Finding 513101 (2024-001)

Significant Deficiency
Requirement
N
Questioned Costs
-
Year
2024
Accepted
2024-12-05
Audit: 331074
Organization: Southwestern Law School (CA)
Auditor: Moss Adams LLP

AI Summary

  • Core Issue: The school failed to report changes in student enrollment status to the NSLDS on time, affecting compliance with federal regulations.
  • Impacted Requirements: Non-compliance with 34 CFR section 685.309(b)(2) regarding timely reporting of enrollment changes, which can lead to incorrect loan deferment and repayment issues.
  • Recommended Follow-Up: Establish a formal policy for reviewing NSLDS submissions for accuracy and completeness, and implement regular monitoring of reporting deadlines.

Finding Text

FINDING 2024-001 – Special Tests and Provisions – Enrollment Reporting: Significant Deficiency in Internal Control over Compliance (See table in Text of the Audit FindingSchedule of Findings and Questioned Costs"). Criteria – 34 CFR section 685.309(b)(2): Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that: (i) a loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under title IV of the Act has changed his or her permanent address. Condition/context – A sample of 40 federal aid recipient students were selected from system generated reports of students who graduated, reported a physical address change, withdrew, or dropped during the 2023-2024 academic year. The enrollment information and withdrawal, address change, or graduation date per the School’s records was compared to the information reported to the National Student Loan Data System (NSLDS) in order to determine if status changes were reported within the required timeframes. Of the 40 students who had a change in address, graduated, or withdrew, 21 were not reported to the NSLDS within the required timeframe, 2 had incorrect effective dates reported to the NSLDS, and 1 had an incorrect status reported to the NSLDS. Cause – The School does not have formally documented policies requiring information submitted to the NSLDS be reviewed for completeness and accuracy, or policies for monitoring reporting deadlines. Effect – The NSLDS database did not include accurate information until the point at which it was corrected. This information is utilized by ED, the Direct Loan program, lenders, and other institutions to determine in-school status, deferment, and grace periods of student loans. Incorrect information could result in incorrect deferment, grace periods, billing, and repayment of student loans. Repeat Finding – This is not a repeat finding. Recommendation – We recommend Southwestern Law School establish a formal policy requiring a review of student status information submitted to the NSLDS, by a third-party intermediary on the School’s behalf, for completeness and accuracy. We also recommend the School establish a cadence of monitoring reporting deadlines, particularly those around classes of graduating students. Views of responsible officials and planned corrective actions – Management agrees with the finding. See the corrective action plan for further detail. Responsible Offices and Individuals – Improving procedures around enrollment reporting is the joint responsibility of the Registrar’s Office and the Information Technology Office. Eileen Zwiers, Registrar, and Sean Murphy, Chief Information Officer, are responsible for implementing the corrective action plan. Corrective Action Plan – Southwestern has prepared and implemented a new Enrollment Reporting Policy to ensure Title IV compliance when reporting changes in student enrollment status to the National Student Loan Data System. The policy outlines Southwestern’s procedures for timely, accurate, and complete reporting through the National Student Clearinghouse. Additionally, the Financial Aid Office will conduct monthly random audits of reported submissions directly from the National Student Loan Data System portal to ensure accuracy. The Financial Aid Office documents and securely stores these verified submissions to support the federal audit, in compliance with federal retention and data management policies. Anticipated Completion Date - The anticipated completion date of the corrective action plan is September 2024.

Corrective Action Plan

Southwestern Law School provides the following corrective action plan for the finding Moss Adams, LLP identified during the Southwestern's federal awards audit for the year ending June 30, 2024. Southwestern acknowledges the finding and recommendation from Moss Adams. Finding 2024-001 - Special Tests and Provisions - Enrollment Reporting: Significant Deficiency in Internal Control over Compliance. Responsible Offices and Individuals: Improving procedures around enrollment reporting is the joint responsibility of the Registrar's Office and the Information Office. Eileen Zwiers, Registrar, and Sean Murphy, Chief Information Officer, are responsible for implementing the corrective action plan. Corrective Action Plan: Southwestern has prepared and implemented a new Enrollment Reporting Policy to ensure Title IV compliance when reporting changes in student enrollment status to the National Student Loan Data System. The policy outlines Southwestern's procedures for timely, accurate and complete through the National Student Clearinghouse. Additionally, the Financial Aid Office will conduct monthly audits of reported submissions directly from the National Student Loan Data System portal to ensure accuracy. The Financial Aid Office documents and securely stores these verified submissions to support the federal audit, in compliance with federal retention and data management policies. Anticipated Completion Date: Southwestern took immediate action to improve the policies and procedures around enrollment reporting. The remediation was appropriately completed September 2024. Sincerely, Eileen Zwiers Registrar Sean Murphy Chief Information Officer

Categories

Student Financial Aid Special Tests & Provisions Subrecipient Monitoring Reporting Significant Deficiency Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 513102 2024-001
    Significant Deficiency
  • 513103 2024-001
    Significant Deficiency
  • 1089543 2024-001
    Significant Deficiency
  • 1089544 2024-001
    Significant Deficiency
  • 1089545 2024-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $50.57M
84.038 Federal Perkins Loan Program (beginning of the Year) $676,175
84.033 Federal Work-Study Program $602,764