Audit 395581

2025-008. FINDING - Noncompliance with Reimbursements to Subrecipients Federal Agency: National Science Foundation Assistance Listing Numbers: 47.070 Program Names and Award Numbers: Research and Development Cluster: CISE-MSI: RPEP: S&CC: Information Systems meet Cultural Competencies; CISE-MSI: DP: IIS-III: ACOSUS: An AI-driven counseling System for Underrepresented Transfer Students Award Numbers: 2131291 – 2021; 2219623 – 2022 Questioned Costs: None Northeastern Illinois University (University) did not pay reimbursements within 30 days for certain subrecipients in the Research and Development Cluster. CONDITIONS FOUND & CRITERIA: For three of 10 (30%) subrecipient invoices selected for testing in the Research and Development Cluster, the University made payments in a time period greater than 30 days. The sample was not intended to be, and was not, a statistically valid sample. Uniform Guidance (2 CFR 200.305(b)(3)) requires, for recipients and subrecipients other than states, payment methods must minimize the time elapsing between the transfer of funds from the federal agency or the pass-through entity and the disbursement of funds by the recipient or subrecipient, regardless of whether the payment is made by electronic funds transfer or by other means. Further, when the reimbursement method is used for payment, organizations must make a payment within 30 calendar days after receipt of the billing unless the federal awarding agency or pass-through entity reasonably believes the request to be improper. CAUSE: University officials stated the department did not timely enter invoices into the Accounts Payable system which resulted in delayed processing by Accounts Payable, thus the payment was not made in accordance with the Uniform Guidance. EFFECT: Failure to meet subrecipients payment requirements is noncompliance with federal regulations and could result in loss of grant funding in future years. (Finding Code No. 2025-008) RECOMMENDATION: We recommend the University implements processes and controls to ensure that payments to subrecipients are made in accordance with the Uniform Guidance. UNIVERSITY RESPONSE: The University agrees with the recommendation. This issue was due to one department’s oversight in maintaining and providing appropriate documentation. The department was sent a reminder of the expectation of timely filing all required documentation to ensure payments to subrecipients are made in accordance with the Uniform Guidance.

2025-007. FINDING - Noncompliance with Federal Funding Accountability and Transparency Act Reporting Requirement Federal Agency: Department of Education Assistance Listing Numbers: 84.031 Program Names: Higher Education Institutional Aid, ARCOS - Advancing Research and Career Opportunities in STEM Award Numbers: P031C210111 – 2021 Questioned Costs: None Northeastern Illinois University (University) did not report a first-tier subaward of $30,000 or more to the Federal Funding Accountability and Transparency Act Subaward Reporting System (FSRS) for the Higher Education Institutional Aid grants. CONDITIONS FOUND & CRITERIA: The Higher Education Institutional Aid grants had one first-tier subaward for $217,541 that was not reported to the FSRS. This was the only subaward granted in the Higher Education Institutional Aid program. Under the requirements of the Federal Funding Accountability and Transparency Act (FFATA) that are codified in 2 CFR Part 170, recipients (i.e., direct recipients) of grants or cooperative agreements are required to report first-tier subawards of $30,000 or more to the FSRS. CAUSE: University officials stated the University did not have a formalized process for FFATA subaward reporting and had not clearly assigned responsibility to a specific office, resulting in the subaward not being reported. EFFECT: FFATA reporting is critical for management of federal funds when first-tier subawards are made. Without controls in place, the University in not in compliance with federal regulations. (Finding Code No. 2025-007) RECOMMENDATION: We recommend the University implements processes and controls to ensure that FFATA reporting requirements are executed when required. UNIVERSITY RESPONSE: The University agrees with the recommendation and acknowledges that the first-tier subaward under the Higher Education Institutional Aid grant was not reported to the FSRS. This occurred because the University did not have an established process for FFATA reporting and had not clearly designated which office was responsible. The University will explore procedures to address this issue.

2025-006. FINDING - Noncompliance with Enrollment Reporting Requirements Federal Agency: Department of Education Assistance Listing Numbers: 84.268, 84.063 Program Names: Federal Direct Student Loans, Federal Pell Grant Program Award Numbers: P268K251350 - 2025; P063P241350 - 2025 Questioned Costs: None Northeastern Illinois University (University) did not have adequate procedures and controls in place to ensure that the effective date of students who unofficially withdrew was accurately reported to National Student Loan Data System (NSLDS). CONDITIONS FOUND & CRITERIA: During our testing of the University’s compliance with enrollment reporting requirements for Direct loan programs via the NSLDS (OMB No. 1845-0035), we noted the University did not update program-level and campus-level effective enrollment dates for the students’ appropriate withdrawal date. We noted the following: Two of 25 (8%) of the students originally tested withdrew during the Spring semester; however, they were reported to NSLDS as withdrawn with an effective enrollment change date in the following Fall semester and were not updated retroactively. NSLDS requires that the date the current enrollment status is to be reported when the change was first effective (See 4.4.2 of NSLDS Enrollment Reporting Guide). Ten of 15 (67%) additional students tested as a result of the error withdrew during their respective fall and spring semester; however, they were reported to NSLDS as withdrawn with an effective enrollment at the end of the semester and were not updated retroactively, thus bringing total errors to 12 of 40 students (30%). NSLDS requires that the date the current enrollment status is to be reported when the change was first effective (See 4.4.2 of NSLDS Enrollment Reporting Guide) and can be retroactively reported to reflect the accurate effective date (See 4.4.5 of NSLDS Enrollment Reporting Guide). The sample was not intended to be, and was not, a statistically valid sample. The NSLDS Enrollment Reporting Guide (4.4.5) does speak to continuing education as a way of determination of student’s enrollment status. However, this is only applicable when evaluating the end of the current school year, during the spring and summer semester, with respect to the upcoming school year’s fall semester. CAUSE: University officials stated due to timing issues between the University’s enrollment file certification process and the NSLDS’s roster creation process, the exceptions above were noted. EFFECT: Failure to meet enrollment reporting requirements is noncompliance with federal regulations and could result in loss of loan/grant funding in future years. (Finding Code No. 2025-006, 2024-006) RECOMMENDATION: We recommend the University's implement greater controls and oversight of the University's current Roster Verification process to ensure that a more accurate determination of the last date of attendance for withdrawal determination are reported to NSLDS. UNIVERSITY RESPONSE: The University agrees with the recommendation. To prevent a recurrence of roster timing conflict, the University will coordinate with the NSC to determine the most appropriate submission date for the Unofficial Withdrawal file. Implementing this solution will require the Financial Aid Office to provide the Registrar’s Office with the complete Unofficial Withdrawal file (Last Dates of Attendance included) earlier, as all students on that file are reported to the NSC as actively enrolled students.