Finding 390250 (2023-002)

Material Weakness Repeat Finding
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2024-03-29
Audit: 301132
Organization: National University (CA)
Auditor: Moss Adams LLP

AI Summary

  • Core Issue: There is a material weakness in internal controls regarding enrollment reporting, with 12 out of 75 students not reported to NSLDS on time.
  • Impacted Requirements: Compliance with 34 CFR section 685.309(b)(2) is not being met, affecting loan status and repayment processes.
  • Recommended Follow-Up: Establish consistent criteria for status queries and conduct regular testing to ensure accurate identification of students who have ceased attendance.

Finding Text

FINDING 2023-002 - Special Tests and Provisions - Enrollment Reporting: Material Weakness in Internal Control (See III. Federal Awards Findings and Questioned Costs - Finding 2023-002 for table) Criteria - 34 CFR section 685.309(b)(2): Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that: i. a loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or ii. A student who is enrolled at the school and who received a loan under title IV of the Act has changed his or her permanent address. Condition/context- A sample of 75 federal aid recipient students were selected from system generated reports of students who graduated, reported a physical address change, withdrew, or dropped during the 2022-2023 academic year. The enrollment information and withdrawal, address change, or graduation date per NU's records was compared to the information reported to the National Student Loan Data System (NSLDS) in order to determine if status changes were reported within the required timeframes. Of the 75 students whom had a change in address, graduated, or withdrew, 12 were not reported to the NSLDS within the required timeframe. Of the 75 students, 1 had an incorrect effective date reported to the NSLDS. Cause - The attendance queries periodically used for change of status purposes were incomplete and failed to identify several students whom had stopped attending class prior to completion of a payment period. Effect- The NSLDS database did not include accurate information until the point at which it was corrected. This information is utilized by ED, the Direct Loan program, lenders, and other institutions to determine in-school status, deferment, and grace periods of student loans. Incorrect information could result in incorrect deferment, grace periods, billing, and repayment of student loans. Repeat finding - This is a repeat finding. See 2022-002. Recommendation - We recommend NU establish consistent and accurate criteria when developing and running report queries to identify students who have stopped attending prior to the end of the payment period. We also recommend testing of the queries at established intervals to ensure they are consistently identifying the appropriate students. Views of responsible officials and planned corrective actions - Management agrees with this finding. The institution proposes a multifaceted approach aimed at resolving the root causes of the inaccuracies and preventing their recurrence. National University has implemented regular reviews of its enrollment reporting. During this process, errors in reporting are identified and corrected. However, the timing of the review has not allowed enough time to process corrections within compliance. To allow for appropriate adjustments and corrections to be implemented after testing but before the enrollment reporting deadline, National University will shift the timing of its enrollment reporting review from 60 to 30 days. Though NU is currently testing enrollment reporting and adjusting queries in an ongoing effort to improve accuracy, some of those adjustments inadvertently caused students to not appear in our queries. This impact on reporting occurred in edge cases not taken into account in the queries. To ensure this does not happen in the future, NU will implement a testing regime for these queries. This testing will be conducted at regular intervals to verify the effectiveness and accuracy of the queries in identifying students who have ceased attendance as required. Through these concerted efforts, NU hopes to demonstrate its full commitment to addressing the audit findings. We know that these efforts will take time to fully take effect and be reflected in future audits.

Categories

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

Other Findings in this Audit

  • 390234 2023-001
    Material Weakness Repeat
  • 390235 2023-002
    Material Weakness Repeat
  • 390236 2023-003
    Significant Deficiency Repeat
  • 390237 2023-001
    Material Weakness Repeat
  • 390238 2023-002
    Material Weakness Repeat
  • 390239 2023-003
    Significant Deficiency Repeat
  • 390240 2023-001
    Material Weakness Repeat
  • 390241 2023-002
    Material Weakness Repeat
  • 390242 2023-003
    Significant Deficiency Repeat
  • 390243 2023-001
    Material Weakness Repeat
  • 390244 2023-002
    Material Weakness Repeat
  • 390245 2023-003
    Significant Deficiency Repeat
  • 390246 2023-001
    Material Weakness Repeat
  • 390247 2023-002
    Material Weakness Repeat
  • 390248 2023-003
    Significant Deficiency Repeat
  • 390249 2023-001
    Material Weakness Repeat
  • 390251 2023-003
    Significant Deficiency Repeat
  • 966676 2023-001
    Material Weakness Repeat
  • 966677 2023-002
    Material Weakness Repeat
  • 966678 2023-003
    Significant Deficiency Repeat
  • 966679 2023-001
    Material Weakness Repeat
  • 966680 2023-002
    Material Weakness Repeat
  • 966681 2023-003
    Significant Deficiency Repeat
  • 966682 2023-001
    Material Weakness Repeat
  • 966683 2023-002
    Material Weakness Repeat
  • 966684 2023-003
    Significant Deficiency Repeat
  • 966685 2023-001
    Material Weakness Repeat
  • 966686 2023-002
    Material Weakness Repeat
  • 966687 2023-003
    Significant Deficiency Repeat
  • 966688 2023-001
    Material Weakness Repeat
  • 966689 2023-002
    Material Weakness Repeat
  • 966690 2023-003
    Significant Deficiency Repeat
  • 966691 2023-001
    Material Weakness Repeat
  • 966692 2023-002
    Material Weakness Repeat
  • 966693 2023-003
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $227.33M
84.063 Federal Pell Grant Program $14.52M
84.425 Covid-19 - Education Stabilization Fund - Higher Education Emergency Relief Fund (heerf) - Student Portion $5.02M
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $2.42M
84.038 Feeral Perkins Loan Program $2.39M
84.425 Covid-19 - Education Stabilization Fund - Higher Education Emergency Relief Fund (heerf) - Supplemental Support Under the American Rescue Plan Allocation Table $1.39M
84.425 Covid-19 - Education Stabilization Fund - Higher Education Emergency Relief Fund (heerf) - Institutional Portion $737,557
84.007 Federal Supplemental Educational Opportunity Grants $460,898
93.359 Nurse Education, Practice Quality and Retention Grants $210,575
84.411 Education Innovation Research $110,700
84.031 Access $108,744
47.070 Computer and Information Science and Engineering $103,437
47.074 Biological Sciences $42,093
84.336 Teacher Quality Partnership Grants $41,653
12.903 Gencyber Teacher Program $41,159
93.124 Nurse Anesthetist Traineeships $27,250
84.033 Federal Work-Study Program $16,724