Finding Text
Finding 2026-002 – Reporting Federal Program: Student Financial Assistance Cluster Listing Number: 84.063 Federal Pell Grant Program Federal Agency: Department of Education Award Year: June 1, 2025 – May 31, 2026 Criteria: According to the Federal Register Vol. 89 No. 181, for institutions beginning their fiscal years prior to 7/1/2025, an institution must submit Pell Grant, Direct Loan, and TEACH Grant disbursement records to COD, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement, whichever is later. Additionally, 2 CFR § 200.303 requires the recipient of federal funds to establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition and Context: The University did not have effective internal controls over the review of Federal Pell Grant disbursements and did not report Pell Grant program data to the Common Origination and Disbursements (COD) system within the required timeframes. During our testwork of 40 Federal Pell Grant student disbursements totaling $122,977, we identified 18 disbursements for 18 students, totaling $47,002, that were not reported to the COD system within the required 15-day reporting period. The disbursements were made between August 25, 2025, and August 26, 2025, and were reported to COD 17 to 18 days after the disbursement dates. Upon further review, the University determined that Pell Grant program data for an additional 1,729 student disbursements was not reported to COD within the required timeframe during the fiscal year. Further, we noted the University did not have adequate review or monitoring controls in place to ensure that Pell disbursement data was reported to COD within the required timeframes. Possible Cause and Effect: The late reporting to COD was caused by insufficient monitoring over the application of federal reporting requirements for Pell Grant disbursements. University officials determined that the disbursements were not reported within the required 15-day timeframe because officials misinterpreted Electronic Announcement ID GENERAL-24-94 issued on July 30, 2024, which allowed certain Pell Grant disbursement records for the 2024-2025 award year to be submitted to COD no later than November 30, 2024. This guidance wasincorrectly applied to the 2025-2026 award year. While the University has procedures in place to report Pell Grant disbursements to COD timely, the related monitoring controls did not identify that the reporting requirements had been misapplied. As a result, the Pell Grant disbursements were reported to COD after the required deadline, resulting in noncompliance with federal reporting requirements. Isolated or Systemic: Systemic. Questioned Costs: None noted. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding: No. Recommendation: We recommend that the University enhances its monitoring over the application of federal reporting requirements for Pell Grant disbursements to ensure all Pell disbursements are reported to COD within the required timeframe. View of Responsible Officials: Management concurs with the finding. The University acknowledges that Pell Grant disbursements were not reported to the Common Origination and Disbursement (COD) system within the required 15-day timeframe during a portion of the 2025-26 award year. The University determined that the late reporting resulted from the continued application of Department of Education guidance that had provided extended reporting flexibility in response to FAFSA processing issues. That flexibility applied to the 2024-25 award year and did not extend to the 2025-26 award year. While the University had a process for monitoring federal guidance, the process did not sufficiently identify that the temporary reporting flexibility had expired or ensure that the standard 15-day reporting requirement was applied for the 2025-26 award year. The University was unable to determine precisely where the communication breakdown occurred.