FAC Explorer

Audit 4064

FY End
2021-06-30
Total Expended
$8.65M
Findings
26
Programs
4
Organization: Concordia College (NY)
Year: 2021 Accepted: 2023-11-26
Auditor: Pkf O'Connor Davies LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
2362 2021-002 Material Weakness - ACELN
2363 2020-002 Material Weakness - E
2364 2020-003 Significant Deficiency - E
2365 2020-004 Material Weakness Yes N
2366 2020-005 Material Weakness - C
2367 2020-006 Significant Deficiency - N
2368 2020-007 Significant Deficiency Yes N
2369 2020-008 Material Weakness Yes N
2370 2020-009 Significant Deficiency - N
2371 2020-010 Material Weakness - N
2372 2020-011 Material Weakness - N
2373 2020-012 Material Weakness - N
2374 2020-013 Material Weakness - EN
578804 2021-002 Material Weakness - ACELN
578805 2020-002 Material Weakness - E
578806 2020-003 Significant Deficiency - E
578807 2020-004 Material Weakness Yes N
578808 2020-005 Material Weakness - C
578809 2020-006 Significant Deficiency - N
578810 2020-007 Significant Deficiency Yes N
578811 2020-008 Material Weakness Yes N
578812 2020-009 Significant Deficiency - N
578813 2020-010 Material Weakness - N
578814 2020-011 Material Weakness - N
578815 2020-012 Material Weakness - N
578816 2020-013 Material Weakness - EN

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $7.06M Yes 13
84.063 Federal Pell Grant Program $1.52M Yes 0
84.007 Federal Supplemental Educational Opportunity Grants $40,768 Yes 0
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $33,031 Yes 0

Contacts

Name Title Type
NT8TUD8VBZC9 Ryan Caster Auditee
7168472651 Stephen MacHinski Auditor
No contacts on file

Notes to SEFA

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The College has elected not to use the 10-percent de minimis indirect cost rate allowable under the Uniform Guidance. The College is reimbursed for programmatic and administrative costs in accordance with rules set forth by the Department of Education. In 2021, the College did not claim administrative cost allowances from the Federal Work Study Program or the Federal Supplemental Educational Opportunity Grants. The accompanying schedule of expenditure of federal awards (the "Schedule" includes the federal award activity of Concordia College (the “College”) under programs of the Federal government for the year ended June 30, 2021. The information in this Schedule is presented in accordance with the requirements of the Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (“Uniform Guidance”). Because the Schedule presents only a selected portion of the operations of the College, it is not intended to and does not present the financial position, changes in net assets or cash flows of the College.
Title: Summary of Significant Accounting Policies Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The College has elected not to use the 10-percent de minimis indirect cost rate allowable under the Uniform Guidance. The College is reimbursed for programmatic and administrative costs in accordance with rules set forth by the Department of Education. In 2021, the College did not claim administrative cost allowances from the Federal Work Study Program or the Federal Supplemental Educational Opportunity Grants. Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Title: Federal Direct Student Loans Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The College has elected not to use the 10-percent de minimis indirect cost rate allowable under the Uniform Guidance. The College is reimbursed for programmatic and administrative costs in accordance with rules set forth by the Department of Education. In 2021, the College did not claim administrative cost allowances from the Federal Work Study Program or the Federal Supplemental Educational Opportunity Grants. The College is responsible for the performance of certain administrative duties with respect to the Federal Direct Student Loans program and, accordingly, these loans are not included in the College’s basic financial statements. It is not practical to determine the balance of loans outstanding from students of the College under this program as of June 30, 2021. The College processed $7,062,524 of Federal Direct Student Loans for the year ended June 30, 2021.
