FAC Explorer

Finding 381102 (2022-005)

-
Requirement
N
Questioned Costs
-
Year
2022
Accepted
2024-03-19
Audit: 295850
Organization: Richland Community College (IL)
Auditor: Sikich LLP

AI Summary

  • Core Issue: Two out of 40 student files had errors in awarding Direct Subsidized and Unsubsidized Loans, leading to noncompliance with eligibility requirements.
  • Impacted Requirements: The College failed to follow the proper order of aid dispersal, affecting students' eligibility for Title IV aid.
  • Recommended Follow-Up: The College should review and improve its policies and procedures to ensure accurate awarding of Title IV aid.

Finding Text

Criteria: 34 CFR 685.101 (b)(1) notes, “an eligible undergraduate student who is enrolled at a school participating in the Direct Loan Program may borrow under the Direct Subsidized Loan and Direct Unsubsidized Loan programs.” The order of dispersing aid requires that grants and subsidized loans be considered first. 34 CFR 685.200(a)(iii) “In the case of an undergraduate student who seeks a Direct Subsidized Loan or a Direct Unsubsidized Loan at a school that participates in the Federal Pell Grant Program, the student has received a determination of Federal Pell Grant eligibility for the period of enrollment for which the loan is sought.” Condition: In two of the 40 student files tested (5%), Subsidized and Unsubsidized Direct loans we not properly awarded. The College under awarded one student $2,000. Another student was over awarded $71 in Subsidized loans. We consider this condition to be an instance of noncompliance relating to the Eligibility compliance requirement. Statistical sampling was not used in making sample selections. Questioned Costs: $0 Cause and Effect: Without proper review of eligibility of financial aid, students may receive an incorrect amount of Title IV aid. Students should receive the proper amount of aid. Recommendation: We recommend the College evaluate policies and procedures to ensure students receive the proper amount of Title IV aid. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

Corrective Action Plan

Condition: In two of the 40 student files tested (5%), Subsidized and Unsubsidized Direct loans we not properly awarded. The College under awarded one student $2,000. Another student was over awarded $71 in Subsidized loans. Corrective Action Plan: Financial Aid staff has worked with Administrative Information System (AIS) staff to create daily reporting to assist with student schedule changes and increases in other aid to ensure accuracy in Federal Student loan amounts. Additionally, weekly reporting has been created to track any semester over-awards for students who have a Federal Student loan awarded and who may be over-awarded based on financial need and Cost of Attendance (COA). Responsible Party for Corrective Action Plan: Director, Financial Aid and Veteran Affairs, Financial Aid Specialists Implementation Date for Correction Action Plan: January 18, 2024 (as soon as possible)

Categories

Student Financial Aid Eligibility Matching / Level of Effort / Earmarking

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
84.063 Federal Pell Grant Program $2.86M
84.268 Federal Direct Student Loans $584,193
84.002 Adult Education - Basic Grants to States $138,630
84.425 Education Stabilization Fund $83,550
84.007 Federal Supplemental Educational Opportunity Grants $77,217
14.218 Community Development Block Grants/entitlement Grants $40,000
84.048 Career and Technical Education -- Basic Grants to States $24,601
84.033 Federal Work-Study Program $24,571
17.268 H-1b Job Training Grants $17,915