and future, will depend on future developments, which are highly uncertain and cannot be predicted with any measure of certainty or probability.

Finding Details

Finding 2024-001
Finding No. 2024-01 Special Tests and Provisions - Return of Title IV Funds Federal Program Federal Pell Grant Program (PELL), ALN. 84.063 Name of Federal Agency U.S. Department of Education Pass-through Entity N/A Category Significant Deficiency Compliance / Internal control Compliance Requirement Special test and provisions – Return of Title VI Funds Criteria 1. DCL GEN-04-03 Revised, November 2004, indicates “Treatment of a student who fails to receive a passing grade in any class”. a. An institution must have a procedure for determining whether a Title IV aid recipient who began attendance during a period completed the period or should be treated as a withdrawal. We do not require an institution to use a specific procedure for making this determination. i. If a student earns a passing grade in at least one course offered over an entire period, the institution may make the presumption that the student completed the course and, thus, completed the period. ii. No passing grades: If a student who began attendance and has not officially withdrawn fails to earn a passing grade in at least one course offered over an entire period, the institution must assume, for Title IV purposes, that the student has unofficially withdrawn, unless the institution can document that the student completed the period. iii. In this circumstance, if the institution determines that the student does have aid that could have been disbursed for the period and the student does not have any passing or “earned F” grades, the institution must perform the R2T4 calculation using the student’s documented withdrawal date and make any applicable PWDs. Finally, if the school does not have any completion percentage requirements for an incomplete grade, (or allows an incomplete grade to be assigned to a student without ensuring that the student completed at least 60% of the period), then the school must perform an R2T4 calculation. 34 CFR Section 668.173 (b) states that: an institution returns unearned title IV, HEA program funds timely if; (1) the institution deposits or transfers the funds into the bank account it maintains under §668.163 no later than 45 days after the date it determines that the student withdrew; (2) the institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) the institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower's loan account for the amount returned; or (4) the institution issues a check no later than 45 days after the date it determines that the student withdrew Condition Found In testing compliance with the Return of Title IV Funds (R2T4) requirements, we selected a sample of six (6) students who received all failing and/or incomplete grades to determine whether each student completed the period. During our evaluation, we noted the following exceptions: 1. We identified one (1) instance in which a student began attendance but did not officially withdraw and failed to earn a passing grade in the only course taken during the entire payment period. Upon reviewing the academic records, we found no evidence of academic activity to indicate that the student completed the period. 2. Although the institution subsequently performed an R2T4 calculation, the Title IV funds were returned late. Cause The Institution’s Assessment Office requires faculty to submit a quarterly report titled “Low Academic Achievement,” in which professors must document the reasons why students received a grade of D or F in their course. While the institution acknowledges that these reports are not detailed and only indicate the timeframe during which the student participated in class, we noted that some student data was missing from the reports submitted by faculty. Additionally, as is customary at the institution, faculty members are not required to submit copies of their grade records. Effect As a result of these conditions, the Department of Education may impose penalties and deprive other needy students of federal funds. Context Of the sixty-three (63) participants of the Student Financial Aid Program with no passing grades, we examined six (6) participants of PELL and in one (1) case return of refund procedure were performed late. Identification of a Repeat Finding This is not a repeat finding from the immediate previous audit. Questioned Costs None Recommendation We recommend that the Institution strengthen and enforce its procedures for documenting and monitoring students who receive failing grades. Additionally, the Institution should ensure that the Return of Title IV Funds (R2T4) process is properly followed in accordance with federal regulations, and that compliance is consistently maintained. Views of Responsible Officials of the Auditee and Planned Corrective Actions Management of the University agrees with this finding. Please refer to the corrective action plan on pages 42.
