Finding 1191472 (2025-004)

Material Weakness Repeat Finding
Requirement
E
Questioned Costs
-
Year
2025
Accepted
2026-03-27
Audit: 395393
Organization: Montcalm Community College (MI)

AI Summary

  • Core Issue: The College's cost of attendance (COA) calculations are inconsistent, leading to potential underfunding of Title IV aid for students.
  • Impacted Requirements: Compliance with federal regulations (34 CFR 668.42, 673.5, 673.6, 685.301) regarding accurate COA determination.
  • Recommended Follow-Up: Implement a review process to ensure COA inputs are accurate and consistent with documentation.

Finding Text

Cost of Attendance Calculation Inputs (repeat finding) Finding Type. Immaterial Noncompliance/Significant Deficiency in Internal Control over Compliance (Eligibility). Programs. Student Financial Assistance Cluster; U.S. Department of Education; Assistance Listing Numbers 84.007, 84.033, 84.063, and 84.268; Award Numbers P007A242049, P033A242049, P063P241644, P063Q241644 and P268K251644. Criteria. In accordance with 34 CFR 668.42 (FWS), 34 CFR 673.5 and 673.6 (FSEOG), and 34 CFR 685.301 (Direct Loan), as referenced in the Compliance Supplement, total Title IV aid awarded to a student may not exceed the student’s financial need or cost of attendance (COA). Institutions must ensure that COA components are accurately determined and consistently applied. Condition. During our testing of the College’s cost of attendance (COA) calculations, we identified inconsistencies between the COA component amounts recorded in the system and the amounts documented on the College’s COA calculation sheet. For instance, the College's tuition component was supposed to be based on credit intensity, but instead was being calculated using the student's enrollment status (e.g., full-time, half-time, etc.). Additionally, the College included direct loan fees in every students COA, even if they were not a direct loan receiving student. Cause. The College does not have a review process in place for ensuring the inputs used in the cost of attendance determination are accurate. Effect. As a result, COA amounts used in awarding Title IV aid were being understated, preventing some students from potentially receiving additional aid they were entitled to. Questioned Costs. No costs were required to be questioned as a result of this finding insomuch as our testing did not reveal any unallowed costs. Recommendation. We recommend that the College establish and adhere to review procedures to ensure that all inputs used in the COA calculation are accurate, complete, and consistent with approved documentation. View of Responsible Officials. Management agrees with this finding and has prepared a Corrective Action Plan.

Corrective Action Plan

Cost of Attendance Calculation Inputs Auditor Description of Condition and Effect. During our testing of the College’s cost of attendance (COA) calculations, we identified inconsistencies between the COA component amounts recorded in the system and the amounts documented on the College’s COA calculation sheet. For instance, the College's tuition component was supposed to be based on credit intensity, but instead was being calculated using the student's enrollment status (e.g., full-time, half-time, etc.). Additionally, the College included direct loan fees in every students COA, even if they were not a direct loan receiving student. As a result, COA amounts used in awarding Title IV aid were being understated, preventing some students from potentially receiving additional aid they were entitled to. Auditor Recommendation. We recommend that the College establish and adhere to review procedures to ensure that all inputs used in the COA calculation are accurate, complete, and consistent with approved documentation. Corrective Action. Management is actively enhancing the College’s Cost of Attendance (COA) processes to ensure all inputs—particularly tuition, loan fees, and enrollment‑related components—accurately reflect approved documentation and federal requirements. The Financial Aid Office has reconfigured PowerFAIDS to calculate tuition based on credit intensity rather than enrollment status, and loan fees are now included only for students who actually borrow federal loans. An annual COA governance and approval process is now in place, requiring review and authorization by the Vice President of Finance and Administration before COA figures are built into the system. All COA entries in PowerFAIDS undergo an independent verification against the approved COA worksheet as part of a “build‑to‑proof” procedure. Spot checks are conducted at the start of each term to ensure accuracy across enrollment levels, and all mid‑year changes are documented using a formal change‑control log. Responsible Person. Jennifer Stimson, Director of Financial Aid Anticipated Completion Date. March 31, 2026

Categories

Student Financial Aid Eligibility Significant Deficiency

Other Findings in this Audit

  • 1191458 2025-002
    Material Weakness Repeat
  • 1191459 2025-002
    Material Weakness Repeat
  • 1191460 2025-002
    Material Weakness Repeat
  • 1191461 2025-002
    Material Weakness Repeat
  • 1191462 2025-002
    Material Weakness Repeat
  • 1191463 2025-003
    Material Weakness Repeat
  • 1191464 2025-003
    Material Weakness Repeat
  • 1191465 2025-003
    Material Weakness Repeat
  • 1191466 2025-003
    Material Weakness Repeat
  • 1191467 2025-003
    Material Weakness Repeat
  • 1191468 2025-004
    Material Weakness Repeat
  • 1191469 2025-004
    Material Weakness Repeat
  • 1191470 2025-004
    Material Weakness Repeat
  • 1191471 2025-004
    Material Weakness Repeat
  • 1191473 2025-005
    Material Weakness Repeat
  • 1191474 2025-005
    Material Weakness Repeat
  • 1191475 2025-005
    Material Weakness Repeat
  • 1191476 2025-005
    Material Weakness Repeat
  • 1191477 2025-005
    Material Weakness Repeat
  • 1191478 2025-006
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
84.268 FEDERAL DIRECT STUDENT LOANS $943,515
21.027 CORONAVIRUS STATE AND LOCAL FISCAL RECOVERY FUNDS $265,248
17.268 H-1B JOB TRAINING GRANTS $123,598
84.048 CAREER AND TECHNICAL EDUCATION -- BASIC GRANTS TO STATES $114,209
84.007 FEDERAL SUPPLEMENTAL EDUCATIONAL OPPORTUNITY GRANTS $61,793
84.033 FEDERAL WORK-STUDY PROGRAM $29,396
84.063 FEDERAL PELL GRANT PROGRAM $3,405