Finding Text
Finding No. 2022-005 ? Cash Management Federal Agency: U.S. Department of Education Program: Student Financial Assistance Cluster ? Federal Direct Loan Program: ALN 84.268, Federal Pell Grant Program: ALN: 84.063, Federal Work-Study Program: ALN 84.033, Federal Supplemental Educational Opportunity Grants: ALN 84.007 Criteria: An excess cash balance tolerance is allowed if that balance is less than 1% of the institution's prior-year drawdowns and is eliminated within the next seven calendar days (34 CFR 668.166(a) and (b)). The institution must return immediately any amount of excess cash over the one-percent tolerance and any amount of excess cash remaining in its account within the seven-day tolerance period. Condition: There was one drawdown from the G5 during the year for federal direct loans in which the College was in an excess cash position starting on June 29, 2022, through September 20, 2022. The maximum daily excess cash balance during this time-period was $51,701. Questioned Costs: None Prevalence: Identified in 1 out of 15 disbursements tested. The sample was not intended to be, and was not, a statistically valid sample. Effect: The DOE may require the institution to reimburse it for the costs the federal government incurred in providing that excess cash to the institution; and provide funds to the institution under the reimbursement payment method or heightened cash monitoring payment method (as described in CFR 668.162(c) and (d)). Cause: This issue is the result of improper controls surrounding drawdowns to ensure that they are expended or returned to the DOE within the required timeframe. Recommendation: We recommend management implement a control to regularly monitor disbursements and reconcile to drawdowns to ensure applicable requirements are met. Reporting Views of Management and Corrective Actions: Management agrees with the finding and corrective actions will be made.