Finding Text
Finding No. 2024-003 – Documentation of Internal Controls over Compliance Material Weakness Federal Program – Student Financial Aid Cluster – Federal Direct Student Loans (ALN 84.268), U.S. Department of Education Criteria – Auditee requirements contained in Title 2 U.S. Code of Federal Regulations (2 CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart D – Post Federal Award Requirements, Section 200.303 – Internal Controls, requires the auditee to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with a framework such as the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (“COSO”). Condition – We noted that controls identified by management over material compliance requirements lacked sufficient documentation to conclude application of controls is in place. Cause – The cause is due to ineffective internal control procedures with no physical indication of review or an audit trail that indicates that the identified control took place. Effect – Ineffective internal control procedures resulted in compliance findings. See Finding No. 2024-002. Reportable Questioned Costs: None Context – Internal controls in place over material compliance requirements identified by management had no documentation in place to demonstrate application of controls. Repeat Finding – This is a repeat finding of 2023-003. Recommendation – We recommend the Institute ensures all internal control procedures in place include documentation that demonstrates application of controls. Views of Responsible Officials – Management agrees with the finding. See Corrective Action Plan.