Finding Text
2024-006: Perkins Loan Recordkeeping and Record Retention
Significant Deficiency/Other Matter Noncompliance
Federal Program: Student Financial Assistance Cluster
Assistance Listing Number(s):
Student Financial Assistance Cluster
• 84.038
Criteria: Institutions must properly maintain its Perkins loan records in the manner set forth in 34 CFR 674.19.(e). Institutions are required to keep original paper promissory notes or original paper master promissory notes (MPNs) and repayment schedules in a locked, fireproof container. The original promissory notes and repayment schedules must be kept until the loans are satisfied. An institution shall retain repayment records, including cancellation and deferment requests for at least three years from the date on which a loan is assigned to the secretary, canceled, or repaid. An institution shall retain disbursement and electronic authentication and signature records for each loan made using an MPN for at least three years from the date the loan is canceled, repaid, or otherwise satisfied.
Condition: The College could not locate promissory notes or MPNs for some of its Perkins loans when requested by the auditors.
Cause: Improper recordkeeping and retention processes and controls.
Effect or Potential Effect: Noncompliance with the Department of Education and record retention requirements set forth in 34 CFR 674.19.(e).
Questioned Costs: None
Context: In our sample of 40 students with open Perkins loans as of June 30, 2024, the College could not locate the original promissory note for 1 student. In our sample of 40 students with retired or assigned loans in the current year and prior three years, the College could not locate the promissory note and repayment records for 3 students.
Repeat Finding: No
Recommendation: We recommend the College review its process and controls in place for recordkeeping and retention over both open loans and retired or assigned loans for the past 3 years, to ensure required documents are adequately maintained and stored.
Views of Responsible Officials: Management agrees with the finding. See corrective action plan.