Finding Text
Finding 2024-015 - U.S. Department of Education (USDJ, Title IV Student Financial Aid Programs - Inconsistencies Between Award Letters and Actual Title IV Disbursements (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 – Per 34 CFR § 668.165 (a), institutions must notify a student or parent of a PLUS borrower, of the amount and type of Title IV funds the student will receive and ensure the information provided is accurate and consistent with actual disbursements. Condition – During testing of student financial aid records, we identified that thirteen (13) out of sixty (60) students had inconsistencies between the Title IV award amounts listed on their financial aid award letters and the amounts actually disbursed to their student account statements. Differences included Pell Grant, Direct Loan, and campus-based aid amounts that did not match the final disbursements reflected in the University’s student account system. Cause – The inconsistencies appear to have resulted from failure to update award letters. Effect – Students received incorrect or misleading information about their financial aid eligibility. Discrepancies can result in over awards or under awards of Title IV funds, improper loan disbursements and the University is not meeting administrative capability requirements under 34 CFR § 668.18. Questioned Costs - $0 Perspective – A discrepancy rate of 13 out of 60 students (21.7%) indicates a systemic issue, not isolated clerical errors. Because award letters are the official communication of eligibility and expected aid, inconsistencies undermine transparency, violate federal notification requirements, and reflect weaknesses in the University’s internal controls over awarding and disbursement. Repeat Finding - No Auditor’s Recommendation - The University should implement monthly reconciliations, strengthen cross-department coordination, perform year-end reconciliation prior to FISAP submission. Implementation of these measures will help ensure compliance with federal regulations, reduce financial reporting risk, and reinforce the University’s administrative capability. Management’s Response – Management has added secondary review, implemented periodic internal monitoring, and enhanced system controls within the financial aid software. View of Responsible Officials – Management agrees with the finding and acknowledges that discrepancies occurred between information reflected on award letters and actual Title IV disbursements, resulting in inconsistent communication of federal aid information to students and parents.