Finding 45688 (2022-004)

Material Weakness Repeat Finding
Requirement
E
Questioned Costs
-
Year
2022
Accepted
2023-05-08
Audit: 40629
Auditor: Sikich LLP

AI Summary

  • Core Issue: The College failed to report actual loan disbursement dates for 57.5% of students sampled, violating federal regulations.
  • Impacted Requirements: This finding affects compliance with 34 CFR 668.164 (a)(1), indicating a material weakness in internal controls.
  • Recommended Follow-Up: The College should establish procedures to ensure accurate reporting of disbursement dates to the NSLDS.

Finding Text

Criteria: 34 CFR 668.164 (a)(1) states ?Except as provided under paragraph (a)(2) of this section, a disbursement of title IV, HEA program funds occurs on the date that the institution credits the student?s ledger account or pays the student or parent directly with- (i) Funds received form the Secretary; (ii) Institutional funds received from a lender under title IV, HEA program funds; Condition: The College did not report actual loan disbursement dates to the Common Origination and Disbursement (COD) system for 23 of the 40 students in the sample (57.5%). We consider this condition to be a material weakness in internal control over compliance relating to the Eligibility compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2021-003. Statistical sampling was not used in making sample selections. Questioned Costs: N/A. Cause and Effect: The College posted the batches incorrectly resulting in a variance in the date of the disbursement per the student account and the date per NSLDS. Recommendation: We recommend the College implement procedures in order to report accurate disbursements dates for Direct Loans to NSLDS. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

Corrective Action Plan

Condition: The College did not report actual loan disbursement dates to the Common Origination and Disbursement (COD) system for 23 of the 40 students in the sample (57.5%). We consider this condition to be a material weakness in internal control over compliance relating to the Eligibility compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2021-003. Statistical sampling was not used in making sample selections. Corrective Action Plan: It is important to note that the entire 2021/2022 award year was processed by 3rd party servicer, Fully Disbursed. The current Financial Aid staff at Blackburn College started in October of 2021 but the processing was conducted by Fully Disbursed as they were under contract with Blackburn College for all 2021-2022 processing and packaging until August 2022 at the completion of the summer semester. The Financial Aid Office must emphasize the importance of accurate record-keeping in financial transactions. As a department we will continue to work closely with the Business office to ensure that every drawdown is properly documented and matches the corresponding dates and amounts. Additionally, we will continue to perform monthly reconciliations to ensure that any discrepancies are identified and addressed promptly. This process helps to minimize errors and maintain transparency in our overall financial aid operations. Responsible Person for Correction Action Plan: Alexis Brown, Director of Financial Aid Implementation Date for Corrective Action Plan: Fall 2022

Categories

Student Financial Aid Eligibility Material Weakness Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 45687 2022-003
    Significant Deficiency Repeat
  • 45689 2022-005
    Material Weakness Repeat
  • 45690 2022-006
    -
  • 45691 2022-003
    Significant Deficiency Repeat
  • 45692 2022-004
    Material Weakness Repeat
  • 45693 2022-005
    Material Weakness Repeat
  • 45694 2022-006
    -
  • 45695 2022-003
    Significant Deficiency Repeat
  • 45696 2022-004
    Material Weakness Repeat
  • 45697 2022-005
    Material Weakness Repeat
  • 45698 2022-006
    -
  • 45699 2022-003
    Significant Deficiency Repeat
  • 45700 2022-004
    Material Weakness Repeat
  • 45701 2022-005
    Material Weakness Repeat
  • 45702 2022-006
    -
  • 45703 2022-003
    Significant Deficiency Repeat
  • 45704 2022-004
    Material Weakness Repeat
  • 45705 2022-005
    Material Weakness Repeat
  • 45706 2022-006
    -
  • 622129 2022-003
    Significant Deficiency Repeat
  • 622130 2022-004
    Material Weakness Repeat
  • 622131 2022-005
    Material Weakness Repeat
  • 622132 2022-006
    -
  • 622133 2022-003
    Significant Deficiency Repeat
  • 622134 2022-004
    Material Weakness Repeat
  • 622135 2022-005
    Material Weakness Repeat
  • 622136 2022-006
    -
  • 622137 2022-003
    Significant Deficiency Repeat
  • 622138 2022-004
    Material Weakness Repeat
  • 622139 2022-005
    Material Weakness Repeat
  • 622140 2022-006
    -
  • 622141 2022-003
    Significant Deficiency Repeat
  • 622142 2022-004
    Material Weakness Repeat
  • 622143 2022-005
    Material Weakness Repeat
  • 622144 2022-006
    -
  • 622145 2022-003
    Significant Deficiency Repeat
  • 622146 2022-004
    Material Weakness Repeat
  • 622147 2022-005
    Material Weakness Repeat
  • 622148 2022-006
    -

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $2.72M
84.063 Federal Pell Grant Program $1.15M
84.033 Federal Work-Study Program $936,243
84.425 Education Stabilization Fund $105,943
84.038 Perkins Loan Program $75,937
84.007 Federal Supplemental Educational Opportunity Grants $53,686