Finding Text
Assistance Listing, Federal Agency, and Program Name Student Financial Assistance Cluster - Federal Direct Student Loans Program (ALN 84.268), Federal Supplemental Educational Opportunity Grant Program (ALN 84.007), and Federal Pell Grant Program (ALN 84.063) Federal Award Identification Number and Year - Various Pass through Entity - None Finding Type - Significant deficiency Repeat Finding - Yes 2024-002 Criteria - If a recipient of Title IV grant or loan funds withdraws from a school after beginning attendance but before he or she has attended 60 percent of the scheduled length of the semester, the school must perform a return of Title IV funds (R2T4) calculation. If the amount disbursed to the student is greater than the amount the student earned, the unearned funds must be returned. A school must return unearned funds for which it is responsible no later than 45 days from the determination of a student's withdrawal (30 days if never attended) (34 CFR 668.220(1)). 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 must determine the amount of Title IV aid earned by the student as of the student's withdrawal date. Condition - The College did not perform an accurate calculation to determine the amount of funds to return of Title IV funds for 2 students. Questioned Costs - $1,247 If questioned costs are not determinable, description of why known questioned costs were undetermined or otherwise could not be reported - N/A Identification of How Questioned Costs Were Computed - Questioned costs of $1,247 resulted from the College calculating a return of Title IV funds of $1,195 and the actual amount of funds returned was $2,442. Context - Of the 40 students tested, there was 2 students for whom there was error in the calculation that resulted in the improper amount being returned to the Department of Education. Cause and Effect - A control was not operating appropriately to ensure amounts calculated to be refunded agree to the actual amounts refunded to the Department of Education. Recommendation - The College should implement procedures and controls to review the calculations to ensure compliance with federal regulations. Views of Responsible Officials and Planned Corrective Actions - Accuracy in performing the required Return to Title IV Funds function is of significant importance to Lake Michigan College. Currently, a second individual performs an independent review of a sample of calculations. Although we find these two scenarios to be isolated in nature, we will increase our quality control sample review. We are also investigating how we might automate more of the process in order to help reduce any manual error.