Finding Text
2024-004 Significant Deficiency: Disbursement Notifications (U.S. Department of Education, William D.
Ford Direct Loan Program, ALN #84.268; U.S. Department of Education, Teacher Education Assistance
for College and Higher Education Grants, ALN #84.379) (Repeat Finding: 2023-005)
Criteria: In accordance with 34 CFR 668.165(a)(2), when a University credits a student’s account, the
University must notify the student or parent of (i) the anticipated date and amount of the
disbursement, (ii) the student’s or parent’s rights to cancel all or a portion of that loan or
disbursement, and (iii) the procedures and time by which the student or parent must notify the
University that he or she wishes to cancel the loan or disbursement. This communication must occur
no earlier than 30 days before, and no later than seven days after, crediting the student’s ledger
account at the institution if the institution does not obtain affirmative confirmation from the student.
Statement of Condition: During the 2024 audit, it was noted that certain students who had received
Direct Loan funds and/or TEACH grant funds did not receive disbursement notifications.
Questioned Costs: Such information is not applicable for this finding since it is nonmonetary in nature.
Perspective Information: The 2024 audit included a detailed testing of 38 applicable student files, of
which this significant deficiency applies to 13, indicating an error rate of 34.2%.
Cause and Effect: Due to a system failure during the Spring semester, many students did not receive
notification from the University of Direct Loan or TEACH Grant disbursements made to their account.
This glitch was not recognized by the responsible parties in a timely manner to manually create and
disburse such notification. The purpose of disbursement notifications is to provide information to
students and parents regarding their accounts and options they may have concerning Title IV aid.
Neglecting to provide the disbursement notifications may result in students or parents making
uninformed decisions.
Recommendation: The University should ensure system functionality periodically, specifically
entering periods in which disbursements are concentrated, such as the beginning of the semester, to
prevent lapses in mass. The University should also create a process to verify that disbursement
notifications have been distributed as intended, so that any missed notices can be remedied timely.
View of Responsible Officials: The University has taken a comprehensive and proactive approach to
address this issue through two key initiatives. First, we have instituted a robust audit process designed
to ensure the integrity and functionality of the system responsible for documenting sent emails. This
process enables us to systematically verify that the system is operating as intended. Second, we have
deployed advanced software solutions that serve to mitigate the risk of similar issues arising in the
future. These combined measures reflect our commitment to ensuring operational reliability and
preventing recurrence.