2022?020 REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Rehabilitation Services?Vocational Rehabilitation Grants to State 84.126 Grant Award H126A200095, H126A210095, H126A220095Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 2 CFR 200.302(b)(2) ?Accurate, current, and complete disclosure of the financial results of each Federal award or program in accordance with the reporting requirements set forth in ?? 200.328 and 200.329. If a Federal awarding agency requires reporting on an accrual basis from a recipient that maintains its records on other than an accrual basis, the recipient must not be required to establish an accrual accounting system. This recipient may develop accrual data for its reports on the basis of an analysis of the documentation on hand. Similarly, a pass-through entity must not require a subrecipient to establish an accrual accounting system and must allow the subrecipient to develop accrual data for its reports on the basis of an analysis of the documentation on hand.? Condition: The West Virginia Division of Rehabilitation Services (WVDRS) is responsible for preparing the Rehabilitation Services Administration (RSA-17), Federal Financial Report, quarterly. The RSA-17 is used to track the status of financial data tied to a particular Federal Grant Award. The RSA-17 report should be complete, accurate, and prepared in accordance with the required accounting basis. There was an error in reporting where certain amounts reported did not agree to the underlying data used to prepare the reports. The Director?s review was not precise enough to detect the error. Questioned Costs: N/A Context: Total federal expenditures for the Vocational Rehabilitation Grant were $31,508,101 for the year ended June 30, 2022. Cause: WVDRS has policies and procedures in place to review the RSA-17 prior to submission; however, the review was not precise enough to identify the errors. Effect: Incorrect data could be reported to the RSA. Recommendation: We recommend that WVDRS enforce the existing policies and procedures surrounding the review and approval of the RSA-17 report prior to submission. Views of Responsible Officials: Management acknowledges the finding. See corrective action plan.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?016 SPECIAL TESTS AND PROVISIONS ? BORROWER DATA TRANSMISSION AND RECONCILIATION (Repeat of Prior Year Findings 2021?013, 2020?016, 2019?020, 2018?013, 2017?007, and 2016?006) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 685.300(b)(5) states that schools must agree to ?On a monthly basis, reconcile institutional records with Direct Loan funds received from the Secretary and Direct Loan disbursement records submitted to and accepted by the Secretary.? Condition: For our control testing of the Direct Loan School Account Statement (SAS) reconciliation requirements at Pierpont Community and Technical College (PCTC), there was no identifiable control. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loan expenditures for the SFA cluster in total were $350,719,890, for the year ended June 30, 2022. Total Direct Loan expenditures for PCTC and WVSU were $2,582,514 and $11,188,523, respectively for the year ended June 30, 2022. Cause: Written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The absence of proper reviews over the reconciliations could cause the institution?s financial records for Direct Loan expenditures to be improperly stated. Recommendation: We recommend that management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?017 SPECIAL TESTS AND PROVISIONS ? GRAMM-LEACH-BLILEY ACT ? STUDENT INFORMATION SECURITY (Repeat of Prior Year Findings 2021?018, 2020?018, and 2019?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 16 CFR 314.4 (b) requires institutions to base their information security programs on a risk assessment that ?identifies reasonably foreseeable internal and external risks to the security, confidentiality, and integrity of customer information that could result in the unauthorized disclosure, misuse, alteration, destruction, or other compromise of such information, and assesses the sufficiency of any safeguards in place to control these risks.? Condition: Fairmont State University (FSU) and Pierpont Community and Technical College (PCTC) did not perform an adequate risk assessment that covered the entire fiscal year. It is to be noted that FSU performed the required risk assessment June 1, 2022 and documented safeguards for the risks identified which covered one month and PCTC performed the required risk assessment in December 2021 and documented safeguards for the risks identified which covered six months. Further, the institutions identified above do not have internal controls in place surrounding the Gramm-Leach-Bliley Act requirements regarding student information security. Questioned Costs: N/A Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Cause: Institutions do not have policies and procedures, including internal controls, addressing the requirements of the Gramm-Leach-Bliley Act regarding student information security. Effect: The absence of policies and procedures could result in the loss or improper storage of student account information. Recommendation: We recommend that management implement policies and procedures, including internal controls, to ensure that they are in compliance with the Gramm-Leach-Bliley Act regarding student information security. