FINDING #2022 ? 002: INTERNAL CONTROLS OVER FEDERAL AWARDS Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 2 CFR 200.303, nonfederal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition / Context: During our audit procedures, we noted that a formal documented review process was not available for the following areas: ? R2T4 calculations [Berkeley City College and Merritt College] ? Student award packaging [Merritt College] ? Students selected for verification by the Department of Education [Merritt College] Furthermore, because the Financial Aid Director positions were vacant, reconciliations performed by the loan officers were not reviewed for: ? Pell Grant and Supplemental Education Opportunity Grant [Berkeley and Merritt College] ? Direct Loan [Berkeley City College] Questioned Costs: None. Cause: The Colleges' Financial Aid Director positions were vacant at June 30, 2022, resulting in an oversight. Effect: A lack of internal controls can result in noncompliance with provisions of the various programs within the Student Financial Assistance Cluster. Repeat Finding: See prior year finding 2021-004. Recommendation: We recommend the Colleges reinforce their review processes, monitor proper follow-up on audit findings, and review all activity level controls to ensure compliance with the various requirements of the Student Financial Assistance Cluster.Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address internal controls pertaining to reconciliation of Title IV funds, R2T4 processing, award packaging and verification. Huron has created more robust packaging and disbursement rules to ensure only eligible students are awarded and paid. Additionally, the district has created business processes and procedures to improve internal controls over federal awards. While the cutoff date for the audit was missed for the 2021-2022 school year, corrective actions have been taken to ensure the reconciliation of Title IV funds and secondary reviews have been completed and are currently underway for 2022-2023. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR680.309(b) and the National Student Loan Data System (NSLDS) Enrollment Reporting Guide published by the Department of Education, schools must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. In addition, schools must report enrollment status changes within 30 days of becoming aware of the status change or in its next scheduled enrollment submission if the scheduled submission is within 60 days. Condition / Context: During our testing of 25 students, which is a statistically valid sample, we noted one (1) instance of a student status change failing to be reported to NSLDS. Questioned Costs: None. Cause: Unknown, the status was correctly submitted to the Federal Clearinghouse but failed to automatically `push? or report to NSLDS. Effect: The case identified resulted in noncompliance with the applicable Title IV regulations. Inaccurate information is reflected on the NSLDS database. A student?s enrollment data protects the rights of borrowers by ensuring that loan interest subsidies are based on accurate enrollment data, ensures loan repayment dates are accurately based on the last data of attendance, allows in-school deferments to be automatically granted using NSLDS enrollment data, and provides vast amounts of critical data about the effectiveness of Title IV aid programs, including completion data. Repeat Finding: See prior year finding 2021-005. Recommendation: We recommend the District engage with the Clearinghouse to review applicable reporting procedures to ensure that enrollment and program information is accurately and timely reported to NSLDS as required by regulations. Action taken in response to finding: The District Administration & Records will perform a study of the current business processes to identify data discrepancies. The District will engage the Clearinghouse and review the applicable reporting procedures with the financial aid offices to ensure sound internal controls over reporting and updating of NSLDS enrollment data. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR 668.164(l), an institution must return to ED (notwithstanding any state law, such as a law that allows funds to escheat to the state) any Title IV funds, except FWS program funds, that it attempts to disburse directly to a student or parent but they do not receive or negotiate those funds. For FWS program funds, the institution is required to return only the federal portion of the payroll disbursements. If the institution attempted to disburse the funds by check and the check is not cashed, the funds must be returned no later than 240 days after the date it issued the check. If a check is returned, or an EFT is rejected, the institution may make additional attempts to disburse the funds, provided that the attempts are made no later than 45 days after the funds were returned or rejected. If the institution does not make an additional attempt to disburse the funds, the funds must be returned before the end of the 45-day period and no later than 240 days from the date of the initial attempt to disburse the funds. Condition / Context: Ten (10) out of a sample of 25 outstanding refund checks tested were yet not returned to the U.S. Department of Education. Eight (8) of the ten (10) had aged past the 240-day requirement. Questioned Costs: $7,408.87 Cause: Following the District?s receipt of refund checks, we noted that there is not a process for making contact with students within the initial 45-day period to resolve issues. Likewise, we noted there is not a process to ensure checks outside of the 45-day period are remitted back to ED. Effect: The District is not in compliance with the applicable Title IV regulations stating that all student refund checks that are outstanding for more than 240 days be returned to the U.S. Department of Education. Any additional attempts to disburse funds must be made no later than 45 days after the funds were returned or rejected. Repeat Finding: See prior year finding 2021-006. Recommendation: We recommend that the District review its procedures related to outstanding student refund checks to ensure they are being returned to the Department of Education or disbursed to students as stated in the criteria mentioned above. Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address the internal controls pertaining to returning funds and reissuing funds back to students. District Finance has been working closely with each College to return funds to the Department of Education. Queries have been created to identify returned checks which will be monitored on a regular basis to reverse financial aid disbursements and re-report changes to COD. Planned completion date for corrective action plan: March 31, 2023.
