Finding 503678 (2022-005)

-
Requirement
C
Questioned Costs
-
Year
2022
Accepted
2024-10-24

AI Summary

  • Core Issue: The College failed to pay out credit balances from federal aid before requesting reimbursements from the Department of Education.
  • Impacted Requirements: This noncompliance violates 34 CFR 668.164(h)(2) regarding cash management and heightened cash monitoring.
  • Recommended Follow-Up: Implement a process to identify and pay out federal aid credit balances to students on time.

Finding Text

Credit Balances and Heightened Cash Monitoring 2 (HCM2) Compliance DEPARTMENT OF EDUCATION ALN #: 84.268 and 84.063 Federal Award Identification #: 2021-2022 Financial Aid Year Condition: The College is required to pay out credit balances created by federal aid before submitting requests for reimbursement to the Department of Education (ED) under HCM2. Criteria: 34 CFR 668.164(h)(2) Questioned Costs: $-0- Context: Out of 40 students tested for holding credit balances, there were 2 students who had a credit balance created by federal direct loans and federal pell grants that were not paid out to the student before submitting reimbursement requests to ED. Cause: There was not an adequate process in place to identify credit balances created by federal aid and paying them before reimbursement requests were submitted. Effect: Noncompliance with the Department of Education's cash management and heightened cash monitoring regulations. Identification as repeat finding, if applicable: N/A Recommendation: We recommend the College design and implement a process to identify credit balances created by federal aid and disburse them to students within the required timeframe. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.

Corrective Action Plan

Credit Balances and Heightened Cash Monitoring 2 (HCM2) Compliance Planned Corrective Action: Southwestern Christian University will provide ongoing training to current staff as well as new staff on HCM1 and/or HCM2 compliance regulations with the Department of Education. SCU will have additional staff review student accounts for credit balances that would result from disbursements of Title IV Aid. Person Responsible for Corrective Action Plan: Rita Palmer, Director of Financial Aid Anticipated Date of Completion: Immediately

Categories

Student Financial Aid Cash Management Subrecipient Monitoring Matching / Level of Effort / Earmarking

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