Finding Text
FINDING 2025-001: INCORRECT FEDERAL DIRECT LOAN AMOUNTS FEDERAL AGENCY: U.S. DEPARTMENT OF EDUCATION PROGRAM NAME: FEDERAL DIRECT LOAN PROGRAM ALN: 84.268 FEDERAL AWARD YEAR: 2024-2025 Compliance Requirement: Eligibility (E.) Criteria: A student may not receive a Federal Direct Subsidized Loan amount that exceeds the student’s estimated cost of attendance for the period of enrollment less the borrower’s expected family contribution and estimated financial assistance for that period. Further, a second-year student can receive up to $4,500 in subsidized loans in one academic year (34 CFR 685.203). Condition: We tested seventy-one files, sixty-seven of which were Federal Direct Loan recipients, and two students received incorrect loan amounts. We consider this finding to be an instance of non-compliance. Cause: The condition was caused by using an incorrect number of credits while prorating the final academic year of the program for one student and by awarding the wrong grade level loans for the other student. Effect: The result is one student received an overawarded unsusidized loan and the other student received an underawarded subsidized loan. Question Costs: $0 Statistical sampling was not used when making sample selections. Recommendation: As $237 has since been refunded to the Department of Education, we recommend the Institution increase controls over packaging direct loans. There is no action required for the $333 in underawarded subsidized loans, as the student is no longer a current student, so the Institution is unable to reclassify the loans. Views of Responsible Officials: The Institution agrees with the Single Audit Finding and a response is included in the Corrective Action Plan.