Finding Text
Criteria or specific requirement: The Code of Federal Regulations, 34 CFR 685.203 specifies the annual and aggregate loan limits the Institutions may not exceed for an academic year of study under the Direct Loan program and also requires loans to be prorated for a program of student that is less than a full academic year in length. Uniform Grant Guidance (2 CFR 200.303) requires nonfederal entities receiving Federal awards establish and maintain internal controls designed to reasonably ensure compliance with Federal laws, regulations, and program compliance requirements. Effective internal controls should include procedures to ensure students are awarded and disbursed the proper federal fund amounts.
Condition: During our eligibility testing of forty students, we noted two students that were under awarded in Subsidized loans.
Questioned costs: None
Context: During our eligibility testing of forty students, we identified two students who were under awarded in Subsidized loans.
Cause: For one of the students the College's system applied the scholarship to the students account and incorrectly reduced the students subsidized loan award. For another student the student was packaged incorrectly and had unmet need and should have received a subsidized loan to meet unmet need before being awarded unsubsidized loans.
Effect: Students were not awarded all the aid they were eligible for.
Repeat Finding: No
Recommendation: We recommend that the College review its process for packaging awards and adjusting awards after they are packaged to ensure that the student’s subsidized loan award is calculated correctly.
Views of responsible officials: There is no disagreement with the audit finding.