Finding Text
Finding 2025-012 – Special Tests and Provisions: Title IV Credit Balance Disbursements – Noncompliance and Significant Deficiency in Internal Control Over Compliance; Agencies – Department of Education; Assistance Listing Numbers (ALN) – 84.007, 84.033, 84.063 & 84.268; Program Name – Student Financial Assistance Cluster; Award Year / Award Number – N/A; Criteria or Specific Requirement – Pursuant to 34 C.F.R. § 668.164(h), an institution must pay any remaining balance of Title IV, Higher Education Act program funds directly to the student or parent as soon as possible, but no later than 14 calendar days after the date the Title IV credit balance occurs. Management should maintain procedures to ensure Title IV credit balances are identified and disbursed within the required regulatory timeframe.; Condition – For one Title IV credit balance tested, management did not ensure the Title IV credit balance was identified and disbursed within the required 14-day timeframe.; Cause – Based on inquiries with management and review of the circumstances surrounding the transaction, the University's monitoring and review controls did not identify the outstanding Title IV credit balance in sufficient time to ensure disbursement within the required regulatory timeframe.; Effect or Potential Effect – The student did not receive the Title IV credit balance within the timeframe required by Department of Education cash management requirements Failure to timely disburse Title IV credit balances may delay students' access to federal financial aid funds and results in noncompliance with the cash management requirements established by the U.S. Department of Education. Repeated occurrences could increase the institution's risk of regulatory scrutiny and potential sanctions.; Questioned Costs - None reported.; Context – There were 12 students with credit balances on their account. A sample of 3 of these students were selected. We identified one credit balance that was not disbursed within the required 14-day timeframe. The refund was disbursed 41 days after the required deadline.; Repeat Finding – This is not a repeat finding.; Recommendation – We recommend that the University enhance its controls over Title IV credit balance disbursements to ensure refunds are timely identified, processed, and disbursed in accordance with the federal 14-day requirement.; Views of Responsible Officials – Management concurs with the finding and is strengthening monitoring procedures to ensure Title IV credit balances are identified and disbursed within required timeframes.