Finding Text
2022 003 Cash Management U.S. Department of Education: Education Stabilization Fund ? Higher Education Emergency Relief Fund (HEERF) Minority Serving Institutions (ALN 84.425L) Federal Award Numbers and Years: P425L200021 (4/21/20 ? 6/30/23) Statistically Valid Sample: The sample was not intended to be, and was not, a statistically valid sample. Prior Year Finding: N/A Finding Type: Material Weakness and Material Noncompliance Criteria For CRRSAA HEERF II and ARP HEERF III, the Certification and Agreements and/or Supplemental Agreements requires that Student Aid Portion (ALN 84.425E) should be disbursed within 15 calendar days of the drawdown from ED?s G5 grants system and Institutional Aid Portion, (a)(2), and (a)(3) funds (all other ALNs) should be disbursed within 3 calendar days of the drawdown from G5. Additionally, in accordance with Federal requirements, the University shall maintain internal controls over Federal programs designed to provide reasonable assurance that cash management requirements are executed in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award that could have a direct and material effect on a Federal program. Condition and Context The University had one HEERF drawdown during fiscal year 2022. The drawdown occurred on August 5, 2021, however, the funds were spent during the timeframe of September 23, 2021 through February 10, 2022. Therefore, the University did not spend the drawdown within the required timeframe. The University?s policies and procedures to ensure compliance with the above requirements did not include certain internal controls that were designed properly and operating effectively to ensure that the drawn down funds were spent within the applicable guidelines. Cause The University?s policies and procedures to ensure compliance with the above requirements did not include certain internal controls that were designed properly and operating effectively to ensure that funds were spent timely in accordance with the compliance requirement. Effect The University held onto unspent HEERF funds outside of the allowable timeframe, and may have earned unallowable interest on its bank account that should be returned to the awarding agency. Questioned Costs As amounts were ultimately expended for allowable purposes, questioned costs would be limited to interest earned on amounts held outside the allowable timeframe. Recommendation We recommend that the University strengthen its policies and procedures over the cash management process in relation to the Education Stabilization Fund program. We also recommend that the University ensure that internal controls in place surrounding the cash management process are performed as designed.