Finding Text
Federal Agency: Department of Education
Federal Program Name: Student Financial Assistance Cluster
Assistant Listing Number: 84.038
Federal Award Identification Number and Year: N/A – Prior Perkins Awards
Award Period: July 1, 2022 to June 30, 2023
Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters
Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 674.19.(e)(4)(iii), states that after the loan obligation is satisfied, the institution shall return the original or a true and exact copy of the note marked "paid in full" to the borrower, or otherwise notify the borrower in writing that the loan is paid in full, and retain a copy for the full prescribed period.
Condition: The College did not retain a copy of the note marked “paid in full” in the records of the retired or assigned loans.
Questioned Costs: None.
Context: During our testing, we noted that the college did not retain a copy of the note marked "paid in full." for six of the ten retired or assigned loans tested.
Cause: The College did not retain a copy of the note in the file.
Effect: The College is not in compliance with the record retention requirements.
Repeat Finding: No.
Recommendation: We recommend the college implement a checklist to reference to ensure all required elements of the Perkins loan records are retained as required.
Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding and has developed a plan to correct it.