Finding 2024-001
Finding No. 2024-01 Special Tests and Provisions - Return of Title IV Funds Federal Program Federal Pell Grant Program (PELL), ALN. 84.063 Name of Federal Agency U.S. Department of Education Pass-through Entity N/A Category Significant Deficiency Compliance / Internal control Compliance Requirement Special test and provisions – Return of Title VI Funds Criteria 1. DCL GEN-04-03 Revised, November 2004, indicates “Treatment of a student who fails to receive a passing grade in any class”. a. An institution must have a procedure for determining whether a Title IV aid recipient who began attendance during a period completed the period or should be treated as a withdrawal. We do not require an institution to use a specific procedure for making this determination. i. If a student earns a passing grade in at least one course offered over an entire period, the institution may make the presumption that the student completed the course and, thus, completed the period. ii. No passing grades: If a student who began attendance and has not officially withdrawn fails to earn a passing grade in at least one course offered over an entire period, the institution must assume, for Title IV purposes, that the student has unofficially withdrawn, unless the institution can document that the student completed the period. iii. In this circumstance, if the institution determines that the student does have aid that could have been disbursed for the period and the student does not have any passing or “earned F” grades, the institution must perform the R2T4 calculation using the student’s documented withdrawal date and make any applicable PWDs. Finally, if the school does not have any completion percentage requirements for an incomplete grade, (or allows an incomplete grade to be assigned to a student without ensuring that the student completed at least 60% of the period), then the school must perform an R2T4 calculation. 34 CFR Section 668.173 (b) states that: an institution returns unearned title IV, HEA program funds timely if; (1) the institution deposits or transfers the funds into the bank account it maintains under §668.163 no later than 45 days after the date it determines that the student withdrew; (2) the institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) the institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower's loan account for the amount returned; or (4) the institution issues a check no later than 45 days after the date it determines that the student withdrew Condition Found In testing compliance with the Return of Title IV Funds (R2T4) requirements, we selected a sample of six (6) students who received all failing and/or incomplete grades to determine whether each student completed the period. During our evaluation, we noted the following exceptions: 1. We identified one (1) instance in which a student began attendance but did not officially withdraw and failed to earn a passing grade in the only course taken during the entire payment period. Upon reviewing the academic records, we found no evidence of academic activity to indicate that the student completed the period. 2. Although the institution subsequently performed an R2T4 calculation, the Title IV funds were returned late. Cause The Institution’s Assessment Office requires faculty to submit a quarterly report titled “Low Academic Achievement,” in which professors must document the reasons why students received a grade of D or F in their course. While the institution acknowledges that these reports are not detailed and only indicate the timeframe during which the student participated in class, we noted that some student data was missing from the reports submitted by faculty. Additionally, as is customary at the institution, faculty members are not required to submit copies of their grade records. Effect As a result of these conditions, the Department of Education may impose penalties and deprive other needy students of federal funds. Context Of the sixty-three (63) participants of the Student Financial Aid Program with no passing grades, we examined six (6) participants of PELL and in one (1) case return of refund procedure were performed late. Identification of a Repeat Finding This is not a repeat finding from the immediate previous audit. Questioned Costs None Recommendation We recommend that the Institution strengthen and enforce its procedures for documenting and monitoring students who receive failing grades. Additionally, the Institution should ensure that the Return of Title IV Funds (R2T4) process is properly followed in accordance with federal regulations, and that compliance is consistently maintained. Views of Responsible Officials of the Auditee and Planned Corrective Actions Management of the University agrees with this finding. Please refer to the corrective action plan on pages 42.
