Audit 395774

(3) Findings and Questioned Costs Relating to Federal Awards Finding No. 2025 001 – Enrollment Reporting – Material Weakness and Material Noncompliance Federal Program: Student Financial Assistance Federal Department/Agency: U.S. Department of Education Assistance Listing Numbers: 84.063 and 84.268 Federal Award Year: July 1, 2024 – June 30, 2025 Criteria Under Uniform Guidance 2 CFR § 200.303 (Internal controls), the University must establish and maintain effective internal control over compliance with federal program requirements. Federal Title IV regulations mandate that institutions promptly update the National Student Loan Data System (NSLDS) with enrollment status changes (such as graduations, withdrawals, or leaves of absence) within prescribed timeframes. Specifically, institutions are required to report enrollment status changes to NSLDS at least every 60 days. Institutions must review, update, and certify student enrollment statuses, program information, and effective dates. Accurate and timely enrollment reporting is critical to ensure that students’ loan repayment statuses (in-school deferment, grace periods, etc.) are correctly managed in accordance with federal requirements. Condition and context In our sample of 40 students with status changes during the year, we found: • 3 students who had graduated were inaccurately reported to NSLDS as withdrawn, rather than as graduates. Additionally, their change in status was reported to NSLDS 23, 36 and 52 days late. • The effective date for 1 student was inaccurately reported to NSLDS, with a 10-day discrepancy. • 1 student who was on an approved leave of absence was inaccurately reported to NSLDS as withdrawn. Cause The primary cause of the finding was a breakdown in the University’s enrollment reporting process, particularly in the coordination and timing of data submissions to its third-party enrollment reporting servicer (the National Student Clearinghouse, NSC), as well as inadequate monitoring of NSLDS status updates. In order for NSLDS to correctly reflect status of students, the University has to review files that have been processed by NSC and make manual updates as needed to ensure that the files that are ultimately submitted to NSLDS contain accurate information. Effect Inaccurate and delayed submission of student enrollment status information affects the determinations that lenders and servicers of student loans make related to in-school status, deferments, grace periods, and repayment schedules, as well as the federal government's payment of interest subsidies. Questioned Costs None Statistical Sample The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding A similar finding was not reported in the prior year. Recommendation We recommend that the University strengthen and reinforce its policies and procedures to ensure that individuals responsible for monitoring the completeness and accuracy of data reported to the National Student Loan Data System (NSLDS) perform a documented review of all reports prior to submission. These procedures should include a formal, supervisory‑level review by management. Views of Responsible Officials The University of Massachusetts acknowledges the enrollment status of certain students was not accurately or timely transmitted to the National Student Loan Data System (NSLDS). The University will implement additional controls and procedures to ensure data is transmitted to NSLDS correctly and timely, including increased reviews of data submitted to NSDLS, and a reconciliation of student status with NSLDS.