Finding Text
Federal Program: Student Financial Assistance Cluster, Federal Direct Loan Program Federal Agency: U.S. Department of Education Pass-Through Entity: Not applicable Assistance Listing Number: 84.268 Federal Award Year: June 30, 2022 Criteria: Title IV regulations (34 U.S. Code of Federal Regulations (CFR) 668.16) requires recipients of Federal awards to administer its federal programs with an adequate system of internal controls over applicable compliance requirements. Condition: There was not an adequate system of controls in place that would have prevented or detected potential material noncompliance matters within the Activities Allowed or Unallowed, Eligibility and Special Tests and Provisions (related to Return of Title IV Funds, Enrollment Reporting and Federal Direct Loan Disbursements) compliance requirement areas. Cause: The Organization filled its vacant director of financial aid position in the spring of 2021. It was later discovered that this person did not have the suitable skills required to effectively administer the federal financial aid programs of the Organization and this person was terminated in spring of 2022. Thus, a critical position was left vacant for part of the testing year. Effect: The potential exists that noncompliance could occur in the Activities Allowed or Unallowed, Eligibility and Special Tests and Provisions compliance areas and not be detected by the by the Organization's internal controls over compliance. Questioned Costs: There were no questioned costs associated with this finding. Context: The key position of financial aid director was vacant for part of the testing period. As of the time of our testing, this position has been filled. Recommendation: The Organization should implement procedures to ensure any individuals responsible for the oversight or review of any vendors or individuals administering financial aid are properly trained and knowledgeable of the specific requirements of Title IV. Views of Responsible Official(s): Management agrees with this finding and has recognized their need for a qualified individual who is knowledgeable about financial aid requirements. They have hired a new Director of Financial Aid and Student Housing.