Finding Text
Federal agency: Department of Education
Federal program title: Student Financial Assistance Cluster
Assistance Listing Number: 84.007, 84.033, 84.063, 84.268
Federal Award Identification Number and Year: P007A223438 - 2023, P033A223438 - 2023, P063P222047 - 2023, P268K232047 - 2023
Award Period: July 1, 2022 to June 30, 2023
Type of Finding:
• Compliance, Other Matter
• Significant Deficiency in Internal Control over Compliance
Criteria or specific requirement: 34 CFR 668.21(a) states that the institution must return all title IV, HEA program funds that were credited to the student's account at the institution or disbursed directly to the student for the payment period. The institution must return those funds no later than 30 days after the date that the institution becomes aware that the student will not or has not begun attendance. Per 2 CFR 200.303, nonfederal entities receiving federal awards are required to establish and maintain internal controls designed to reasonably ensure compliance with federal laws, regulations, and program compliance requirements.
Condition: The University incorrectly calculated and did not disburse aid timely for Return to Title IV (R2T4) calculations. The University also did not have formal procedures in place to review the Return to Title IV calculations.
Context: During our testing of 14 R2T4s, we identified that 9 R2T4 calculations had mechanically incorrect calculations. Out of the 9, 7 had the incorrect number of scheduled break days, and 6 had incorrect disbursed amounts. Also, during our testing, we identified 1 instance of payments returned later than 45 days after withdrawal. Additionally, we were unable to identify formal control procedures related to Return to Title IV transactions.
Questioned costs: $3,391
Cause: The University was incorrectly calculating R2T4s as well as using the incorrect number of scheduled break days for Spring Semester. Additionally, the University did not have a formal procedure for reviewing R2T4s.
Effect: The University could return incorrect amounts based off of their calculations and incorrect calculations could affect student repayment amounts based off of amount earned.
Repeat Finding: No.
Recommendation: We recommend the University document review of Return to Title IV calculations by an employee that did not prepare the calculations. We also recommend that the University review policies and procedures related to R2T4 calculations to ensure calculations are performed correctly and disbursed timely.
Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.