FAC Explorer

Audit 43391

FY End
2022-06-30
Total Expended
$15.70M
Findings
6
Programs
9
Organization: Wheaton College (MA)
Year: 2022 Accepted: 2023-03-30
Auditor: Rsm US LLP

Organization Exclusion Status:

Findings

ID Ref Severity Repeat Requirement
50138 2022-002 Significant Deficiency - N
50139 2022-001 Significant Deficiency - L
50140 2022-001 Significant Deficiency - L
626580 2022-002 Significant Deficiency - N
626581 2022-001 Significant Deficiency - L
626582 2022-001 Significant Deficiency - L

Programs

ALN Program Spent Major Findings
84.268 Federal Direct Student Loans $8.42M Yes 0
84.425 Economic Stabilization Fund $1.75M Yes 1
84.063 Federal Pell Grant Program $1.68M Yes 0
84.038 Federal Perkins Loan Program $1.37M Yes 1
84.033 Federal Work-Study Program $292,549 Yes 0
84.007 Federal Supplemental Educational Opportunity Grants $285,805 Yes 0
16.525 Grants to Reduce Domestic Violence, Dating Violence, Sexual Assault, and Stalking on Campus $77,127 - 0
10.164 Wholesale Farmers and Alternative Market Development $23,373 - 0
43.001 Science $15,344 - 0

Contacts

Name Title Type
QMNKAZSELHR8 Sarah Langis Auditee
5082863523 Michele Divito Auditor
No contacts on file

Notes to SEFA

Title: Federal Direct Loans Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. 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. De Minimis Rate Used: N Rate Explanation: The College has elected to not use the 10% de minimis indirect cost rate allowed under the Uniform Guidance The College distributed $8,424,967 of federally guaranteed loans to students of the College through the Federal Direct Loan Program (ALN 84.268), which includes Direct Subsidized and Unsubsidized Loans, and Direct Parent Loans for Undergraduate Students. These distributions and the related funding sources are not included in the Colleges financial statements.
Title: Perkins Loan Program Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. 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. De Minimis Rate Used: N Rate Explanation: The College has elected to not use the 10% de minimis indirect cost rate allowed under the Uniform Guidance The federal student loan program listed below is administered directly by the College and balances and transactions relating to this program are included in the Colleges basic financial statements. Loans outstanding at the beginning of the year and loans made during the year are included in the Federal expenditures presented in the Schedule. The balance of loans outstanding at June 30, 2022, consists of: $1,065,322. The Federal Perkins Loan program expired on September 30, 2017. As such, there were no new loansissued or administrative cost allowance claimed under the program for the year ended June 30, 2022.
Title: Sub-recipients Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. 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. De Minimis Rate Used: N Rate Explanation: The College has elected to not use the 10% de minimis indirect cost rate allowed under the Uniform Guidance The College did not pass federal funds through to sub-recipients during the year ended June 30, 2022.
Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. 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. De Minimis Rate Used: N Rate Explanation: The College has elected to not use the 10% de minimis indirect cost rate allowed under the Uniform Guidance The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Wheaton College (the College) under programs of the federal government for the year ended June 30, 2022. The information in the Schedule is presented in accordance with Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a selectedportion of the operations of the College, it is not intended to and does not present the financial position, changes in net assets or cash flows of the College. The College includes loans granted under the Federal Perkins Loan Program and Federal Direct Student Loans Program as expenditures of federal awards.

