Audit 4129

FY End
2023-05-31
Total Expended
$46.81M
Findings
2
Programs
6
Year: 2023 Accepted: 2023-11-27
Auditor: Eide Bailly LLP

Organization Exclusion Status:

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Findings

ID Ref Severity Repeat Requirement
2402 2023-001 Significant Deficiency - N
578844 2023-001 Significant Deficiency - N

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $40.18M Yes 1
84.038 Federal Perkins Loan Program $360,555 Yes 0
84.033 Federal Work-Study Program $322,281 Yes 0
84.007 Federal Supplemental Educational Opportunity Grants $256,550 Yes 0
84.063 Federal Pell Grant Program $5,935 Yes 0
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $3,772 Yes 0

Contacts

Name Title Type
JQZPGE33SU95 Jennifer Ramm Auditee
2542955527 Shelby Ebarb 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. When applicable, 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. No federal assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The University has not elected to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The accompanying consolidated schedule of expenditures of federal and state awards (the schedule) includes the federal and state grant activity of University of Mary Hardin-Baylor (the University). The federal information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance). Because the schedule presents only a selected portion of the operations of the University, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the University.
Title: Federal Student Loan Program Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, 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. No federal assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The University has not elected to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The federal student loan program listed subsequently is administered directly by the University and balances and transactions relating to this program are included in the University's consolidated financial statements. The balance of loans outstanding at May 31, 2023 consists of: "See the Notes to the SEFA for chart/table." During September 2015, the Federal government allowed the Perkins Loan Program to expire. The Department of Education (the Department) has published guidance on the wind-down of the Perkins Loans. Associated with this wind-down, the University will be required to return the Department of Education’s share of the University’s Perkins Loans, assign the Perkins Loans to the Department of Education, or liquidate the Perkins Loans. Currently, the University is in the process of complying with the Department's instructions to assign all Perkins Loans in default to the Department. The University is continuing to service non-defaulted Perkins loans and will re-evaluate the program requirements annually based on guidance issued. Federal law no longer allows new loans under the Perkins Loan Program.
Title: State Awards Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable, 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. No federal assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The University has not elected to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance. The state awards included in the accompanying consolidated schedule of expenditures of federal and state awards are presented for informational purposes only and are not subject to requirements of the state of Texas Single Audit Circular, as colleges and universities are excluded per the Texas Uniform Grant and Contract Management Act; section 783.003(4).

Finding Details

Federal Agency Name: U.S. Department of Education Program Name: Student Financial Assistance Cluster ALN: 84.268 Federal Award Number: P268K222288, P268K232288 Award Year: 2022-2023 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Compliance Requirement: Special Tests and Provisions – Notification of Loan Disbursement Criteria: Per 34 CFR 668.165(a), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of the anticipated date and amount of the disbursement, the student or parent’s right to cancel all or a portion of the loan, and the procedures by which the institution must be notified if he or she wishes to cancel the loan. UMHB requires students to provide affirmative confirmation of Title IV award amounts. Per 34 CFR 668.165(a), institutions that obtain affirmative confirmation of the accepted loan amounts must provide the aforementioned disbursement notice in writing no earlier than 30 days before, and no later than 30 days after, crediting the student's institutional account. Condition: We tested a sample of 40 students who received Title IV funds during the year. Of those students, we tested disbursement notification records for the 36 students who received Direct Loans during the year. We noted errors in two student files. Two students were notified of Spring 2023 Direct Loan disbursements more than 30 days after their student accounts were credited with the disbursements. We did not note any resulting inappropriate credit balances on the student accounts. Upon additional review, the University identified a total of 100 students who received late loan disbursement notifications. Cause: Loan disbursement notifications are provided to a list of students following each round of aid disbursements. The list of students who require notification comes from a financial aid software report. Financial aid staff provide notifications based on the generated list. One report of Spring 2023 disbursements incorrectly excluded a set of 100 Spring 2023 transfer students. The error was identified after the 30 day disbursement notification timeframe and prior to the beginning of the Single Audit. The University corrected the system generated report parameters and provided students with notification of the disbursements as soon as possible after the omission was discovered. Effect: Certain students may have been temporarily unaware that they had Title IV funds applied to their account and available for their use. Questioned Costs: None reported. Context/Sampling: A nonstatistical sample of 40 students who received $791,187 in Title IV Aid, out of a population of 2,668 students who received $44,639,514 in Title IV aid. 2 of the students had errors in loan disbursement notification. These two students were included in the 100 Spring 2023 transfer students identified by the client. This group of 100 students received $1,310,535 in aid. Repeat Finding from Prior Year: No Recommendation: We recommend the University perform a review of all automated loan disbursement report parameters to ensure that reports of loan disbursements properly include all students receiving loan disbursements. View of Responsible Officials: Management agrees with the finding. See Corrective action plan.
Federal Agency Name: U.S. Department of Education Program Name: Student Financial Assistance Cluster ALN: 84.268 Federal Award Number: P268K222288, P268K232288 Award Year: 2022-2023 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Compliance Requirement: Special Tests and Provisions – Notification of Loan Disbursement Criteria: Per 34 CFR 668.165(a), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of the anticipated date and amount of the disbursement, the student or parent’s right to cancel all or a portion of the loan, and the procedures by which the institution must be notified if he or she wishes to cancel the loan. UMHB requires students to provide affirmative confirmation of Title IV award amounts. Per 34 CFR 668.165(a), institutions that obtain affirmative confirmation of the accepted loan amounts must provide the aforementioned disbursement notice in writing no earlier than 30 days before, and no later than 30 days after, crediting the student's institutional account. Condition: We tested a sample of 40 students who received Title IV funds during the year. Of those students, we tested disbursement notification records for the 36 students who received Direct Loans during the year. We noted errors in two student files. Two students were notified of Spring 2023 Direct Loan disbursements more than 30 days after their student accounts were credited with the disbursements. We did not note any resulting inappropriate credit balances on the student accounts. Upon additional review, the University identified a total of 100 students who received late loan disbursement notifications. Cause: Loan disbursement notifications are provided to a list of students following each round of aid disbursements. The list of students who require notification comes from a financial aid software report. Financial aid staff provide notifications based on the generated list. One report of Spring 2023 disbursements incorrectly excluded a set of 100 Spring 2023 transfer students. The error was identified after the 30 day disbursement notification timeframe and prior to the beginning of the Single Audit. The University corrected the system generated report parameters and provided students with notification of the disbursements as soon as possible after the omission was discovered. Effect: Certain students may have been temporarily unaware that they had Title IV funds applied to their account and available for their use. Questioned Costs: None reported. Context/Sampling: A nonstatistical sample of 40 students who received $791,187 in Title IV Aid, out of a population of 2,668 students who received $44,639,514 in Title IV aid. 2 of the students had errors in loan disbursement notification. These two students were included in the 100 Spring 2023 transfer students identified by the client. This group of 100 students received $1,310,535 in aid. Repeat Finding from Prior Year: No Recommendation: We recommend the University perform a review of all automated loan disbursement report parameters to ensure that reports of loan disbursements properly include all students receiving loan disbursements. View of Responsible Officials: Management agrees with the finding. See Corrective action plan.