Federal Program: U.S. Department of Education Student Financial Assistance Cluster: Federal Direct Student Loans, Federal Assistance Listing 84.268 Criteria: The University must comply with 34 CFR 668.22(a). Condition: During our testing of six official withdrawals, we noted one instance where the University incorrectly treated a student as withdrawn for Return of Title IV (R2T4) purposes. The student was enrolled in both modules for the Fall term, earned six credit hours in the first module and subsequently withdrew during the second module. The University reported the student as withdrawn to the National Student Loan Data System (NSLDS) and performed a R2T4 calculation using the total days of both modules in the denominator of the R2T4 calculation. However, since the student successfully completed six credit hours in the first module, which exceeds the coursework required for the University's definition of half time enrollment, the student should not have been classified as withdrawn nor had a R2T4 calculation performed. Upon further analysis from management, there were an additional five students that were enrolled in modules, earning half-time enrollment, who were reported as withdrawn to the NSLDS and a R2T4 calculation was erroneously completed for them. Cause: This error occurred due to inadequate internal controls over identifying withdrawal status for students enrolled in module courses, specifically related to assessing whether completed coursework met or exceeded the half-time enrollment threshold prior to performing an R2T4 calculation or reporting them as withdrawn to the NSLDS. Effect: The provisions of 34 CFR 668.22(a) were not followed and thus a total of six students had a R2T4 calculation erroneously performed. Six students were also erroneously reported as withdrawn to the NSLDS. Questioned Costs: There were no questioned costs associated with this finding Recommendation: We recommend that the University strengthen its internal controls related to R2T4 calculations by: (a) implementing a system control to evaluate whether or not completed module coursework meets the half-time threshold before classifying a student as withdrawn, (b) providing additional training to financial aid staff on withdrawal determinations and performing an R2T4 calculation for students enrolled in modules, and (c) performing a supervisory review of all R2T4 calculations related to module students. Corrective Actions Taken or Planned: We agree with this finding and recommendation. After further review of R2T4 rules for module programs, the University of Pikeville will no longer perform R2T4’s on any student that has met the Exemption rules per FSA handbook, Vol 5, Chapter 1, “R2T4 Withdrawal Exemptions”. Responsible Parties: Daniel Donner, Director of Financial Aid Completion Date: March 4, 2026