Finding 503675 (2022-003)

Material Weakness
Requirement
G
Questioned Costs
$1
Year
2022
Accepted
2024-10-24

AI Summary

  • Core Issue: The University did not fully spend the required amount of HEERF funds on student grants, failing to meet earmarking requirements.
  • Impacted Requirements: Non-compliance with CARES Act, CRRSAA Act, and ARP Act regarding minimum student grant expenditures.
  • Recommended Follow-Up: Return the questioned costs of $94,893 as directed by the Department of Education and improve expenditure reconciliation processes.

Finding Text

Higher Education Emergency Relief Fund (HEERF) Earmarking Material Weakness DEPARTMENT OF EDUCATION ALN #: 84.425E and 84.425F Federal Award Identification #: P425F202243 Condition: The University had drawn all their authorized HEERF institutional funds by the end of the performance period but did not fully spend the student portion, therefore the University did not meet the earmarking requirements for the minimum amount of HEERF funds spent on student grants. Criteria: CARES Act section 18004 (a) (1), CRRSAA Act section 314 (a) (1), ARP Act Questioned Costs: $94,893 Context: The University did not have support for providing $76,991 of grants to students from the HEERF student portion (84.425E) which represents the University's remaining available authorization at the end of the performance period. Due to not fully spending this student portion, this disallowed a prorated amount totaling $94,893 of the institutional portion (84.425F) given the conditions and earmarking requirements for HEERF. Cause: Inadequate reconciliation of expenditures and drawdowns and lack of review at the end of the period of performance. Effect: Since the student emergency grant minimum was not met, the University is not eligible for the full allocation of the institutional portion of the HEERF funds. Identification as repeat finding, if applicable: N/A Recommendation: We recommend the University return funds as applicable and as directed by the Department of Education. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.

Corrective Action Plan

Higher Education Emergency Relief Fund (HEERF) Earmarking Planned Corrective Action: Southwestern Christian University will designate multiple staff to oversee the guidelines and disbursements of all federal money. The Interim CFO is responsible for the reconciliation of expenditures and drawdowns from any future federal funds. Person Responsible for Corrective Action Plan: Bill Martin, Interim CFO Anticipated Date of Completion: Immediately

Categories

Questioned Costs Period of Performance Matching / Level of Effort / Earmarking Allowable Costs / Cost Principles Cash Management Material Weakness

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $1.76M
84.425 Covid-19 Education Stabilization Fund Heerf - Student Aid Portion $1.01M
84.063 Federal Pell Grant Program $763,081
84.425 Covid-19 Education Stabilization Fund Heerf - Institutional Portion $690,630
84.425 Covid-19 Education Stabilization Fund Heerf - Strengthening Institutions Program $69,211
84.033 Federal Work-Study Program $43,511
84.007 Federal Supplemental Educational Opportunity Grants $30,000