FINDING #2022 ? 002: INTERNAL CONTROLS OVER FEDERAL AWARDS Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 2 CFR 200.303, nonfederal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition / Context: During our audit procedures, we noted that a formal documented review process was not available for the following areas: ? R2T4 calculations [Berkeley City College and Merritt College] ? Student award packaging [Merritt College] ? Students selected for verification by the Department of Education [Merritt College] Furthermore, because the Financial Aid Director positions were vacant, reconciliations performed by the loan officers were not reviewed for: ? Pell Grant and Supplemental Education Opportunity Grant [Berkeley and Merritt College] ? Direct Loan [Berkeley City College] Questioned Costs: None. Cause: The Colleges' Financial Aid Director positions were vacant at June 30, 2022, resulting in an oversight. Effect: A lack of internal controls can result in noncompliance with provisions of the various programs within the Student Financial Assistance Cluster. Repeat Finding: See prior year finding 2021-004. Recommendation: We recommend the Colleges reinforce their review processes, monitor proper follow-up on audit findings, and review all activity level controls to ensure compliance with the various requirements of the Student Financial Assistance Cluster.Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address internal controls pertaining to reconciliation of Title IV funds, R2T4 processing, award packaging and verification. Huron has created more robust packaging and disbursement rules to ensure only eligible students are awarded and paid. Additionally, the district has created business processes and procedures to improve internal controls over federal awards. While the cutoff date for the audit was missed for the 2021-2022 school year, corrective actions have been taken to ensure the reconciliation of Title IV funds and secondary reviews have been completed and are currently underway for 2022-2023. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR680.309(b) and the National Student Loan Data System (NSLDS) Enrollment Reporting Guide published by the Department of Education, schools must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. In addition, schools must report enrollment status changes within 30 days of becoming aware of the status change or in its next scheduled enrollment submission if the scheduled submission is within 60 days. Condition / Context: During our testing of 25 students, which is a statistically valid sample, we noted one (1) instance of a student status change failing to be reported to NSLDS. Questioned Costs: None. Cause: Unknown, the status was correctly submitted to the Federal Clearinghouse but failed to automatically `push? or report to NSLDS. Effect: The case identified resulted in noncompliance with the applicable Title IV regulations. Inaccurate information is reflected on the NSLDS database. A student?s enrollment data protects the rights of borrowers by ensuring that loan interest subsidies are based on accurate enrollment data, ensures loan repayment dates are accurately based on the last data of attendance, allows in-school deferments to be automatically granted using NSLDS enrollment data, and provides vast amounts of critical data about the effectiveness of Title IV aid programs, including completion data. Repeat Finding: See prior year finding 2021-005. Recommendation: We recommend the District engage with the Clearinghouse to review applicable reporting procedures to ensure that enrollment and program information is accurately and timely reported to NSLDS as required by regulations. Action taken in response to finding: The District Administration & Records will perform a study of the current business processes to identify data discrepancies. The District will engage the Clearinghouse and review the applicable reporting procedures with the financial aid offices to ensure sound internal controls over reporting and updating of NSLDS enrollment data. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR 668.164(l), an institution must return to ED (notwithstanding any state law, such as a law that allows funds to escheat to the state) any Title IV funds, except FWS program funds, that it attempts to disburse directly to a student or parent but they do not receive or negotiate those funds. For FWS program funds, the institution is required to return only the federal portion of the payroll disbursements. If the institution attempted to disburse the funds by check and the check is not cashed, the funds must be returned no later than 240 days after the date it issued the check. If a check is returned, or an EFT is rejected, the institution may make additional attempts to disburse the funds, provided that the attempts are made no later than 45 days after the funds were returned or rejected. If the institution does not make an additional attempt to disburse the funds, the funds must be returned before the end of the 45-day period and no later than 240 days from the date of the initial attempt to disburse the funds. Condition / Context: Ten (10) out of a sample of 25 outstanding refund checks tested were yet not returned to the U.S. Department of Education. Eight (8) of the ten (10) had aged past the 240-day requirement. Questioned Costs: $7,408.87 Cause: Following the District?s receipt of refund checks, we noted that there is not a process for making contact with students within the initial 45-day period to resolve issues. Likewise, we noted there is not a process to ensure checks outside of the 45-day period are remitted back to ED. Effect: The District is not in compliance with the applicable Title IV regulations stating that all student refund checks that are outstanding for more than 240 days be returned to the U.S. Department of Education. Any additional attempts to disburse funds must be made no later than 45 days after the funds were returned or rejected. Repeat Finding: See prior year finding 2021-006. Recommendation: We recommend that the District review its procedures related to outstanding student refund checks to ensure they are being returned to the Department of Education or disbursed to students as stated in the criteria mentioned above. Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address the internal controls pertaining to returning funds and reissuing funds back to students. District Finance has been working closely with each College to return funds to the Department of Education. Queries have been created to identify returned checks which will be monitored on a regular basis to reverse financial aid disbursements and re-report changes to COD. Planned completion date for corrective action plan: March 31, 2023.
