Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Aid Assistance Listing Number: Student Financial Aid Cluster Award Period: September 1, 2024 to August 31, 2025 Type of Finding: • Significant Deficiency in Internal Control Over Compliance • Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 668.164(h) states a title IV, HEA credit balance occurs whenever the amount of title IV, HEA program funds credited to a student's ledger account for a payment period exceeds the amount assessed the student for allowable charges associated with that payment period. Title IV, HEA credit balances must be paid directly to the student or parent as soon as possible, but: (1) No later than 14 days after the balance occurred if the credit balance occurred after the first day of class of a payment period; or (2) No later than 14 days after the first day of class of a payment period if the credit balance occurred on or before the first day of class of that payment period. Condition: During our testing of credit balances resulting from federal funds, we noted that although the refunds were ultimately paid, 3 out of 40 credit balances tested were not refunded within the required 14-day period. It was also noted that the credit balances selected for testing lacked sufficient documentation to demonstrate proper oversight. We were unable to identify formalized review/approval procedures to ensure that internal control activities are consistently executed and documented. Questioned Costs: None Context: Federal regulations require institutions to refund credit balances resulting from Title IV funds within 14 days of the balance being created. Timely refunds ensure compliance with U.S. Department of Education requirements and protect students from delays in receiving funds. Failure to meet this deadline can result in noncompliance and potential financial or administrative consequences. Cause: The District did not have proper procedures in place to ensure all credit balances are refunded within the 14-day period. Effect or Potential Effect of Finding: The District did not refund students within 14 days for credit balances that arose from federal funds as required by the regulations. Repeat Finding: No. Recommendation: We recommend the District review and strengthen its policies and procedures to ensure that all student credit balances resulting from federal funds are refunded within the required 14- day period. Views of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Aid Assistance Listing Number: Student Financial Aid Cluster Award Period: September 1, 2024 to August 31, 2025 Type of Finding: • Material Weakness in Internal Control Over Compliance • Other Matters Criteria or Specific Requirement: The Department of Education requires the District to report the disbursement dates and amounts to the Common Origination and Disbursement (COD) system within 15 days of disbursing Pell (34 CFR 690.83(b)(2) and Direct Loan (34 CFR 685.309) funds to a student. Condition: During our testing, we noted 27 of the 40 disbursements tested were not reported within the required 15 days to the Common Origination and Disbursement (COD) system. In addition, we noted 2 out of the 40 disbursements tested where the disbursement date in COD did not match the student ledger. Questioned Costs: None Context: During our testing, it was noted the District had gone back to update student disbursement dates to match the student ledger; however, this was not done within the 15 days. Cause: The District identified a number of disbursement dates in COD did not match the disbursement dates per the student ledgers. Due to this, they corrected the disbursements in COD but it was not done within the 15-day-requirement. Effect or Potential Effect of Finding: Students’ interest accrues based on disbursement date reported to COD, thus interest calculation could be skewed due to the discrepancy in disbursement dates reported. The District is also not following the regulations for timely reporting. Repeat Finding: No. Recommendation: We recommend the District evaluate its procedures and policies around reporting disbursements to COD to ensure that student information is reported accurately and timely. Views of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Aid Assistance Listing Number: Student Financial Aid Cluster Award Period: September 1, 2024 to August 31, 2025 Type of Finding: Material Weakness in Internal Control Over Compliance Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 685.309 requires that enrollment status changes for students be reported to NSLDS within 30 days or within 60 days if the student with the status change will be reported on a scheduled transmission within 60 days of the change in status. In addition, regulations require the data to include an accurate status and effective date. Condition: During our testing, it was noted the campus enrollment effective date per NSLDS did not match the District's records for 23 out of the 40 students tested. In addition, the change in status was not reported timely for 13 out of the 40 students tested. Finally, for 7 out of 40 students tested, the status in NSLDS did not match the District's records. Questioned Costs: None Context: There were discrepancies between the campus enrollment effective dates and statuses reported to NSLDS and the District's records as well as students did not have their enrollment status change updated timely. Cause: The District's current processes and controls did not ensure that student status changes and effective dates were accurately and timely reported to NSLDS. The effective date should be the student's last date of attendance and academically-related activity. Effect or Potential Effect of Finding: The NSLDS system is not updated with the correct student information, which can cause a student to not properly enter the repayment period. Repeat Finding: No. Recommendation: We recommend the District review and strengthen its reporting procedures to ensure that student statuses are accurately and timely reported to NSLDS, as required by federal regulations. Views of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Aid Assistance Listing Number: Student Financial Aid Cluster Award Period: September 1, 2024 to August 31, 2025 Type of Finding: • Material Weakness in Internal Control Over Compliance • Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 668.22(f)(2)(i), the total number of calendar days in a payment period or period of enrollment includes all days that the student was scheduled to complete, except that scheduled breaks of at least five consecutive days are excluded from the total number of calendar days in a payment period or period of enrollment and the number of calendar days completed in that period. Condition: During our testing of Return of Title IV (R2T4) calculations, we noted the District had used an incorrect percentage of days attended causing the District to incorrectly calculate the return of Title IV funds. Questioned Costs: $5,372 Context: Federal regulations require institutions to calculate and return unearned Title IV funds when a student withdraws. The calculation is based on the percentage of days attended, and funds must be returned to the COD system within 45 days of completing the R2T4 calculation. These rules ensure compliance with U.S. Department of Education requirements and protect federal funds. Cause: The District did not have a process in place to correctly calculate the students’ percentage of days attended. Effect or Potential Effect of Finding: The District is not completing accurate R2T4 calculations as defined by the regulations. Failure to return funds timely may result in noncompliance with federal regulations, potential liabilities, and risk of loss of eligibility for Title IV programs. Repeat Finding: No. Recommendation: We recommend the District review the R2T4 requirements and implement procedures to ensure that calculations use the correct period of enrollment. Views of Responsible Officials: There is no disagreement with the audit finding.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Aid Assistance Listing Number: Student Financial Aid Cluster Award Period: September 1, 2024 to August 31, 2025 Type of Finding: • Material Weakness in Internal Control Over Compliance • Other Matters Criteria or Specific Requirement: Uniform Guidance (2 CFR 200) requires non-federal entities to establish and maintain effective internal control over federal awards that provides reasonable assurance of compliance with federal statutes, regulations, and the terms and conditions of the award. This includes documented control activities such as approvals, reviews, reconciliations, and monitoring procedures. Condition: During our testing of internal controls over compliance, we identified that the District did not consistently implement or document key control activities related to its monthly reconciliations for Pell, Direct Loans, SEOG, and FWS. Questioned Costs: None Context: During our audit, we evaluated the design and operating effectiveness of the District’s internal controls over compliance and noted controls were not implemented consistently or lacked sufficient documentation to demonstrate compliance. Cause: The deficiencies appear to result from insufficient oversight and a lack of formalized procedures to ensure that internal control activities are consistently executed and documented. Effect or Potential Effect of Finding: Without effective internal controls over compliance, the entity is at increased risk of: • Noncompliance with federal requirements • Improper or unallowable costs being charged to federal programs • Reduced accountability over federal funds • Potential questioned costs or future restrictions on federal funding Repeat Finding: No. Recommendation: We recommend that management: • Strengthen and formalize internal control procedures over federal awards, including documented reviews, approvals, and reconciliations. • Provide training to staff responsible for federal program administration to ensure understanding of Uniform Guidance requirements. • Establish periodic internal reviews to verify that control activities are consistently performed and documented. Views of Responsible Officials: There is no disagreement with the audit finding.