Finding 382601 (2023-002)

Criteria: According to 34 CFR 685.203 an eligible dependent or independent student is disbursed Subsidized Direct Loans up to their need and what they are eligible for based on their year in school. Condition: During our student file testing we noted two students out of forty were disbursed the incorrect Direct Loan amount. Based on the student’s enrollment status and need the students were over awarded $4,500 in Subsidized Loans and under awarded $4,500 in Unsubsidized Loans. We consider this error in awarding to be an instance of noncompliance of the Eligibility Compliance Requirement. Statistical sampling was not used when making sample selections. Questioned Costs: $0 Effect: Two students were over awarded Subsidized Direct Loans in the amount of $4,500 and under awarded Unsubsidized Direct loans in the amount of $4,500. Cause: The University’s internal controls did not identify the fact that the students were over awarded Subsidized Direct Loans in the amount of $4,500 and under awarded Unsubsidized Direct loans in the amount of $4,500. Recommendation: We recommend the University closely monitor all students who receive direct loans and verify that they receive the proper amount of Subsidized and Unsubsidized Direct Loans. Views of Responsible Officials: Management agrees with this finding and response is included in Corrective Action Plan.