FINDING #2022 ? 002: INTERNAL CONTROLS OVER FEDERAL AWARDS Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 2 CFR 200.303, nonfederal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition / Context: During our audit procedures, we noted that a formal documented review process was not available for the following areas: ? R2T4 calculations [Berkeley City College and Merritt College] ? Student award packaging [Merritt College] ? Students selected for verification by the Department of Education [Merritt College] Furthermore, because the Financial Aid Director positions were vacant, reconciliations performed by the loan officers were not reviewed for: ? Pell Grant and Supplemental Education Opportunity Grant [Berkeley and Merritt College] ? Direct Loan [Berkeley City College] Questioned Costs: None. Cause: The Colleges' Financial Aid Director positions were vacant at June 30, 2022, resulting in an oversight. Effect: A lack of internal controls can result in noncompliance with provisions of the various programs within the Student Financial Assistance Cluster. Repeat Finding: See prior year finding 2021-004. Recommendation: We recommend the Colleges reinforce their review processes, monitor proper follow-up on audit findings, and review all activity level controls to ensure compliance with the various requirements of the Student Financial Assistance Cluster.Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address internal controls pertaining to reconciliation of Title IV funds, R2T4 processing, award packaging and verification. Huron has created more robust packaging and disbursement rules to ensure only eligible students are awarded and paid. Additionally, the district has created business processes and procedures to improve internal controls over federal awards. While the cutoff date for the audit was missed for the 2021-2022 school year, corrective actions have been taken to ensure the reconciliation of Title IV funds and secondary reviews have been completed and are currently underway for 2022-2023. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR680.309(b) and the National Student Loan Data System (NSLDS) Enrollment Reporting Guide published by the Department of Education, schools must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. In addition, schools must report enrollment status changes within 30 days of becoming aware of the status change or in its next scheduled enrollment submission if the scheduled submission is within 60 days. Condition / Context: During our testing of 25 students, which is a statistically valid sample, we noted one (1) instance of a student status change failing to be reported to NSLDS. Questioned Costs: None. Cause: Unknown, the status was correctly submitted to the Federal Clearinghouse but failed to automatically `push? or report to NSLDS. Effect: The case identified resulted in noncompliance with the applicable Title IV regulations. Inaccurate information is reflected on the NSLDS database. A student?s enrollment data protects the rights of borrowers by ensuring that loan interest subsidies are based on accurate enrollment data, ensures loan repayment dates are accurately based on the last data of attendance, allows in-school deferments to be automatically granted using NSLDS enrollment data, and provides vast amounts of critical data about the effectiveness of Title IV aid programs, including completion data. Repeat Finding: See prior year finding 2021-005. Recommendation: We recommend the District engage with the Clearinghouse to review applicable reporting procedures to ensure that enrollment and program information is accurately and timely reported to NSLDS as required by regulations. Action taken in response to finding: The District Administration & Records will perform a study of the current business processes to identify data discrepancies. The District will engage the Clearinghouse and review the applicable reporting procedures with the financial aid offices to ensure sound internal controls over reporting and updating of NSLDS enrollment data. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR 668.164(l), an institution must return to ED (notwithstanding any state law, such as a law that allows funds to escheat to the state) any Title IV funds, except FWS program funds, that it attempts to disburse directly to a student or parent but they do not receive or negotiate those funds. For FWS program funds, the institution is required to return only the federal portion of the payroll disbursements. If the institution attempted to disburse the funds by check and the check is not cashed, the funds must be returned no later than 240 days after the date it issued the check. If a check is returned, or an EFT is rejected, the institution may make additional attempts to disburse the funds, provided that the attempts are made no later than 45 days after the funds were returned or rejected. If the institution does not make an additional attempt to disburse the funds, the funds must be returned before the end of the 45-day period and no later than 240 days from the date of the initial attempt to disburse the funds. Condition / Context: Ten (10) out of a sample of 25 outstanding refund checks tested were yet not returned to the U.S. Department of Education. Eight (8) of the ten (10) had aged past the 240-day requirement. Questioned Costs: $7,408.87 Cause: Following the District?s receipt of refund checks, we noted that there is not a process for making contact with students within the initial 45-day period to resolve issues. Likewise, we noted there is not a process to ensure checks outside of the 45-day period are remitted back to ED. Effect: The District is not in compliance with the applicable Title IV regulations stating that all student refund checks that are outstanding for more than 240 days be returned to the U.S. Department of Education. Any additional attempts to disburse funds must be made no later than 45 days after the funds were returned or rejected. Repeat Finding: See prior year finding 2021-006. Recommendation: We recommend that the District review its procedures related to outstanding student refund checks to ensure they are being returned to the Department of Education or disbursed to students as stated in the criteria mentioned above. Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address the internal controls pertaining to returning funds and reissuing funds back to students. District Finance has been working closely with each College to return funds to the Department of Education. Queries have been created to identify returned checks which will be monitored on a regular basis to reverse financial aid disbursements and re-report changes to COD. Planned completion date for corrective action plan: March 31, 2023.
