Finding Text
Criteria: Per 34 CFR 685.300(b)(5), to participate in the Direct Loan Program, a school must, 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/context: Direct Loan reconciliations were not completed for six months of the fiscal year - the months of January 2024 through June 2024. Additionally, support for Direct Loan reconciliations that had been completed was not maintained during the year.
Cause: During the transition of Student Financial Aid Directors during the year, there was an issue in which the SAIG was unavailable to the Financial Aid Director due to previous access at another institution.
Effect: If the College fails to comply with the terms and conditions of a Federal award, the Federal awarding agency may impose additional conditions, as described in 2 CFR 200.208, or implement other remedies for noncompliance, as described in 2 CFR 200.339.
Additionally, if not completed on a regular basis, the school is at risk of not meeting disbursement reporting and excess cash deadlines.
Questioned costs: None.
Identification as a repeat finding: No.
Recommendation: The College should develop, implement, and maintain a process to complete monthly Direct Loan reconciliations that includes process and procedures in place to complete monthly reconciliations when the main point of contact or access to SAIG and COD is not available. Additionally, the College should develop procedures and requirements to maintain monthly Direct Loan reconciliations and associated support.
Views of responsible officials: Management concurs with the finding. See Exhibit I for the corrective action plan.