FINDING 2025-001 Internal Control over Compliance and Compliance with Reporting (Significant Deficiency and Noncompliance) Federal Agency: U.S. Department of Education Federal Program: Federal Appropriations Assistance Listing Number: 84.910A Criteria: Pursuant to the Education of the Deaf Act, 20 U.S.C. § 4354(2), Gallaudet University is required to prepare and submit an Annual Report of Achievements (“Annual Report”) containing specified information regarding educational, recruitment, and employment activities. The required information includes: (1) the number of recruitment activities by type and location for all educational levels under 20 U.S.C. § 4354(2)(E), and (2) employment openings/vacancies by grade level or job type and the number of individuals who applied and were hired under 20 U.S.C. § 4354(2)(F). The University is responsible for maintaining sufficient records to support the completeness and accuracy of information reported in the Annual Report. Condition: The University reported the recruitment and employment information required under the Education of the Deaf Act in its Annual Report; however, it did not retain sufficient supporting documentation to substantiate the reported disclosures. Specifically, the University was unable to provide the underlying source data supporting: (1) the number of recruitment activities by type and location for all educational levels and (2) employment openings and vacancies, grade level or type of job, and the number of individuals who applied and were hired. Effect or Potential Effect: As a result, the University could not demonstrate the completeness and accuracy of the reported information included in the Annual Report, and the audit team was unable to verify the reported metrics/data. The lack of appropriate processes to accumulate and maintain the relevant supporting documentation used to prepare the Annual Report increases the risk that inaccurate or incomplete information could be reported without detection and may result in noncompliance with the reporting requirements of the Education of the Deaf Act. Context: During testing of the University's Annual Report, required under the Education of the Deaf Act, the audit team tested all tables and disclosures subject to the reporting requirements. The exceptions identified affected two required reporting elements: (1) recruitment activities by type and location for all educational levels and, (2) employment openings/vacancies, grade level or job type, and applicant and hiring statistics. No supporting documentation was available to support the data presented for either disclosure. Cause: The University did not maintain the underlying source reports, supporting schedules, or other documentation used to compile certain information included in the Annual Report. As a result, the data used to prepare the disclosures could not be recreated or validated subsequent to the report's submission. Questioned Costs: None identified. Recommendation: We recommend that the University strengthen its procedures for accumulating, preparing and retaining support for Annual Report disclosures required under the Education of the Deaf Act. Specifically, management should retain the source reports, supporting schedules, calculations, and other relevant documentation used to compile reported information and implement a review process to verify that supporting documentation is maintained and readily available to substantiate all reported metrics/data. Views of Responsible Official: Management’s corrective action plan, including immediate remediation steps and enhancements to internal controls over Reporting, is presented in the Corrective Action Plan section of this report.
FINDING 2025-002 Internal Control over Compliance and Compliance with Procurement, Suspension and Debarment (Significant Deficiency and Noncompliance) Federal Agency: Various Federal Agencies Federal Program: Research and Development Cluster Assistance Listing Numbers: 47.076, 93.243, and 47.010 (Direct Awards) Criteria: Uniform Guidance requires recipients and subrecipients to maintain and use documented procurement procedures for procurement transactions under a Federal award or subaward, and such procedures must be consistent with the procurement standards in 2 CFR § 200.317 through 200.327. In addition, 2 CFR § 200.320(a)(1)(ii) provides that micro-purchases may be awarded without soliciting competitive price or rate quotations only if the recipient or subrecipient considers the price reasonable based on research, experience, purchase history, or other information and maintains documentation to support its conclusion. Condition: During the audit, we tested five (5) vendors classified as micro-purchases. For each selected vendor, the University was unable to provide documentation evidencing that a cost or price reasonableness review was performed prior to vendor selection or contract execution. Specifically, the procurement files did not include pricing comparisons, competing quotes, market research, purchase history, documented experience, or other support demonstrating how the contract price was determined to be reasonable. Effect or Potential Effect: Without documented evidence of price reasonableness, the University cannot demonstrate that micro-purchase awards were made in accordance with Uniform Guidance procurement requirements. This increases the risk that federally-funded procurement transactions may not be supported by adequate documentation to demonstrate that prices paid were reasonable, and that procurement decisions may not be consistently supported, reviewed, and retained in accordance with federal requirements. Context: This is a condition based on testing the University’s compliance with specific requirements. The prevalence of this finding is detailed in the condition above. The samples were selected using a non-statistical method. Cause: The University did not consistently maintain documentation within its procurement files to evidence that price reasonableness was considered and supported prior to vendor selection or contract execution for micro-purchase transactions. Questioned Costs: No questioned costs were identified. The finding relates to insufficient documentation supporting the price reasonableness determination of certain procurements. Recommendation: We recommend that the University strengthen its procurement procedures for federally-funded micro-purchases to require documentation of price reasonableness prior to approval of the purchase or execution of the contract. We further recommend that the University require such documentation to be retained in a consistent manner and that procurement personnel review the documentation for completeness before approval. Views of Responsible Official: Management’s corrective action plan, including immediate remediation steps and enhancements to internal controls over Procurement, Suspension and Debarment, is presented in the Corrective Action Plan section of this report.