Finding 2024-001
Finding No. 2024-01 Special Tests and Provisions - Return of Title IV Funds Federal Program Federal Pell Grant Program (PELL), ALN. 84.063 Name of Federal Agency U.S. Department of Education Pass-through Entity N/A Category Significant Deficiency Compliance / Internal control Compliance Requirement Special test and provisions – Return of Title VI Funds Criteria 1. DCL GEN-04-03 Revised, November 2004, indicates “Treatment of a student who fails to receive a passing grade in any class”. a. An institution must have a procedure for determining whether a Title IV aid recipient who began attendance during a period completed the period or should be treated as a withdrawal. We do not require an institution to use a specific procedure for making this determination. i. If a student earns a passing grade in at least one course offered over an entire period, the institution may make the presumption that the student completed the course and, thus, completed the period. ii. No passing grades: If a student who began attendance and has not officially withdrawn fails to earn a passing grade in at least one course offered over an entire period, the institution must assume, for Title IV purposes, that the student has unofficially withdrawn, unless the institution can document that the student completed the period. iii. In this circumstance, if the institution determines that the student does have aid that could have been disbursed for the period and the student does not have any passing or “earned F” grades, the institution must perform the R2T4 calculation using the student’s documented withdrawal date and make any applicable PWDs. Finally, if the school does not have any completion percentage requirements for an incomplete grade, (or allows an incomplete grade to be assigned to a student without ensuring that the student completed at least 60% of the period), then the school must perform an R2T4 calculation. 34 CFR Section 668.173 (b) states that: an institution returns unearned title IV, HEA program funds timely if; (1) the institution deposits or transfers the funds into the bank account it maintains under §668.163 no later than 45 days after the date it determines that the student withdrew; (2) the institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) the institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower's loan account for the amount returned; or (4) the institution issues a check no later than 45 days after the date it determines that the student withdrew Condition Found In testing compliance with the Return of Title IV Funds (R2T4) requirements, we selected a sample of six (6) students who received all failing and/or incomplete grades to determine whether each student completed the period. During our evaluation, we noted the following exceptions: 1. We identified one (1) instance in which a student began attendance but did not officially withdraw and failed to earn a passing grade in the only course taken during the entire payment period. Upon reviewing the academic records, we found no evidence of academic activity to indicate that the student completed the period. 2. Although the institution subsequently performed an R2T4 calculation, the Title IV funds were returned late. Cause The Institution’s Assessment Office requires faculty to submit a quarterly report titled “Low Academic Achievement,” in which professors must document the reasons why students received a grade of D or F in their course. While the institution acknowledges that these reports are not detailed and only indicate the timeframe during which the student participated in class, we noted that some student data was missing from the reports submitted by faculty. Additionally, as is customary at the institution, faculty members are not required to submit copies of their grade records. Effect As a result of these conditions, the Department of Education may impose penalties and deprive other needy students of federal funds. Context Of the sixty-three (63) participants of the Student Financial Aid Program with no passing grades, we examined six (6) participants of PELL and in one (1) case return of refund procedure were performed late. Identification of a Repeat Finding This is not a repeat finding from the immediate previous audit. Questioned Costs None Recommendation We recommend that the Institution strengthen and enforce its procedures for documenting and monitoring students who receive failing grades. Additionally, the Institution should ensure that the Return of Title IV Funds (R2T4) process is properly followed in accordance with federal regulations, and that compliance is consistently maintained. Views of Responsible Officials of the Auditee and Planned Corrective Actions Management of the University agrees with this finding. Please refer to the corrective action plan on pages 42.
Finding 2024-001
Finding No. 2024-01 Special Tests and Provisions - Return of Title IV Funds Federal Program Federal Pell Grant Program (PELL), ALN. 84.063 Name of Federal Agency U.S. Department of Education Pass-through Entity N/A Category Significant Deficiency Compliance / Internal control Compliance Requirement Special test and provisions – Return of Title VI Funds Criteria 1. DCL GEN-04-03 Revised, November 2004, indicates “Treatment of a student who fails to receive a passing grade in any class”. a. An institution must have a procedure for determining whether a Title IV aid recipient who began attendance during a period completed the period or should be treated as a withdrawal. We do not require an institution to use a specific procedure for making this determination. i. If a student earns a passing grade in at least one course offered over an entire period, the institution may make the presumption that the student completed the course and, thus, completed the period. ii. No passing grades: If a student who began attendance and has not officially withdrawn fails to earn a passing grade in at least one course offered over an entire period, the institution must assume, for Title IV purposes, that the student has unofficially withdrawn, unless the institution can document that the student completed the period. iii. In this circumstance, if the institution determines that the student does have aid that could have been disbursed for the period and the student does not have any passing or “earned F” grades, the institution must perform the R2T4 calculation using the student’s documented withdrawal date and make any applicable PWDs. Finally, if the school does not have any completion percentage requirements for an incomplete grade, (or allows an incomplete grade to be assigned to a student without ensuring that the student completed at least 60% of the period), then the school must perform an R2T4 calculation. 