Title: Indirect Cost Rate Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The College has elected not to use the 10-percent de minimis indirect cost rate allowable under the Uniform Guidance. The College is reimbursed for programmatic and administrative costs in accordance with rules set forth by the Department of Education. In 2021, the College did not claim administrative cost allowances from the Federal Work Study Program or the Federal Supplemental Educational Opportunity Grants. The College has elected not to use the 10-percent de minimis indirect cost rate allowable under the Uniform Guidance. The College is reimbursed for programmatic and administrative costs in accordance with rules set forth by the Department of Education. In 2021, the College did not claim administrative cost allowances from the Federal Work Study Program or the Federal Supplemental Educational Opportunity Grants.
Title: Liquidation of the College Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance wherein certain types of expenditures are not allowable or are limited as to reimbursement. De Minimis Rate Used: N Rate Explanation: The College has elected not to use the 10-percent de minimis indirect cost rate allowable under the Uniform Guidance. The College is reimbursed for programmatic and administrative costs in accordance with rules set forth by the Department of Education. In 2021, the College did not claim administrative cost allowances from the Federal Work Study Program or the Federal Supplemental Educational Opportunity Grants. As discussed in Note 2 to the financial statements, the Board of Regents approved the closure of the College on January 23, 2021. Management had previously determined that liquidation of the College was imminent and as a result, the College changed its basis of accounting on January 16, 2021 from a going concern basis to a liquidation basis. Our opinion is not modified with respect to that matter.

Finding Details

Finding 2021-002
2021-002 Noncompliance with Uniform Grant Guidance Requirements FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Criteria: To comply with the Student Financial Aid Cluster requirements, institutions must follow direct and material compliance requirements as outlined in the OMB Compliance Supplement. In addition, entities subject to an audit in accordance with Uniform Grant Guidance are required to submit the Data Collection Form with the Federal Audit Clearinghouse. We were engaged to express an opinion on the College’s compliance with direct and material compliance requirements for Student Financial Assistance Cluster. Furthermore, to ensure completeness of the schedule of expenditures of federal awards and appropriate recognition of revenue from Federal awards is reflected in the College’s accounting records, the expenditures on the schedule of expenditure of federal awards should be reconciled to the College’s accounts and records. Condition: Because of the closure of the College, we were unable to obtain sufficient audit evidence of student records to test the compliance of direct and material compliance requirements which were identified as activities allowed or unallowed, cash management, eligibility, reporting, and special tests and provisions. In addition, management was unable to provide sufficient documentation to support the reconciliation of the schedule of expenditures of federal awards to the College’s accounts and records. Further, we noted that the management did not submit the data collection form to the Federal Audit Clearinghouse in a timely manner. Cause: Due to the closure of the College, Ellucian Banner (“Banner”), the accounting and financial system for the College was shut down in preparing for the upcoming shutdown of the College. Management lost access to electronic files in Banner and proper maintenance of student records were neither maintained by management nor was the data downloaded from Banner prior to the system being shut down. Effect: The lack of a formal closing process and lack of maintenance of sufficient documentation for student records made it impossible for us to obtain sufficient audit evidence of student records to test the compliance of direct and material compliance requirements. In addition, we were unable to test the completeness of the schedule of expenditures of federal awards since it did not reconcile to tuition revenue as reflected in the College’s accounts and records. Lastly, management was unable to submit the data collection form to the Federal Audit Clearinghouse by the required due date. Repeat Finding: No Recommendation: We recommend that the outsourced financial consultants and those charged with governance maintain proper student records as the College continues with its liquidation. In addition, we recommend the schedule of expenditures of federal awards be reconciled to the College’s accounts and records. Finally, management should ensure that future data collection forms that may be required to be submitted are done so on a timely basis. Management’s Response: See corrective action plan attached.
