Core Issue: Incorrect refund calculations were found for two students in the Federal Direct Loan Program, marking a repeat finding.
Impacted Requirements: Compliance with the Return to Title IV refund calculation (34 CFR 668.22) was not met, leading to incorrect refunds.
Recommended Follow-Up: The Institution should refund $352 to the Department of Education and enhance controls over the refund process.
Finding Text
FINDING 2023-004: INCORRECT REFUND CALCULATIONS
FEDERAL AGENCY: U.S. DEPARTMENT OF EDUCATION
PROGRAM NAME: FEDERAL DIRECT LOAN PROGRAM
ALN: 84.268
FEDERAL AWARD YEAR: 2022-2023 Compliance Requirement: Special Tests and Provisions (N.) - Return of Title IV Funds Criteria: An institution must use the Return to Title IV refund calculation (34 CFR 668.22). Condition: We tested thirteen drop students and found two incorrect refund calculations. We consider this finding to be a significant deficiency and is a repeat finding shown in Section IV of this report as prior year Finding 2022-002. Cause: The condition was caused by using incorrect amounts in Step 1 of the Return to Title IV refund calculation for one student and by using incorrect charges in Step 5 of the Return to Title IV refund calculation for the other student. Effect: The result is the Institution refunded incorrect amounts to the Department of Education. Question Costs: $352 Statistical sampling was not used when making sample selections. Recommendation: We recommend the Institution refund $352 to the Department of Education and increase controls over refunds. There is no liablity for the remaining $362, as this was due to overrefunding loans. Views of Responsible Officials: The Institution agrees with the Single Audit Finding and a response is included in the Corrective Action Plan.
Corrective Action Plan
FINDING 2023-004: INCORRECT REFUND CALCULATIONS A. COMMENTS ON FINDING AND RECOMMENDATION(S): PIMS AGREES WITH THE FINDINGS OF THE AUDITORS THAT STUDENT B3 AND B 1 WERE INCORRECTLY REFUNDED DUE TO MISSING OR INCORRECT INFORMATION ON THE R2T4. PIMS WILL REFUND THE $352 OWED TO THE DOE. B. ACTIONS TAKEN OR PLANNED: PIMS FA OFFICE HAS MOVED TO COMPLETING THE R2T4 ONLINE TO HELP ELIMINATE CALCULATION ERRORS. ALL R2T4'S ARE THEN REVIEWED BY FA MANAGER TO ENSURE ALL FIGURES ARE ENTERED CORRECTLY AND AUTO CALCULATING CORRECTLY.