Finding 30442 (2022-007)

Significant Deficiency
Requirement
N
Questioned Costs
-
Year
2022
Accepted
2023-03-30
Audit: 24262
Auditor: Rsm US LLP

AI Summary

  • Core Issue: Seven out of 27 student files were missing original loan documents, violating federal recordkeeping requirements.
  • Impacted Requirements: Institutions must retain original promissory notes and repayment schedules until loans are satisfied, as per 34 CFR 674.19(e).
  • Recommended Follow-Up: Review all student files to identify missing documentation and plan necessary remediation to ensure compliance.

Finding Text

Finding No. 2022-007?Special Tests ? Perkins Loan Recordkeeping and Record Retention Federal Agency: U.S. Department of Education Program: Federal Perkins Loans: ALN: 84.038 Criteria: Per 34 CFR 674.19(e), an institution shall keep the original promissory notes and repayment schedules until the loans are satisfied. If required to release original documents in order to enforce the loan, the institution must retain certified true copies of those documents. Condition: Based on inspection of 27 student files, it was noted that there were seven files that did not contain original loan documents. Questioned Costs: None. Prevalence: Out of 27 student files tested, seven files did not contain original loan documents. The sample was not intended to be, and was not, a statistically valid sample. Effect: The institution may not be able to assign the loan to the government or enforce the loan without original promissory notes. Cause: The loans date back for several years. There have been several individuals charged with responsibility of administering the program over the years who may have had a lack of proper understanding of applicable requirements. Recommendation: We recommend that the Conservatory review their student files to determine which files do not have original loan documentation to determine total exposure and determine what remediation will be required to ensure compliance with the applicable requirements. View of Responsible Officials and Planned Corrective Actions: Management agrees with the finding and corrective actions will be made.

Corrective Action Plan

Finding No. 2022-007 ? Special Tests ? Perkins Loan Recordkeeping and Record Retention Finding: It was noted that 7 Perkins Loan promissory notes were copies and not the original document. Corrective Action Taken or Planned: The Conservatory will review student files to identify total population of promissory notes that are not originals and review the potential impact. Expected completion June 2023. Responsible person Kathleen Jewett, Director of Student Accounts

Categories

Student Financial Aid Matching / Level of Effort / Earmarking Special Tests & Provisions

Other Findings in this Audit

  • 30432 2022-008
    Significant Deficiency
  • 30433 2022-009
    Significant Deficiency
  • 30434 2022-010
    Significant Deficiency
  • 30435 2022-009
    Significant Deficiency
  • 30436 2022-009
    Significant Deficiency
  • 30437 2022-009
    Significant Deficiency
  • 30438 2022-003
    Significant Deficiency
  • 30439 2022-004
    Significant Deficiency
  • 30440 2022-005
    Material Weakness
  • 30441 2022-006
    Significant Deficiency Repeat
  • 30443 2022-009
    Significant Deficiency
  • 30444 2022-003
    Significant Deficiency
  • 30445 2022-004
    Significant Deficiency
  • 30446 2022-005
    Material Weakness
  • 30447 2022-006
    Significant Deficiency Repeat
  • 606874 2022-008
    Significant Deficiency
  • 606875 2022-009
    Significant Deficiency
  • 606876 2022-010
    Significant Deficiency
  • 606877 2022-009
    Significant Deficiency
  • 606878 2022-009
    Significant Deficiency
  • 606879 2022-009
    Significant Deficiency
  • 606880 2022-003
    Significant Deficiency
  • 606881 2022-004
    Significant Deficiency
  • 606882 2022-005
    Material Weakness
  • 606883 2022-006
    Significant Deficiency Repeat
  • 606884 2022-007
    Significant Deficiency
  • 606885 2022-009
    Significant Deficiency
  • 606886 2022-003
    Significant Deficiency
  • 606887 2022-004
    Significant Deficiency
  • 606888 2022-005
    Material Weakness
  • 606889 2022-006
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $6.39M
84.038 Federal Perkins Loans $1.45M
84.425 Covid-19 - Education Stabilization Fund $468,940
84.033 Federal Work-Study Program $287,786
84.063 Federal Pell Grant Program $222,747
84.007 Federal Supplemental Educational Opportunity Grants $121,997
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $75,888