Corrective Action Plans

Finding 2023-002: Financial Responsibility Comments on Finding and Recommendation: The College agrees with this finding as determined in the audit and states that the College had a net reduction in student enrollments and had incurred additional expenses as it operated at two separate locations within Florida. The College incurred additional losses in tuition revenue and services revenue as it restructured how to operate both locations appropriately during 2023. The College had additional interest expense in 2023 during the restructuring of the administration and the facilities of the College. Actions Taken or Planned: The College acted in 2024 to reduce the academic footprint to the facility it owned in Bradenton FL, while reporting the Gainesville FL location as no longer offering instruction, but maintaining a clinical facility to allow students to complete the requirements of their academic program. The College also removed and replaced the Executive Director and other members of administration that contributed to the financial issues faced by the College. Name: Dr. Dorian G. Kramer DACM Title: Director Telephone: (941)-289-2456 Email: dkramer@dragonrises.edu

FINDING 2023-001 NONCOMPLIANCE - REPORT SUBMISSION Program Title/Federal Grantor/ALN: Foster Care Title IV-E U.S. Department of Health and Human Services Assistance Listing Number 93.658 Corrective Action Plan The Organization will file the SF-SAC Single Audit Data Collection Form by the due date or file an extension when needed. Name of the Contact Person Responsible for Corrective Action Brian Gambini, Administrator Anticipated Completion Date September 30, 2025

Given staff & contract staff turnover during the year, required financial aid reporting requirements were late, this will not be an issue moving forward as the University ceased participation in all federal financial aid programs and is expected to fully transition to a scholarship granting organization.

We agree with the recommendation. A full-time staff position "Student Scholarship Accounting & Compliance Officer" is filled and a component of this role is to disburse credit balances within 14 days, should there be a need. However no Federal financial assistance funds were awarded after June 30, 2023 as the University ceased academic operations and degree granting in May 2023 upon completion of spring semester.

Cluster Name: Student Financial Assistance Cluster Assistance listing numbers and names: Northern Arizona University 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study 84.038 Federal Perkins Loan Program—Federal Capital Contributions 84.063 Federal Pell Grant Programs 84.268 Federal Direct Student Loans 84.379 Teacher Education Assistance for College and Higher Education Grants (TEACH Grants) 93.364 Nursing Student Loans 93.925 Scholarships for Health Professions Students from Disadvantaged Backgrounds—Scholarships for Disadvantaged Students (SDS) Agency: Northern Arizona University (NAU) Name of contract person and title: Bradley Miner, NAU Associate Vice President and Comptroller Anticipated Completion Date June 30, 2024 Agency’s Response: Concur The University agrees with this finding and although it relies on the Federal agencies for valid identity verification, the University has already taken significant corrective action to proactively monitor and detect fraudulent student identities. The University has various internal controls, system fraud controls, and integrity measures in place as required or identified as industry best-practice to mitigate and prevent the increasing sophistication of fraudulent activity. In academic year 2023 the University had 282 online students selected for Verification by the Department of Education (ED). The 8 isolated fraud instances were the only identified fraud cases. The University receives valid identity verification checks from the Department of Education (ED) as an input for creating student profiles. Additionally, the University works with administrative agencies and leverages FAFSA checks conducted by Social Security Administration (SSA), Department of Veteran Affairs (VA), Department of Homeland Security (DHS), National Student Loan Data System (NSLDS), Department of Defense (DOD), Department of Justice (DOJ). Financial Aid does not disburse until enrollment verification is complete. 1. The University has reviewed prior fiscal years to determine if additional fraudulently enrolled students received student financial assistance, and if fraudulent loans and awards were awarded. The University conducted an in-depth analysis of multiple qualitative attributes of students receiving financial assistance. This analysis identified high risk students receiving loans and awards. Students in this population were required to complete V4 verification. 2. The University implemented anti-fraud measures as an alternative to automated student Internet Protocol (IP) verification. During the analysis to identify fraudulently enrolled students, the University identified programs at high-risk for fraudulent activity. As a proactive fraudulent activity identification measure, the University will require all students in high-risk programs, with active FAFSAs to submit and complete V4 identity verification. This anti-fraud measure will identify fraudulently enrolled students prior to the disbursement of student financial assistance including loans and awards. 3. The University has put in to place a number of additional verification measures and detective controls to validate online student identities and check for repetitive information and trends. The University is conducting feasibility studies to determine if the suggested guidance for Internet Protocol student verification abides by certain security and privacy standards and policies. Additionally, the University has concern with fraudsters ability to mask Internet Protocols by deploying Virtual Private Networks (VPNs). This renders the advanced protocols ineffective. As a compensating control, the University will begin selecting 5% of online students for V4 verification. Random sampling of online students for identity verification provides enhanced detective measures to combat the risk of identity theft for use in financial aid fraud. Additionally, the University put in place several upfront measures to detect repetitive information and trends to identify potentially fraudulent activity. Detective monitoring reporting identifies duplicate deposit information, redundant student email information, and duplicate student address information. The Department will continue to utilize these successful anti-fraud measures to proactively identify fraudulent student identities. 4. The University will continue its efforts working with law enforcement agencies to recover improper payments for fraudulent claims it paid due to identity theft, to the extent practicable. The University worked with law enforcement agencies to investigate the fraud. At the conclusion of the investigation $138,135 has been repaid. The University will continue to partner with federal, state, and local law enforcement agencies and financial institutions across the country to recover losses and aggressively pursue legal action against perpetrators of fraud.

