Finding 21442 (2022-004)

Significant Deficiency
Requirement
N
Questioned Costs
$1
Year
2022
Accepted
2023-03-05

AI Summary

  • Core Issue: Three checks for Title IV awards were not returned to the Department of Education within the required 240 days, leading to noncompliance.
  • Impacted Requirements: Failure to follow 34 CFR 668.164 and 2 CFR 200.303 regarding timely return of uncashed checks and maintaining internal controls.
  • Recommended Follow-Up: Update procedures for processing and monitoring refund checks to ensure compliance with Title IV regulations.

Finding Text

U.S. Department of Education 2022-004: 240 Days Outstanding Check Federal Agency: Department of Education Federal Program Name: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.033, 84.063, 84.268 Federal Award Identification Number and Year: P007A210605- 2022; P033A210605- 2022; P063P211182- 2022; P268K221182- 2022 Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria: The Code of Federal Regulations, 34 CFR 668.164 states that an institution must return to the Department of Education, any Title IV funds that it attempts to disburse directly to a student or parent that are not received by the student or parent. If an EFT to a student's or parent's financial account is rejected, or a check to a student or parent is returned, the institution may make additional attempts to disburse the funds, provided that those attempts are made not later than 45 days after the EFT was rejected or the check returned. In cases where the institution does not make another attempt, the funds must be returned to the Department of Education before the end of this 45-day period. If a check is sent to a student or parent is not returned to the institution but is not cashed, the institution must return the funds to the Department of Education no later than 240 days after the date it first issued the check. In addition, 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations and program compliance requirements. Condition: Our audit identified 3 outstanding checks payable to students for Title IV awards that were not returned to the Department of Education within the 240 day prescribed timeframe. Questioned Costs: $2,265 Context and Cause: The District?s existing policies and procedures did not ensure compliance with the applicable criteria. Effect: The checks identified resulted in noncompliance with the Title IV regulation. Repeat Finding: This was not a finding in the prior year. Recommendation: We recommend the College to update its procedures and procedures for processing and monitoring refund checks to ensure compliance with the Title IV requirements. Views of responsible officials: Management concurs with the finding and plans to correct the finding.

Corrective Action Plan

U.S. Department of Education 2022-004: Student Financial Assistance Cluster ? 240 Days Outstanding Check ? Assistance Listing Number: Various Recommendation: We recommend the College to update its procedures and procedures for processing and monitoring refund checks to ensure compliance with the Title IV requirements. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: During the 2021-22 aid year, the financial aid and fiscal services departments have been working hard together to clean up and streamline the process by which we handle stale-dated ?financial aid checks? (Title-IV funds processed through BankMobile) as well as ?student refund checks? (non-Title IV funds processed through our district office). In our review, we found that three students had Title IV aid incorrectly processed as ?student refund checks? whose initial disbursement date was more than 240 days before the date of discovery. As a result, we reported those checks to the auditors when asked for outstanding Title IV checks. We have taken the following actions in response to this item: ? We have developed a ?Time Out / Reversal? workgroup that includes members of both the financial aid and fiscal services department to ensure that reissuance of checks does not occur automatically (pre-existing, but this workgroup allows us to address this issue). ? We have trained the workgroup members specifically on the importance of the 240 day limit. Implemented by September 2022. ? We continue to improve the communication between the financial aid and fiscal services. department. We currently hold meetings every two weeks to bring up any common issues and solve problems related to the administration. Implemented by September 2022. Name(s) of the contact person(s) responsible for corrective action: Alysa Borelli, Dean of Enrollment and Student Services. Planned completion date for corrective action plan: The corrective action plan was implemented by August of 2022.

Categories

Questioned Costs Student Financial Aid Subrecipient Monitoring Significant Deficiency Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 21441 2022-001
    Significant Deficiency Repeat
  • 21443 2022-001
    Significant Deficiency Repeat
  • 21444 2022-003
    Significant Deficiency
  • 21445 2022-004
    Significant Deficiency
  • 65268 2022-001
    Significant Deficiency Repeat
  • 65269 2022-003
    Significant Deficiency
  • 65270 2022-004
    Significant Deficiency
  • 65271 2022-001
    Significant Deficiency Repeat
  • 65272 2022-004
    Significant Deficiency
  • 65273 2022-001
    Significant Deficiency Repeat
  • 65274 2022-002
    Significant Deficiency
  • 65275 2022-004
    Significant Deficiency
  • 65276 2022-005
    Material Weakness
  • 597883 2022-001
    Significant Deficiency Repeat
  • 597884 2022-004
    Significant Deficiency
  • 597885 2022-001
    Significant Deficiency Repeat
  • 597886 2022-003
    Significant Deficiency
  • 597887 2022-004
    Significant Deficiency
  • 641710 2022-001
    Significant Deficiency Repeat
  • 641711 2022-003
    Significant Deficiency
  • 641712 2022-004
    Significant Deficiency
  • 641713 2022-001
    Significant Deficiency Repeat
  • 641714 2022-004
    Significant Deficiency
  • 641715 2022-001
    Significant Deficiency Repeat
  • 641716 2022-002
    Significant Deficiency
  • 641717 2022-004
    Significant Deficiency
  • 641718 2022-005
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.063 Pell Grant $6.76M
84.425 Covid-19 Heerf - Student Aid $6.07M
84.425 Covid-19 Heerf - Institutional $5.27M
84.268 William D. Ford Direct Loan Program $751,965
84.048 Perkins Title I-C (basic Grants to States) $405,392
84.007 Supplemental Educational Opportunities Grant (seog) $184,584
84.033 Federal Work Study (fws) $168,340
12.600 California Advanced Defense Ecosystems & National Consortia Effort (cadence) $156,646
93.658 Foster-Kinship Care Education $78,451
12.617 California Advances Supply Chain Analysis & Diversification Effort (cascade) $64,635
93.558 Temporary Assistance for Needy Families (tanf) $62,782
10.558 Child Care Food Program $31,974
84.063 Student Financial Aid Administrative Allowance $8,534
64.028 Veteran Assistance Title 38 $1,650