34 CFR Section 668.173 (b) states that: an institution returns unearned title IV, HEA program funds timely if; (1) the institution deposits or transfers the funds into the bank account it maintains under §668.163 no later than 45 days after the date it determines that the student withdrew; (2) the institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) the institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower's loan account for the amount returned; or (4) the institution issues a check no later than 45 days after the date it determines that the student withdrew Condition Found In testing compliance with the Return of Title IV Funds (R2T4) requirements, we selected a sample of six (6) students who received all failing and/or incomplete grades to determine whether each student completed the period. During our evaluation, we noted the following exceptions: 1. We identified one (1) instance in which a student began attendance but did not officially withdraw and failed to earn a passing grade in the only course taken during the entire payment period. Upon reviewing the academic records, we found no evidence of academic activity to indicate that the student completed the period. 2. Although the institution subsequently performed an R2T4 calculation, the Title IV funds were returned late. Cause The Institution’s Assessment Office requires faculty to submit a quarterly report titled “Low Academic Achievement,” in which professors must document the reasons why students received a grade of D or F in their course. While the institution acknowledges that these reports are not detailed and only indicate the timeframe during which the student participated in class, we noted that some student data was missing from the reports submitted by faculty. Additionally, as is customary at the institution, faculty members are not required to submit copies of their grade records. Effect As a result of these conditions, the Department of Education may impose penalties and deprive other needy students of federal funds. Context Of the sixty-three (63) participants of the Student Financial Aid Program with no passing grades, we examined six (6) participants of PELL and in one (1) case return of refund procedure were performed late. Identification of a Repeat Finding This is not a repeat finding from the immediate previous audit. Questioned Costs None Recommendation We recommend that the Institution strengthen and enforce its procedures for documenting and monitoring students who receive failing grades. Additionally, the Institution should ensure that the Return of Title IV Funds (R2T4) process is properly followed in accordance with federal regulations, and that compliance is consistently maintained. Views of Responsible Officials of the Auditee and Planned Corrective Actions Management of the University agrees with this finding. Please refer to the corrective action plan on pages 42.
Finding 2024-001
Finding No. 2024-01 Special Tests and Provisions - Return of Title IV Funds Federal Program Federal Pell Grant Program (PELL), ALN. 84.063 Name of Federal Agency U.S. Department of Education Pass-through Entity N/A Category Significant Deficiency Compliance / Internal control Compliance Requirement Special test and provisions – Return of Title VI Funds Criteria 1. DCL GEN-04-03 Revised, November 2004, indicates “Treatment of a student who fails to receive a passing grade in any class”. a. An institution must have a procedure for determining whether a Title IV aid recipient who began attendance during a period completed the period or should be treated as a withdrawal. We do not require an institution to use a specific procedure for making this determination. i. If a student earns a passing grade in at least one course offered over an entire period, the institution may make the presumption that the student completed the course and, thus, completed the period. ii. No passing grades: If a student who began attendance and has not officially withdrawn fails to earn a passing grade in at least one course offered over an entire period, the institution must assume, for Title IV purposes, that the student has unofficially withdrawn, unless the institution can document that the student completed the period. iii. In this circumstance, if the institution determines that the student does have aid that could have been disbursed for the period and the student does not have any passing or “earned F” grades, the institution must perform the R2T4 calculation using the student’s documented withdrawal date and make any applicable PWDs. Finally, if the school does not have any completion percentage requirements for an incomplete grade, (or allows an incomplete grade to be assigned to a student without ensuring that the student completed at least 60% of the period), then the school must perform an R2T4 calculation. 34 CFR Section 668.173 (b) states that: an institution returns unearned title IV, HEA program funds timely if; (1) the institution deposits or transfers the funds into the bank account it maintains under §668.163 no later than 45 days after the date it determines that the student withdrew; (2) the institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) the institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower's loan account for the amount returned; or (4) the institution issues a check no later than 45 days after the date it determines that the student withdrew Condition Found In testing compliance with the Return of Title IV Funds (R2T4) requirements, we selected a sample of six (6) students who received all failing and/or incomplete grades to determine whether each student completed the period. During our evaluation, we noted the following exceptions: 1. We identified one (1) instance in which a student began attendance but did not officially withdraw and failed to earn a passing grade in the only course taken during the entire payment period. Upon reviewing the academic records, we found no evidence of academic activity to indicate that the student completed the period. 