Finding Text
Assistance Listing Number. Federal Agency, and Program Name - 84.033, U.S. Department of Education, Federal Work-Study and 84.268, U.S. Department of Education, Federal Direct Student Loans
Finding Type - Material weakness and material noncompliance with laws and regulations Repeat Finding - Yes - 2022-006
Criteria - The Seminary has 45 days from the date the college determines a student's withdrawal date to calculate a return of Title IV funds for the student and return the funds. Withdrawal dates are defined as the time when the student officially withdraws, cr expresses notification to withdraw, or if the student does not officially withdraw, the date the Seminary determines the student is no longer in attendance (34 CFR Section 668.22(j)(1)).
Condition - The Seminary did not have controls in place to identify and document the students who have withdrawn and the applicability of performing a return of Title IV funds.
Questioned Costs - $3,713
Identification of How Questioned Costs Were Computed - Procedures identified a population of two students that met the requirements to have a calculation performed. Of those students, it was determined one student’s aid should have been returned and the actual amount calculated is reported as questioned costs.
Context - Of the four students identified that received Title IV funding and met the definition of an official or unofficial withdrawal during the period, two students did not have a calculation documented by the Seminary. Although documentaton was not maintained, one student had the full loan returned timely without calculating the earned portion for the Seminary, while the other students award was not calculated or returned to the Department of Education in accordance with the regulations.
Cause and Effect - The Seminary did not have proper controls in place to identity and document students who have withdrawn from the Seminary. The lack of documentation around students who withdrew officially or unofficially led to the inability to support the compliance with the applicable code of federal regulations in a timely manner.
Recommendation - The Seminary should implement a procedure that documents the Seminary's review of the student’s individual facts and circumstances, including, but not limited to, documenting the date of disbursement, the date of withdrawal, and the date of determination by the institution, whether the student is deemed an official or unofficial withdrawal.
Views of Responsible Officials and Planned Corrective Actions - The financial aid director has established a procedure to ensure that R2T4 calculations are completed and any funds due to be returned are sent back to the Department of Education within 45 days of the date of the student's withdrawal. The financial aid director created a listing to track all student withdrawals (including details of withdrawal). The registrar sends an email to the financial aid director notifying when a student has withdrawn from the institution, which gets entered onto the list. The financial aid director set up the Department of Education's R2T4 calculator for the 2023-2024 academic year. R2T4 calculations are completed for any student withdrawn and, if necessary, funds are returned to the Department of Education.