Finding 2020-002
2020-002 Eligibility FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: The College relies upon flag reports generated by the College’s Banner system to verify and monitor the eligibility of students to receive Federal Student Financial Assistance awards. The Director of Financial Aid receives and reviews the students flagged with eligibility exceptions that need to be resolved before Federal Student Financial Assistance is disbursed. Based upon the review and resolution of eligibility flags, Federal Student Financial Assistance is disbursed, or the student is determined to be ineligible for Federal Student Financial Assistance. The Director of Financial Aid was unable to provide copies of exception reports, therefore we were unable to determine if controls over eligibility were in place and operating effectively. Status: Due to the closure of the College, the Banner system was shutdown with management losing access to electronic files in the system. Maintenance of proper financial records and student enrollment files in paper form were not kept by management nor was the data downloaded from Banner prior to the system being shutdown. Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-003
2020-003 Eligibility FALN Number: 84.379 Program or Cluster Name: Teacher Education Assistance for College and Higher Education Grants (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For one of three graduate students selected that received TEACH grant disbursements, the student’s cumulative undergraduate grade point average did not meet or exceed the GPA requirement of 3.25 on a 4.0 scale. Status: Due to the closure of the College, various software systems were shutdown without downloading data to a backup drive. In addition, sufficient paper documentation was not maintained in supporting the activity of the College for both financial transactions and remaining compliance requirements in winding down the operations. Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-004
2020-004 Special Test - Gramm-Leach Bliley Act FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: We noted that the College did not have a policy to address student information security. Status: Due to the closure of the College, various software systems were shutdown with little consideration being given to information security and the storage of sensitive student data. Management was more concerned with recording of financial transactions and winding down operations of the College. We are unable to verify if the College is in compliance with the Program Participation Agreement and the Gramm-Leach Bliley Act. As such, the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-005
2020-005 Cash Management FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: We noted that the College did not follow internal procedures to ensure that Student Financial Assistance funds were not drawn down in excess of the institution’s immediate needs for disbursement to student accounts. In addition, there was no documentation available to verify that controls over the G5 drawdowns were reviewed or approved prior to initiation. Status: Due to the closure of the College, various software systems were shutdown without downloading data to a backup drive. In addition, sufficient paper documentation was not maintained in supporting the activity of the College for both financial transactions and remaining compliance requirements in winding down the operations. Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-006
2020-006 Special Tests - Verification FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For one of eleven students selected for verification, it was noted that no evidence of review by the Financial Aid Department was performed of the verification worksheet or supporting documentation. Status: Due to the closure of the College, the review of the documents obtained during the verification process was not documented either digitally or in paper format. Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-007
2020-007 Special Tests – Disbursements to or on Behalf of Students FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: During our audit procedures, for three of forty students selected for testing, it was noted that refunds of credit balances created by the disbursement of Student Financial Assistance disbursements were not paid to students within fourteen days of the date the credit balance occurred. In addition, it was noted that the College follows the same process for issuing all student refunds, regardless of the Title IV status. An additional nine student refunds were not paid within fourteen days of the date the credit balance occurred. Status: Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-008
2020-008 Special Tests – Return of Title IV Funds FALN Number: 84.268 / 84.063 Program or Cluster Name: Federal Direct Student Loan Program / Federal Pell Grant Program (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For three of seventeen student withdrawals, we were unable to verify the date of the student withdrawals or examine the Return to Title IV funds calculation for accuracy or timeliness. Status: Because of the closure of the College, individual student records including individual transaction records were not maintained either digitally or in paper format. We were unable to determine whether Return of Title IV fund calculations were required or performed accurately or timely and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-009
2020-009 Special Tests – Disbursements to and on Behalf of Students FALN Number: 84.268 Program or Cluster Name: Federal Direct Student Loan Program (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For one of forty Federal Direct Student Loan Program disbursements tested, one disbursement was made to a student thirty-five days prior to the first day of classes for the applicable payment period. Status: Due to the closure of the College, individual student records including individual transaction records were not maintained either digitally or in paper format. We are unable to verify whether federal student financial assistance was disbursed to students within the required timeframe and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-010
2020-010 Special Tests – Enrollment Reporting FALN Number: 84.268 Program or Cluster Name: Federal Direct Student Loan Program (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For six of forty status changes selected for testing, no documentation was provided. For three students, no documentation of the students’ enrollment status change was provided. Twenty status changes were not reported accurately. Seventeen status changes were not reported within 60 days. We did not note any documentation of review or approval of enrollment status changes as part of the enrollment reporting process. Status: Due to the closure of the College, individual student records including individual transaction records were not maintained either digitally or in paper format. As such, we are unable to verify if internal controls over federal student financial assistance disbursements functioned properly and thus are unable to verify the correction of the finding. See current year finding 2021-002.