Assistance listing number and program name: 93.658 Foster Care—Title IV-E 93.658 COVID-19 - Foster Care—Title IV-E Agency: Arizona Department of Child Safety (DCS) Name of contact person and title: Emilio Gonzales, DCS Audit Administrator Anticipated completion date: Fiscal Year 2025 Agency’s Response: Concur The Department will comply with the Federal Funding Accountability and Transparency Act (FFATA) and Federal Uniform Guidance regulations in accordance with the Department’s Grant policies and procedures. As of November 2024, the Department worked with the federal agency to resolve the inability to submit outstanding subaward information prior to January 2024. The FFATA reporting was completed for fiscal years 2024, 2023, 2022 and 2021. The Department will also continue to follow its policies and procedures for reporting subaward actions, as required.

a. Comments on the Findings and Each Recommendation Due the ongoing impact of the COVID 19 pandemic, the Organization and CHR Consulting Services, Inc. (“CHR”), the entity responsible for maintaining the books and records of the Organization, experienced staffing shortages due to retirements and medical leave. In addition, as a result of the ongoing impact of the COVID 19 pandemic, the Organization continued to experience noncompliance with certain debt covenants in 2023 and first half of 2024. In addition, the Organization had several vendor or liabilities, including the Pennsylvania bed tax liability that required resolution prior to the issuance of the audited financial statements. b. Action(s) Taken or Planned on the Finding The Organization and CHR have been able to recruit additional staff and CHR has added additional supervisory personnel to oversee the financial reporting and audit process. In an effort to improve communications with the Grantor, in August 2023, the Organization began providing monthly financial and operational information. In addition, monthly calls were implemented with the representatives of the Grantor, discussing key operational and performance measures. While key issues were identified and discussed with the Grantor, the Grantor has not been able to provide waivers for such noncompliance with covenant requirements. As noted in Note 2 the audited financial statements, the financial performance of the Organization has improved, allowing the Organization to enter into long-term payment plans for the resolution of the key liabilities of the Organization. It is anticipated that the audit for 2024 and related forms will be issued within the allowable time period in the loan agreements.

Finding 2023-004: Internal Control Deficiency Reporting Federal Grantor: United States Department of Health and Human Services Assistance Listing No.: 93.048 Summary of Finding: Evidence of internal controls was not in place throughout the audit period to ensure that reports which are submitted are complete and accurate. The same individual that prepares the SF-425 report, was the same individual who reviewed and submitted the reports. Corrective Action Plan: Internal controls were implemented in October 2023 following the 2022-03 finding, to ensure that once the SF-425 report is completed, someone from the accounting department verifies the funds being reported are correct and appropriate. Documentation will be maintained to support the review process. Responsible Party: Sonja Landry, Executive Director Anticipated Completion Date: Completed October 2023

The University agrees with the finding and acknowledges the finding was also reported in the previous fiscal year. Despite high staff turnover, the Director of the Financial Aid Office and in collaboration with the Controller’s Office the issue is being addressed for any future reporting.

