Finding Text
FINDING 2024-001 – Special Tests and Provisions – Return of Title IV: Significant Deficiency in Internal Control over Compliance (See SFQC - Section III - Finding 2024-001 for included table)
Criteria – 34 CFR Section 668.22(e)(2): Percentage earned. The percentage of Title IV grant or loan assistance that has been earned by the student is—
(i) Equal to the percentage of the payment period or period of enrollment that the student completed (as determined in accordance with paragraph (f) of this section) as of the student’s withdrawal date, if this date occurs on or before—
(A) Completion of 60 percent of the payment period or period of enrollment for a program that is measured in credit hours; or
(B) 60 percent of the clock hours scheduled to be completed for the payment period or period of enrollment for a program that is measured in clock hours; or
(ii) 100 percent, if the student’s withdrawal date occurs after—
(A) Completion of 60 percent of the payment period or period of enrollment for a program that is measured in credit hours; or
(B) 60 percent of the clock hours scheduled to be completed for the payment period or period of enrollment for a program measured in clock hours.
34 CFR Section 668.22(f)(2): The total number of calendar days in a payment period or period of enrollment includes all days within the period that the student was scheduled to complete, except that scheduled breaks of at least five consecutive days are excluded from the total number of calendar days in a payment period or period of enrollment and the number of calendar days completed in that period.
Condition/Context – A sample of 10 out of a population of approximately 66 federal aid recipient students whom withdrew, dropped out, or enrolled but never attended during the 2023-2024 academic year were selected. Student records were compared to the calculation of the return of Title IV funds, if any, and the federal government’s Common Origin and Disbursement system. For two of the selected students, the amount to be returned was calculated incorrectly. This resulted in an understatement of student financial assistance earned by the students.
Questioned Costs – Known questioned costs were $105. We projected the error rate over the entire universe of students whom received federal aid and withdrew, dropped out, or enrolled but never attended during Spring 2024 semester. Using this method, we determined likely questioned costs to be approximately $313.
Effect – When the return of Title IV funds is not correctly calculated, the student ultimately receives the incorrect amount of funding.
Cause – The College correctly calculated the number of days within the Spring 2024 semester, including the number of days with scheduled breaks, but typed in the incorrect number into it’s R2T4 calculation worksheet resulting in an incorrect percentage of aid earned for the selected Spring 2024 withdrawn students.
Repeat Finding – This is not a repeat finding.
Recommendation – We recommend the College implement a process by which all R2T4 calculation worksheets are reviewed upon completion, with evidence of the review and approval by someone other than the preparer retained. During this review, the reviewer should ensure start and end dates of terms and the length of identified scheduled breaks align with the College’s academic calendar.
Views of Responsible Officials and Planned Corrective Actions – Otis College of Art and Design agrees with the Return of Title IV calculation finding. This error was noticed by new financial aid staff/administration hired in late spring of 2024 after the prior administration had completed all return of Title IV calculations except for the unofficial withdrawals. The new staff noticed the error and made the adjustment going forward starting with the unofficial withdrawals for spring 2024. This error only affected the days of Spring Break. No other semesters had an error in the dates used in the Return of Title IV calculations. The Executive Director of Financial Aid and The One Stop, Michaela Matsumoto and Registrar Nicole Raef are the responsible individuals for implementation of the corrective action plan. Financial Aid Management met with the Registrar’s Office to ensure all future semester set up dates are correct and have been reviewed. This improvement of processes to ensure a double check of the Return of Title IV calendar setup has been implemented for 2025-2026.