FINDING #2022 ? 002: INTERNAL CONTROLS OVER FEDERAL AWARDS Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 2 CFR 200.303, nonfederal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition / Context: During our audit procedures, we noted that a formal documented review process was not available for the following areas: ? R2T4 calculations [Berkeley City College and Merritt College] ? Student award packaging [Merritt College] ? Students selected for verification by the Department of Education [Merritt College] Furthermore, because the Financial Aid Director positions were vacant, reconciliations performed by the loan officers were not reviewed for: ? Pell Grant and Supplemental Education Opportunity Grant [Berkeley and Merritt College] ? Direct Loan [Berkeley City College] Questioned Costs: None. Cause: The Colleges' Financial Aid Director positions were vacant at June 30, 2022, resulting in an oversight. Effect: A lack of internal controls can result in noncompliance with provisions of the various programs within the Student Financial Assistance Cluster. Repeat Finding: See prior year finding 2021-004. Recommendation: We recommend the Colleges reinforce their review processes, monitor proper follow-up on audit findings, and review all activity level controls to ensure compliance with the various requirements of the Student Financial Assistance Cluster.Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address internal controls pertaining to reconciliation of Title IV funds, R2T4 processing, award packaging and verification. Huron has created more robust packaging and disbursement rules to ensure only eligible students are awarded and paid. Additionally, the district has created business processes and procedures to improve internal controls over federal awards. While the cutoff date for the audit was missed for the 2021-2022 school year, corrective actions have been taken to ensure the reconciliation of Title IV funds and secondary reviews have been completed and are currently underway for 2022-2023. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR680.309(b) and the National Student Loan Data System (NSLDS) Enrollment Reporting Guide published by the Department of Education, schools must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. In addition, schools must report enrollment status changes within 30 days of becoming aware of the status change or in its next scheduled enrollment submission if the scheduled submission is within 60 days. Condition / Context: During our testing of 25 students, which is a statistically valid sample, we noted one (1) instance of a student status change failing to be reported to NSLDS. Questioned Costs: None. Cause: Unknown, the status was correctly submitted to the Federal Clearinghouse but failed to automatically `push? or report to NSLDS. Effect: The case identified resulted in noncompliance with the applicable Title IV regulations. Inaccurate information is reflected on the NSLDS database. A student?s enrollment data protects the rights of borrowers by ensuring that loan interest subsidies are based on accurate enrollment data, ensures loan repayment dates are accurately based on the last data of attendance, allows in-school deferments to be automatically granted using NSLDS enrollment data, and provides vast amounts of critical data about the effectiveness of Title IV aid programs, including completion data. Repeat Finding: See prior year finding 2021-005. Recommendation: We recommend the District engage with the Clearinghouse to review applicable reporting procedures to ensure that enrollment and program information is accurately and timely reported to NSLDS as required by regulations. Action taken in response to finding: The District Administration & Records will perform a study of the current business processes to identify data discrepancies. The District will engage the Clearinghouse and review the applicable reporting procedures with the financial aid offices to ensure sound internal controls over reporting and updating of NSLDS enrollment data. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR 668.164(l), an institution must return to ED (notwithstanding any state law, such as a law that allows funds to escheat to the state) any Title IV funds, except FWS program funds, that it attempts to disburse directly to a student or parent but they do not receive or negotiate those funds. For FWS program funds, the institution is required to return only the federal portion of the payroll disbursements. If the institution attempted to disburse the funds by check and the check is not cashed, the funds must be returned no later than 240 days after the date it issued the check. If a check is returned, or an EFT is rejected, the institution may make additional attempts to disburse the funds, provided that the attempts are made no later than 45 days after the funds were returned or rejected. If the institution does not make an additional attempt to disburse the funds, the funds must be returned before the end of the 45-day period and no later than 240 days from the date of the initial attempt to disburse the funds. Condition / Context: Ten (10) out of a sample of 25 outstanding refund checks tested were yet not returned to the U.S. Department of Education. Eight (8) of the ten (10) had aged past the 240-day requirement. Questioned Costs: $7,408.87 Cause: Following the District?s receipt of refund checks, we noted that there is not a process for making contact with students within the initial 45-day period to resolve issues. Likewise, we noted there is not a process to ensure checks outside of the 45-day period are remitted back to ED. Effect: The District is not in compliance with the applicable Title IV regulations stating that all student refund checks that are outstanding for more than 240 days be returned to the U.S. Department of Education. Any additional attempts to disburse funds must be made no later than 45 days after the funds were returned or rejected. Repeat Finding: See prior year finding 2021-006. Recommendation: We recommend that the District review its procedures related to outstanding student refund checks to ensure they are being returned to the Department of Education or disbursed to students as stated in the criteria mentioned above. Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address the internal controls pertaining to returning funds and reissuing funds back to students. District Finance has been working closely with each College to return funds to the Department of Education. Queries have been created to identify returned checks which will be monitored on a regular basis to reverse financial aid disbursements and re-report changes to COD. Planned completion date for corrective action plan: March 31, 2023.
