Audit 415509

Significant Deficiency – Return of Title IV funds Program: Student Financial Assistance Cluster – Federal Direct Loans and Pell Grants Federal Agency: U.S. Department of Education Assistance Listing Number (ALN): 84.268 and 84.063 Federal Award Identification Number: Various Federal Award Year: June 30, 2026 Criteria: Title IV regulations (34 CFR 668.22) require that when a recipient of Title IV grant or loan assistance withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the institution must determine the amount of Title IV grant or loan assistance that the student earned as of the student's withdrawal date in accordance with the regulations. An institution must then return the unearned portion of grants or loans to the Title IV program as soon as possible but no later than 45 days after the date of the institution's determination that the student withdrew. Condition/Context: 2 of the 2 students in the sample selected for testing that required a return of Title IV funds had an amount returned by the College that was incorrect due to an incorrect number of days for the term being used in the R2T4 calculation. For the fall term, the College incorrectly omitted 2 break days, and for the spring term the College used an incorrect end of term date that was 7 days earlier than the actual end of period per the academic calendar. The student from the fall term had $18 too much returned and the student from the spring term had $50 less returned than required, both of Federal Direct Unsubsidized Loans. The College’s controls over the term dates input and R2T4 calculation reviews did not detect the errors. The sample was not a statistically valid sample. Upon learning of these exceptions the College corrected the days used in the calculation for the 2 students noted above and the auditor viewed the corrected R2T4 calculations, student accounts and COD screen prints. The College performed a review of all other withdrawn students noting an additional 7 students impacted from each term. For the fall term an additional $70 too much was returned ($8 Direct Loans and $62 Pell Grants). For the spring term an additional $434 ($220 Direct Loans and $214 Pell) was required to be returned. The College corrected these amounts for all but 1 student ($3 direct loans). The auditor viewed the corrected R2T4 calculations, student accounts and COD screen prints for the 13 students. Cause: Turnover in the financial aid office resulted in the shift the responsibilities between staff and an ineffective informal review. Effect: The College returned incorrect amounts to students and/or the U.S. Department of Education (ED), and they were in possession of funds belonging to the student and/or ED for more than 45 days. Questioned Costs: The auditor’s exceptions were netted for a total of $32 Federal Direct Loans ALN 84.268 to be returned. The College’s additional students noted were netted for a total of $212 Federal Direct Loans ALN 84.268 and $152 Pell ALN 84.063 to be returned. Recommendation: The College should update its return of Title IV policies and procedures to ensure that the dates used for terms and breaks are correct and implement a more formal review of calculations. Management's Response: Management agrees with the finding. Management considers this to be an isolated incident that will not re-occur in future years. Since discovering this error in the 25-26 Academic Year, three staff members have reviewed the 26-27 Academic Calendar to ensure that start dates, end dates and breaks are correctly entered into PowerFAIDS. Additionally, the staff member who managed this process in the 25-26 Academic Year is no longer employed by the College. A new staff member will be responsible for this process and will receive supplemental training to ensure knowledge and accuracy.

Significant Deficiency – Enrollment Reporting Program: Student Financial Assistance Cluster Federal Agency: U.S. Department of Education Assistance Listing Number (ALN): Various Federal Award Identification Number: Various Federal Award Year: June 30, 2026 Criteria: Title IV regulations (34 CFR 685.309(b)) require that upon receipt of an enrollment report from the Secretary, institutions must update all information included in the report and return the report to the Secretary: (i) in the manner and format prescribed by the Secretary; and (ii) within the timeframe prescribed by the Secretary. Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, an institution must notify the Secretary within 30 days after the date the institution discovers that: (i) a loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the institution, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended or (ii) a student who is enrolled at the institution and who received a loan under Title IV of the Act has changed his or her permanent address. Condition/Context: For one of 25 students who were tested, the student’s withdrawal status was reported to NSLDS late, 71 days after the date of determination. For one of 25 students who were tested, the student’s graduation date was reported incorrectly to NSLDS. The College’s controls over enrollment reporting did not detect the errors. The sample was not a statistically valid sample. Cause: The College's enrollment reporting process relies on manual identification and follow-up of certain enrollment changes and did not include an effective reconciliation to ensure that all reportable changes were submitted and that the enrollment statuses and effective dates ultimately reflected in NSLDS agreed with the College's underlying institutional records. Effect: The accuracy of Title IV student loan records depends heavily on the accuracy of the enrollment information reported by institutions. If an institution does not review, update and verify student enrollment statuses, effective dates of the enrollment status and the anticipated completion dates, then the Title IV student loan records will be inaccurate and the U.S. Department of Education may not correctly start grace periods, repayment, etc. Questioned Costs: Not applicable. Recommendation: The College should review and update its enrollment reporting policies and procedures to establish documented controls that ensure all reportable enrollment changes, including changes requiring manual reporting, are identified and submitted within the required timeframes. The College should also reconcile enrollment statuses and effective dates transmitted through the National Student Clearinghouse to the information ultimately reflected in NSLDS and timely investigate and correct rejected, omitted or inconsistent records. Management's Response: Management agrees with the finding and is committed to strengthening its procedures to avoid similar issues in the future. Beginning in September 2026, a second and new Registrar’s Office staff member will be trained in to complete an additional review of the National Student Clearinghouse status for all students withdrawing after a particular semester. This secondary review will be completed at the end of January and at the end of June to ensure the 60-day reporting period is met. The College will manually update the graduated enrollment status start date for the impacted student to the correct date through the National Student Clearinghouse. The College will reach out to the National Student Clearinghouse to determine why the graduation date that was reported on the degree file does not match the date that was used when the student’s enrollment record was updated by the Clearinghouse using the graduated enrollment status from the degree verified process.