Finding Text
Federal Program Information: Federal Pell Grant Program (ALN: 84.063) and Federal Direct Student Loans (ALN: 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): L. Reporting – Financial Reporting – Federal regulations require the University to submit origination and disbursement records for students to the Common Origination and Disbursement System (“COD”). Items considered key in student origination records, if applicable, are: award amount, enrollment date, verification status code (when the applicate is selected for verification), transaction number, cost of attendance, and the “Academic Start Date” and “Academic End Date”. Institutions must also submit disbursement records to the COD for students no earlier than 7 calendar days prior to the disbursement date, and no later than 15 calendar days after the institution makes a disbursement. Key items to test on disbursement records are disbursement date and amount. Condition: For certain disbursements identified through our testing, errors were identified in key items reported to the COD in student origination and disbursement records. Additionally, the University failed to report disbursement records for certain students within the required timeframe. Cause: Insufficient administrative oversight and internal controls with respect to accurate reporting of federal award information. Effect or Potential Effect: The University was not in compliance with COD reporting requirements. Questioned Costs: Known questioned costs: none; total questioned costs: indeterminable. While no known questioned costs resulted from the COA differences identified through the sampled items, sufficient information was not available to determine whether questioned costs may have resulted from similar issues in the untested population. Context: We noted the following exceptions during our testing: • For 23 of 40 students selected for origination record testing, the student’s cost of attendance was inaccurately reported within the COD. • For 19 of 40 students selected for disbursement record testing, the disbursement date reported to the COD did not match the actual date on which related funds were credited to the student's account. • For 4 of 40 students selected for disbursement record testing, the University did not submit required disbursement information within the required timeframe. Identification as a Repeat Finding: This is a repeat finding from prior year. This was reported as Finding 2024-002 in the prior year schedule of findings and questioned costs. Recommendation: We recommend that the University enhance its internal controls and policies and procedures over the applicable compliance requirements to ensure origination and disbursement records are reported accurately and timely to the COD for Direct Loan and Pell Grant recipients, in accordance with federal regulations. Views of Responsible Officials: The University acknowledges that it did not consistently ensure the accuracy and timeliness of data reported to the Common Origination and Disbursement (COD) system during the 2024–2025 award year. Specifically, cost of attendance values reported to COD did not always align with the cost of attendance used for awarding aid, disbursement dates reported to COD did not consistently reflect the actual dates funds were credited to student accounts, and certain disbursement records were not transmitted within required post-disbursement reporting timeframes. As a result, the University experienced instances of inaccurate and untimely COD reporting, increasing institutional compliance risk, and limiting the University’s ability to demonstrate adherence to federal reporting requirements during audit testing. The University determined that these deficiencies were primarily attributable to weaknesses in internal controls governing origination and disbursement reporting, including reliance on legacy PowerFAIDS workflows without sufficient reconciliation, validation, or supervisory review prior to COD submission. Contributing factors also included the absence of a standardized disbursement and reporting calendar and insufficient monitoring of system transmission errors and exceptions.