FINDING #2022 ? 002: INTERNAL CONTROLS OVER FEDERAL AWARDS Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 2 CFR 200.303, nonfederal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition / Context: During our audit procedures, we noted that a formal documented review process was not available for the following areas: ? R2T4 calculations [Berkeley City College and Merritt College] ? Student award packaging [Merritt College] ? Students selected for verification by the Department of Education [Merritt College] Furthermore, because the Financial Aid Director positions were vacant, reconciliations performed by the loan officers were not reviewed for: ? Pell Grant and Supplemental Education Opportunity Grant [Berkeley and Merritt College] ? Direct Loan [Berkeley City College] Questioned Costs: None. Cause: The Colleges' Financial Aid Director positions were vacant at June 30, 2022, resulting in an oversight. Effect: A lack of internal controls can result in noncompliance with provisions of the various programs within the Student Financial Assistance Cluster. Repeat Finding: See prior year finding 2021-004. Recommendation: We recommend the Colleges reinforce their review processes, monitor proper follow-up on audit findings, and review all activity level controls to ensure compliance with the various requirements of the Student Financial Assistance Cluster.Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address internal controls pertaining to reconciliation of Title IV funds, R2T4 processing, award packaging and verification. Huron has created more robust packaging and disbursement rules to ensure only eligible students are awarded and paid. Additionally, the district has created business processes and procedures to improve internal controls over federal awards. While the cutoff date for the audit was missed for the 2021-2022 school year, corrective actions have been taken to ensure the reconciliation of Title IV funds and secondary reviews have been completed and are currently underway for 2022-2023. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR680.309(b) and the National Student Loan Data System (NSLDS) Enrollment Reporting Guide published by the Department of Education, schools must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. In addition, schools must report enrollment status changes within 30 days of becoming aware of the status change or in its next scheduled enrollment submission if the scheduled submission is within 60 days. Condition / Context: During our testing of 25 students, which is a statistically valid sample, we noted one (1) instance of a student status change failing to be reported to NSLDS. Questioned Costs: None. Cause: Unknown, the status was correctly submitted to the Federal Clearinghouse but failed to automatically `push? or report to NSLDS. Effect: The case identified resulted in noncompliance with the applicable Title IV regulations. Inaccurate information is reflected on the NSLDS database. A student?s enrollment data protects the rights of borrowers by ensuring that loan interest subsidies are based on accurate enrollment data, ensures loan repayment dates are accurately based on the last data of attendance, allows in-school deferments to be automatically granted using NSLDS enrollment data, and provides vast amounts of critical data about the effectiveness of Title IV aid programs, including completion data. Repeat Finding: See prior year finding 2021-005. Recommendation: We recommend the District engage with the Clearinghouse to review applicable reporting procedures to ensure that enrollment and program information is accurately and timely reported to NSLDS as required by regulations. Action taken in response to finding: The District Administration & Records will perform a study of the current business processes to identify data discrepancies. The District will engage the Clearinghouse and review the applicable reporting procedures with the financial aid offices to ensure sound internal controls over reporting and updating of NSLDS enrollment data. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR 668.164(l), an institution must return to ED (notwithstanding any state law, such as a law that allows funds to escheat to the state) any Title IV funds, except FWS program funds, that it attempts to disburse directly to a student or parent but they do not receive or negotiate those funds. For FWS program funds, the institution is required to return only the federal portion of the payroll disbursements. If the institution attempted to disburse the funds by check and the check is not cashed, the funds must be returned no later than 240 days after the date it issued the check. If a check is returned, or an EFT is rejected, the institution may make additional attempts to disburse the funds, provided that the attempts are made no later than 45 days after the funds were returned or rejected. If the institution does not make an additional attempt to disburse the funds, the funds must be returned before the end of the 45-day period and no later than 240 days from the date of the initial attempt to disburse the funds. Condition / Context: Ten (10) out of a sample of 25 outstanding refund checks tested were yet not returned to the U.S. Department of Education. Eight (8) of the ten (10) had aged past the 240-day requirement. Questioned Costs: $7,408.87 Cause: Following the District?s receipt of refund checks, we noted that there is not a process for making contact with students within the initial 45-day period to resolve issues. Likewise, we noted there is not a process to ensure checks outside of the 45-day period are remitted back to ED. Effect: The District is not in compliance with the applicable Title IV regulations stating that all student refund checks that are outstanding for more than 240 days be returned to the U.S. Department of Education. Any additional attempts to disburse funds must be made no later than 45 days after the funds were returned or rejected. Repeat Finding: See prior year finding 2021-006. Recommendation: We recommend that the District review its procedures related to outstanding student refund checks to ensure they are being returned to the Department of Education or disbursed to students as stated in the criteria mentioned above. Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address the internal controls pertaining to returning funds and reissuing funds back to students. District Finance has been working closely with each College to return funds to the Department of Education. Queries have been created to identify returned checks which will be monitored on a regular basis to reverse financial aid disbursements and re-report changes to COD. Planned completion date for corrective action plan: March 31, 2023.
