Audit 369581

Finding 2024-001 Credit Balances Condition: We tested a sample of 40 students, of which 22 had Title IV credit balances during the year. For four of these 22 students, the Institution did not disburse the credit balances within the required timeframe. The sample was selected using a statistical methodology designed to achieve a 90% confidence level. The resulting error rate (18.2%) exceeded our materiality threshold of 10%. Further, this same issue was noted in a recent U.S. Department of Education program review. Accordingly, expanding the sample would not reduce the materiality of this finding. Criteria: In accordance with 34 CFR §668.164(e), when a Title IV credit balance exists, an institution must pay the credit balance directly to the student (or parent, if applicable) as soon as possible, but no later than 14 calendar days after:1. The balance occurs if it happens after the first day of classes of a payment period; or 2. The first day of classes of a payment period if the balance occurs on or before that day. Cause: This instance of noncompliance was due to an oversight in the Institution’s monitoring and disbursement process. Effect: Failure to timely disburse Title IV credit balances results in students not receiving financial aid funds when needed for educational and living expenses, potentially creating financial hardship. Questioned Costs: $0 –– Non-monetary compliance finding. Recommendation: The Institution should strengthen its monitoring and internal control procedures to ensure that Title IV credit balances are consistently identified and disbursed within the required timeframe. View of Responsible Officials: The Institution concurs with the finding. See corrective action plan.

Finding 2024-002 Exit Counseling. Condition: We tested a sample of 40 students, of which 12 required Federal Direct Loan (FDL) exit counseling. For two of these 12 students, the Institution did not timely perform the required exit counseling. The sample was selected using a statistical methodology designed to achieve a 90% confidence level. The resulting error rate (16.7%) exceeded our materiality threshold of 10%. Further, this same issue was identified in a recent U.S. Department of Education program review. Accordingly, expanding the sample would not reduce the materiality of this finding. Criteria: Per 34 CFR §685.304(b), institutions must ensure that each Direct Loan borrower completes exit counseling shortly before the student ceases at least half-time enrollment. Exit counseling must cover repayment options, debt management strategies, and the consequences of default. If the institution is unable to conduct the session prior to the student’s departure, the institution must mail or electronically provide exit counseling materials to the borrower within 30 days of learning that the student withdrew, graduated, or otherwise ceased to be enrolled at least half-time. Documentation of completion or notification must be maintained in the student’s file. Cause: The noncompliance occurred due to oversight during both graduation and withdrawal processes, resulting in exit counseling not being conducted or documented within the required timeframe. Effect: Failure to perform exit counseling increases the risk that students will not understand repayment obligations, raising the likelihood of loan default. Borrower defaults result in increased costs to the U.S. Department of Education. Questioned Costs: $0 –– Non-monetary compliance finding. Recommendation The Institution should strengthen its policies and monitoring controls to ensure exit counseling is consistently completed and documented for all Direct Loan borrowers upon withdrawal or graduation. View of Responsible Officials: The Institution concurs with the finding. See corrective action plan.