Finding Text
Finding 2022-003 ? Early Disbursement of Title IV Funds (Not a Repeat Finding) Federal Agency: U.S. Department of Education Pass-through Entity: None Federal Program: Student Financial Assistance Cluster (Federal Assistance Listing No.?s 84.007, 84.033, 84.038, 84.063, 84.268, 84.379) Requirement: Special Tests and Provisions Criteria: In accordance with 34 CFR 668.164(i)(2), Culver Stockton College may not make an early disbursement of a Direct Loan to a first-year, first-time borrower who is subject to the 30-day delayed disbursement requirements in 34 CFR 685.303(b)(5) unless the College is exempt from the 30-day delayed disbursement requirements under 34 CFR 685.303(b)(5)(i)(A). This exemption only applies to schools with a cohort default rate of less than 15 percent for each of the three most recent fiscal years for which data is available. Condition: In our sample of 60 students, the College disbursed Title IV funds to fourteen first-year, first-time borrowing students before the 30-day period expired. However, the College did not meet the exemption to the delayed disbursement requirement because its cohort default rate was more than 15 percent for one of the three most recent fiscal years available. Cause of Condition: The College typically falls under the exemption and is allowed early disbursement. They were aware of the year in which the cohort default rate was above 15 percent and properly followed the rules to delay disbursement until 30- days. However, they were not aware that the exemption takes into consideration each of the three most recent fiscal years available. Effect: Any deviations from Student Financial Assistance requirements may potentially jeopardize the College?s program eligibility. Questioned Costs: None. Perspective Information: Because the College was not aware that they did not meet the exemption, this is considered a systemic problem. Recommendation: We recommend the College provide additional training for staff involved in the disbursement of Title IV funds and ensure that the Official Cohort Default Rate notification is carefully reviewed and provided to all relevant personnel to ensure compliance with all changes mentioned in the notification. Also, implementing additional monitoring procedures to ensure disbursements are performed within the correct time periods allowed would help strengthen adherence to the requirements.