FAC Explorer

Audit 352615

FY End
2024-05-31
Total Expended
$21.42M
Findings
4
Programs
3
Organization: University of Western States (OR)
Year: 2024 Accepted: 2025-04-03
Auditor: Rsm US LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
553963 2024-001 Significant Deficiency - E
553964 2024-002 Significant Deficiency - N
1130405 2024-001 Significant Deficiency - E
1130406 2024-002 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $20.59M Yes 2
84.038 Federal Perkins Loan Program $771,994 Yes 0
84.033 Federal Work-Study Program $56,085 Yes 0

Contacts

Name Title Type
G8NKGWYSLES8 Theresa Cowan Auditee
3177556905 Craig Wories Auditor
No contacts on file

Notes to SEFA

Title: Note 1. Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are recognized on the accrual basis of accounting. Such expenditures are reported following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: UWS has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of the University of Western States (UWS) under programs of the federal government for the year ended May 31, 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 UWS, it is not intended to and does not present the financial position, changes in nets assets, or cash flows for UWS. No funds were identified as having been provided to subrecipients by UWS and, accordingly, no funds identified in the Schedule are attributable to subrecipient entities. There were no federal awards expended for non-cash assistance or insurance at period end.
Title: Note 2. Summary of Significant Accounting Policies Accounting Policies: Expenditures reported on the Schedule are recognized on the accrual basis of accounting. Such expenditures are reported following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: UWS has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. Expenditures reported on the Schedule are recognized on the accrual basis of accounting. Such expenditures are reported following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Title: Note 3. Indirect Cost Rate Accounting Policies: Expenditures reported on the Schedule are recognized on the accrual basis of accounting. Such expenditures are reported following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: UWS has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. UWS has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
Title: Note 4. Federal Student Loan Program Accounting Policies: Expenditures reported on the Schedule are recognized on the accrual basis of accounting. Such expenditures are reported following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: UWS has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. The federal student loan program listed below is administered directly by UWS and balances and transactions relating to this program are included in UWS’s financial statements. Loans outstanding at the beginning of the period and loans made during the year ended May 31, 2024 are included in the federal expenditures presented in the Schedule. The balance of loans outstanding at May 31, 2024 consists of: Federal Perkins Loan Program, ALN 84.038, Outstanding Balance at May 31, 2024 $546,148. On October 1, 2017, the Federal Perkins Extension Act of 2015 expired and no longer permits disbursements to students of any kind after June 30, 2018. UWS has been notified the government will begin collecting the Federal share of UWS’s Perkins Loan Revolving Funds in the future. During the year ended May 31, 2024, UWS issued new loans to students under the Federal Direct Student Loan Program (FDLP). The loan program includes subsidized and unsubsidized Stafford Loans, Parent PLUS loans, and PLUS loans for graduate and professional students. The value of loans issued for the FDLP is based on disbursed amounts. The loan amounts issued during the year ended May 31, 2024 are disclosed on the Schedule. UWS is responsible only for the performance of certain administrative duties with respect to the federally guaranteed student loans programs and, accordingly, balances and transactions relating to these loan programs are not included in UWS’s consolidated financial statements. Therefore, it is not practicable to determine the balance of loans outstanding to students and former students at UWS at May 31, 2024.