2. Although the institution subsequently performed an R2T4 calculation, the Title IV funds were returned late. Cause The Institution’s Assessment Office requires faculty to submit a quarterly report titled “Low Academic Achievement,” in which professors must document the reasons why students received a grade of D or F in their course. While the institution acknowledges that these reports are not detailed and only indicate the timeframe during which the student participated in class, we noted that some student data was missing from the reports submitted by faculty. Additionally, as is customary at the institution, faculty members are not required to submit copies of their grade records. Effect As a result of these conditions, the Department of Education may impose penalties and deprive other needy students of federal funds. Context Of the sixty-three (63) participants of the Student Financial Aid Program with no passing grades, we examined six (6) participants of PELL and in one (1) case return of refund procedure were performed late. Identification of a Repeat Finding This is not a repeat finding from the immediate previous audit. Questioned Costs None Recommendation We recommend that the Institution strengthen and enforce its procedures for documenting and monitoring students who receive failing grades. Additionally, the Institution should ensure that the Return of Title IV Funds (R2T4) process is properly followed in accordance with federal regulations, and that compliance is consistently maintained. Views of Responsible Officials of the Auditee and Planned Corrective Actions Management of the University agrees with this finding. Please refer to the corrective action plan on pages 42.
Finding 2024-001
Finding No. 2024-01 Special Tests and Provisions - Return of Title IV Funds Federal Program Federal Pell Grant Program (PELL), ALN. 84.063 Name of Federal Agency U.S. Department of Education Pass-through Entity N/A Category Significant Deficiency Compliance / Internal control Compliance Requirement Special test and provisions – Return of Title VI Funds Criteria 1. DCL GEN-04-03 Revised, November 2004, indicates “Treatment of a student who fails to receive a passing grade in any class”. a. An institution must have a procedure for determining whether a Title IV aid recipient who began attendance during a period completed the period or should be treated as a withdrawal. We do not require an institution to use a specific procedure for making this determination. i. If a student earns a passing grade in at least one course offered over an entire period, the institution may make the presumption that the student completed the course and, thus, completed the period. ii. No passing grades: If a student who began attendance and has not officially withdrawn fails to earn a passing grade in at least one course offered over an entire period, the institution must assume, for Title IV purposes, that the student has unofficially withdrawn, unless the institution can document that the student completed the period. iii. In this circumstance, if the institution determines that the student does have aid that could have been disbursed for the period and the student does not have any passing or “earned F” grades, the institution must perform the R2T4 calculation using the student’s documented withdrawal date and make any applicable PWDs. Finally, if the school does not have any completion percentage requirements for an incomplete grade, (or allows an incomplete grade to be assigned to a student without ensuring that the student completed at least 60% of the period), then the school must perform an R2T4 calculation. 34 CFR Section 668.173 (b) states that: an institution returns unearned title IV, HEA program funds timely if; (1) the institution deposits or transfers the funds into the bank account it maintains under §668.163 no later than 45 days after the date it determines that the student withdrew; (2) the institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) the institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower's loan account for the amount returned; or (4) the institution issues a check no later than 45 days after the date it determines that the student withdrew Condition Found In testing compliance with the Return of Title IV Funds (R2T4) requirements, we selected a sample of six (6) students who received all failing and/or incomplete grades to determine whether each student completed the period. During our evaluation, we noted the following exceptions: 1. We identified one (1) instance in which a student began attendance but did not officially withdraw and failed to earn a passing grade in the only course taken during the entire payment period. Upon reviewing the academic records, we found no evidence of academic activity to indicate that the student completed the period. 2. Although the institution subsequently performed an R2T4 calculation, the Title IV funds were returned late. Cause The Institution’s Assessment Office requires faculty to submit a quarterly report titled “Low Academic Achievement,” in which professors must document the reasons why students received a grade of D or F in their course. While the institution acknowledges that these reports are not detailed and only indicate the timeframe during which the student participated in class, we noted that some student data was missing from the reports submitted by faculty. Additionally, as is customary at the institution, faculty members are not required to submit copies of their grade records. Effect As a result of these conditions, the Department of Education may impose penalties and deprive other needy students of federal funds. Context Of the sixty-three (63) participants of the Student Financial Aid Program with no passing grades, we examined six (6) participants of PELL and in one (1) case return of refund procedure were performed late. Identification of a Repeat Finding This is not a repeat finding from the immediate previous audit. Questioned Costs None Recommendation We recommend that the Institution strengthen and enforce its procedures for documenting and monitoring students who receive failing grades. Additionally, the Institution should ensure that the Return of Title IV Funds (R2T4) process is properly followed in accordance with federal regulations, and that compliance is consistently maintained. Views of Responsible Officials of the Auditee and Planned Corrective Actions Management of the University agrees with this finding. Please refer to the corrective action plan on pages 42.
