Finding Text
ITEM # 2024-001 Timely Disbursement of Title IV Funds to Students
Federal Student Aid Cluster
Assistance Listing Numbers 84.007, 84.033, 84.038, 84.063, 84.268, 84.379
U.S. Department of Education
Criteria
When an institution submits a drawdown request for funds utilizing the Department of Education’s (“DOE”) electronic grants management system, known as G5, the drawdown may not exceed the amount of funds needed to make immediate disbursements to eligible students and parents. If the request is accepted, the DOE initiates an electronic funds transfer to the institution’s account. The institution must then disburse the requested funds no later than three business days following receipt of those funds from the DOE.
Condition and Context
The University did not disburse the requested funds to the students within the three-business day requirement for thirteen of the forty-five disbursements tested. Specifically, eleven of the disbursements were for Direct Loans and two of the disbursements were for Pell spanning across both the fall and spring semesters.
Questioned Cost
Undetermined.
Cause
The University had a lack of oversight over disbursement of Title IV funding to students after drawing down funds from the DOE. The University did not properly disburse Title IV funding to students within the required timeframe.
Effect
The University is not in compliance with the cash management requirement of Title IV funding awarded to students.
Recommendation
We recommend the University consistently adhere to its system and reconcile drawdowns to the student records to ensure amounts disbursed to students for Title IV awards are timely distributed to students within three business days.