Finding Details

Finding 2024-001
Finding 2024-001: Eligibility – Determining Federal Direct Student Loan Awards Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster, Federal Direct Student Loans Assistance Listing Number: 84.268 Award Year: June 1, 2023 – May 31, 2024 Program Expenditures: $20,593,109 Questioned Costs: $119,443 Criteria: Per 34 CFR 685.203(b)(iii), in the case of a graduate or professional student for a period of enrollment beginning on or after July 1, 2012, the total amount the student may borrow for any academic year of study under the Unsubsidized Loan program may not exceed $8,500. Per 34 CFR 685.203(c)(2)(v), the additional amount that a student described in paragraph (c)(1)(i) of this section may borrow under the Federal Direct Unsubsidized Loan Program for any academic year of student may not exceed the following: in the case of a graduate or professional student, $12,000. Condition: During testing of eligibility, six out six students selected for testing within the Doctor of Naturopathic Program were overawarded Federal Direct Unsubsidized Loans, noting this encompasses all students within the program. Eligibility testing was performed over 40 other students with no exceptions. We determined that UWS improperly awarded 6 out of 6 students Federal Direct Unsubsidized Loans in excess of the maximum amount for one academic year of $20,500. The total overawards accumulated to $119,443 in total loan funds. Cause: The students were awarded the higher annual Federal Direct Unsubsidized Loan limits for certain graduate and professional health professions students. Schools may award the increased unsubsidized amounts to students who are enrolled at least half time in certain health professions programs. The programs must be accredited by specific accrediting agencies for students to qualify for additional unsubsidized loan amounts. The UWS Naturopathic Medicine Doctoral program has not yet achieved the required accreditation from The Council on Naturopathic Medical Education. Effect: UWS is required to return overawarded funds to the Department of Education in accordance with Department guidelines. Noncompliance with federal guidelines could impact future funding. Questioned Costs: $119,443 Context: Six out six students subject to eligibility testing within the Doctor of Naturopathic Medicine program were overawarded Federal Direct Unsubsidized Loans in excess of the maximum allowed amount of $20,500 for an academic period. Eligibility testing was performed over forty other students with no errors. Management detected the overaward subsequent to year-end, but prior to the start of the audit and informed RSM of the error. Repeat Finding: No. Recommendation: We recommend UWS strengthen internal controls around the establishing of financial aid award limits. Views of Responsible Officials: Management agrees with the finding. Please see corrective action plan attached.
Finding 2024-002
Finding 2024-002: Special Tests: Enrollment Reporting – Improper Reporting of Withdrawal Date Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster, Federal Direct Student Loans Assistance Listing Number: 84.268 Award Year: June 1, 2023 – May 31, 2024 Program Expenditures: $20,593,109 Questioned Costs: $0 Criteria: Per the National Student Loan Data System (NSLDS) enrollment reporting guide (Section 4.4.3) when a student withdraws during a term, the effective date for the withdrawn status is the withdrawal date used by the Institution in accordance with 34 CFR 668.22. Condition: During our enrollment testing, we noted that the effective date of withdrawal in NSLDS for 3 students tested was incorrectly listed as the date of determination by UWS instead of the withdrawal date determined in accordance with 34 CFR 668.22. Internal controls in place did not identify the errors. Cause: Three students with incorrect enrollment reporting dates were due to the student’s out of school status treated by the relevant University department as an unofficial withdrawal instead of an official withdrawal for enrollment reporting purposes. The Dates of Determination were therefore used incorrectly. Effect: Incorrect enrollment reporting could impact a student’s repayment period. Noncompliance with federal guidelines could impact future funding. Questioned Costs: $0 Context: 3 out of a total of 24 students tested for enrollment reporting in NSLDS had an incorrect date listed as the effective date of the student’s enrollment status. No other exceptions were noted in our enrollment testing. Repeat Finding: No. Recommendation: We recommend UWS review their policies and internal controls around NSLDS reporting of the withdrawal date to ensure compliance with the regulations. Views of Responsible Officials: Management agrees with the finding. Please see corrective action plan attached.
Finding 2024-001
Finding 2024-001: Eligibility – Determining Federal Direct Student Loan Awards Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster, Federal Direct Student Loans Assistance Listing Number: 84.268 Award Year: June 1, 2023 – May 31, 2024 Program Expenditures: $20,593,109 Questioned Costs: $119,443 Criteria: Per 34 CFR 685.203(b)(iii), in the case of a graduate or professional student for a period of enrollment beginning on or after July 1, 2012, the total amount the student may borrow for any academic year of study under the Unsubsidized Loan program may not exceed $8,500. Per 34 CFR 685.203(c)(2)(v), the additional amount that a student described in paragraph (c)(1)(i) of this section may borrow under the Federal Direct Unsubsidized Loan Program for any academic year of student may not exceed the following: in the case of a graduate or professional student, $12,000. Condition: During testing of eligibility, six out six students selected for testing within the Doctor of Naturopathic Program were overawarded Federal Direct Unsubsidized Loans, noting this encompasses all students within the program. Eligibility testing was performed over 40 other students with no exceptions. We determined that UWS improperly awarded 6 out of 6 students Federal Direct Unsubsidized Loans in excess of the maximum amount for one academic year of $20,500. The total overawards accumulated to $119,443 in total loan funds. Cause: The students were awarded the higher annual Federal Direct Unsubsidized Loan limits for certain graduate and professional health professions students. Schools may award the increased unsubsidized amounts to students who are enrolled at least half time in certain health professions programs. The programs must be accredited by specific accrediting agencies for students to qualify for additional unsubsidized loan amounts. The UWS Naturopathic Medicine Doctoral program has not yet achieved the required accreditation from The Council on Naturopathic Medical Education. Effect: UWS is required to return overawarded funds to the Department of Education in accordance with Department guidelines. Noncompliance with federal guidelines could impact future funding. Questioned Costs: $119,443 Context: Six out six students subject to eligibility testing within the Doctor of Naturopathic Medicine program were overawarded Federal Direct Unsubsidized Loans in excess of the maximum allowed amount of $20,500 for an academic period. Eligibility testing was performed over forty other students with no errors. Management detected the overaward subsequent to year-end, but prior to the start of the audit and informed RSM of the error. Repeat Finding: No. Recommendation: We recommend UWS strengthen internal controls around the establishing of financial aid award limits. Views of Responsible Officials: Management agrees with the finding. Please see corrective action plan attached.
Finding 2024-002
Finding 2024-002: Special Tests: Enrollment Reporting – Improper Reporting of Withdrawal Date Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster, Federal Direct Student Loans Assistance Listing Number: 84.268 Award Year: June 1, 2023 – May 31, 2024 Program Expenditures: $20,593,109 Questioned Costs: $0 Criteria: Per the National Student Loan Data System (NSLDS) enrollment reporting guide (Section 4.4.3) when a student withdraws during a term, the effective date for the withdrawn status is the withdrawal date used by the Institution in accordance with 34 CFR 668.22. Condition: During our enrollment testing, we noted that the effective date of withdrawal in NSLDS for 3 students tested was incorrectly listed as the date of determination by UWS instead of the withdrawal date determined in accordance with 34 CFR 668.22. Internal controls in place did not identify the errors. Cause: Three students with incorrect enrollment reporting dates were due to the student’s out of school status treated by the relevant University department as an unofficial withdrawal instead of an official withdrawal for enrollment reporting purposes. The Dates of Determination were therefore used incorrectly. Effect: Incorrect enrollment reporting could impact a student’s repayment period. Noncompliance with federal guidelines could impact future funding. Questioned Costs: $0 Context: 3 out of a total of 24 students tested for enrollment reporting in NSLDS had an incorrect date listed as the effective date of the student’s enrollment status. No other exceptions were noted in our enrollment testing. Repeat Finding: No. Recommendation: We recommend UWS review their policies and internal controls around NSLDS reporting of the withdrawal date to ensure compliance with the regulations. Views of Responsible Officials: Management agrees with the finding. Please see corrective action plan attached.