FINDING 2023-018 – MATCHING FOR ENDOWMENTS FROM GRANTS Federal Program Information: Title III, ALN #84.031B Criteria: The Title III grant requires a match for endowment funding. Condition: The required match did not occur during the fiscal year. Context: During the fiscal year 2021 a contribution was recorded to the endowment for $200,000. This was an allowable expenditure under the grant agreement. However, a match of $200,000 was required, and the match was not made during fiscal year 2021, 2022 or 2023. During the current year, there was no match made to the endowment. In addition, there were transfers made from the endowment investment account in the amount of $1,107,619 that was not for purposes outlined within the endowment agreement. The $1,107,619 was repaid to the account in April 2024. Questioned Cost: $1,307,619 Effect: The University was not in compliance with the grant agreement. Cause: The University did not follow up and make the transfer from local funds and inappropriately transferred funds from the investment endowment account. Repeat Finding: Yes, modified from the prior year. Recommendation: We recommend that when the original grant expenditure is recorded, that the grant match occurs at the same time. Additionally, we recommend that the University not transfer any funds from the investment endowment accounts unless the conditions meet the endowment agreement requirements. Response: The University acknowledges this finding and the importance of maintaining the accuracy and integrity of grant funds. The University will review the status of the matching funds and coordinate with the U.S. Department of Education if any adjustments are required. The questioned cost was resolved after June 30, 2023.
Federal Program Information: Federal Direct Loan Program, ALN #84.268, Federal Pell Grant Program, ALN #84.063, Federal Supplemental Educational Opportunity Grants, ALN #84.007 Criteria: 34 CFR 668.22 outlines when a recipient of the loan program withdraws during the year, the University must determine the amount of the loan that the student earned as of the student’s withdrawal date for a Return of Title IV Funds. Condition: The University did not comply with all requirements associated with the calculation and return of Title IV funds for students who withdrew during an academic term. The calculations were not formally reviewed by an independent individual. Context: During testing of the Return of Title IV) population, a sample of student records was selected to evaluate compliance with federal requirements. The following exceptions were identified within the sample tested: • For 19 students the University did not return Title IV funds within the required 45-day timeframe. The range was from 50 days to 453 days. • For 4 students where the calculations were performed correctly; the actual amounts returned differed from the calculated amounts by more than $10. The amount of the over-return was $1,149. • For 1 student where 100% of Title IV aid was returned, as management determined the student did not attend and assigned a withdrawal date of the first day of the term. Aid was disbursed in August and September 2022 and it was not returned until January 2023, exceeding the required timeframe. • For 4 students the Registrar did not maintain an Official Withdrawal Form or other supporting documentation to substantiate the withdrawal date used in the calculation. Questioned Cost: Unknown Effect: Aid was not returned timely, support was not maintained and incorrect amounts were returned. Cause: The Student Financial Aid office experienced turnover and the process to review the calculations was not completed. Repeat Finding: Yes Recommendation: We recommend that the University review and update its policies and procedures in place over processing and review of Return of Title IV Aid Calculations. Response: The University is actively reviewing and updating policies and procedures regarding Return to Title IV aid calculations. Data challenges are being addressed, and additional controls are now in place to ensure this is not a repeat finding moving forward. These include new personnel, additional training and system upgrades that ensure accurate and timely R2T4 processing. In addition, the University is recalculating R2T4 calculations covering this audit period as part of a separate engagement.
FINDING 2023-020 – STUDENT FINANCIAL AID DISBURSEMENTS Federal Program Information: Federal Direct Loan Program, ALN #84.268 Criteria: 34 CFR 685.203, Loan Limits Condition: Federal Direct Loans were incorrectly awarded and disbursed to students. Context: Five students incorrectly received unsubsidized loans that was above their eligibility amount. Questioned Cost: $3,754 Effect: Students were incorrectly awarded and disbursed student financial aid. Cause: Errors in management's packaging of the student financial aid resulted in inaccurate awards and disbursements to students. Repeat Finding: Yes Recommendation: We recommend implementing procedures that appropriately determines student financial aid to students and ensures the proper disbursements. Response: The University is actively reviewing and updating policies and procedures regarding eligibility and disbursement controls. The University has implemented various new reports for monitoring and correcting over/under award situations.
