Finding Text
2024-005. FINDING (Failure to Retain Adequate Documentation of Internal Direct Loans Reconciliation)
Federal Department: U.S. Department of Education
Assistance Listing Number: 84.268
Cluster Name: Student Financial Assistance Cluster
Program Name: Federal Direct Student Loans
Award Numbers: P268K240567, P268K230567
Questioned Cost: None
Program Expenditures: $21,113,430
Cluster Expenditures: $32,781,904
Governors State University (University) did not retain documentation of its internal monthly Direct Loans reconciliation to demonstrate timely completion.
CONDITION
During testing of Direct Loans, we were unable to verify whether the University completed the monthly internal reconciliation in a timely manner due to the absence of supporting documentation.
CRITERIA
The Federal Student Aid (FSA) issued Electronic Announcement General-22-86 covering reconciliation requirements for all Title IV programs between Department of Education’s G5 system records and the University’s internal records. It further requires the University to reconcile internally, disbursement data between Financial Services and Comptroller Office and Financial Aid Office.
Additionally, the Uniform Guidance (2 CFR 200.303(a)) requires nonfederal entities receiving federal awards to establish and maintain effective internal control designed to reasonably ensure compliance with federal laws, statutes, regulations, and the terms and conditions of the federal award.
CAUSE
University officials stated the University performs the monthly internal reconciliation process. However, the monthly internal reconciliation spreadsheet is updated each month without retaining the prior versions.
EFFECT
Failure to properly document internal monthly reconciliations between the Financial Services and Comptroller Office and Financial Aid Office may result in inaccurate and incomplete financial information. (Finding Code No. 2024-005)
RECOMMENDATION
We recommend the University improve its procedures to ensure documentation is retained to demonstrate timely completion of reconciliations.
UNIVERSITY RESPONSE
The University agrees with this finding and accepts the recommendation. Existing procedures have been revised to require the retention of internal reconciliation records on a monthly basis.