Finding 2024-001
Finding No. 2024-01 Special Tests and Provisions - Return of Title IV Funds Federal Program Federal Pell Grant Program (PELL), ALN. 84.063 Name of Federal Agency U.S. Department of Education Pass-through Entity N/A Category Significant Deficiency Compliance / Internal control Compliance Requirement Special test and provisions – Return of Title VI Funds Criteria 1. DCL GEN-04-03 Revised, November 2004, indicates “Treatment of a student who fails to receive a passing grade in any class”. a. An institution must have a procedure for determining whether a Title IV aid recipient who began attendance during a period completed the period or should be treated as a withdrawal. We do not require an institution to use a specific procedure for making this determination. i. If a student earns a passing grade in at least one course offered over an entire period, the institution may make the presumption that the student completed the course and, thus, completed the period. ii. No passing grades: If a student who began attendance and has not officially withdrawn fails to earn a passing grade in at least one course offered over an entire period, the institution must assume, for Title IV purposes, that the student has unofficially withdrawn, unless the institution can document that the student completed the period. iii. In this circumstance, if the institution determines that the student does have aid that could have been disbursed for the period and the student does not have any passing or “earned F” grades, the institution must perform the R2T4 calculation using the student’s documented withdrawal date and make any applicable PWDs. Finally, if the school does not have any completion percentage requirements for an incomplete grade, (or allows an incomplete grade to be assigned to a student without ensuring that the student completed at least 60% of the period), then the school must perform an R2T4 calculation. 34 CFR Section 668.173 (b) states that: an institution returns unearned title IV, HEA program funds timely if; (1) the institution deposits or transfers the funds into the bank account it maintains under §668.163 no later than 45 days after the date it determines that the student withdrew; (2) the institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) the institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower's loan account for the amount returned; or (4) the institution issues a check no later than 45 days after the date it determines that the student withdrew Condition Found In testing compliance with the Return of Title IV Funds (R2T4) requirements, we selected a sample of six (6) students who received all failing and/or incomplete grades to determine whether each student completed the period. During our evaluation, we noted the following exceptions: 1. We identified one (1) instance in which a student began attendance but did not officially withdraw and failed to earn a passing grade in the only course taken during the entire payment period. Upon reviewing the academic records, we found no evidence of academic activity to indicate that the student completed the period. 2. Although the institution subsequently performed an R2T4 calculation, the Title IV funds were returned late. Cause The Institution’s Assessment Office requires faculty to submit a quarterly report titled “Low Academic Achievement,” in which professors must document the reasons why students received a grade of D or F in their course. While the institution acknowledges that these reports are not detailed and only indicate the timeframe during which the student participated in class, we noted that some student data was missing from the reports submitted by faculty. Additionally, as is customary at the institution, faculty members are not required to submit copies of their grade records. Effect As a result of these conditions, the Department of Education may impose penalties and deprive other needy students of federal funds. Context Of the sixty-three (63) participants of the Student Financial Aid Program with no passing grades, we examined six (6) participants of PELL and in one (1) case return of refund procedure were performed late. Identification of a Repeat Finding This is not a repeat finding from the immediate previous audit. Questioned Costs None Recommendation We recommend that the Institution strengthen and enforce its procedures for documenting and monitoring students who receive failing grades. Additionally, the Institution should ensure that the Return of Title IV Funds (R2T4) process is properly followed in accordance with federal regulations, and that compliance is consistently maintained. Views of Responsible Officials of the Auditee and Planned Corrective Actions Management of the University agrees with this finding. Please refer to the corrective action plan on pages 42.