Finding 2020-011
2020-011 Special Tests – Borrower Data and Reconciliation (Direct Loans) FALN Number: 84.268 Program or Cluster Name: Federal Direct Student Loan Program (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For three of three monthly Common Origination and Disbursement (“COD”) reconciliations requested, reconciliations were not provided. Status: Due to the closure of the College review of the documents obtained during the COD process along with the supporting documents was not documented either digitally or in paper format. As such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-012
2020-012 Special Reporting FALN Number: 84.007 Program or Cluster Name: Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: The FISAP report for the 2019-2020 award year and the application for the 2021-2022 award year was submitted online by November 2, 2020, however the signature was not submitted until February 25, 2021. In addition, we noted multiple inaccuracies in the data reported on the initial FISAP report. Per inquiry of the Director of Financial Aid, corrections were made, however the corrected FISAP report was not provided, therefore we were unable to determine if the corrected FISAP was completed accurately. In addition, per inquiry of the Director of Financial Aid, there was no subsequent review of the FISAP report prior to the initial or revised submission. Status: During and leading up to the closure of the College there was a significant amount of transactions being recorded while the finance function was being transitioned to outside consultants. This led to review processes regarding financial compliance and reporting not functioning. In addition, with the closure of the College, management lost access to various software and reporting systems. Maintenance of proper records in paper form were not kept by management nor was the data downloaded from the software prior to access being disabled. As such, the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-013
2020-013 Eligibility & Special Tests – Institutional Eligibility FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For nine of forty students selected for testing, we were unable to resolve questions relating to satisfactory academic progress. Status: Student and financial scholarship records could not be provided and thus we were unable to determine that students were making satisfactory academic progress, and therefore eligible to receive the Federal Student Financial Assistance received. As such, the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2021-002
2021-002 Noncompliance with Uniform Grant Guidance Requirements FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Criteria: To comply with the Student Financial Aid Cluster requirements, institutions must follow direct and material compliance requirements as outlined in the OMB Compliance Supplement. In addition, entities subject to an audit in accordance with Uniform Grant Guidance are required to submit the Data Collection Form with the Federal Audit Clearinghouse. We were engaged to express an opinion on the College’s compliance with direct and material compliance requirements for Student Financial Assistance Cluster. Furthermore, to ensure completeness of the schedule of expenditures of federal awards and appropriate recognition of revenue from Federal awards is reflected in the College’s accounting records, the expenditures on the schedule of expenditure of federal awards should be reconciled to the College’s accounts and records. Condition: Because of the closure of the College, we were unable to obtain sufficient audit evidence of student records to test the compliance of direct and material compliance requirements which were identified as activities allowed or unallowed, cash management, eligibility, reporting, and special tests and provisions. In addition, management was unable to provide sufficient documentation to support the reconciliation of the schedule of expenditures of federal awards to the College’s accounts and records. Further, we noted that the management did not submit the data collection form to the Federal Audit Clearinghouse in a timely manner. Cause: Due to the closure of the College, Ellucian Banner (“Banner”), the accounting and financial system for the College was shut down in preparing for the upcoming shutdown of the College. Management lost access to electronic files in Banner and proper maintenance of student records were neither maintained by management nor was the data downloaded from Banner prior to the system being shut down. Effect: The lack of a formal closing process and lack of maintenance of sufficient documentation for student records made it impossible for us to obtain sufficient audit evidence of student records to test the compliance of direct and material compliance requirements. In addition, we were unable to test the completeness of the schedule of expenditures of federal awards since it did not reconcile to tuition revenue as reflected in the College’s accounts and records. Lastly, management was unable to submit the data collection form to the Federal Audit Clearinghouse by the required due date. Repeat Finding: No Recommendation: We recommend that the outsourced financial consultants and those charged with governance maintain proper student records as the College continues with its liquidation. In addition, we recommend the schedule of expenditures of federal awards be reconciled to the College’s accounts and records. Finally, management should ensure that future data collection forms that may be required to be submitted are done so on a timely basis. Management’s Response: See corrective action plan attached.