FINDING #2022 ? 002: INTERNAL CONTROLS OVER FEDERAL AWARDS Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 2 CFR 200.303, nonfederal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition / Context: During our audit procedures, we noted that a formal documented review process was not available for the following areas: ? R2T4 calculations [Berkeley City College and Merritt College] ? Student award packaging [Merritt College] ? Students selected for verification by the Department of Education [Merritt College] Furthermore, because the Financial Aid Director positions were vacant, reconciliations performed by the loan officers were not reviewed for: ? Pell Grant and Supplemental Education Opportunity Grant [Berkeley and Merritt College] ? Direct Loan [Berkeley City College] Questioned Costs: None. Cause: The Colleges' Financial Aid Director positions were vacant at June 30, 2022, resulting in an oversight. Effect: A lack of internal controls can result in noncompliance with provisions of the various programs within the Student Financial Assistance Cluster. Repeat Finding: See prior year finding 2021-004. Recommendation: We recommend the Colleges reinforce their review processes, monitor proper follow-up on audit findings, and review all activity level controls to ensure compliance with the various requirements of the Student Financial Assistance Cluster.Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address internal controls pertaining to reconciliation of Title IV funds, R2T4 processing, award packaging and verification. Huron has created more robust packaging and disbursement rules to ensure only eligible students are awarded and paid. Additionally, the district has created business processes and procedures to improve internal controls over federal awards. While the cutoff date for the audit was missed for the 2021-2022 school year, corrective actions have been taken to ensure the reconciliation of Title IV funds and secondary reviews have been completed and are currently underway for 2022-2023. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR680.309(b) and the National Student Loan Data System (NSLDS) Enrollment Reporting Guide published by the Department of Education, schools must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. In addition, schools must report enrollment status changes within 30 days of becoming aware of the status change or in its next scheduled enrollment submission if the scheduled submission is within 60 days. Condition / Context: During our testing of 25 students, which is a statistically valid sample, we noted one (1) instance of a student status change failing to be reported to NSLDS. Questioned Costs: None. Cause: Unknown, the status was correctly submitted to the Federal Clearinghouse but failed to automatically `push? or report to NSLDS. Effect: The case identified resulted in noncompliance with the applicable Title IV regulations. Inaccurate information is reflected on the NSLDS database. A student?s enrollment data protects the rights of borrowers by ensuring that loan interest subsidies are based on accurate enrollment data, ensures loan repayment dates are accurately based on the last data of attendance, allows in-school deferments to be automatically granted using NSLDS enrollment data, and provides vast amounts of critical data about the effectiveness of Title IV aid programs, including completion data. Repeat Finding: See prior year finding 2021-005. Recommendation: We recommend the District engage with the Clearinghouse to review applicable reporting procedures to ensure that enrollment and program information is accurately and timely reported to NSLDS as required by regulations. Action taken in response to finding: The District Administration & Records will perform a study of the current business processes to identify data discrepancies. The District will engage the Clearinghouse and review the applicable reporting procedures with the financial aid offices to ensure sound internal controls over reporting and updating of NSLDS enrollment data. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR 668.164(l), an institution must return to ED (notwithstanding any state law, such as a law that allows funds to escheat to the state) any Title IV funds, except FWS program funds, that it attempts to disburse directly to a student or parent but they do not receive or negotiate those funds. For FWS program funds, the institution is required to return only the federal portion of the payroll disbursements. If the institution attempted to disburse the funds by check and the check is not cashed, the funds must be returned no later than 240 days after the date it issued the check. If a check is returned, or an EFT is rejected, the institution may make additional attempts to disburse the funds, provided that the attempts are made no later than 45 days after the funds were returned or rejected. If the institution does not make an additional attempt to disburse the funds, the funds must be returned before the end of the 45-day period and no later than 240 days from the date of the initial attempt to disburse the funds. Condition / Context: Ten (10) out of a sample of 25 outstanding refund checks tested were yet not returned to the U.S. Department of Education. Eight (8) of the ten (10) had aged past the 240-day requirement. Questioned Costs: $7,408.87 Cause: Following the District?s receipt of refund checks, we noted that there is not a process for making contact with students within the initial 45-day period to resolve issues. Likewise, we noted there is not a process to ensure checks outside of the 45-day period are remitted back to ED. Effect: The District is not in compliance with the applicable Title IV regulations stating that all student refund checks that are outstanding for more than 240 days be returned to the U.S. Department of Education. Any additional attempts to disburse funds must be made no later than 45 days after the funds were returned or rejected. Repeat Finding: See prior year finding 2021-006. Recommendation: We recommend that the District review its procedures related to outstanding student refund checks to ensure they are being returned to the Department of Education or disbursed to students as stated in the criteria mentioned above. Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address the internal controls pertaining to returning funds and reissuing funds back to students. District Finance has been working closely with each College to return funds to the Department of Education. Queries have been created to identify returned checks which will be monitored on a regular basis to reverse financial aid disbursements and re-report changes to COD. Planned completion date for corrective action plan: March 31, 2023.
