Finding 1093512 (2024-002)

Significant Deficiency
Requirement
E
Questioned Costs
-
Year
2024
Accepted
2024-12-28
Audit: 334955
Organization: University of Providence (MT)

AI Summary

  • Core Issue: Four students exceeded their subsidized loan limits due to timing errors in processing summer and fall loan awards.
  • Impacted Requirements: This situation resulted in noncompliance with federal regulations regarding annual loan limits for Direct Subsidized and Unsubsidized Loans.
  • Recommended Follow-Up: Implement internal controls to monitor loan disbursements closely and utilize new reporting tools to prevent future overages.

Finding Text

U.S. Department of Education Student Financial Aid Cluster: ALN: 84.063 Pell Grant ALN: 84.007 Supplemental Educational Opportunity Grant ALN 84.033 Federal Work Study ALN 84.038 Federal Perkins Loan Program ALN 84.268 Federal Direct Student Loans Criteria: Direct Subsidized Loans and Direct Unsubsidized Loans have annual loan limits that vary based on the student's grade level and dependency status (34 CFR 685.203). The annual loan limit is the maximum amount that a student may receive for an academic year. Under 34 CFR 685.203(d) and (e), the aggregate loan limits are listed for Direct Subsidized Loans and Direct Unsubsidized Loans (a borrower's maximum allowable outstanding loan debt, excluding capitalized interest, but including amounts borrowed under the Federal Family Education Loan program prior to 2010). Condition: There were four students who exceeded their subsidized loan limits during the audit period. Context: Reports generated from Banner indicated that only four students exceeded this limit for the audit period. Effect: Noncompliance with the federal regulations on loan limits. Questioned Costs: None. Cause: These students were enrolled and attended spring, summer, and fall programs. When the fall amounts were awarded, the summer award had not yet been processed, so there was no overage at the time of the fall award. Once the summer was processed, the students exceeded the loan limit. This error was not caught or corrected during the audit period. Auditor Recommendation: We recommend the University implement internal control procedures to prevent this overage from occurring in future years. University Response: The four students who exceeded their loan limits were Accelerated Nursing Students. The loan offers were made and disbursed for Fall 2024 prior to receiving updated information from the summer disbursements. This is due to a delay in the information that NSLDS provides, resulting in an overpayment. The new ISIR records were not found until this audit period. Of the four students, one was corrected with the Subsidized Loan reallocated to an Unsubsidized Loan. The amount of the reallocation is $656. Of the remaining three students: • Two could not be reallocated because they had already done consolidations • One did not have an unsubsidized loan to reallocate to. In the future, students subject to this timing issue will be monitored closely for Subsidized Loan usage in the first two semesters as it relates to their full eligibility. Since this will always be a timing issue, the financial aid office will leverage all available tools to prevent recurrence and ensure subsidized loans are not over awarded in future years. Jenzabar, our new Student Information System, has reporting tools available for our office to use, and we will utilize these reports to closely follow the students in the ABSN program.

Categories

Student Financial Aid Allowable Costs / Cost Principles Eligibility Reporting Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 517061 2024-001
    Significant Deficiency
  • 517062 2024-001
    Significant Deficiency
  • 517063 2024-001
    Significant Deficiency
  • 517064 2024-001
    Significant Deficiency
  • 517065 2024-001
    Significant Deficiency
  • 517066 2024-002
    Significant Deficiency
  • 517067 2024-002
    Significant Deficiency
  • 517068 2024-002
    Significant Deficiency
  • 517069 2024-002
    Significant Deficiency
  • 517070 2024-002
    Significant Deficiency
  • 1093503 2024-001
    Significant Deficiency
  • 1093504 2024-001
    Significant Deficiency
  • 1093505 2024-001
    Significant Deficiency
  • 1093506 2024-001
    Significant Deficiency
  • 1093507 2024-001
    Significant Deficiency
  • 1093508 2024-002
    Significant Deficiency
  • 1093509 2024-002
    Significant Deficiency
  • 1093510 2024-002
    Significant Deficiency
  • 1093511 2024-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $3.59M
84.063 Federal Pell Grant Program $1.03M
84.042 Trio Student Support Services $187,171
84.033 Federal Work-Study Program $74,273
84.038 Federal Perkins Loan Program $72,066
84.007 Federal Supplemental Educational Opportunity Grants $47,987