Finding 2020-002
2020-002 Eligibility FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: The College relies upon flag reports generated by the College’s Banner system to verify and monitor the eligibility of students to receive Federal Student Financial Assistance awards. The Director of Financial Aid receives and reviews the students flagged with eligibility exceptions that need to be resolved before Federal Student Financial Assistance is disbursed. Based upon the review and resolution of eligibility flags, Federal Student Financial Assistance is disbursed, or the student is determined to be ineligible for Federal Student Financial Assistance. The Director of Financial Aid was unable to provide copies of exception reports, therefore we were unable to determine if controls over eligibility were in place and operating effectively. Status: Due to the closure of the College, the Banner system was shutdown with management losing access to electronic files in the system. Maintenance of proper financial records and student enrollment files in paper form were not kept by management nor was the data downloaded from Banner prior to the system being shutdown. Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-003
2020-003 Eligibility FALN Number: 84.379 Program or Cluster Name: Teacher Education Assistance for College and Higher Education Grants (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For one of three graduate students selected that received TEACH grant disbursements, the student’s cumulative undergraduate grade point average did not meet or exceed the GPA requirement of 3.25 on a 4.0 scale. Status: Due to the closure of the College, various software systems were shutdown without downloading data to a backup drive. In addition, sufficient paper documentation was not maintained in supporting the activity of the College for both financial transactions and remaining compliance requirements in winding down the operations. Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-004
2020-004 Special Test - Gramm-Leach Bliley Act FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: We noted that the College did not have a policy to address student information security. Status: Due to the closure of the College, various software systems were shutdown with little consideration being given to information security and the storage of sensitive student data. Management was more concerned with recording of financial transactions and winding down operations of the College. We are unable to verify if the College is in compliance with the Program Participation Agreement and the Gramm-Leach Bliley Act. As such, the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-005
2020-005 Cash Management FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: We noted that the College did not follow internal procedures to ensure that Student Financial Assistance funds were not drawn down in excess of the institution’s immediate needs for disbursement to student accounts. In addition, there was no documentation available to verify that controls over the G5 drawdowns were reviewed or approved prior to initiation. Status: Due to the closure of the College, various software systems were shutdown without downloading data to a backup drive. In addition, sufficient paper documentation was not maintained in supporting the activity of the College for both financial transactions and remaining compliance requirements in winding down the operations. Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-006
2020-006 Special Tests - Verification FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For one of eleven students selected for verification, it was noted that no evidence of review by the Financial Aid Department was performed of the verification worksheet or supporting documentation. Status: Due to the closure of the College, the review of the documents obtained during the verification process was not documented either digitally or in paper format. Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-007
2020-007 Special Tests – Disbursements to or on Behalf of Students FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: During our audit procedures, for three of forty students selected for testing, it was noted that refunds of credit balances created by the disbursement of Student Financial Assistance disbursements were not paid to students within fourteen days of the date the credit balance occurred. In addition, it was noted that the College follows the same process for issuing all student refunds, regardless of the Title IV status. An additional nine student refunds were not paid within fourteen days of the date the credit balance occurred. Status: Student and financial scholarship records could not be provided and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-008