Finding Details

Finding 2022-002
Finding No. 2022-002 Federal Perkins Loans Recordkeeping and Record Retention Federal Agency: Department of Education Program: Federal Perkins Loan Program: ALN:84.038 Criteria: Per 34 CFR 674.19?, an institution shall keep the original promissory notes and repayment schedules until the loans are satisfied. If required to release original documents in order to enforce the loan, the institution must retain certified true copies of those documents. Condition: Based on inspection of 25 student files, it was noted that there were two files that did not contain original loan documents. Questioned Costs: None. Prevalence: Out of 25 student files tested, two did not contain original loan documents. The sample was not intended to be, and was not, a statistically valid sample. Effect: The institution may not be able to assign the loan to the government or enforce the loan without original promissory notes. Cause: The College has been participating in for many years, and as such, original records on loans disbursed for students were lost/misplaced since origination due to physical location changes as well as staff changes. In addition, older loans were disbursed with multiple promissory notes, whereas regulations changes from 2003 onwards enforced the use of Master Promissory Notes, which lessened the volume of loan documentation to be retained. Recommendation: We recommend the College continue to search for the missing promissory notes and if unsuccessful remove the loans from its Perkins portfolio as the Government portion will not be able to be turned over to the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been made.
Finding 2022-001
Finding No. 2022-001 Higher Education Emergency Relief Fund (HEERF) Reporting Federal Agency: Department of Education (DOE) Program: COVID-19 Education Stabilization Fund Under the Coronavirus Aid, Relief and Economic Security Act (CARES Act): ALN: 84.425F Criteria: Reporting requirements to the DOE state that the institutional portion of HEERF is reported by quarter in the quarter funds are drawn from the G5 system and reported for the allowable categories under the grant. The reports filed should include all information about expenditures incurred or lost revenue claimed under the grant. Condition: Amounts reported for the institutional portion by the College were originally reported in the wrong category (misclassified). Questioned Costs: None Prevalence: 1 of 1 institutional quarterly report tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Incorrect amounts and classifications were reported to the DOE. Improper reporting could result in the DOE withholding payments to the College. Cause: Changes to the program rules, regulations and reporting for the HEERF programs were evolving throughout the different phases of the program. This issue is the result of improper tracking of those changes as they were occurring which resulted in errors in the original filing. Recommendation: We recommend the College amend the incorrect reports. The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been made.
Finding 2022-001
Finding No. 2022-001 Higher Education Emergency Relief Fund (HEERF) Reporting Federal Agency: Department of Education (DOE) Program: COVID-19 Education Stabilization Fund Under the Coronavirus Aid, Relief and Economic Security Act (CARES Act): ALN: 84.425F Criteria: Reporting requirements to the DOE state that the institutional portion of HEERF is reported by quarter in the quarter funds are drawn from the G5 system and reported for the allowable categories under the grant. The reports filed should include all information about expenditures incurred or lost revenue claimed under the grant. Condition: Amounts reported for the institutional portion by the College were originally reported in the wrong category (misclassified). Questioned Costs: None Prevalence: 1 of 1 institutional quarterly report tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Incorrect amounts and classifications were reported to the DOE. Improper reporting could result in the DOE withholding payments to the College. Cause: Changes to the program rules, regulations and reporting for the HEERF programs were evolving throughout the different phases of the program. This issue is the result of improper tracking of those changes as they were occurring which resulted in errors in the original filing. Recommendation: We recommend the College amend the incorrect reports. The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been made.
Finding 2022-002
Finding No. 2022-002 Federal Perkins Loans Recordkeeping and Record Retention Federal Agency: Department of Education Program: Federal Perkins Loan Program: ALN:84.038 Criteria: Per 34 CFR 674.19?, an institution shall keep the original promissory notes and repayment schedules until the loans are satisfied. If required to release original documents in order to enforce the loan, the institution must retain certified true copies of those documents. Condition: Based on inspection of 25 student files, it was noted that there were two files that did not contain original loan documents. Questioned Costs: None. Prevalence: Out of 25 student files tested, two did not contain original loan documents. The sample was not intended to be, and was not, a statistically valid sample. Effect: The institution may not be able to assign the loan to the government or enforce the loan without original promissory notes. Cause: The College has been participating in for many years, and as such, original records on loans disbursed for students were lost/misplaced since origination due to physical location changes as well as staff changes. In addition, older loans were disbursed with multiple promissory notes, whereas regulations changes from 2003 onwards enforced the use of Master Promissory Notes, which lessened the volume of loan documentation to be retained. Recommendation: We recommend the College continue to search for the missing promissory notes and if unsuccessful remove the loans from its Perkins portfolio as the Government portion will not be able to be turned over to the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been made.
Finding 2022-001
Finding No. 2022-001 Higher Education Emergency Relief Fund (HEERF) Reporting Federal Agency: Department of Education (DOE) Program: COVID-19 Education Stabilization Fund Under the Coronavirus Aid, Relief and Economic Security Act (CARES Act): ALN: 84.425F Criteria: Reporting requirements to the DOE state that the institutional portion of HEERF is reported by quarter in the quarter funds are drawn from the G5 system and reported for the allowable categories under the grant. The reports filed should include all information about expenditures incurred or lost revenue claimed under the grant. Condition: Amounts reported for the institutional portion by the College were originally reported in the wrong category (misclassified). Questioned Costs: None Prevalence: 1 of 1 institutional quarterly report tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Incorrect amounts and classifications were reported to the DOE. Improper reporting could result in the DOE withholding payments to the College. Cause: Changes to the program rules, regulations and reporting for the HEERF programs were evolving throughout the different phases of the program. This issue is the result of improper tracking of those changes as they were occurring which resulted in errors in the original filing. Recommendation: We recommend the College amend the incorrect reports. The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been made.
Finding 2022-001
Finding No. 2022-001 Higher Education Emergency Relief Fund (HEERF) Reporting Federal Agency: Department of Education (DOE) Program: COVID-19 Education Stabilization Fund Under the Coronavirus Aid, Relief and Economic Security Act (CARES Act): ALN: 84.425F Criteria: Reporting requirements to the DOE state that the institutional portion of HEERF is reported by quarter in the quarter funds are drawn from the G5 system and reported for the allowable categories under the grant. The reports filed should include all information about expenditures incurred or lost revenue claimed under the grant. Condition: Amounts reported for the institutional portion by the College were originally reported in the wrong category (misclassified). Questioned Costs: None Prevalence: 1 of 1 institutional quarterly report tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: Incorrect amounts and classifications were reported to the DOE. Improper reporting could result in the DOE withholding payments to the College. Cause: Changes to the program rules, regulations and reporting for the HEERF programs were evolving throughout the different phases of the program. This issue is the result of improper tracking of those changes as they were occurring which resulted in errors in the original filing. Recommendation: We recommend the College amend the incorrect reports. The Federal funding for this program has ended. If the DOE should add additional funding or create new or similar programs, we recommend that management implement a control to regularly monitor and manage changes to rules and regulations promulgated by the DOE. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding, and corrective measures have been made.