Finding Text
2024-004—Common Origination and Disbursement Reporting
U.S. Department of Education
Student Financial Assistance Programs Cluster (Direct)
Federal Direct Loan Program (84.268)
Federal Pell Grant Program (84.063)
Federal Award Year: 2023-2024
Repeat Finding: No
Criteria
Per the Federal Student Aid Handbook Volume 8 Chapter 3: “For each Direct Loan that a school disburses to a student or parent, the school must submit a loan award record to the Common Origination and Disbursement (COD) system that includes the student’s grade level, the loan period and academic year dates, the loan amount, the anticipated and actual dates and amounts of the loan disbursements, and other information.
For all Direct Loans, you must document the student’s Cost of Attendance (COA), Expected Family Contribution (EFC), and Estimated Financial Assistance (EFA) in the student’s file. This information must be made available to the Department upon request. The specific Direct Loan amount that a student or parent borrower is eligible to receive is determined based on various factors such as the student’s COA, EFC, EFA, and remaining eligibility under the annual and aggregate loan limits information.”
Condition
The College incorrectly reported the COA to COD for 3 students. Out of the 34 students tested, we noted 3 students (8.8%) whose COA was incorrectly reported to COD. The incorrect reporting did not have an effect on the total award given to students (reporting only).
The College did not have formally documented controls related to the processes of enrollment reporting and reporting, which is required under Uniform Grant Guidance.
Cause
A manual update to each student’s COA in the COD system was required, but did not occur.
Effect
Noncompliance with federal regulations could result in the loss of future federal funding.
Questioned costs
There were no questioned costs with respect to this finding.
Context
We tested 34 students who received Federal Direct Student Loans. For each student tested, management provided documentation from COD, showing the reported amount of COA to COD. Out of the 34 students tested, we noted 3 students (8.8%) whose COA was incorrectly reported to COD.
Recommendation
We recommend the College review current processes and implement updated processes and controls for reporting to COD, implementing procedures to ensure reporting to COD is accurate.
Views of responsible officials
Management agrees with this finding. See corrective action plan.