2020-008 Special Tests – Return of Title IV Funds FALN Number: 84.268 / 84.063 Program or Cluster Name: Federal Direct Student Loan Program / Federal Pell Grant Program (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For three of seventeen student withdrawals, we were unable to verify the date of the student withdrawals or examine the Return to Title IV funds calculation for accuracy or timeliness. Status: Because of the closure of the College, individual student records including individual transaction records were not maintained either digitally or in paper format. We were unable to determine whether Return of Title IV fund calculations were required or performed accurately or timely and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-009
2020-009 Special Tests – Disbursements to and on Behalf of Students FALN Number: 84.268 Program or Cluster Name: Federal Direct Student Loan Program (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For one of forty Federal Direct Student Loan Program disbursements tested, one disbursement was made to a student thirty-five days prior to the first day of classes for the applicable payment period. Status: Due to the closure of the College, individual student records including individual transaction records were not maintained either digitally or in paper format. We are unable to verify whether federal student financial assistance was disbursed to students within the required timeframe and as such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-010
2020-010 Special Tests – Enrollment Reporting FALN Number: 84.268 Program or Cluster Name: Federal Direct Student Loan Program (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For six of forty status changes selected for testing, no documentation was provided. For three students, no documentation of the students’ enrollment status change was provided. Twenty status changes were not reported accurately. Seventeen status changes were not reported within 60 days. We did not note any documentation of review or approval of enrollment status changes as part of the enrollment reporting process. Status: Due to the closure of the College, individual student records including individual transaction records were not maintained either digitally or in paper format. As such, we are unable to verify if internal controls over federal student financial assistance disbursements functioned properly and thus are unable to verify the correction of the finding. See current year finding 2021-002.
Finding 2020-011
2020-011 Special Tests – Borrower Data and Reconciliation (Direct Loans) FALN Number: 84.268 Program or Cluster Name: Federal Direct Student Loan Program (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For three of three monthly Common Origination and Disbursement (“COD”) reconciliations requested, reconciliations were not provided. Status: Due to the closure of the College review of the documents obtained during the COD process along with the supporting documents was not documented either digitally or in paper format. As such the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-012
2020-012 Special Reporting FALN Number: 84.007 Program or Cluster Name: Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: The FISAP report for the 2019-2020 award year and the application for the 2021-2022 award year was submitted online by November 2, 2020, however the signature was not submitted until February 25, 2021. In addition, we noted multiple inaccuracies in the data reported on the initial FISAP report. Per inquiry of the Director of Financial Aid, corrections were made, however the corrected FISAP report was not provided, therefore we were unable to determine if the corrected FISAP was completed accurately. In addition, per inquiry of the Director of Financial Aid, there was no subsequent review of the FISAP report prior to the initial or revised submission. Status: During and leading up to the closure of the College there was a significant amount of transactions being recorded while the finance function was being transitioned to outside consultants. This led to review processes regarding financial compliance and reporting not functioning. In addition, with the closure of the College, management lost access to various software and reporting systems. Maintenance of proper records in paper form were not kept by management nor was the data downloaded from the software prior to access being disabled. As such, the correction of the finding could not be verified. See current year finding 2021-002.
Finding 2020-013
2020-013 Eligibility & Special Tests – Institutional Eligibility FALN Number: 84.268 / 84.063 / 84.007 / 84.379 Program or Cluster Name: Federal Direct Student Loans / Federal Pell Grant Program / Federal Work-Study Program / Federal Supplemental Educational Opportunity Grants / Teacher Education Assistance for College and Higher Education (Student Financial Assistance Cluster) Agency: U.S. Department of Education Condition: For nine of forty students selected for testing, we were unable to resolve questions relating to satisfactory academic progress. Status: Student and financial scholarship records could not be provided and thus we were unable to determine that students were making satisfactory academic progress, and therefore eligible to receive the Federal Student Financial Assistance received. As such, the correction of the finding could not be verified. See current year finding 2021-002.