Finding 3414 (2023-002)

Significant Deficiency
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2023-12-05
Audit: 5338
Organization: Northwestern College (IA)

AI Summary

  • Core Issue: The College failed to conduct a formal risk assessment as required by the Gramm-Leach-Bliley Act, leaving student financial aid information potentially vulnerable.
  • Impacted Requirements: The College did not address key areas such as employee training, information systems security, and response to data breaches as outlined in 16 CFR 314.4 (b).
  • Recommended Follow-Up: Collaborate with the consulting firm to document safeguards for identified risks and ensure compliance with updated Gramm-Leach-Bliley Act regulations effective June 9, 2023.

Finding Text

2023-002 Gramm-Leach-Bliley Act Federal Agency: Department of Education Federal Program: Student Financial Aid Cluster CFDA Numbers: 84.007 – Federal Supplemental Education Opportunity Grants 84.033 – Federal Work Study Program 84.038 – Federal Perkins Loans 84.063 – Federal Pell Grant Program 84.268 – Federal Direct Student Loans 84.379 – Teacher Education Assistance for College and Higher Education Grants Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Gramm-Leach-Bliley Act (Public Law 106-102) requires financial institutions to explain their information-sharing practices to their customers and to safeguard sensitive data. (16 CFR 314) The Federal Trade Commission considers Title IV-eligible institutions that participate in Title IV Educational Assistance Programs as “financial institutions” and subject to the Gramm-Leach-Bliley Act (16 CFR 313.3(k)(2)(vi). Condition: Under an institution’s Program Participation Agreement with the Department of Education and the Gramm-Leach-Bliley Act, schools must protect student financial aid information, with particular attention to information provided to institutions by the Department or otherwise obtained in support of the administration of the federal student financial aid programs. Questioned costs: None Context: During our audit procedures, it was noted that the College did not prepare a formal risk assessment that addresses the three areas noted in 16 CFR 314.4 (b) which are (1) Employee training and management; (2) Information systems, including network and software design, as well as information processing, storage, transmission and disposal; and (3) Detecting, preventing and responding to attacks, intrusions, or other systems failures and document safeguards for identified risks. Cause: The College has hired a consultant to help with and enhance the implementation of the updated Gramm-Leach-Bliley Act requirements and that didn’t occur until late in the 2023 fiscal year. Effect: The student personal information could potentially be vulnerable. Repeat Finding: No Recommendation: We recommend the College work with their consulting firm to review their documentation and ensure that there are documented safeguards for identified risks and the required documentation and practices are implemented. We also recommend reviewing the changes in the Gramm-Leach-Bliley Act regulations that were required to be implemented as of June 9, 2023. Views of responsible officials: There is no disagreement with the audit finding.

Corrective Action Plan

2023-002 Student Financial Assistance Cluster – Assistance Listing No. Various Recommendation: We recommend the College work with their consulting firm to review their documentation and ensure that there are documented safeguards for identified risks and the required documentation and practices are implemented. We also recommend reviewing the changes in the Gramm-Leach-Bliley Act (GLBA) regulations that were required to be implemented as of June 9, 2023. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The College engaged a consulting firm as our Virtual Chief Information Security Officer (vCISO) in 2022-23 to assist in compliance with the GLBA. The College’s work with our vCISO includes a comprehensive risk assessment of the College’s information security posture, a determination of identified risks, access to expert security resources to build an effective and measurable security program, and an evaluation of the controls protecting the external network. These action items began in the 2022-23 fiscal year and are ongoing in the 2023-24 fiscal year. The vCISO program includes virtual multi-year ongoing support. Name(s) of the contact person(s) responsible for corrective action: Harlan Jorgensen, Director of Computing Services Planned completion date for corrective action plan: June 30, 2024

Categories

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

Other Findings in this Audit

  • 3407 2023-001
    Significant Deficiency
  • 3408 2023-001
    Significant Deficiency
  • 3409 2023-001
    Significant Deficiency
  • 3410 2023-001
    Significant Deficiency
  • 3411 2023-001
    Significant Deficiency
  • 3412 2023-001
    Significant Deficiency
  • 3413 2023-001
    Significant Deficiency
  • 3415 2023-002
    Significant Deficiency
  • 3416 2023-002
    Significant Deficiency
  • 3417 2023-002
    Significant Deficiency
  • 3418 2023-002
    Significant Deficiency
  • 3419 2023-002
    Significant Deficiency
  • 3420 2023-002
    Significant Deficiency
  • 579849 2023-001
    Significant Deficiency
  • 579850 2023-001
    Significant Deficiency
  • 579851 2023-001
    Significant Deficiency
  • 579852 2023-001
    Significant Deficiency
  • 579853 2023-001
    Significant Deficiency
  • 579854 2023-001
    Significant Deficiency
  • 579855 2023-001
    Significant Deficiency
  • 579856 2023-002
    Significant Deficiency
  • 579857 2023-002
    Significant Deficiency
  • 579858 2023-002
    Significant Deficiency
  • 579859 2023-002
    Significant Deficiency
  • 579860 2023-002
    Significant Deficiency
  • 579861 2023-002
    Significant Deficiency
  • 579862 2023-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $9.08M
84.063 Federal Pell Grant Program $1.23M
84.425 Education Stabilization Fund $569,484
84.038 Federal Perkins Loan Program $537,134
84.033 Federal Work-Study Program $158,455
84.007 Federal Supplemental Educational Opportunity Grants $138,772
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $119,399
84.334 Gaining Early Awareness and Readiness for Undergraduate Programs $15,000
47.049 Mathematical and Physical Sciences $4,274
84.063 Administrative Cost Allowance $1,480