Finding 2024-001
Finding No. 2024-01 Special Tests and Provisions - Return of Title IV Funds Federal Program Federal Pell Grant Program (PELL), ALN. 84.063 Name of Federal Agency U.S. Department of Education Pass-through Entity N/A Category Significant Deficiency Compliance / Internal control Compliance Requirement Special test and provisions – Return of Title VI Funds Criteria 1. DCL GEN-04-03 Revised, November 2004, indicates “Treatment of a student who fails to receive a passing grade in any class”. a. An institution must have a procedure for determining whether a Title IV aid recipient who began attendance during a period completed the period or should be treated as a withdrawal. We do not require an institution to use a specific procedure for making this determination. i. If a student earns a passing grade in at least one course offered over an entire period, the institution may make the presumption that the student completed the course and, thus, completed the period. ii. No passing grades: If a student who began attendance and has not officially withdrawn fails to earn a passing grade in at least one course offered over an entire period, the institution must assume, for Title IV purposes, that the student has unofficially withdrawn, unless the institution can document that the student completed the period. iii. In this circumstance, if the institution determines that the student does have aid that could have been disbursed for the period and the student does not have any passing or “earned F” grades, the institution must perform the R2T4 calculation using the student’s documented withdrawal date and make any applicable PWDs. Finally, if the school does not have any completion percentage requirements for an incomplete grade, (or allows an incomplete grade to be assigned to a student without ensuring that the student completed at least 60% of the period), then the school must perform an R2T4 calculation. 34 CFR Section 668.173 (b) states that: an institution returns unearned title IV, HEA program funds timely if; (1) the institution deposits or transfers the funds into the bank account it maintains under §668.163 no later than 45 days after the date it determines that the student withdrew; (2) the institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) the institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower's loan account for the amount returned; or (4) the institution issues a check no later than 45 days after the date it determines that the student withdrew Condition Found In testing compliance with the Return of Title IV Funds (R2T4) requirements, we selected a sample of six (6) students who received all failing and/or incomplete grades to determine whether each student completed the period. During our evaluation, we noted the following exceptions: 1. We identified one (1) instance in which a student began attendance but did not officially withdraw and failed to earn a passing grade in the only course taken during the entire payment period. Upon reviewing the academic records, we found no evidence of academic activity to indicate that the student completed the period. 2. Although the institution subsequently performed an R2T4 calculation, the Title IV funds were returned late. Cause The Institution’s Assessment Office requires faculty to submit a quarterly report titled “Low Academic Achievement,” in which professors must document the reasons why students received a grade of D or F in their course. While the institution acknowledges that these reports are not detailed and only indicate the timeframe during which the student participated in class, we noted that some student data was missing from the reports submitted by faculty. Additionally, as is customary at the institution, faculty members are not required to submit copies of their grade records. Effect As a result of these conditions, the Department of Education may impose penalties and deprive other needy students of federal funds. Context Of the sixty-three (63) participants of the Student Financial Aid Program with no passing grades, we examined six (6) participants of PELL and in one (1) case return of refund procedure were performed late. Identification of a Repeat Finding This is not a repeat finding from the immediate previous audit. Questioned Costs None Recommendation We recommend that the Institution strengthen and enforce its procedures for documenting and monitoring students who receive failing grades. Additionally, the Institution should ensure that the Return of Title IV Funds (R2T4) process is properly followed in accordance with federal regulations, and that compliance is consistently maintained. Views of Responsible Officials of the Auditee and Planned Corrective Actions Management of the University agrees with this finding. Please refer to the corrective action plan on pages 42.