Audit 395941

Federal Agency: U.S. Department of Education Federal Program Name: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063, and 84.268 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: July 1, 2024 – June 30, 2025 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: Per Uniform Guidance 34 of the Code of Federal Regulations (CFR) 668.164(h)(2)(i), Title IV credit balances must be paid directly to the student no later than 14 days after the balance occurred. Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: During our testing, 10 out of 60 credit balance refunds were returned later than 14 days after the credit balance occurred in student account. Questioned costs: None Context: The College was returning credit balance refunds longer than 14 days after they occurred. Cause: The College was holding financial aid balance until student's purchased bookstore items on student accounts. Effect: The students did not have access to their credit balance refunds timely. Repeat Finding: Yes, 2024-001 Recommendation: We recommend the college update procedures around disbursements of credit balances and implement controls to ensure credit balances are being returned timely. Views of responsible officials: There is no disagreement with the audit finding. Prior to FY23, students signed a form acknowledging and authorizing the College to have credit balances held on their account in the event there would be classes added and to purchase books. During FY2023, this procedure was discontinued for an unrelated reason and an unintended consequence was not meeting the 14-day requirement. A new procedure was developed and implemented in January, 2025. The 10 credit balance refunds from the population of 60 were from the period of July 1, 2024, through December 31, 2025. The prior year audit was released on November 15, 2025, at which point all credit balances had already been refunded under the prior procedures. There wasn’t an opportunity to correct the situation until the spring semester in 2025.

Federal Agency: U.S. Department of Education Federal Program Name: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063, and 84.268 Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: July 1, 2024 – June 30, 2025 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: 34 CFR 668.21(a) states that the institution must return all Title IV, Higher Education Act (HEA) program funds that were credited to the student's account at the institution or disbursed directly to the student for the payment period. The institution must return those funds no later than 30 days after the date that the institution becomes aware that the student will not or has not begun attendance. Per 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. Condition: During our testing, we noted the College did not have adequate internal controls designed for return of Title IV calculations or direct loan reconciliations. Questioned costs: None Context: During our testing we noted one instance where the College did not input the correct number of days when completing its return of funds calculation. We also noted one instance where the incorrect direct loan amount was used in the calculation. Cause: The College did not have formal procedures in place to review return of Title IV calculations or direct loan reconciliations. Effect: If not properly reviewed, the College could return incorrect amounts based off of their calculations, which could affect student repayment amounts based off of amount earned. Also, the direct loan reconciliations could have errors that would not be detected timely. Repeat Finding: Yes, 2024-002 Recommendation: We recommend the College implement policies and procedures surrounding reviews of return of title IV calculations and direct loan reconciliations. Views of responsible officials: There is no disagreement with the finding. Financial aid staff have added to our Return to Title IV procedures that we complete the calculation in Colleague and the U.S. Department of Education Common Origination & Disbursement to make sure all amounts are correct. The Financial Aid Manager completes the calculation, and the Director then reviews and sends any questions/concerns back to the Financial Aid Manager. The Director will approve once any concerns are addressed.

Federal Agency: U.S. Department of Education Federal Program Name: Student Financial Assistance Cluster Assistance Listing Number: 84.063 – Federal Pell Grant Program, and 84.268 – Federal Direct Student Loans Pass-Through Agency: N/A Pass-Through Number(s): N/A Award Period: July 1, 2024 – June 30, 2025 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or specific requirement: Per Uniform Guidance 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements. The Code of Federal Regulations, 34 CFR 682.610, states that institutions must report accurately the enrollment status of all students regardless of if they receive aid from the institution or not. Changes to said status are required to be reported within 30 days of becoming aware of the status change, or with the next scheduled transmission of statuses if the scheduled transmission is within 60 days. The Code of Federal Regulations, 34 CFR 685.309(b), states the school is required to report changes in the student’s enrollment status, the effective date of the status, and an anticipated completion date. Condition: During testing of 40 enrollment changes, we identified 5 instances of changes being reported after 60 day threshold, 33 instances where the enrollment batch wasn't certified within 60 days, and 1 instance of incorrect enrollment status. Questioned costs: None Context: A control system to prevent and detect errors in the reporting process was not created to ensure that all reporting compliance was filed timely. Cause: The College’s processes and controls did not ensure that the student status changes were properly and timely reported to NSLDS. Effect: The College did not comply with Department of Education (ED) regulations by reporting student enrollment status changes timely. Repeat Finding: Yes, 2024-003 Recommendation: We recommend the College reevaluate its procedures and review policies surrounding reporting status changes to NSLDS to put a process in place to ensure the student status changes are being reported timely. Views of responsible officials: There is no disagreement with the audit finding. The College utilizes a third-party, National Student Clearinghouse (NSC) to report to the National Student Loan Data System (NSLDS). Clarification was obtained from NSC regarding the process between NSC and NSLDS to prevent future occurrences. The NSC report will be submitted at the earliest possible date to provide additional time to review and verify that accurate data was transferred from NSC to NSLDS.