Finding Text
Federal Agency Program – U.S. Department of Education, Student Financial Assistance Cluster, Federal Pell Grant Program, Assistance Listing Number 84.063; Federal Direct Loan Program, Assistance Listing Number 84.268
Program Year - June 1, 2023 – May 31, 2024
Criteria or Specific Requirement – Special Tests – Return of Title IV Funds –
When a recipient of Title IV grant or loan assistance withdraws from an institution
during a payment period or period of enrollment in which the recipient began
attendance, the institution must determine the amount of Title IV aid earned by
the student as of the student’s withdrawal date. If the total amount of Title IV
assistance earned by the student is less than the amount that was disbursed to
the student on his or her behalf as of the date of the institution’s determination
that the student withdrew, the difference must be returned to the Title IV programs
as outlined in this section and no additional disbursements may be made to the
student for the payment period or period of enrollment (34 CFR Sections
668.22(a)(1)-(3)).
Condition – During our testing, we noted two students whose return of funds calculation was incorrect and funds were submitted after the required deadline.
Questioned Costs – $1,428
Context – During our testing, it was noted that the University does have a
process in place to ensure return of calculations are being performed,
but there was a break-down in the communication process during the year.
Of a sample of ten return of funds tested from a population of 49 performed
during the examination period, two calculations were incorrect and funds were not returned within the required time of 45 days. Our sample was not, and was not intended to be, statistically valid.
Cause – The process of communicating a withdrawal to the party responsible
for the refund did not occur timely and incorrect data was used to calculate the return.
Effect – The University returned the incorrect amount of funds to the Department
of Education.
Identification as a Repeat Finding – Yes finding 2023-001
Recommendation – We recommend that the University has a policy in place to
review the return of funds calculation and ensure that the calculation is accurate
according to the regulations to be diligent in performing secondary reviews to
endure the calculations are performed correctly.
While testing the return of Title IV funds from a sample, Forvis Mazars noted that
two students did not have a refund calculation completed in a timely manner.
These findings had been discovered by SBU and corrected, and funds were returned
earlier, but they were still outside the compliance timeframe, which required an audit finding.
One student didn't inform the University she dropped timely and when that was
communicated to the Registrar Office it was not entered in the system correctly
and therefore not communicated to the Financial Aid Department. Though late,
once it was discovered, she was processed. The other student had the return
initially calculated with the assumption she received loans but never accepted
them and they were not disbursed, so the refund was calculated incorrectly. It
was subsequently corrected at the end of the semester for the proper amount
but because of the delay it was late.
Views of Responsible Officials and Planned Corrective Actions - The issues
identified in the previous audit were identified part way through fiscal year 2023.
Corrective actions identified in the prior audit and listed below are in place
going forward.
To address these issues, SBU employees have taken the following corrective measures:
1. We reworked the reporting process for withdrawals. All withdrawals now go to the Associate Provost regardless of campus or program. They are then processed by the Registrar's Office and placed in a shared drive. Once there, they are reviewed weekly by the Financial Aid Office, and R2T4s are completed in a timely manner. If there are any withdrawals outside of the normal process timeframe they are escalated and the Registrar and Executive Director of Financial Aid are notified.
2. R2T4 requests are completed by one Financial Aid staff member and verified and processed by another to ensure accuracy and reliability.
3. We have implemented an administrative withdrawal process to give campus and program directors the ability and authority to withdraw students who are no longer in attendance to limit the number of all Fs at the end of the semester.