Audit 372942

Finding 2025-001: Significant Deficiency – Return of Title IV funds Federal Program: Student Financial Assistance Cluster, Federal Direct Student Loans Federal Agency: U.S. Department of Education Pass-Through Entity: Not Applicable Assistance Listing Number (ALN): 84.268 Federal Award Number: P268K251780 Federal Award Year: June 30, 2025 Criteria: Title IV regulations (34 CFR 668.22) require the College to return the unearned portion of grants or loans to the Title IV program within 45 days after a student withdraws. Condition/Context: Of the 16 students tested in the sample, one student did not have an R2T4 completed during Summer 2024. Subsequent to the auditor identifying this exception in July 2025 the University completed the calculation and returned the required funds. The auditor reviewed the calculation and student's account statement confirming that corrective action was taken. The sample was not a statistically valid sample. Cause: The University's controls surrounding return of Title IV calculations did not appropriately ensure the return was completed timely. Effect: The unearned funds were not returned to the U.S. Department of Education. Questioned Costs: A total of $3,805 in Federal Direct Loans assistance listing number 84.268. Recommendation: The University should revise its procedures and controls to ensure that the return of Title IV calculations are completed timely and accurately for all students who withdraw. Management's Response: The University agrees with the finding. The University believes this was an isolated incident related to the turnover of the Financial Aid Director position. Beginning in Summer 2025, the new Financial Aid Director and Registrar have been meeting bi-weekly to discuss all changes of enrollment including withdrawals. The process ensures that all students are reviewed and all R2T4s are completed on all students who withdraw from Midland University and have Title IV funding.

Finding 2025-002: Significant Deficiency – NSLDS Enrollment Reporting Federal Program: Student Financial Assistance Cluster Federal Agency: U.S. Department of Education Pass-Through Entity: Not Applicable Assistance Listing Number (ALN): 84.268 Federal Award Number: P268K251780 Federal Award Year: June 30, 2025 Criteria: Title IV regulations (34 CFR 685.309(b)) require that upon receipt of an enrollment report from the Secretary, institutions must update all information included in the report and return the report to the Secretary: (i) in the manner and format prescribed by the Secretary; and (ii) within the timeframe prescribed by the Secretary. Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, an institution must notify the Secretary within 30 days after the date the institution 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 institution, 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 institution and who received a loan under Title IV of the Act has changed his or her permanent address. Condition/Context: Of the 25 students tested, two students had incorrect or late information reported. One student’s withdrawn date reported in spring 2025 was incorrect and did not agree to the University’s documentation to support the date of determination. A second student’s status’ certification date was reported 71 days after their date of determination. The sample was not a statistically valid sample. Cause: The University's controls surrounding the reporting of students’ statuses and status effective dates to the National Student Loan Data System (NSLDS) did not appropriately ensure the information was submitted accurately or timely. Effect: Information reported to NSLDS was either incorrect or not updated timely. Questioned Costs: N/A Recommendation: The University should revise its procedures and controls to ensure NSLDS enrollment reporting is completed accurately and timely for all students’ status and status effective dates. Management's Response: The University agrees with the finding. The University believes this was an isolated incident related to the turnover of the Financial Aid Director position in coordination with the registrar’s office that performs the NSLDS reporting. Beginning in Summer 2025, the new Financial Aid Director and Registrar have been meeting bi-weekly to discuss all aspects of enrollment reporting. This will ensure that both offices are aware of reporting requirements and timelines.