Finding 1583 (2023-001)

Inaccurate and Untimely Return of Title IV Funds (R2T4) Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268, 84.063 Federal Award Identification #: 2022-2023 Financial Aid Year Condition: There were two incorrect calculations of returned funds for students that withdrew during the 2022-2023 academic year. Criteria: 34 CFR 668.22 Questioned Costs: $4,275 Context: Out of 10 withdrawal evaluations tested for accuracy and timeliness, 1 student in a modular program had incorrect R2T4 calculations both in the Fall 2022 and Spring 2023 terms. In the Fall 2022 term, it was incorrectly determined that the student met the 49% successful completion exemption. In result, a return of Title IV funds was never made for the student in the Fall term. In the Spring 2023 term, the R2T4 was inaccurately calculated due to incorrect institutional charges and initial unsubsidized loans included in the calculation. In result, the University did not return enough Title IV Funds ($4,135 FDL, $140 Pell). These were corrected during the audit. Cause: R2T4 calculations were not reviewed for accuracy. There were errors in how the student’s R2T4’s were calculated for both terms. Regarding the Fall 2022 the missed return, PowerFAIDs is set up to automatically calculate returns when student withdraw or cease attendance, however, financial aid staff overrode the student’s completion percentage to 100% because of the misinterpretation of the modular exemption criteria, therefore a return was not calculated. Regarding the Spring 2023 inaccurate return, the financial aid office received the student's account statement after tuition and fees were adjusted and incorrectly input the adjusted charges into the calculation. Effect: Return of Title IV funds were not performed timely and an incorrect amount of unearned Title IV funds returned. Identification as repeat finding, if applicable: N/A Recommendation: We recommend an individual in financial aid with the appropriate level of experience periodically review modular students’ R2T4 calculations and returns to help ensure that internal controls over such processes can operate effectively and achieve compliance. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.