Finding Text
Finding 2024-009 - U.S. Department of Education (Title IV Student Financial Aid Programs - Failure to Document High School Completion for Title IV Eligibility (material weakness) Information on the federal program: Federal Direct Student Loans, FAL No. 84.268, June 30, 2024; Federal Pell Grant Program, FAL No. 84. 063, June 30, 2024; Federal Supplemental Educational Opportunity Grant, FAL No. 84.007, June 30, 2024; Federal Work-Study Program, FAL No. 84.033, June 30, 2024. Criteria – Under Higher Education Act (HEA) § 484(d), a student must possess a high school diploma or its recognized equivalent, or meet an allowable alternative eligibility standard, to receive Title IV federal student aid. Per 34 CFR § 668.32(e), a student is eligible to receive Title IV funds only if the institution has documentation showing that the student has a high school diploma or recognized equivalent, or has completed homeschooling, or meets the requirements for Ability-to-Benefit (ATB). Condition – During testing of student eligibility, we noted that four (4) out of sixty (60) sampled students did not have documentation of high school completion or its recognized equivalent (e.g., high school transcript, diploma, or GED certificate) in their student files. Despite the absence of proof of high school completion, the students were enrolled and awarded Title IV federal student aid. Cause – The exception appears to have resulted from failure to collect or retain required documentation at the time of admission or prior to awarding aid and lack of a systematic verification checkpoint to confirm high school completion before packaging Title IV awards. Effect - Noncompliance may impact the University’s administrative capability under 34 CFR § 668.16, exposing the College to inaccurate reporting and potential repayment liability. Questioned Costs - $53,932 Perspective – High school completion documentation is one of the fundamental eligibility requirements for Title IV aid. A failure rate of 6.6% (4 of 60 students) demonstrate a systemic deficiency, not isolated oversight. Repeat Finding – Yes. Auditor’s Recommendation - The University should implement a mandatory eligibility verification process and strengthen document collection and retention controls. Management’s Response – Management has implemented standardized checklists and workflows, added secondary review, enhanced system controls, and implemented periodic internal monitoring. View of Responsible Officials – Management agrees with the finding and acknowledges that required documentation of high school completion or an allowable alternative was not consistently maintained in student files prior to the disbursement of Title IV federal student aid.