Finding Text
Finding 2022-005: Perkins Loan Recordkeeping and Record Retention Program: Federal Perkins Loan Program CFDA Number: 84.038 Federal Agency: U.S. Department of Education Federal Award Identification Number: Not applicable Federal Award Year: June 30, 2022 Criteria: 34 CFR 674.19 requires that an institution retains disbursement, electronic authentication and signature records and repayment records, including cancellation and deferment requests for each loan made using a Master Promissory Note (MPN) for at least three years from the date the loan is canceled, repaid, or otherwise satisfied. Condition: For 1 borrower selected for testing, the University was unable to locate the original signed MPN. Questioned Costs: Not applicable. Context: Noncompliance with federal regulations was noted for 1 of the 50 students who were tested. Included in the sample were 25 borrowers with open loans as of May 31, 2022 and 25 borrowers with loans retired or assigned loans within the previous three fiscal years and the current fiscal year. A total of 460 borrowers had outstanding Perkins loan balances as of May 31, 2022 and another 291 borrowers had loans that were retired or assigned within the three previous years and the current fiscal year. The sample was not considered statistically valid. Effect: The University may not have appropriate supporting documentation that the original Perkins loan obligation existed and may not have a legally enforceable claim to collect remaining payments due on the loan. Cause: The original signed MPN was inadvertently disposed of at some point in the past prior to maintaining the documentation for the required time period. Recommendation: We recommend that University review Perkins loan record keeping requirements and double check that all record retention periods have ended prior to disposing of any Perkins loan records. Management's Response: Briar Cliff University has maintained all records related to Perkins loan, even though these loans have been discontinued since September 2017. The University has no intentions to delete or remove any documents until the time is appropriate. The current staff unfortunately was not employed when these records were originally collected or reviewed.