Finding Text
Special Tests – Return to Title IV Funds (R2T4) Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster ASSISTANCE LISTING Numbers: 84.268 – Federal Direct Student Loans 84.063 – Federal Pell Grant Program 84.007 – Federal Supplemental Educational Opportunity Grants 84.379 – Teacher Education Assistance for College and Higher Education Grants Federal Award Identification: Various Award Period: June 1, 2024 to June 30, 2025 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matter Criteria or specific requirement: When a recipient of Title IV grant or loan assistance withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the institution is required to determine the amount of Title IV aid earned as of the student’s withdrawal date. If the amount of Title IV aid earned is less than the amount disbursed to the student or on the student’s behalf as of the date the institution determines the student withdrew, the institution must return the unearned portion to the applicable Title IV programs. No additional disbursements may be made for the payment period or period of enrollment. If the amount of Title IV aid earned exceeds the amount disbursed, the difference must be treated as a post-withdrawal disbursement, in accordance with 34 CFR §668.22(a)(1) through (a)(5). Condition: During our testing of students who ceased attendance during a payment period or period of enrollment—including students who met withdrawal exemptions, dropped courses, took a leave of absence, never began attendance, or otherwise terminated enrollment during the audit period—we selected a sample of 15 students to evaluate the timeliness and accuracy of Return to Title IV (R2T4) calculations and procedures. We identified that the Student Financial Aid system did not calculate R2T4 amounts accurately for 5 of the 15 students tested. In addition, there was insufficient review of system-generated calculations to ensure their accuracy. For these students, the return of funds was not completed within the required 45-day timeframe from the date the institution determined the student withdrew. Questioned costs: $6,644 Context: The University did not properly review system generated calculations. 5 out of the 15 students tested had incorrect calculations and the dates funds were returned not completed withing 45 days of the institution determining the student's withdrawal. Cause: The deficiencies were primarily due to ineffective internal controls over the R2T4 process and errors in system-generated calculations. These issues were further exacerbated by staff turnover that occurred prior to the Fall 2024 term. Effect: As a result, Title IV funds may not have been returned in the correct amounts or within required timeframes, resulting in noncompliance with federal regulations governing the administration of Title IV financial aid programs. Repeat finding: No Recommendation: We recommend that the University strengthen internal controls over the R2T4 process by implementing standardized procedures, ensuring system calculations are accurate, and establishing consistent and documented review of R2T4 calculations prior to the return of Title IV funds. Views of responsible officials and planned corrective actions: There is no disagreement with the audit finding. Management has addressed their corrective action plan in a separately issued letter.