Finding 504082 (2023-004)

Significant Deficiency Repeat Finding
Requirement
E
Questioned Costs
$1
Year
2023
Accepted
2024-10-29
Audit: 326482
Organization: Cottey College (MO)
Auditor: Sikich CPA LLC

AI Summary

  • Core Issue: Cottey College failed to report actual loan disbursement dates for 5 out of 37 students, which is a significant compliance deficiency.
  • Impacted Requirements: This finding violates 34 CFR 668.164 (a)(1) regarding timely disbursement of Title IV funds.
  • Recommended Follow-Up: Cottey College should establish procedures to ensure accurate reporting of disbursement dates to the COD system.

Finding Text

2023-004 Student Financial Aid Cluster (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Pell Grant Program (d) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.063 (d) 84.268 - Year Ended June 30, 2023 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: Cottey College did not report actual loan disbursement dates to the Common Origination and Disbursement (COD) system for 5 of the 37 students in the sample (13.5%). We consider this condition to be a significant deficiency 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 2022-003. Statistical sampling was not used in making sample selections. Questioned Costs: $16,444 Cause and Effect: Cottey College noted this was an error that occurred but did not occur with the entire batches. Recommendation: We recommend Cottey College implement procedures in order to report accurate disbursements dates for Direct Loans to COD. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

Corrective Action Plan

2023-004 Student Financial Aid Cluster (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Pell Grant Program (d) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.063 (d) 84.268 - Year Ended June 30, 2023 Condition: The College did not report actual loan disbursement dates to the Common Origination and Disbursement (COD) system for 5 of the 37 students in the sample (13.5%). We consider this condition to be a significant deficiency 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 2022-003. Statistical sampling was not used in making sample selections. Corrective Action Plan: During the 2022-23 school year, an employee who retired in May 2023 worked in the financial aid office. After retiring, a new position was created that is split between the Business Office and Financial Aid and Student Accounts office. This position now reviews student accounts weekly, and during that review they compare the date of disbursement to the student account and the date of disbursement in COD. Through this process, any mismatched dates are corrected and updated to COD. Due to the audit completion delay, our action plan for the previous audit could not be put into place before the year had already been completed. Below is the previous audit plan to show that it was implemented, however, timing meant implementation happened after the 2022-23 year had ended. The financial aid office is currently hiring for a new position that will oversee student accounts. Once this position is filled, we will implement our updated policy and procedure that requires review and collaboration to monitor COD disbursement date, financial aid software disbursement date and student billing statement disbursement date. This will ensure both financial aid staff and student accounts staff will confirm each date in all areas. Planned completion date for corrective action plan: 06/30/2023 Responsible Person for Correction Action Plan: Hannah Masters Implementation Date for Corrective Action Plan: June 2023

Categories

Questioned Costs Student Financial Aid Eligibility Significant Deficiency Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $1.17M
84.063 Federal Pell Grant Program $705,134
84.033 Federal Work-Study Program $29,746
84.007 Federal Supplemental Educational Opportunity Grants $25,644