Finding Text
Federal Agency: U.S. Department of Education; Office of Federal Student Aid Pass through Entity: Not applicable Program Name: Federal Direct Loan Program Federal Pell Grant Program ALN and Program Expenditures: 84.268 ($866,312) 84.063 ($487,504) Award Number: P268K253315 P063P243315 Federal Award Year: July 1, 2024 to June 30, 2025 Questioned Costs: $1,652 (84.268) $1,616 (84.063) Condition Found: R2T4s were not calculated during for the award year ending June 30, 2025. During the compliance testing, it was determined that an R2T4 should have been calculated for two of the seventeen students selected for testing. Criteria: Per the Student Financial Aid Handbook Volume 5, Chapter 1, an R2T4 is required “in the case of a program that is measured in credit hours, the student does not complete all of the days in the payment period or period of enrollment that the student was schedule to complete.” Cause: The Interim Financial Aid Director did not realize R2T4s were still required when the institution was on the HCM2 method of disbursement. Possible Asserted Effect: The first student was awarded $3,697 in Federal Pell Grant funds. The student withdrew during the semester. After the R2T4 was completed, the student was only eligible to receive $2,081 in Federal Pell Grant funds. $1,616 of Federal Pell Grant funds should be returned to the Department of Education. The second student received $2,721 in Subsidized Federal Direct Loan funds. The student withdrew during the semester. After the R2T4 was completed, the student was only eligible to receive $1,069 in Subsidized Federal Direct Loan funds. $1,652 of Subsidized Federal Direct loan funds should be returned to the Department of Education. Repeat Finding: See Finding 2024-002 for a similar finding the prior year. Recommendation: $1,616 of Federal Pell Grant funds and $1,652 of Subsidized Federal Direct Loan funds should be returned to the Department of Education. Procedures should be improved to ensure that R2T4s are completed timely and accurately. Management Response: Management agrees that the R2T4s were not completed. For the first student, the Student Financial Director determined that while the Federal Pell Grant funds were posted to the student’s account, the funds were never requested from the Department of Education. $1,616 was of aid was removed from the student’s account and only $2,081 will be requested from the Department of Education. For the second student, $1,652 of Subsidized Federal Direct Loan funds were returned to the Department of Education in December 2025.