Finding 1182179 (2025-001)

Federal Program Information: Direct Student Loans Program (ALN 84.268) Criteria or Specific Requirement: C. Cash Management: Federal regulations (34 CFR 668.166 (a)(1) & (b)) require that an institution disburse funds requested and received through the G5 system no later than three business days following receipt of those funds from ED. For institutions on the Advance Payment Method, any amount of Title IV funds not disbursed to recipients by the end of the third business day is considered excess cash. ED allows an institution to retain, for up to seven days, excess cash that does not exceed one percent of the total amount of funds drawn by the institution in the prior award year. The institution must return to ED any excess cash over the tolerable amount (one percent) and any amount remaining after the tolerance period (seven days). Questioned costs would be those in excess of the one percent threshold. Condition: The University had six draws of Federal Funds that were held in excess of the allowable timeframe. Cause: Administrative oversight and insufficient internal control. Effect or Potential Effect: The University was not in compliance with cash management requirements. Questioned Costs: None. Context: The University had six instances of draws made during the current year that were held in excess of the allowable timeframe. Identification as a Repeat Finding: There was one similar finding identified in the prior year. See finding 2024-002. Recommendation: We recommend the University enhance its procedures and internal control over cash management to ensure that Federal Funds are not held in excess of allowable time frames. Views of Responsible Officials: Financial Aid and the Controller's Office continue to implement a bi-weekly reconciliation process to ensure that any excess funds are disbursed or returned via G5 within the 10-day window. The Controller’s Office has updated reporting practices that ensure that return of funds are appropriately notated as return of Title IV funds.