Finding 390230 (2023-002)

Federal Agency: U.S. Department of Education Federal Program Name: Federal Direct Student Loans Assistance Listing Number: 84.268 Award Period: 7/1/2022 – 6/30/2023 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: The Code of Federal Regulations, 34 CFR 685.304 require entrance counseling be performed before disbursing loan funds to the student for Direct Subsidized Loan, Direct Unsubsidized Loan and Direct PLUS Loan to a graduate or professional student. The regulations also require exit counseling for all students who ceases at least half-time study at the school. The Code of Federal Regulations, 34 CFR 674.16 requires institution to provide certain repayment information to students before making its first Perkins Loan disbursement to a student. 34 CFR 674.42 also requires exit counseling for all students who ceases at least half-time study at the school. Condition: During our testing, it was noted that some individuals did not receive exit counseling after their departure from the University. Questioned costs: None. Context: During our testing, it was noted that 2 out of 40 students did not receive exit counseling within the required 30 days of a student ceasing attendance. Cause: The University notes that these students graduated from their undergrad program in May of 2022. They then enrolled in a masters program and received new direct loans – they completed and graduated from these programs in May of 2023. Exit counseling was not sent after the May 2023 completion due to them completing such exit counseling in May 2022. Effect: Students are not receiving the proper loan counseling which may contribute to a higher default rate. Repeat finding: No. Recommendation: CLA recommends the University review its policies and procedures around sending exit counseling information to students to ensure students are receiving proper counseling. Views of responsible officials: Management agrees with the finding and has developed a plan to correct the finding.