Finding Text
Finding 2025-003 - U.S. Department of Education (ED), Student Financial Assistance Programs – Withdrawals & Return of Title IV Funds (material weakness): Information on the federal program –Federal Pell Grant Program, FAL No. 84.063, June 30, 2025; Federal Supplemental Opportunity Grant Program, FAL No. 84.007, June 30, 2025; Federal Work-Study Program, FAL No. 84.033, June 30, 2025; Federal Direct Student Loan Program, FAL No. 84.268, June 30, 2025; Federal Teacher Education Assistance for College (TEACH), FAL No. 84.379, June 30, 2025 Criteria – The institution must determine the portion of aid the student earned and the portion that is unearned at the time of withdrawal. Any unearned portion of Title IV funds must be returned to the U.S. Department of Education as soon as possible but no later than within 45 days after the confirmed date of withdrawal. HEA, Section 484B & 34 CFR 668.22. Condition – We observed that two (2) of the four (4) students tested had incorrect calculations. One (1) was completed late and one (1) used the incorrect calendar dates. Cause – The College did not adequately track student withdrawals during the year, particularly those students who unofficially withdrew. Effect – ED may assess liabilities or require reimbursement of funds. Further, federal funding could be reduced or the College placed on heightened cash monitoring. Questioned Costs – $13,100. Perspective – This is considered a systemic problem given the two (2) exceptions noted. Repeat Finding – No. Auditor's Recommendation – The College must strengthen its procedures for monitoring and documenting student withdrawals by consistently adhering to its established policies. This applies to both official and unofficial withdrawals to ensure accurate identification of withdrawal dates and the timely calculation and return of Title IV funds in accordance with federal regulations. Management’s Response – The Office of Enrollment Management and Student Services accept the auditor’s findings regarding the administration of Title IV funds and the Return of Title IV (R2T4) calculations. We recognize that the accurate tracking of student withdrawals—particularly unofficial withdrawals—is critical to maintaining federal compliance and institutional integrity. While this was not a repeat finding, we view the "systemic" nature of the observation with the utmost seriousness. The College is committed to rectifying the procedural gaps that led to incorrect calculations and late submissions. To address the Cause identified (inadequate tracking) and mitigate the Effect of potential liabilities, the following measures are being implemented immediately: • Enhanced Tracking for Unofficial Withdrawals: The Registrar’s Office, in coordination with Information Technology (IT), will implement a bi-weekly "Internal Attendance & Participation" audit. This automated report will flag students with zero academic engagement across all registered courses, allowing the Financial Aid office to identify unofficial withdrawals well before the 45-day federal deadline. • Standardization of Calendar Dates: The Director of Financial Aid has revised the R2T4 calculation worksheet to include a "Mandatory Calendar Verification" step. This ensures that the start/end dates and scheduled breaks used in calculations strictly align with the approved institutional academic calendar. • Staff Training and Capacity Building: All Financial Aid staff responsible for R2T4 calculations will undergo mandatory Title IV compliance training. Furthermore, a secondary review process has been established where a senior staff member must sign off on all calculations exceeding $1,000 to ensure accuracy before funds are returned. View of Responsible Officials – The College agrees with the finding.