Finding Text
Significant Deficiency – Federal Direct Loan Cash Management
Program: Federal Direct Loan Program
Assistance Listing Number: 84.268
Federal Award Identification Number: P268K244070
Federal Agency: U.S. Department of Education
Federal Award Year: June 30, 2024
Condition: During the Fall and Spring semesters, the College did not minimize the time between funds transferred and disbursement to students’ accounts for two of its five drawdowns.
Criteria: The Advance Payment Method requires that the College disburse the requested funds no later than three business days following receipt of funds from the Education Department.
Context: A review of the entire population of drawdowns for the Student Financial Aid cluster for the entire year was performed and as such, the sample is statistically valid.
Cause: The College did not follow its policy for requesting federal funds and disbursing them to student accounts for two of five drawdowns.
Effect: The College did not disburse federal funds to the students’ accounts until approximately three and five weeks after each drawdown in question.
Questioned costs: $1,885,374
Identification of Repeat Finding: This is a repeat finding.
Recommendation: The College should review its procedures related to the request and disbursement of federal funds, including controls over compliance, to ensure they are following the advance payment method and establish controls to ensure it complies with the federal requirement.
Views of Responsible Officials and Planned Corrective Actions: Management agrees with this finding and will ensure staff with compliance responsibilities are appropriately trained and understand the requirements of the program.