Finding Text
Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Assistance Cluster ALN Numbers: 84.268, 84.063, 84.007 Federal Award Identification Number and Year: P268K257727, P063P247727, P007A249116 Award Period: July 1, 2024 - June 30, 2025 Type of Finding: Material Weakness in Internal Control Over Compliance Criteria or specific requirement: 2 CFR part 200 section 200.303 requires that non-Federal entities receiving federal awards (i.e., auditee management) establish and maintain internal control designed to reasonably ensure compliance with Federal statutes, regulations, and the terms and conditions of the federal award. The Code of federal Regulations, 34 CFR 688.164, requires any Title IV federal funds disbursed to a student or parent that are not received or negotiated must be returned to the appropriate federal financial aid program no later than 240 days after the check or electronic fund transfer (EFT) was issued. If a check or an EFT is returned, the College may make additional attempts to deliver the funds, provided that those attempts are made no later than 45 days after the funds were returned or rejected. In cases where the College does not make another attempt, the funds must be returned before the end of the initial 45-day period. The College must cease all attempts to disburse the funds and return them no later than 240 days after the date it issued the first check. Unclaimed Title IV FSA funds must not escheat to the state, revert to the College, or be transferred to any other third party. Condition: The College does not have a control in place to specifically monitor outstanding Title IV federal funded checks issued to students. This absence of oversight prevents the College from ensuring that these funds are returned within 240 days of check issuance. Questioned Costs: N/A. Context: During our testing, it was noted the College did not have a control in place to ensure the return of outstanding Title IV federally funded checks that were old and needed to be returned to the U.S. Department of Education prior to 240 days after issuance. Cause: The College did not have a control in place to ensure outstanding Title IV checks over 240 days are sent back to the Department of Education. Effect: The College is not in compliance with Department of Education requirements to establish internal controls over outstanding checks and refunds of disbursements to students. Repeat Finding: Yes, 2024-003. Recommendation: We recommend the College review the requirements and implement a control to specifically monitor the outstanding Title IV funded checks. Views of responsible officials: There is no disagreement with the finding.