Finding 369675 (2023-001)

U.S. Department of Education Student Financial Assistance Criteria In the process of a student applying for ED federal financial aid, an ISIR is sent electronically to the institution and a SAR, or information on how to access the SAR, is sent to the student. The original ISIR or SAR for an award year may contain codes that relate to student eligibility requirements numbers 2, 4, 5, 9, 10, and 12 in Appendix A. If the original ISIR or SAR does not contain codes relating to those eligibility requirements, and the institution has no information indicating otherwise, the student can be considered to have met them. The ISIR Guide contains all the ISIR and SAR codes and is available at fsa.partners.ed.gov. The ISIR Guide changes annually and should be obtained and reviewed for each relevant period under audit. Per the ISIR Guide, a flag of “C” on a student’s ISIR is an indicator that institutional resolution is required. Therefore, institutional resolution must occur prior to awarding and disbursing financial aid to students. The Federal Student Aid Handbook, Volume 1–FSA Handbook: Student Eligibility contains detailed information about student eligibility and the action needed to resolve discrepancies found in the data matches. The handbook is located on fsapartners.ed.gov. Condition In our testing over eligibility, we noted 1 instance in a sample of 40 students where the University did not resolve an ISIR "C" flag prior to disbursing financial aid for the spring semester. Federal aid disbursed to the 40 student samples aggregated $1,060,001. Cause Management's review control over the institutional resolution of ISIR "C" flag was not operating at a level of precision to identify ISIR "C" flags added during the period of awarding spring financial aid. Effect The University was not in compliance with the requirement to resolve ISIR "C" flags prior to awarding and disbursing financial aid for the year ended May 31, 2023. Questioned Costs The questioned costs related to this finding were $18,535, which represents the Spring aid awarded to the student prior to resolving and clearing the ISIR "C" flag. The ISIR "C" flad was subsequently cleared. Statistical Validity of Samples The samples were not intended to be, and were not, statistically valid. Repeat Finding in the Prior Year No. Recommendation We recommend management enhance the precision of its review over clearing ISIR "C" flags prior to awarding and disbursing financial aid. Views of Responsible Officials The University agrees with the finding. The University's financial aid processes include the daily review of ISIR imports. The Graduate Financial Aid Office will enhance those reviews by promptly introducing the Colleague ISIR Alert Report (IART) on a weekly basis. This tool is specifically designed to identify ISIR records requiring review, encompassing additions and changes to C flags. The weekly report will serve as an additional safeguard to ensure no C flags are inadvertently overlooked. This implementation will be effective immediately. The C flag noted within this finding was resolved in April 2023, prior to the fiscal year ended May 31, 2023.