Finding Text
Audit Finding Reference Number Questioned Costs 2024 – 011 – Aggregate Loan Limits $ 18,651 Federal Program and Specific Federal Award Identification ALN Title and Number 84.268 Federal Direct Student Loans (Direct) Federal Award Year June 30, 2024 Federal Agencies U. S. Department of Education Pass-Through Entity Not applicable Criteria CFR §685.203 (d) stipulates the aggregate unpaid principal amount of all Direct subsidized loans made to a student but excluding the amount of capitalized interest may not exceed (1) for dependent undergraduate students $31,000, (2) for independent undergraduate student or dependent undergraduate who qualifies for additional eligibility, $57,500 and (3) for graduate or professional students, $138,500. The total amount of Direct subsidized loans but excluding the amount of capitalized interest may not exceed $23,000 for a dependent undergraduate student. Condition and Context I noted during my audit that six (6) students out of twenty-five (25) tested received direct loans in excess of the aggregate loan limit. Cause It appears that ABC did not ensure that the student was eligible to receive the loan proceeds. Questioned Costs For purposes of this condition, I have questioned costs totaling $18,651 related to the Direct loan program. Effect ABC has not adhered to Title IV regulations regarding the disbursing of loan funds in accordance with the regulations. Repeat Finding Yes. See Schedule of Prior Year Audit Findings 2023-011. Recommendation I recommend that the management of ABC take immediate steps to ensure that students receive their loan funds as required by Title IV regulations. Management Response The Institution concurs with this finding and accepts the recommendation for leadership to implement immediate steps to ensure that students receive their loan funds as required by Title IV regulations.