FAC Explorer

Finding 389377 (2023-005)

Significant Deficiency Repeat Finding
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2024-03-29
Audit: 300369
Organization: South Carolina State University (SC)
Auditor: Bdo USA PC

AI Summary

  • Core Issue: The University failed to retain required Perkins Loan repayment schedules for 2 out of 40 students, indicating a lack of compliance with recordkeeping rules.
  • Impacted Requirements: This finding highlights deficiencies in the University’s adherence to the Perkins Loan Recordkeeping and Record Retention requirements.
  • Recommended Follow-Up: The University should strengthen internal controls and procedures, supported by a new internal auditor, to ensure compliance and prevent future issues.

Finding Text

Identification of the Federal Program: Federal Perkins Loan Program (Assistance Listing #: 84.038) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): N. Special Tests and Provisions - Perkins Loan Recordkeeping and Record Retention: Institutions are required to keep original paper promissory notes or original paper master promissory notes and repayment schedules in a locked, fireproof container. The original promissory notes and repayment schedules must be kept until the loans are satisfied. If required to release original documents in order to enforce the loan, the institution must retain certified true copies of those documents. 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 prescribed period. When an institution uses a third-party servicer for its Perkins Loan program, the institution must perform due diligence to ensure that the third party servicer is in compliance with the requirements for the functions the third party servicer is performing for the school. Condition: For 2 students selected for testing, the University was unable to provide evidence that the student’s Perkins Loan repayment schedule was retained as required. Cause: Administrative and internal control oversight. Effect or Potential Effect: The University was not in compliance with the Perkins Loan Recordkeeping and Record Retention requirements. Questioned Costs: None. Context: For 2 of 40 students selected for Perkins Loan Recordkeeping and Record retention testing, an exception was noted. Identification as a Repeat Finding: This is a repeat or prior year finding 2022-008. Recommendation: We recommend that the University enhances its procedures and internal controls to ensure compliance with the special reporting requirements. Views of Responsible Officials: The University will take immediate action to address the findings of the audit report. As part of the University’s holistic program to improve compliance and assurance, the institution has requested a position number from the State of South Carolina Human Resource office in the area of internal auditing along with developing a budget line item for this operation. Moving forward, the new internal auditor position will provide needed leadership on all corrective action plans as necessary. The internal auditor will be the point of contact for all audit related matters, thus providing needed onsite management for compliance related issues for the University and its affiliated organizations. The University’s inability to provide evidence that a student’s Perkins Loan repayment schedule and another student’s Perkins Loan file were retained as required will be assessed by the new internal audit team. Corrective procedures and additional internal controls to ensure compliance with the special reporting requirements will be developed. In short, the University will enhance our oversight and management of the corrective action plans through the new internal audit team until this matter has been resolved. The University embraces the recommendation to enhance its procedures and internal controls to ensure compliance with the special reporting requirements.

Corrective Action Plan

Corrective Action Plan: The University will take immediate action to address the findings of the audit report. As part of the University’s holistic program to improve compliance and assurance, the institution has requested a position number from the State of South Carolina Human Resource office in the area of internal auditing along with developing a budget line item for this operation. Moving forward, the new internal auditor position will provide needed leadership on all corrective action plans as necessary. The internal auditor will be the point of contact for all audit related matters, thus providing needed onsite management for compliance related issues for the University and its affiliated organizations. The University’s inability to provide evidence that a student’s Perkins Loan repayment schedule and another student’s Perkins Loan file were retained as required will be assessed by the new internal audit team. Corrective procedures and additional internal controls to ensure compliance with the special reporting requirements will be developed. In short, the University will enhance our oversight and management of the corrective action plans through the new internal audit team until this matter has been resolved. The University embraces the recommendation to enhance its procedures and internal controls to ensure compliance with the special reporting requirements. Anticipated Completion Date: June 30, 2024