FINDING #2022 ? 002: INTERNAL CONTROLS OVER FEDERAL AWARDS Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 2 CFR 200.303, nonfederal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition / Context: During our audit procedures, we noted that a formal documented review process was not available for the following areas: ? R2T4 calculations [Berkeley City College and Merritt College] ? Student award packaging [Merritt College] ? Students selected for verification by the Department of Education [Merritt College] Furthermore, because the Financial Aid Director positions were vacant, reconciliations performed by the loan officers were not reviewed for: ? Pell Grant and Supplemental Education Opportunity Grant [Berkeley and Merritt College] ? Direct Loan [Berkeley City College] Questioned Costs: None. Cause: The Colleges' Financial Aid Director positions were vacant at June 30, 2022, resulting in an oversight. Effect: A lack of internal controls can result in noncompliance with provisions of the various programs within the Student Financial Assistance Cluster. Repeat Finding: See prior year finding 2021-004. Recommendation: We recommend the Colleges reinforce their review processes, monitor proper follow-up on audit findings, and review all activity level controls to ensure compliance with the various requirements of the Student Financial Assistance Cluster.Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address internal controls pertaining to reconciliation of Title IV funds, R2T4 processing, award packaging and verification. Huron has created more robust packaging and disbursement rules to ensure only eligible students are awarded and paid. Additionally, the district has created business processes and procedures to improve internal controls over federal awards. While the cutoff date for the audit was missed for the 2021-2022 school year, corrective actions have been taken to ensure the reconciliation of Title IV funds and secondary reviews have been completed and are currently underway for 2022-2023. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR680.309(b) and the National Student Loan Data System (NSLDS) Enrollment Reporting Guide published by the Department of Education, schools must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. In addition, schools must report enrollment status changes within 30 days of becoming aware of the status change or in its next scheduled enrollment submission if the scheduled submission is within 60 days. Condition / Context: During our testing of 25 students, which is a statistically valid sample, we noted one (1) instance of a student status change failing to be reported to NSLDS. Questioned Costs: None. Cause: Unknown, the status was correctly submitted to the Federal Clearinghouse but failed to automatically `push? or report to NSLDS. Effect: The case identified resulted in noncompliance with the applicable Title IV regulations. Inaccurate information is reflected on the NSLDS database. A student?s enrollment data protects the rights of borrowers by ensuring that loan interest subsidies are based on accurate enrollment data, ensures loan repayment dates are accurately based on the last data of attendance, allows in-school deferments to be automatically granted using NSLDS enrollment data, and provides vast amounts of critical data about the effectiveness of Title IV aid programs, including completion data. Repeat Finding: See prior year finding 2021-005. Recommendation: We recommend the District engage with the Clearinghouse to review applicable reporting procedures to ensure that enrollment and program information is accurately and timely reported to NSLDS as required by regulations. Action taken in response to finding: The District Administration & Records will perform a study of the current business processes to identify data discrepancies. The District will engage the Clearinghouse and review the applicable reporting procedures with the financial aid offices to ensure sound internal controls over reporting and updating of NSLDS enrollment data. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR 668.164(l), an institution must return to ED (notwithstanding any state law, such as a law that allows funds to escheat to the state) any Title IV funds, except FWS program funds, that it attempts to disburse directly to a student or parent but they do not receive or negotiate those funds. For FWS program funds, the institution is required to return only the federal portion of the payroll disbursements. If the institution attempted to disburse the funds by check and the check is not cashed, the funds must be returned no later than 240 days after the date it issued the check. If a check is returned, or an EFT is rejected, the institution may make additional attempts to disburse the funds, provided that the attempts are made no later than 45 days after the funds were returned or rejected. If the institution does not make an additional attempt to disburse the funds, the funds must be returned before the end of the 45-day period and no later than 240 days from the date of the initial attempt to disburse the funds. Condition / Context: Ten (10) out of a sample of 25 outstanding refund checks tested were yet not returned to the U.S. Department of Education. Eight (8) of the ten (10) had aged past the 240-day requirement. Questioned Costs: $7,408.87 Cause: Following the District?s receipt of refund checks, we noted that there is not a process for making contact with students within the initial 45-day period to resolve issues. Likewise, we noted there is not a process to ensure checks outside of the 45-day period are remitted back to ED. Effect: The District is not in compliance with the applicable Title IV regulations stating that all student refund checks that are outstanding for more than 240 days be returned to the U.S. Department of Education. Any additional attempts to disburse funds must be made no later than 45 days after the funds were returned or rejected. Repeat Finding: See prior year finding 2021-006. Recommendation: We recommend that the District review its procedures related to outstanding student refund checks to ensure they are being returned to the Department of Education or disbursed to students as stated in the criteria mentioned above. Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address the internal controls pertaining to returning funds and reissuing funds back to students. District Finance has been working closely with each College to return funds to the Department of Education. Queries have been created to identify returned checks which will be monitored on a regular basis to reverse financial aid disbursements and re-report changes to COD. Planned completion date for corrective action plan: March 31, 2023.