The University concurs with this finding but cannot respond why the student was awarded outside the of procedure and methodology set up for awarding HEERF Funds. The decisions were made by individuals no longer with the University and no documentation was found to determine why the student was awarded outside the policy in place. The Controller’s Office and Financial Aid Office are working together to make sure that in future funds like the HEERF will have documentation attached to secure that we follow procedure and policy and document any exceptions.

The University agrees with the finding. The University has had a significant amount of staff turnover and reorganization in FY 2023 in the financial aid office. The Interim Director of Financial Aid is collaborating with the controller’s office to make sure that the University has internal controls in place over Federal programs to assure that the Pell reporting requirements are executed in compliance with Federal statutes, regulation and terms and conditions of the federal award. The University is investing in making sure that the Financial Aid Office is staffed and create policy and procedure that assure that we improve internal controls on the Pell process.

Management's Response: We concur. View of Responsible Officials and Corrective Action Plan Corrective action plan to ensure enrollment reporting is completed timely and accurately I. The admissions team sends a list of all enrolled students 2. Financial aid will manually enter the student's information into campus IVY 3. Campus IVY updates the student's status in NSLDS every 30 days. 4. If a student withdraws from Community Christian College, financial aid will manually update the student status into campus IVY 5. NSLDS is updated upon completion of the withdrawal This process will ensure that Community Christian College updates enrollment statuses for every student timely

Management's Response: We concur. View of Responsible Officials and Corrective Action Plan The following is the procedure that the College will be implementing to ensure that student withdrawal calculations are performed accurately and returned within 30 days: I. The registrar will send a list to financial aid of all students that have dropped by end of day every Thursday of each week. The list will include date of determination (DOD) and last date of attendance (LOA) of each student b. DOD wiII be within 14 days of student LOA 2. Upon receipt of the list financial aid will complete the following for each student: a. Gather student's current ledger card b. Gather student's current Transcript c. Complete a cover sheet which indicated the current loan period of the student. d. Financial aid will send over items to yd patty processor in order for R2t4 calculation to be completed (Campus IVY) no later than Wednesday of the following week by end of business day. 3. Campus IVY will complete the R2T4 3-5 business days upon receipt and conduct the following: a. If a refund is required- campus IVY will schedule the refund, update student account and send to school. b. School (student accounts) will review the refund, update student account and monies will be placed in the operations account and sent back to GS. c. If a refund is not required based on the R2T4 results, Campus IVY will notate the student account. This corrective action plan will allow Community Christian College to complete the drop process for each student within 30 days from LOA.

Management's Response: We concur. View of Responsible Officials and Corrective Action Plan I. Campus IVY will aid with the data collection for the FISAP 2. Campus IVY will run a disbursement repo11 showing how much FA was disbursed prior year and record 3. Campus IVY will run !SIR report to show eligible applicant and record 4. School will run population repo11 out of Populi and record 5. Campus IVY will run a report to show the amount of FSEOG disbursed prior year and record 6. Once all data is collected, a comparison year to year will take place 7. A comparison of student population as well as amount used 8. The result will allow the school to determine the amount of FSEOG is needed for upcoming year. This correction action plan will allow Community Christian College to repo11 FISAP figures properly with suppo11ing documentation.