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?018 SPECIAL TESTS AND PROVISIONS ? DISBURSEMENTS TO OR ON BEHALF OF STUDENTS (Repeat of Prior Year Findings 2021?012, 2020?013, 2019?017, and 2018?011) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR 668.165(a)(2), requires that, ?Except in the case of a post-withdrawal disbursement made in accordance with ? 668.22(a)(5), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of? (i) The anticipated date and amount of the disbursement; (ii) The student?s or parent?s right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement. (3) The institution must provide the notice described in paragraph (a)(2) of this section in writing.? Condition: For one disbursement notification selected for testing at Pierpont Community and Technical College (PCTC), the disbursement date on the notification did not match the actual date of disbursement. Questioned Costs: $3,711 ? PCTC ? Assistance Listing #84.268 Context: Total expenditures for the SFA cluster were $480,090,562 for the year ended June 30, 2022. Total SFA cluster expenditures for PCTC were $4,888,594 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the institution?s disbursement notifications were not effectively implemented. Effect: Without proper notification of a loan or grant disbursement, a student could lose the opportunity to cancel the loan or grant within the required timeframe. Recommendation: We recommend that the institution implement more effective internal controls and policies and procedures to ensure that all information required as part of the disbursement notifications sent to students is accurate. Further, documentation supporting the disbursement and related notification should be maintained as evidence of the institution?s compliance with federal requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?022 REPORTING (Repeat of Prior Year Finding 2021?021) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Federal Register Volume 85, No. 169 states that the following must appear in a format and location that is easily accessible to the public? (1) An acknowledgement that the institution signed and returned to the Department the Certification and Agreement and the assurance that the institution has used, or intends to use, no less than 50 percent of the funds received under Section 18004(a)(1) of the CARES Act to provide Emergency Financial Aid Grants to Students. (2) The total amount of funds that the institution will receive or has received from the Department pursuant to the institution?s Certification and Agreement for Emergency Financial Aid Grants to Students. (3) The total amount of Emergency Financial Aid Grants distributed to students under Section 18004(a)(1) of the CARES Act as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). (4) The estimated total number of students at the institution eligible to participate in programs under Section 484 in Title IV of the Higher Education Act of 1965 and thus eligible to receive Emergency Financial Aid Grants to Students under Section 18004(a)(1) of the CARES Act. (5) The total number of students who have received an Emergency Financial Aid Grant to students under Section 18004(a)(1) of the CARES Act. (6) The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under Section 18004(a)(1) of the CARES Act. (7) Any instructions, directions, or guidance provided by the institution to students concerning the Emergency Financial Aid Grants.? Per the 2022 Compliance Supplement, on May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Internal control: Fairmont State University (FSU), West Virginia State University (WVSU), Bluefield State University (BSU), West Virginia Northern Community College (WVNCC), West Liberty University (WLU), Southern West Virginia Community and Technical College (SWVCTC), Pierpont Community and Technical College (PCTC), Concord University (CU), Mountwest Community and Technical College (MCTC), and Glenville State University (GSU) did not have adequate internal controls in place surrounding the review of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Compliance: For our compliance testing, the following institutions, MCTC, WVNCC, WVSU, GSU, CU, PCTC, WLU, and BSU, had findings over the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and/or #84.425M), and/or Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) as follows: MCTC, WVNCC, WVSU, GSU, CU, and PCTC posted the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report within the wrong timeframe. CU, WVNCC, BSU, GSU, and PCTC posted the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E) report within the wrong