FINDING 2023-021 – STUDENT FINANCIAL AID REPORTING Federal Program Information: Federal Direct Loan Program, ALN #84.268, Federal Pell Grant Program, ALN #84.063, Federal Supplemental Educational Opportunity Grants, ALN #84.007 Criteria: Institutions participating in Title IV programs are required to submit accurate and complete reports to the U.S. Department of Education, including the Fiscal Operations Report and Application to Participate (FISAP) and Common Origination and Disbursement (COD) records. Per federal requirements, data reported must be supported by underlying records, reconciled to institutional systems, and reviewed for accuracy prior to submission. Condition: The University did not ensure the accuracy and completeness of information reported in the FISAP and COD systems. Context: Errors or lack of support related to the FISAP include: • The number of undergraduate and graduate students. • The total tuition and fees for undergraduate, graduate, and professional students. • The total number of students was misstated by 100 students for dependent undergraduate students. • The total number of students was misstated by 292 students for independent undergraduate students. • Areas missing support were the following sections: Fiscal Operations Report, Fiscal Operations Report Federal Supplemental Educational Opportunity Grant Program and Program Summary for Award Year. Errors related to the COD include: • The academic start date was incorrect for all students tested: o Fall term dates were off by 7 days o Spring term dates were off by 1 day • For 1 student, the cost of attendance reported did not agree to the student file. Questioned Cost: None Effect: Inaccurate and unsupported reporting may result in noncompliance with federal reporting requirements and reduced reliability of information used by the U.S. Department of Education. Cause: Inadequate internal controls over the preparation and review of FISAP and COD reporting. Repeat Finding: No Recommendation: We recommend the University establish a formal review and approval process for FISAP and COD submissions. Response: The University recognizes the importance of submitting an accurate FISAP and maintaining supporting documentation. Data challenges are being addressed, and additional controls are now in place to ensure this is not a repeat finding moving forward. These include new personnel, additional training and system upgrades that ensure accurate reporting. The University recognizes the importance of submitting accurate COD information. Data challenges are being addressed, and additional controls are now in place to ensure this is not a repeat finding moving forward. These include new personnel, additional training and system upgrades that ensure accurate reporting.
FINDING 2023-022 – ALLOWABLE COSTS FOR LAND GRANT Federal Program Information: Land Grant Program, ALN #10.512 Criteria: Costs charged to the grant need to relate to activities occurring within the applicable fiscal year and be supported by adequate documentation. Condition: The University recorded and claimed certain expenses in the current fiscal year even though the related service period extended beyond year-end. In addition, supporting documentation for certain expenses could not be provided. Context: Of 62 expenses tested, 2 related to periods subsequent to the fiscal year-end; however, the full invoice amounts were recorded and claimed in the current year rather than allocating the prepaid portion to the subsequent fiscal year. Additionally, supporting documentation for 2 of 62 expense invoices could not be located. Questioned Cost: $34,794 Effect: Current-year grant expenses were overstated, and the lack of supporting documentation increases the risk that unallowable or unsupported costs could be charged to the program. Cause: The University did not adjust grant expenses for an adjustment to prepaid amounts and due to turnover invoices could not be located. Repeat Finding: No Recommendation: We recommend that expenses be reviewed for recording in the proper period when the invoice is received and all invoices be maintained. Response: The University acknowledges this finding and recognizes the importance of reviewing and recording expenses in the proper period. To address the matter, the University will implement procedures to ensure expenses are charged to the correct program in a timely manner and all documentation is maintained.
FINDING 2023-023 – ALLOWABLE COSTS FOR TITLE III Federal Program Information: Title III, ALN #84.031B Criteria: Costs charged to the grant need to relate to activities occurring within the applicable fiscal year and endowment transfers should occur timely. Condition: The University recorded and claimed certain expenses in the current fiscal year even though the related service period extended beyond year-end. In addition, contributions to endowments did not occur when recorded as an expense. Context: Of 60 expenses tested, 4 related to periods subsequent to the fiscal year-end; however, the full invoice amounts were recorded and claimed in the current year rather than allocating the prepaid portion to the subsequent fiscal year. Additionally, there was 1 of 60 expense invoices for an endowment contribution that was recorded as an expense but not transferred to the endowment. Questioned Cost: $159,367 related to prepaid expenses and $100,000 related to endowments. Effect: Current-year grant expenses were overstated, and the lack of timely transferring of endowment contributions increases the risk that unallowable or unsupported costs could be charged to the program. Cause: The University did not adjust grant expenses for an adjustment to prepaid amounts and did not timely transfer endowment contributions. Repeat Finding: Yes Recommendation: We recommend that expenses be reviewed for recording in the proper period when the invoice is received and all endowment contributions be deposited upon expense. Response: The University acknowledges this finding and recognizes the importance of adjusting grant expenses and timely transferring endowment contributions. To address the matter, the University will implement procedures to ensure grant expenses are properly adjusted and endowment contributions are transferred in a timely manner.
FINDING 2023-024 – ALLOWABLE COSTS FOR CARES ACT Federal Program Information: Coronavirus Aid, Relief and Economic Security (Cares) Act, ALN #84.425J Criteria: Costs charged to the grant need to be supported by adequate documentation. Condition: The University recorded and claimed certain expenses in the current fiscal year, however, supporting documentation for certain expenses could not be provided. Context: Supporting documentation for 3 of 61 expense invoices could not be located. Questioned Cost: $187,185 Effect: Current-year grant expenses were overstated, and the lack of supporting documentation increases the risk that unallowable or unsupported costs could be charged to the program. Cause: Due to turnover invoices could not be located. Repeat Finding: No Recommendation: We recommend that all invoices be maintained. Response: The University agrees with this finding and recognizes the importance of ensuring all invoices can be located. To address the matter, the University will continue to strengthen documentation and retention procedures and internal controls to ensure invoices are properly maintained and readily accessible.