Finding Text
Finding 2023-002: Special Tests and Provisions – Disbursements to or on behalf ofAL Number: 84.268 U.S. Department of Education Federal Direct Student Loans Award Period: June 1, 2022 – May 31, 2023 Criteria: In accordance with 34 CFR 668.165(a), before an institution disburses Title IV of the HigherEducation Act (“Title IV, HEA”) program funds for any award year, the institution must notify a student ofthe amount of funds that the student or his or her parent can expect to receive under each Title IV, HEAprogram, and how and when those funds will be disbursed. If those funds include Direct Loan programfunds, the notice must indicate which funds are from subsidized loans, which are from unsubsidized loans,and which are Parent Loan for Undergraduate Students (“PLUS”). Condition: Students enrolled at the University did not receive EFT notices during the summer or fallsemesters. Context: The University completed a merger with University of the Sciences June 1, 2022. The studentsnot receiving required notifications were legacy University of the Sciences students. Cause: EFT notices are automatically generated by the institution's financial aid software upon packagingof financial aid, according to specific fund codes. Legacy University of the Sciences Students were includedin the University of the Sciences OPEID Code and not flagged to the fund codes generating EFT noticeemails. When the financial aid packages were prepared for disbursement, no EFT notices were providedto that population of students. Effect: 11 of 40 selected students selected did not receive notification of EFT's related to Title IV, HEAprogram awards for the Summer 2022 and Fall 2022 semesters. For the total population, there were 2,179instances of non-compliance which affected 1,259 students and accounted for $19,378,713 in Title IV, HEAprogram award disbursements. Questioned costs: None. Repeat finding: No. Recommendation: We recommend that management consider applicable regulation guidelines andensure that background functions are appropriately functioning for all applicable fund codes, particularlyaround mergers with other institutions. Views of Responsible Officials: See management’s corrective action plan on page 51.