FAC Explorer

Audit 373732

FY End
2025-05-31
Total Expended
$28.88M
Findings
1
Programs
4
Organization: Kansas Health Science Center, Inc. (IL)
Year: 2025 Accepted: 2025-12-10
Auditor: RSM US LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
1164309 2025-001 Material Weakness Yes C

Programs

ALN Program Spent Major Findings
84.268 FEDERAL DIRECT STUDENT LOANS $26.59M Yes 1
21.027 COVID-19: CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS $1.72M Yes 0
93.493 CONGRESSIONAL DIRECTIVES $563,660 Yes 0
94.003 AMERICORPS STATE COMMISSIONS SUPPORT GRANT $946 Yes 0

Contacts

Name Title Type
TD5TWYLNSZM7 Theresa Cowan Auditee
3177556905 Craig Wories Auditor
No contacts on file

Notes to SEFA

The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Kansas Health Science University (KHSU) under programs of the federal government for the year ended May 31, 2025. 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 KHSU, it is not intended to and does not present the financial position, changes in net assets, or cash flows of KHSU. No funds were identified as having been provided to subrecipients by KHSU and accordingly, no funds identified in the Schedule of Expenditures of Federal Awards are attributable to subrecipient entities. There were no federal awards expended for non-cash assistance or insurance at year-end.
Expenditures reported in 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.
KHSU has elected not to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
During the fiscal year ended May 31, 2025, KHSU issued new loans to students under the Federal Direct Student Loan Program (FDLP). The loan program includes unsubsidized Stafford 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 are disclosed in the Schedule. KHSU is responsible only for the performance of certain administrative duties with respect to the federally guaranteed student loan programs and, accordingly, balances and transactions relating to these loan programs are not included in KHSU’s basic financial statements. Therefore, it is not practicable to determine the balance of loans outstanding to students and former students of KHSU at May 31, 2025.

Finding Details

Finding 2025-001
Finding 2025-001: Excess Cash – Student Financial Aid 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, 2024 – May 31, 2025 Program Expenditures: $26,594,632 Questioned Costs: None Criteria: Uniform Grant Guidance (34 CFR 668.166) states the Secretary considers excess cash to be any amount of Title IV, Higher Education Act (HEA) program funds, other than Federal Perkins Loan program funds, that an institution does not disburse to students by the end of the third business day following the date the institution (1) received those funds from the Secretary; or (2) deposited or transferred to its depository account previously disbursed Title IV, HEA program funds, such as those resulting from awards adjustments, recoveries, or cancellations. An institution may maintain for up to seven days an amount of excess cash that does not exceed one percent of the total amount of funds the institution drew down in the prior award year. The institution must return immediately to the Secretary any amount of excess cash over the one-percent tolerance and any amount of excess cash remaining in its account after the seven-day tolerance period. Uniform Grant Guidance (2 CFR 200.303) requires nonfederal entities receiving Federal awards establish and maintain internal controls designed to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure excess cash is properly handled. Condition: The Kansas Health Science University (KHSU) had one instance of excess cash for the Federal Direct Student Loan program. During our cash management testing, we identified KHSU had excess cash for the Direct Loan program ranging from $94,646 to $190,735 for the period from March 21, 2025 to April 3, 2025. For the period of March 21, 2025 to April 3, 2025, the excess cash exceeded one percent of total prior year drawdowns and amounts were not returned within the seven-day period. Cause: University officials stated the excess cash issues were due to time needed to reconcile refunds with the Common Origination and Disbursement system. Effect: Excess cash is noncompliance with Federal regulations and could result in heightened monitoring by the U.S. Department of Education. Questioned Costs: None Context: For the period of March 21, 2025 to April 3, 2025, KHSU had excess cash ranging from $94,646 to $190,735. KHSU held excess cash for a period of 9 business days and 14 calendar days, respectively. Repeat Finding: Yes. (Finding 2024-001) Recommendation: We recommend KHSU strengthen internal controls around the determination of amounts to be drawn and refunded to the Secretary during the fiscal year. Views of Responsible Officials: Management agrees with the finding. Please see corrective action plan attached.