Audit 384755

Incorrect and Untimely Return of Title IV Funds (R2T4) Calculations Material Weakness DEPARTMENT OF EDUCATION ALN #: 84.063 Federal Pell Grants and 84.268 Federal Direct Loans Federal Award Identification #: 2024-2025 Financial Aid Year Condition: Title IV funds were not always returned accurately or timely when students withdrew during a term. Criteria: 34 CFR 668.22 Questioned Costs: $0 Context: Out of 7 students, 3 students who withdrew during the audit period tested had a total of $13,214 Federal Direct Loans (FDL) and $1,820 of Pell returned late, ranging from 17 to 44 days late. Additionally one student in a modular program, had all their Pell returned when they unofficially withdrew but was eligible for $924. Cause: Staffing issues and turnover Effect: Incorrect amounts of federal funding were returned. Return of Title IV funds were not performed timely. Identification as repeat finding, if applicable: Yes, 2024-001. Recommendation: We recommend that R2T4’s be calculated as soon as the financial aid office is notified of student’s official withdrawal or when it is determined a student unofficially withdrew. We also recommend that an individual with appropriate knowledge review R2T4 calculations and returns made to help ensure that internal controls are operating effectively to achieve compliance. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.

Cash Management Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.063 Federal Pell Grants and 84.268 Federal Direct Loans Federal Award Identification #: 2024-2025 Financial Aid Year Condition: The University initiated Federal Direct Loan (FDL) and Pell drawdowns from G5 for amounts greater than what had been disbursed to students, resulting in excess cash on hand for more than 3 days. Criteria: 34 CFR 668.162(a), 34 CFR 668.162(c) Questioned Costs: $0 Context: 2 FDL drawdowns out of 4 tested and 1 Pell drawdown out of 2 tested were greater than the amounts disbursed to students and therefore, not all disbursed within 3 days as required. The Pell overdraw occurred in September 2024 in the amount of $20,087 and was fully disbursed by October 2024. One FDL overdraw occurred in January 2025 in the amount of $52,389 and was fully disbursed by February 2025. One overdraw occurred at the end of April 2025 in the amount of $170,186 and wasn’t fully disbursed until June 2025. It was also noted that another drawdown for $550,000 in March 2025 wasn’t tied to any disbursements but was then returned in April 2025, 12 days later. Cause: Turnover and oversight by management. It appears that draws are being done based on what is authorized in G5 rather than the actual disbursement to student accounts. Effect: Non-compliance with cash management requirements to minimize the time between drawing the Title IV funds and disbursement of those funds to students. Cash on hand in excess of allowable levels and time frames may result in interest owed back to the Department of Education on excess cash. Identification as repeat finding, if applicable: Not applicable Recommendation: We recommend the University review student disbursements reports generated to ensure compliance with cash management requirements to disburse aid first before drawing FDL and Pell. We also recommend the University determine the amount of interest to be returned on the excess cash and return amounts greater than $500 to the Department of Education. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.