Categories

Internal Control / Segregation of Duties Special Tests & Provisions Student Financial Aid Reporting Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 389363 2023-001
    Significant Deficiency Repeat
  • 389364 2023-001
    Significant Deficiency Repeat
  • 389365 2023-001
    Significant Deficiency Repeat
  • 389366 2023-001
    Significant Deficiency Repeat
  • 389367 2023-002
    Significant Deficiency Repeat
  • 389368 2023-002
    Significant Deficiency Repeat
  • 389369 2023-002
    Significant Deficiency Repeat
  • 389370 2023-002
    Significant Deficiency Repeat
  • 389371 2023-003
    Significant Deficiency Repeat
  • 389372 2023-003
    Significant Deficiency Repeat
  • 389373 2023-004
    Significant Deficiency
  • 389374 2023-004
    Significant Deficiency
  • 389375 2023-004
    Significant Deficiency
  • 389376 2023-004
    Significant Deficiency
  • 389378 2023-006
    Significant Deficiency
  • 389379 2023-006
    Significant Deficiency
  • 389380 2023-006
    Significant Deficiency
  • 389381 2023-006
    Significant Deficiency
  • 965805 2023-001
    Significant Deficiency Repeat
  • 965806 2023-001
    Significant Deficiency Repeat
  • 965807 2023-001
    Significant Deficiency Repeat
  • 965808 2023-001
    Significant Deficiency Repeat
  • 965809 2023-002
    Significant Deficiency Repeat
  • 965810 2023-002
    Significant Deficiency Repeat
  • 965811 2023-002
    Significant Deficiency Repeat
  • 965812 2023-002
    Significant Deficiency Repeat
  • 965813 2023-003
    Significant Deficiency Repeat
  • 965814 2023-003
    Significant Deficiency Repeat
  • 965815 2023-004
    Significant Deficiency
  • 965816 2023-004
    Significant Deficiency
  • 965817 2023-004
    Significant Deficiency
  • 965818 2023-004
    Significant Deficiency
  • 965819 2023-005
    Significant Deficiency Repeat
  • 965820 2023-006
    Significant Deficiency
  • 965821 2023-006
    Significant Deficiency
  • 965822 2023-006
    Significant Deficiency
  • 965823 2023-006
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $21.02M
84.063 Federal Pell Grant Program $9.26M
84.031 Higher Education_institutional Aid $4.51M
10.205 Payments to 1890 Land-Grant Colleges and Tuskegee University $2.27M
10.512 Agriculture Extension at 1890 Land-Grant Institutions $1.88M
84.007 Federal Supplemental Educational Opportunity Grants $1.26M
93.397 Cancer Centers Support Grants $707,114
10.524 Scholarships for Students at 1890 Institutions (b) $558,121
84.263 Innovative Rehabilitation Training $468,570
93.516 Affordable Care Act (aca) Public Health Training Centers Program $463,725
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $387,807
84.425 Covid-19 - Heerf Supplemental Support Under the American Rescue Plan $371,663
10.216 1890 Institution Capacity Building Grants $339,780
84.425 Covid-19 - Heerf Historically Black Colleges and Universities (hbcus) $330,881
84.382 Strengthening Minority-Serving Institutions $319,334
84.042 Trio_student Support Services $298,382
81.RD Department of Energy $295,155
84.033 Federal Work-Study Program $275,957
59.037 Small Business Development Centers $266,761
59.059 Congressional Grant $208,539
10.311 Beginning Farmer and Rancher Development Program $193,447
84.120 Minority Science and Engineering Improvement $193,352
84.129 Rehabilitation Long-Term Training $182,600
47.076 Education and Human Resources $179,962
10.514 Expanded Food and Nutrition Education Program $158,309
20.701 University Transportation Centers Program $151,862
10.912 Environmental Quality Incentives Program $132,033
10.902 Soil and Water Conservation $128,326
84.264 Rehabilitation Training_continuing Education $111,363
81.104 Environmental Remediation and Waste Processing and Disposal $101,917
93.243 Substance Abuse and Mental Health Services_projects of Regional and National Significance $92,022
12.910 U.s. Department of Defense $85,638
81.137 Minority Economic Impact $83,778
10.500 Cooperative Extension Service $73,872
84.116 Fund for the Improvement of Postsecondary Education $70,108
47.083 Integrative Activities $69,847
10.523 Centers of Excellence at 1890 Institutions (b) $69,816
10.443 Outreach and Assistance for Socially Disadvantaged and Veteran Farmers and Ranchers $55,433
10.525 Farm and Ranch Stress Assistance Network Competitive Grants Program (b) $43,108
12.598 Centers for Academic Excellence $36,835
10.025 Plant and Animal Disease, Pest Control, and Animal Care $35,910
10.515 Renewable Resources Extension Act and National Focus Fund Projects $34,003
93.350 National Center for Advancing Translational Sciences $24,403
10.771 Rural Cooperative Development Grants $16,549
11.431 Climate and Atmospheric Research $12,127
10.960 Technical Agricultural Assistance $11,600
84.027 Special Education_grants to States $6,788
10.170 Specialty Crop Block Grant Program - Farm Bill $6,708
81.049 Office of Science Financial Assistance Program $6,679
43.008 Education $6,000
93.866 Aging Research $5,583
11.417 Sea Grant Support $4,669
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $3,772
47.049 Mathematical and Physical Sciences $3,629
20.237 Commercial Vehicle Information Systems and Networks $2,550
10.328 National Food Safety Training, Education, Extension, Outreach, and Technical Assistance Competitive Grants Program $2,192
16.607 Bulletproof Vest Partnership Program $1,832
45.129 Promotion of the Humanities_federal/state Partnership $554
84.038 Federal Perkins Loan Program $0