Audit 410013

Criteria: A student may not receive a Federal Direct Subsidized Loan amount that exceeds the student’s estimated cost of attendance for the period of enrollment less the borrower’s expected family contribution and estimated financial assistance for that period. Further, a student’s final year must be prorated based on the remaining credits enrolled during the shortened academic year (34 CFR 685.203). Condition: We tested forty files, thirty-five of which were Federal Direct Loan recipients, and two students received incorrect subsidized and unsubsidized loan amounts. We consider this to be an instance of non-compliance and is repeated from the prior year finding at 2024-004. Cause: The condition was caused by not using remaining enrolled credits to prorate the student’s final shortened academic year. Effect or Potential Effect: The result is students received incorrect Federal Direct Loan amounts. Questioned Costs: $1,564 Recommendation: We recommend the Institution return ineligible $1,564 and increase controls over packaging direct loans. Views of Responsible Officials: Management agrees with the finding.

Criteria: An institution must use the Return to Title IV refund calculation (34 CFR 668.22) Condition: We tested eight drop students, four of which required the spring break nine day period, and found one incorrect refund calculation that used seven days instead of the required nine. We consider this to be an instance of non-compliance. Cause: The condition was caused by using incorrect break dates within step 2 of the return to title iv calculation to determine total completed and total days within semester. Effect or Potential Effect: The result is students received incorrect Federal Direct Loan amounts. Questioned Costs: $12 Recommendation: We recommend the Institution refund $12 to the Department of Education, and increase controls over refund calculations. Views of Responsible Officials: Management agrees with the finding.

Criteria: 34 CFR 675.20 (d)(1) notes “A student may be employed under the FWS program and also receive academic credit for the work performed. Those jobs include, but are not limited to, work performed when the student is…”, Further, 34 CFR 675.20 (d)(2) states “A student employed in a FWS job and receiving academic credit for that job may not be - … (ii) Paid for receiving instruction in a classroom, laboratory, or other academic setting.” Volume 6, Chapter 2 of the 2023-2024 Federal Student Aid Handbook page 7 notes, “In general, students are not permitted to work in FWS positions during scheduled class times. Exceptions are permitted if an individual class is cancelled, if the instructor has excused the student from attending for a particular day, and if the student is receiving credit for employment in an internship, externship, or community work-study experience. Any such exemptions must be documented. “You must maintain adequate timesheets or records of hours worked for FWS students. These timesheets must show, separately for each day worked, the hours a student worked, and the total hours worked during the job’s payment cycle (i.e., twice a month, every week, every two weeks, etc., but not less than once a month). These amounts and hours recorded must match the hours for which the student is paid.” Condition: During our testing of forty individuals receiving federal work study, we noted three individuals (7.5%) working during scheduled class hours. We consider this condition to be an instance of noncompliance relating to the Activities Allowed or Unallowed compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2024-008. Statistical sampling was not used in making sample selections. Questioned Costs: $854 Cause and Effect: Without proper review of hours worked against class hours scheduled, federal work study recipients could receive compensation that is not allowed under the Code of Federal Regulations. Recommendation: We recommend the College evaluate policies and procedures to ensure work study recipients do not receive compensation for hours worked when they have scheduled class hours or for hours not actually worked. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

Criteria: 34 CFR 668.163 (c)(3) notes, “An Institution may keep the initial $500 in interest it earns during the award year on the other title IV, HEA program funds it maintains in accordance with paragraph (c)(1) of this section. No later than 30 days after the end of that award year, the institution must remit to the Department of Health and Human Services, Payment Management System, Rockville, MD 20852, any interest over $500.” Condition: The College retained interest earnings in excess of $500 in their federal bank account during fiscal year 2025. We consider this condition to be an instance of noncompliance relating to the Cash Management compliance requirement. This finding is repeated from the prior year at 2024-009. Questioned Costs: $265 Cause and Effect: Without proper review of their federal bank account interest greater than $500 may be retained. Recommendation: We recommend the College return $265 to the Department. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.