FINDING 2025-003 Internal Control over Compliance and Compliance with Reporting (Significant Deficiency and Noncompliance) Federal Agency: U.S. Department of Education Federal Program: Student Financial Assistance Cluster Assistance Listing Number: Federal Supplemental Educational Opportunity Grant (84.007A), Federal Pell Grant (84.063P), and Federal Work Study (84.033A) Criteria: The Fiscal Operations Report and Application to Participate (FISAP) is used by schools to apply for Campus-Based Program funding for the upcoming award year and to report Campus-Based Program expenditures for the previous award year (34 CFR 674.19, 34 CFR 675.19, 34 CFR 676.19 and 20 U.S.C 1094). Key line items on the FISAP include: Part II (Application), Section E, Line 22: Total tuition and fees; Part II (Application), Section E, Line 23: Total Federal Pell Grant expenditures; Part II (Application), Section F, Lines 25-39: Information on eligible aid applicants; Part IV (FSEOG), Section C, Lines 12-14: Funds to FSEOG recipients; and Part V (FWS), Section C, Lines 12-14: Total compensation for FWS. The University is responsible for maintaining sufficient records to support the completeness and accuracy of information reported in the FISAP. Condition: The University reported the information in the key line items noted above in the FISAP, however, it did not retain sufficient supporting documentation to substantiate certain reported information. Specifically, the University was unable to provide the underlying source data supporting: (1) total tuition and fees for the award year July 1, 2024 to June 30, 2025; (2) information on eligible aid applicants enrolled for award year 2024-25; and (3) nonfederal share of funds to FSEOG recipients. In addition, the total Federal Pell Grant expenditures for the 2024-2025 award year reported by the University in the FISAP did not reconcile to the University’s final Federal Pell Grant closeout balances. Effect or Potential Effect: As a result, the University could not demonstrate the completeness and accuracy of the reported information included within the key line items noted above. The lack of appropriate processes to accumulate and maintain the relevant supporting documentation used to prepare the FISAP increases the risk that inaccurate or incomplete information could be reported without detection and may result in noncompliance with the FISAP reporting requirements. In addition, the total Federal Pell Grant expenditures for the 2024-2025 award year reported in the FISAP were overstated by $97,915. Context: During testing of the University's FISAP, the audit team tested key line items subject to the reporting requirements. No supporting documentation was available to support the: (1) total tuition and fees for the award year July 1, 2024 to June 30, 2025; (2) information on eligible aid applicants enrolled for the award year 2024-25; and (3) the nonfederal share of funds to FSEOG recipients. In addition, the total Federal Pell Grant expenditures for the 2024-2025 award year reported in the FISAP totaled $3,348,864 while the Federal Pell Grant expenditures for the 2024-2025 award year per the University’s records totaled $3,250,949. Cause: The University did not maintain the underlying source reports, supporting schedules, or other documentation used to compile certain information included in the FISAP. As a result, the data used to prepare the disclosures could not be recreated or validated subsequent to the report's submission. In addition, when the FISAP was being prepared, the University had recently implemented a new enterprise planning system and certain financial aid internal controls and reconciliation processes were still being established. Questioned Costs: None identified. Recommendation: We recommend that the University strengthen its procedures for accumulating, preparing and retaining support for the FISAP. Specifically, management should retain the source reports, supporting schedules, calculations, and other relevant documentation used to compile reported information and implement a review process to verify that supporting documentation is maintained and readily available to substantiate all reported information. Views of Responsible Official: Management’s corrective action plan, including immediate remediation steps and enhancements to internal controls over Reporting, is presented in the Corrective Action Plan section of this report.
FINDING 2025-004 Internal Control over Compliance and Compliance with Special Tests and Provisions – NSLDS Reporting (Material Weakness and Material Noncompliance) Federal Agency: U.S. Department of Education Federal Program: Student Financial Assistance Cluster Assistance Listing Number: Federal Pell Grant (84.063P) and Federal Direct Loans (84.268) Criteria: Institutions are required to report enrollment information under the Pell Grant and the Direct Loan and Federal Family Education Loan programs via the National Student Loan Data System (“NSLDS”) (OMB No. 1845-0035, 34 CFR 690.83(b)(2), 34 CFR 682.610, 34 CFR 685.309, and 34 CFR 674.19(f)). The administration of the Title IV programs depends heavily on the accuracy and timeliness of the enrollment information reported by institutions. When a Direct Loan was made to or on behalf of a student who was enrolled or accepted for enrollment at the institution, and the student ceased to be enrolled on at least a halftime basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or a student who is enrolled at the institution and who received a loan under Title IV has changed his or her permanent address, the institution must report the change in its next updated Enrollment Reporting Roster file (due within 60 days of the change). Condition: During the audit, we tested twenty-five (25) students who had enrollment status changes during the fiscal year ended September 30, 2025. For four (4) of these students who graduated, the University did not report the graduation status within the required 60 days of the change. Effect or Potential Effect: Timeliness of reporting graduation status to the NSLDS could impact notification to loan servicers that a borrower has entered repayment status, the start of a borrower’s grace period, and/or deferment, repayment scheduling, and loan servicing. Context: This is a condition based on testing the University’s compliance with specific requirements. The prevalence of this finding is detailed in the condition above. The samples were selected using a non-statistical method. Cause: The University recently implemented a new enterprise planning system and certain reports used to identify enrollment status changes to be reported to NSLDS did not include all students who graduated. The system reports were not sufficiently reviewed to detect these omissions. Questioned Costs: None identified. Recommendation: We recommend that the University strengthen its procedures for identifying and reporting student enrollment status changes to the NSLDS to ensure that the submission of such enrollment information is accurate and timely. Views of Responsible Official: Management’s corrective action plan, including immediate remediation steps and enhancements to internal controls over Special Tests and Provisions – NSLDS reporting, is presented in the Corrective Action Plan section of this report.