Management's Response: We concur. View of Responsible Officials and Corrective Action Plan The following is the procedure that the College will be implemented to ensure that student withdnrn al calculations are performed accurately and returned within 30 days: I. The registrar will send a list to financial aid of all students that have dropped by end of day every Thursday of each week. a. The list will include date of determination (DOD) and last date of attendance (LOA) of each student b. DOD will be within 14 days of student LOA 2. Upon receipt of the list financial aid will complete the following for each student: a. Gather student's current ledger card b. Gather student's current Transcript c. Complete a cover sheet which indicated the current loan period of the student. d. Financial aid will send over items to 3rd party processor in order for R2t4 calculation to be completed (Campus IVY) no later than Wednesday of the following week by end of business day. 3. Campus IVY will complete the R2T4 3-5 business days upon receipt and conduct the following: a. If a refund is required- campus IVY will schedule the refund, update student account and send to school. b. School (student accounts) will review the refund, update student account and monies will be placed in the operations account and sent back to GS. c. If a refund is not required based on the R2T4 results, Campus IVY will notate the student account. This corrective action plan will allow Community Christian College to complete the drop process for each student within 30 days from LOA.

Finding No. 2023-003: Failure to Notify Recipients of Federal Direct Loan Disbursement CFDA Numbers: 84.268 Program: Student Financial Assistance Cluster Corrective Action: The University added a monitoring report to identify any communication failures for disbursement notifications. Implementation Date: June 10, 2024 Contact Person: Amanda Fijal

Finding No. 2023-004: Untimely and Inaccurate Reporting of Pell and FDL Data CFDA Numbers: 84.268 Program: Student Financial Assistance Cluster Corrective Action: A control will be added to loan set-up. Additional training was provided to staff monitoring loan reports. Implementation Date: June 10, 2024 Contact Person: Amanda Fijal

Name of Responsible Individual: Nate R. McGill, Associate Director, Center for Career & Professional Success, Ben Carmichael, Associate Director for Compliance, John Hooth, Senior Director of Payroll Corrective Action: Federal Work Study supervisors are required to have training on the appropriate policies and procedures when hiring a Federal Work Study student. They will sign off on a document stating they understand they must follow these procedures and losing the privilege of hiring FWS students can be the result of not following these policies and procedures. One of these policies is that students cannot have time approved prior to working those hours. The student’s hours work may match the pay the student received and was approved for, but it is against policy to approve hours before the student worked. FWS supervisors will sign they understand this. The Federal Work Study coordinator (located in the Center for Career & Professional Services) is responsible for reviewing the hours a student works and ensuring supervisors have approved the correct number of hours and the hours were approved after the student worked those hours. Due to turnover in the department, a full-time FWS coordinator had not been hired and the person responsible for reviewing the hours worked had additional responsibilities outside of monitoring Federal Work Study. A full-time Federal Work Study Coordinator position has been approved and the anticipation is this position will be filled prior to the end of the Fall 2024 semester. The Associate Director for Compliance will include a review of when the supervisor approved the students’ hours as a part of the bi-semester Federal Work Study sample. These reviews are completed to ensure students are paid on-time and accurately, as well as ensure the student is not working-class hours. This plan to include when the supervisor approved the hours should provide another layer of oversight. Anticipated Completion Date: The Center for Career and Professional Services is anticipating hiring a full-time Federal Work Study Coordinator by the end of the Fall 2024 semester. All FWS supervisor training occurs prior to the hire of any Federal Work Study students and the first review of timesheets to ensure accuracy/timeliness in payment, as well as no supervisor approves time prior to the student working.

Name of Responsible Individual: Ben Carmichael, Associate Director for Compliance, Roderick Johnson, Assistant Director for Compliance, Robert Muhammad, Executive Director of Financial Aid and Robin Whitfield, Associate VP for Finance & Bursar Corrective Action: It was discovered in December 2021 that Part III Federal Perkins Loan portion of the FISAP had experienced data conversion issues after the conversion from ACS Loan Servicing to ECSI Corporation as the University’s third-party servicer. There were Perkins Loans disbursed to students not included in the conversion, so the data provided annually by ECSI had accuracy issues. The University had approached ECSI in March 2022 requesting a review of the ACS data provided at conversion and an updated report that can be used to accurately complete the FISAP. Work on the project halted due to invoicing issues between Howard University and ECSI. There are currently no invoicing issues between ECSI and Howard University, so the institution engaged with ECSI in March 2024 to identify the loans that fell off during conversion from ACS and then we will update the prior year FISAP’s as needed. ECSI has informed Howard it could take 6 months or more for the comparison process to be completed and made available to the University for updating of prior year FISAP’s. ECSI has stated to Howard that most institutions do not attempt to reach this parity, as it can be difficult to accomplish. Anticipated Completion Date: December 2024 is the anticipated date by which Howard would expect the comparison process to be completed. Howard has been in contact with ECSI and the comparison process is still ongoing.