FINDING #2022 ? 002: INTERNAL CONTROLS OVER FEDERAL AWARDS Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 2 CFR 200.303, nonfederal entities must establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Condition / Context: During our audit procedures, we noted that a formal documented review process was not available for the following areas: ? R2T4 calculations [Berkeley City College and Merritt College] ? Student award packaging [Merritt College] ? Students selected for verification by the Department of Education [Merritt College] Furthermore, because the Financial Aid Director positions were vacant, reconciliations performed by the loan officers were not reviewed for: ? Pell Grant and Supplemental Education Opportunity Grant [Berkeley and Merritt College] ? Direct Loan [Berkeley City College] Questioned Costs: None. Cause: The Colleges' Financial Aid Director positions were vacant at June 30, 2022, resulting in an oversight. Effect: A lack of internal controls can result in noncompliance with provisions of the various programs within the Student Financial Assistance Cluster. Repeat Finding: See prior year finding 2021-004. Recommendation: We recommend the Colleges reinforce their review processes, monitor proper follow-up on audit findings, and review all activity level controls to ensure compliance with the various requirements of the Student Financial Assistance Cluster.Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address internal controls pertaining to reconciliation of Title IV funds, R2T4 processing, award packaging and verification. Huron has created more robust packaging and disbursement rules to ensure only eligible students are awarded and paid. Additionally, the district has created business processes and procedures to improve internal controls over federal awards. While the cutoff date for the audit was missed for the 2021-2022 school year, corrective actions have been taken to ensure the reconciliation of Title IV funds and secondary reviews have been completed and are currently underway for 2022-2023. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR680.309(b) and the National Student Loan Data System (NSLDS) Enrollment Reporting Guide published by the Department of Education, schools must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. In addition, schools must report enrollment status changes within 30 days of becoming aware of the status change or in its next scheduled enrollment submission if the scheduled submission is within 60 days. Condition / Context: During our testing of 25 students, which is a statistically valid sample, we noted one (1) instance of a student status change failing to be reported to NSLDS. Questioned Costs: None. Cause: Unknown, the status was correctly submitted to the Federal Clearinghouse but failed to automatically `push? or report to NSLDS. Effect: The case identified resulted in noncompliance with the applicable Title IV regulations. Inaccurate information is reflected on the NSLDS database. A student?s enrollment data protects the rights of borrowers by ensuring that loan interest subsidies are based on accurate enrollment data, ensures loan repayment dates are accurately based on the last data of attendance, allows in-school deferments to be automatically granted using NSLDS enrollment data, and provides vast amounts of critical data about the effectiveness of Title IV aid programs, including completion data. Repeat Finding: See prior year finding 2021-005. Recommendation: We recommend the District engage with the Clearinghouse to review applicable reporting procedures to ensure that enrollment and program information is accurately and timely reported to NSLDS as required by regulations. Action taken in response to finding: The District Administration & Records will perform a study of the current business processes to identify data discrepancies. The District will engage the Clearinghouse and review the applicable reporting procedures with the financial aid offices to ensure sound internal controls over reporting and updating of NSLDS enrollment data. Planned completion date for corrective action plan: June 30, 2023.
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063 and 84.268 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria or Specific Requirement: In accordance with 34 CFR 668.164(l), an institution must return to ED (notwithstanding any state law, such as a law that allows funds to escheat to the state) any Title IV funds, except FWS program funds, that it attempts to disburse directly to a student or parent but they do not receive or negotiate those funds. For FWS program funds, the institution is required to return only the federal portion of the payroll disbursements. If the institution attempted to disburse the funds by check and the check is not cashed, the funds must be returned no later than 240 days after the date it issued the check. If a check is returned, or an EFT is rejected, the institution may make additional attempts to disburse the funds, provided that the attempts are made no later than 45 days after the funds were returned or rejected. If the institution does not make an additional attempt to disburse the funds, the funds must be returned before the end of the 45-day period and no later than 240 days from the date of the initial attempt to disburse the funds. Condition / Context: Ten (10) out of a sample of 25 outstanding refund checks tested were yet not returned to the U.S. Department of Education. Eight (8) of the ten (10) had aged past the 240-day requirement. Questioned Costs: $7,408.87 Cause: Following the District?s receipt of refund checks, we noted that there is not a process for making contact with students within the initial 45-day period to resolve issues. Likewise, we noted there is not a process to ensure checks outside of the 45-day period are remitted back to ED. Effect: The District is not in compliance with the applicable Title IV regulations stating that all student refund checks that are outstanding for more than 240 days be returned to the U.S. Department of Education. Any additional attempts to disburse funds must be made no later than 45 days after the funds were returned or rejected. Repeat Finding: See prior year finding 2021-006. Recommendation: We recommend that the District review its procedures related to outstanding student refund checks to ensure they are being returned to the Department of Education or disbursed to students as stated in the criteria mentioned above. Action taken in response to finding: The district has entered into a contract with Huron Consulting Group to address the internal controls pertaining to returning funds and reissuing funds back to students. District Finance has been working closely with each College to return funds to the Department of Education. Queries have been created to identify returned checks which will be monitored on a regular basis to reverse financial aid disbursements and re-report changes to COD. Planned completion date for corrective action plan: March 31, 2023.