timeframe. GSU did not prepare one quarter of the Section 18004(a)(1) Institutional Portion Quarterly Public Reporting (Assistance Listing #84.425F) report. MCTC did not prepare the Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) report. The following institutions were either missing items on their reports or reporting incorrect items: * BSU, CU, and PCTC?s information did not agree to underlying supporting documentation and/or information was not included in the report as required for the Section 18004(a)(1) Student Portion Quarterly Public Reporting (Assistance Listing #84.425E). * WVSU, the student report was posted using the form for the Section 18004(a)(1) Institutional Portion, (a)(2) and (a)(3) Quarterly Public Report, therefore excluding compliance reporting requirements for student reporting. * WLU did not include total estimated students on quarterly student reports. * WVNCC did not report the total amount of Emergency Financial Aid Grants distributed to students, did not report an estimation of students eligible to receive Emergency Financial Aid, did not report the total number of students that received Emergency Financial Aid, and did not report the methods used by the institution to determine which students received Emergency Financial Aid and how much they should receive. Questioned Costs: N/A Context: Total HEERF expenditures for FSU, WVSU, BSU, WVNCC, WLU, SWVCTC, PCTC, CU, MCTC, and GSU were $9,934,140, $8,136,120, $6,696,586, $3,539,699, $5,372,766, $5,238,243, $4,214,265, $4,750,293, $3,661,171, $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to ensure that complete and accurate information is submitted to the institutions? websites. Effect: The institutions are not properly reporting the required information on the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports. Recommendation: We recommend that the institutions enhance policies and procedures surrounding the preparing, updating, and reviewing of the Section 18004(a)(1), (a)(2), and (a)(3) Annual Reporting, Section 18004 Quarterly Public Reporting (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings #84.425F, and #84.425M), Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (Assistance Listing #84.425E) reports prior to posting to their website or ED. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?023 ALLOWABILITY (Repeat of Prior Year Finding 2021?022) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). As it relates to expenditures under the HEERF II and HEERF III (a)(1) Student Aid Portion or for additional emergency financial aid grants made using other HEERF grant funds, auditors should determine (1) the institution had a documented plan to distribute funds to students, (2) that institutions prioritized grants to students with exceptional need, (3) that the institution did not place any restrictions on the expenditure of those funds beyond what is in the statute, above, (4) the institution expended the entirety of the Student Aid Portion grant on Emergency financial aid grants to students, and (5) that the institution did not reimburse itself for any costs or expenses previously issued to students. With the exception of HEERF (a)(2) grantees using their (a)(2) grant funds, grantees are prohibited from using HEERF funding for the acquisition of real property or construction under 34 CFR section 75.533. This includes using HEERF grant funds on capital projects, including deferred maintenance and capital improvement. However, this general prohibition on construction and acquisition of real property does not extend to activities that meet the definition of ?minor remodeling? under 34 CFR section 77.1. Minor remodeling means minor alterations in a previously completed building, for purposes associated with the coronavirus. The term also includes the extension of utility lines, such as water and electricity, from points beyond the confines of the space in which the minor remodeling is undertaken but within the confines of the previously completed building. The term does not include permanent building construction, structural alterations to buildings, building maintenance, or repairs (see also HEERF III FAQs questions 23 and 24). Construction and Real Property Expenditures under HEERF (a)(2) subprograms (Assistance Listings #84.425J, #84.425K, #84.425L, and #84.425M): Under the Consolidated Appropriations Act, 2022 (Pub. L. No. 117-103), as of March 15, 2022, HEERF (a)(2) program subgrantees may expend their HEERF (a)(2) grant funds on construction and real property for projects that are connected to the purpose of the ESF program to ?prevent, prepare for, and respond to coronavirus.? Any HEERF (a)(2) grantees taking advantage of this flexibility will have to receive approval from ED for their specific construction and real property projects supported by HEERF (a)(2) grant funds. HEERF (a)(2) grantees cannot use their (a)(2) grant funds on construction or real property associated with facilities related to athletics, sectarian instruction, or religious worship. Condition: During our testing of allowability at Bluefield State University (BSU), we identified the following: * $1,596,270 in scholarship expenditures that were paid with the Student Aid Portion funds. * $19,883 in HVAC routine maintenance expenditures that were paid with Institutional funds. * $1,458,234 in expenditures related to the construction of a firewall and paid with HBCU funds. There was no prior approval from the US Department of Education of these expenditures. During our testing of allowability at Glenville State University (GSU), GSU did not provide contemporaneous sufficient supporting documentation to support the allowability of $1,690,311 in payroll expenditures that were reimbursed with Institutional funds. Every finding noted above has a corresponding control finding. In addition, Mountwest Community and Technical College (MCTC) had instances of the internal control review control not occurring related to institution portion disbursements. Questioned Costs: $1,596,270 ? BSU ? Assistance Listing #84.425E Grant Award #P425E200618 - 20B $19,882 ? BSU ? Assistance Listing #84.425F Grant Award # P425F200727 - 20B $1,458,234 ? BSU ? Assistance Listing #84.425J Grant Award # P425J200063 - 20B $1,690,311 ? GSU - Assistance Listing #84.425F Grant Award #P425F202029 - 20B Context: Total HEERF expenditures for BSU, MCTC, and GSU were $6,696,586, $3,661,171, and $4,760,329, respectively, for the year ended June 30, 2022. The total expenditures for the HEERF program for the year ended June 30, 2022 were $413,605,940. Cause: The institutions do not have adequate internal controls in place to prevent non-compliance with the required regulations. Effect: The institutions are not in compliance with federal statues, regulations, and terms of the conditions of the federal award. Without sufficient internal controls in place, expenditures may be paid that are not allowable. Recommendation: We recommend that the institutions enhance their policies and procedures to ensure they are in compliance with all federal statutes, regulations, and terms and conditions of the federal award. We recommend that the institutions also implement controls to ensure that expenditures are properly reviewed and approved before being charged to a federal award. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?024 CASH MANAGEMENT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund Under the Coronavirus Aid, Relief, and Economic Security Act Higher Education Emergency Relief Fund (HEERF) 84.425E/84.425F/ 84.425J/84.425MCriteria: 2 CFR 200.303 requires a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). See Part 3, Section C, ?Cash Management.? In addition to these basic cash management principles, for CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (Assistance Listing #84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within three calendar days of the drawdown from G5. For lost revenue, the ?obligation? occurs on the date the institution completes its estimate of its amount of lost revenue after the estimation period. Condition: Compliance: For one transaction selected for testing, Southern West Virginia Community and Technical College (SWVCTC) drew down federal funds under the institutional portion in advance and did not disburse them within three days. For West Virginia Northern Community and Technical College (WVNCC), one of the five drawdowns selected for testing was a duplicate and drawn down in error. This was corrected after it was found by the institution. Control: In addition to the institutions identified above, we noted the following: SWVCTC did not have evidence of a control related to cash management. For Mountwest Community and Technical College (MCTC), three of the five drawdowns selected for testing did not have sufficient documentation of the review control. Two instances occurred prior to the 2021 corrective action plan being implemented. For one instance, documentation of the review was not timely and occurred after the date of the drawdown. Questioned Costs: N/A Context: Total expenditures for the Education Stabilization Fund were $413,605,940 for the year ended June 30, 2022. The total expenditures for WVNCC, SWVCTC, and MCTC were $3,539,699, $5,238,243, and $3,661,171 for the year ended June 30, 2022. Cause: Internal controls and policies and procedures related to the cash management were not effectively designed or performed. Effect: The institution could draw down the incorrect amount of higher education emergency relief funds. Recommendation: We recommend that the institutions implement more effective internal controls and policies. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?021 MAINTENANCE OF EFFORT Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Under section 317 of the CRRSA Act, for fiscal year 2022, a state that receives ESSER II, GEER II, or EANS funds under the CRRSA Act must: a) Maintain State support for elementary and secondary education in fiscal year 2022 at least at the proportional level of the state?s support for elementary and secondary education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019; and b) Maintain state support for higher education in fiscal year 2022 at least at the proportional level of the state?s support for higher education relative to the state?s overall spending, averaged over fiscal years 2017, 2018, and 2019. Under section 2004(a) of the ARP Act, a state that receives ARP ESSER funds must meet the above MOE requirement in each of fiscal years 2022 and 2023. Condition: The Department of Education did not meet the maintenance of effort provisions during fiscal year 2022. Questioned Costs: N/A Context: Total federal expenditures for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $413,605,940. Cause: The Department of Education did not receive adequate appropriations from the State Legislature. The Department of Education requested a waiver from the provisions, but did not receive approval prior to the submission of the audit report. Effect: The Education Stabilization Fund did not meet the maintenance of effort requirement. Recommendation: The West Virginia Department of Education management and the State Legislative officials need to implement procedures to ensure adequate appropriations are made each federal fiscal year to meet the maintenance of effort requirements. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?025 TRANSPARENCY ACT REPORTING Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Education Stabilization Fund (ESF) 84.425C/84.425D/ 84.425R/84.425U Grant Award S425D210036 Grant Award S425V210008 Grant Award S425U210036 Grant Award S425U210036 ? 21A Grant Award S425W210050 ? 21A Grant Award S425D200036Criteria: 2 CFR 200.303 requires that the non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).? Condition: During our testing of controls over Federal Funding Accountability and Transparency Act (FFATA) Reports, program management was unable to provide sufficient documentation that the internal control was operating effectively for any of the 14 items in the sample. Questioned Costs: N/A Context: Subawards for the Education Stabilization Fund program for the fiscal year ended June 30, 2022, were $244,709,234. Cause: Inadequate documentation of controls by program management. Effect: Auditors were unable to determine that controls were operating effectively with the level of documentation provided. Recommendation: We recommend that program management take immediate action to ensure sufficient documentation is retained showing that FFATA reports have been reviewed and approved by appropriate personnel prior to submission. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?011 SPECIAL TESTS AND PROVISIONS ? RETURN OF TITLE IV FUNDS (Repeat of Prior Year Findings 2021?015, 2020?014, and 2019?018) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 668.173(b) requires timely return of title IV, HEA program funds. In accordance with procedures established by the Secretary or FFEL Program lender, an institution returns unearned title IV, HEA program funds timely if - (1) The institution deposits or transfers the funds into the bank account it maintains under ? 668.163 no later than 45 days after the date it determines that the student withdrew; (2) The institution initiates an electronic funds transfer (EFT) no later than 45 days after the date it determines that the student withdrew; (3) The institution initiates an electronic transaction, no later than 45 days after the date it determines that the student withdrew, that informs a FFEL lender to adjust the borrower?s loan account for the amount returned; or (4) The institution issues a check no later than 45 days after the date it determines that the student withdrew. An institution does not satisfy this requirement if - (i) The institution?s records show that the check was issued more than 45 days after the date the institution determined that the student withdrew; or (ii) The date on the cancelled check shows that the bank used by the Secretary or FFEL Program lender endorsed that check more than 60 days after the date the institution determined that the student withdrew. Condition: In six of 10 instances in internal control testing at West Virginia State University (WVSU), we noted that the internal control was not sufficiently documented or not functioning effectively. We also noted inadequate documentation of internal controls at Pierpont Community College (PCTC), Bluefield State University (BSU), New River Community and Technical College (NRCTC), and West Liberty University (WLU). Additionally, for BSU, PCTC, and NRCTC, it was noted that certain amounts to be returned were calculated incorrectly, were not returned timely, or were not calculated and returned at all. Questioned Costs: $11,937 ? BSU; $1,001 ? NRCTC; and $7,530 known questioned cost plus unknown questioned costs for calculations not performed by management for all unofficial withdrawals ? PCTC Context: Total Student Financial Assistance Cluster expenditures for the year ended June 30, 2022, were $480,090,562. The total Student Financial Assistance Cluster expenditures for the year end June 30, 2022, for WVSU, PCTC, BSU, NRCTC, and WLU were $11,188,523, $4,888,594, $7,984,211, $3,423,043, and $15,701,217, respectively. Cause: The institutions do not have adequate internal controls in place over the return of Title IV funds to prevent non-compliance. Effect: The institutions may not be returning the correct amount of federal student financial assistance required or the funds are not returned within the required time frame to the United States Department of Education. Recommendation: Management should implement internal controls to ensure that the correct amount of federal student financial assistance is returned and returned within the required time frame. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?012 SPECIAL TESTS AND PROVISIONS ? ENROLLMENT REPORTING (Repeat of Prior Year Findings 2021?016, 2020?015, 2019?019, 2018?012, 2017?006, 2016?008, 2015?015, 2014?011, 2013?028, 2012?43, 2012?47, 2012?49, and 2011?22) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). 34 CFR section 685.309(b) requires that institutions must ?(1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary - (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary. (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that - (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. Condition: In our compliance testing, Fairmont State University (FSU) did not certify the status update within the 60-day requirement. For four of the five internal control instances tested for Blue Ridge Community and Technical College (BRCTC), adequate support for the internal control was not retained. For two of the five internal control instances tested for Pierpont Community and Technical College (PCTC), adequate support for the internal control was not retained. At West Virginia State University, there was no identifiable control that could be tested in the fall semester. Further, Marshall University did not submit summer enrollment files to the National Student Clearinghouse. Questioned Costs: N/A Context: Total Direct Loan and Pell expenditures for the SFA cluster in total were $440,969105 for the year ended June 30, 2022. Total Direct Loan and Pell expenditures for FSU, BRCTC, PCTC, WVSU and Marshall University were $17,854,722, $5,105,071, $4,772,684, $10,699,711, and $89,405,192, respectively. Cause: The institutions did not have adequate internal controls in place surrounding the enrollment reporting process. Effect: The institutions may not promptly notify the National Student Loan Data System (NSLDS) of changes in student status in an accurate manner; thus, inaccurate information is reported to the NSLDS. Recommendation: Management should develop an effective corrective action plan to address this matter in a timely manner. As institutions are responsible for timely reporting whether they report directly or via a third-party servicer, we recommend that the institutions implement a review process to ensure they are promptly notifying the U.S. Department of Education and NSLDS of changes in a student?s status in a timely and accurate manner. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?013 FISCAL OPERATIONS REPORT AND APPLICATION TO PARTICIPATE (Repeat of Prior Year Finding 2021?019) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) (OMB No. 1845-0030) ? This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. By October 1, 2021, the institution should submit its FISAP that includes the Fiscal Operations Report for the award year ended July 1, 2020 - June 30, 2021, and the Application to Participate for the 2022-2023 award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition: Multiple key line items reported on the June 30, 2022, FISAP Part II for Fairmont State University (FSU), West Virginia State University (WVSU), and the West Virginia School of Osteopathic Medicine (WVSOM) did not reconcile to supporting documentation. WVSU also had key line items in Part IV and V that did not reconcile to supporting documentation. Questioned Costs: Unknown Context: Total Student Financial Assistance Cluster expenditures for FSU, WVSU, and WVSOM were $18,146,824, $11,188,523, and $42,755,731, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: The review process was not designed precise enough to detect inaccurate amounts reported on the FISAP prior to submission to the United States Department of Education. Effect: The United States Department of Education uses the information in the FISAP to determine the amount of funds the institution will receive for each campus-based program. The institution must submit accurate data. If not, the institution might not receive all the funds to which the institution is entitled or might be required to return funds that the institution was not entitled to receive. Recommendation: We recommend that FSU, WVSU, and WVSOM implement more effective policies, procedures, and more precise internal controls surrounding the review of the FISAP to ensure the report is properly reviewed and information reported to the Department is accurate. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?014 FINANCIAL REPORTING (Repeat of Prior Year Findings 2021?020, 2020?011, and 2019?015) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Condition: In our control testing, Pierpont Community and Technical College (PCTC) could not provide adequate documentation of controls in place over Pell COD reconciliations to ensure the data reported is complete, accurate, and prepared in accordance with the required instructions. West Virginia State University (WVSU) has no identifiable control that could be tested in the fall semester. Questioned Costs: N/A Context: Total Direct Loans and Pell, expenditures for PCTC and WVSU were $4,772,684 and $10,699,711 for the year ended June 30, 2022. The total expenditures for Direct Loans, Pell, TEACH, and IASG for the year ended June 30, 2022 was $441,445,850. Cause: PCTC?s policies and procedures do not require adequate documentation be maintained to demonstrate that controls are operating effectively. WVSU had written procedures detailing the process to reconcile loans from Common Origination and Disbursement (COD) records to Banner exist. However, management represented that a formal reconciliation review process has not been successfully implemented. Effect: The U.S. Department of Education could receive incorrect Pell or Direct Loan payment data. Recommendation: We recommend that PCTC implement more effective policies and procedures surrounding the review and approval of the Pell payment data prior to submission. We recommend that WVSU management implement its existing process that monthly reconciliations are performed and saved, as documented in the institution?s written procedure, including documentation of supervisor review and approval. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.
2022?015 SPECIAL TESTS AND PROVISIONS ? VERIFICATION (Repeat of Prior Year Findings 2021?014, 2020?012, and 2019?016) Federal Program Information: Federal Agency and Program Name Assistance Listing # U.S. Department of Education Office of Student Financial Assistance Office of Post-Secondary Education U.S. Department of Health and Human Services Health Resources and Services Administration Student Financial Assistance (SFA) Cluster 84.007/84.033/84.038/84.063/84.268/84.379/ 84.408/93.264/ 93.342/93.364/ 93.925Criteria: 2 CFR 200.303 requires that a non-federal entity must ?(a) 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. These internal controls should be in compliance with guidance in ?Standards for Internal Control in the Federal Government? issued by the Comptroller General of the United States and the ?Internal Control Integrated Framework?, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The 2022 Federal Compliance Supplement requires that ?a menu of potential verification items for each award year is published in the Federal Register, and the items to verify for a given application are selected by ED from that menu and indicated on the student?s output documents. Verification tracking groups and verification items for each award year can also be found in the annual FSA Handbook, Application and Verification Guide, Chapter 4. The institution shall also require applicants to verify any information used to calculate an applicant?s EFC that the institution has reason to believe is inaccurate and provide an accurate code for the individual?s verification status in the Common Origination and Disbursement (COD) system (34 CFR 668.54(a); FSA Handbook Application and Verification Guide, Chapter 4).? Condition: Bluefield State University (BSU), Fairmont State university (FSU), and Pierpont Community and Technical College (PCTC) did not have adequate internal controls in place surrounding the verification compliance requirement. During our testing, we noted for the samples selected that there was no documentation that a review was performed over the verification files. Additionally, PCTC could not locate documentation supporting the completion of the verification for one student selected. Questioned Cost: $16,573 ? PCTC Context: Total Student Financial Assistance Cluster expenditures for BSU, FSU, and PCTC were $7,984,211, $18,146,824, and $4,888,594, respectively, for the year ended June 30, 2022. The total expenditures for the Student Financial Assistance Cluster for the year ended June 30, 2022 were $480,090,562. Cause: BSU, FSU, and PCTC did not have adequate internal controls in place to ensure that verification changes identified were processed and submitted to the U.S. Department of Education. Effect: Students receiving federal aid could receive the incorrect amount of federal student financial assistance. Recommendation: Management should develop and update internal controls to ensure that changes identified during the verification process are submitted to the U.S. Department of Education. Views of Responsible Officials: Management concurs with the finding and has developed a plan to correct the finding.