Name of Responsible Individual: Konya White, Director of Enrollment Systems Associate Director for Compliance, Ben Carmichael, Associate Director for Compliance, and Roderick Johnson, Assistant Director for Compliance Corrective Action: This student’s Pell disbursement was not reported within 15 days of disbursement due to the COD (Common Origination Disbursement) system rejecting the student’s disbursement. These Pell rejects are worked through the reconciliation process and this exception was not worked in a timely manner, resulting in COD accepting the disbursement past the 15-day deadline. The Howard University employee who was completing reconciliation of Title IV funds, as well as responsible for working through any Pell rejected disbursements is no longer employed at Howard. The Assistant Director for Compliance works in the Office of Financial Aid and responsible for completing reconciliation and working any Pell rejected disbursements. The Associate Director for Compliance in Enrollment Management reviews reconciliations and ensures any rejected disbursements are resolved within the 15-day timeframe. Anticipated Completion Date: This finding was mitigated in May 2023. The responsibility of Title IV reconciliation was performed and worked by two consultants who had experience with Title IV reconciliation. The Assistant Director for Compliance hired in January 2024 has experience with Title IV reconciliation and was trained by the two consultants on Howard procedures for Title IV reconciliation and working rejected disbursements. The responsibility for Title IV reconciliation now lies entirely within the Office of Financial Aid.

Name of Responsible Individual: Ben Carmichael, Associate Director for Compliance, Roderick Johnson, Assistant Director for Compliance, Robert Muhammad, Executive Director of Financial Aid and Brenda Willis, Senior Executive Director of Financial Grants & Contracts Corrective Action: The University will continue to provide additional information and training to personnel outside of the Office of Financial Aid. This information and training – where applicable – will be used to ensure that the University’s policies and procedures are in line with federal regulations and that internal policies and procedures do not supersede or impede federal regulations. Anticipated Completion Date: October 31, 2024. The Senior Executive Director of Financial Grants and Contracts is currently working with the Associate Director for Compliance and the Executive Director of Financial Aid to improve communication between all departments responsible for cash management.

Name of Responsible Individual: Ben Carmichael, Associate Director for Compliance, Konya White, Director of Enrollment Systems and LaTrice Byam, Executive Director of Academic Planning and Curriculum Corrective Action: The Enrollment Reporting process is supervised by the University Registrar and is responsible for providing enrollment reports to Howard University’s third-party servicer, National Student Clearinghouse (“NSC”), who then submits the report to NSLDS student’s enrollment status. The University is committed to ensure sufficient training and support to the Office of the Registrar to keep the institution in compliance. While the expectation is the University will hire an experienced University Registrar and Associate Director Registrar for compliance, continued training opportunities will be made available through National Student Clearinghouse and NASFAA (National Association of Student Financial Aid Administrators). The reported data is for students who are ¾ time during a semester, “3Q,” was discovered through testing of enrollment reporting samples to not be set up correctly in Banner. This has resulted in students who are taking between 9-11 credits being reported as “H” for half-time instead of “3Q” for three-quarter time. The newest University Registrar set up the “3Q” status correctly in Banner in January 2024 and testing of enrollment reporting samples show the 3Q status is accurate. The students in the program and campus-level findings should now be accurately reported as “3Q.” After speaking with the Executive Director of Academic Planning and Curriculum, the CIP codes for the program identified as findings had not been updated when all CIP codes were updated in 2020. She also confirmed the length of the program was incorrectly published on the site for these programs. Howard has moved to Workday Student as the University’s Enterprise Resource Planning system and the accurate CIP codes and program lengths were confirmed. The transition to Workday Student allowed the University to review each program to ensure accuracy when integrating the data from Banner to Workday. The University Registrar was not aware the FSA Audit testing exempt range of 07-19-2022 through 02-28-2024 required students who had an enrollment change during that period to be updated. This audit exemption range was abnormal, and the University hired a new Registrar during this time period, which resulted in there being no knowledge transfer the enrollment changes had not been updated. Graduation files are now being sent monthly to the National Student Clearinghouse to avoid students not being picked up for graduation as they are cleared. Anticipated Completion Date: The correction to the “3Q” status took place in January 2024 and testing has shown this issue to be resolved. Additional testing will occur in the new ERP Workday to ensure incorrect reporting of students who are ¾ time does not occur. Enrollment reporting samples will be pulled approximately 2-3 weeks after the first Fall 2024 enrollment file is sent to National Student Clearinghouse.

2023-008 Student Financial Aid Cluster (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Pell Grant Program (d) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.063 (d) 84.268 - Year Ended June 30, 2023 Condition: During our testing of thirty-seven student files, we noted one individual (2.7%) received an excess of $1,969 over the maximum undergraduate level of $23,000 in Federal Direct Subsidized Loans. Corrective Action Plan: During the 2022-23 school year, an employee who retired in May 2023 awarded all returning student institutional aid and federal aid. Upon her retirement, Hannah Masters, Executive Director of Financial Aid and Student Accounts, took over awarding all students (incoming and returning students). Starting in June 2023, Hannah awards all students based on enrollment status from Jenzabar 1 (Cottey's ERP) for returning students and Salesforce for incoming students. Then on census date, the Registrar sends an updated final report of student grade level and attempted credit hours. Hannah then reviews all student accounts manually and confirms the enrollment, grade level, and loan levels for each student. This ensures no student is under or over awarded for the term based on grade level or financial need. Responsible Person for Correction Action Plan: Hannah Masters Implementation Date for Corrective Action Plan: June 2023

2023-007 Student Financial Aid Cluster (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Pell Grant Program (d) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.063 (d) 84.268 - Year Ended June 30, 2023 Condition: Throughout the year cash on hand exceeded the immediate disbursement needs for three working days and the excess cash tolerances were not eliminated within seven working days. We consider this condition to be a significant deficiency in internal control over compliance relating to the Cash Management compliance requirement and is not a repeat finding. Corrective Action Plan: During the 2022-23 fiscal year, SEOG and Federal Work Study funds were drawn when funds were authorized, not when funds were expended. The mistake was realized in the Federal Work Study draw and the funds were returned, but the SEOG draw was not refunded. The funds were subsequently awarded. Going forward all Federal Funds will be drawn after they are awarded. Responsible Person for Correction Action Plan: Kevin Smithberger Implementation Date for Corrective Action Plan: August 2024

2023-006 Student Financial Aid Cluster (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Pell Grant Program (d) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.063 (d) 84.268 - Year Ended June 30, 2023 Condition: During our testing of thirty-seven student files, we noted two individuals (5%) did not receive the full amount of their Federal Direct Subsidized Loans. We consider this condition to be an instance of non-compliance relating to the Eligibility compliance requirement. Statistical sampling was not used in making sample selections. Corrective Action Plan: During the 2022-23 school year, an employee who retired in May 2023 awarded all returning student institutional aid and federal aid. Upon her retirement, Hannah Masters, Executive Director of Financial Aid and Student Accounts, took over awarding all students (incoming and returning students). Starting in June 2023, Hannah awards all students based on enrollment status from Jenzabar 1 (Cottey's ERP) for returning students and Salesforce for incoming students. Then on census date, the Registrar sends an updated final report of student grade level and attempted credit hours. Hannah then reviews all student accounts manually and confirms the enrollment, grade level, and loan levels for each student. This ensures no student is under or over awarded for the term based on grade level or financial need. With the staffing changes, we are also now reviewing each package every time a FAFSA update is imported. This gives us another round of reviews to ensure students are not over or under awarded based on financial need. Responsible Person for Correction Action Plan: Hannah Masters Implementation Date for Corrective Action Plan: June 2023