Finding 518507 (2024-001)

Significant Deficiency
Requirement
N
Questioned Costs
-
Year
2024
Accepted
2025-01-09
Audit: 336963
Organization: Odessa College District (TX)
Auditor: Whitley Penn LLP

AI Summary

  • Core Issue: The College failed to return Title IV funds for students who withdrew after 45 days, violating federal regulations.
  • Impacted Requirements: Compliance with 34 CFR 668.22, which mandates timely return of unearned Title IV funds.
  • Recommended Follow-up: The College should review and improve its processes to ensure timely returns of Title IV funds in line with federal deadlines.

Finding Text

Finding 2024-001 Significant Deficiency in Internal Control over Compliance and Other Matters Federal Agency: U.S. Department of Education Federal Program Name: Student Financial Assistance Cluster Assistance Listing Number(s): 84.007, 84.033, 84.063, 84.268 Compliance Requirement: Special Tests and Provisions – Return of Title IV Funds Award Period: 2023-2024 Criteria or Specific Requirement: 34 CFR 668.22 requires that 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 grant or loan assistance that the student earned as of the student's withdrawal date in accordance with Federal regulations and return the unearned portion of the grant or loan funds to the Title IV programs as soon as possible but no later than 45 days after the withdrawal date. Condition: The return of Title IV funding amount for a sample of 9 students tested was not returned within 45 days after the withdrawal date. Cause: The College’s process consists of returning the required Title IV funds once a semester for all students regardless of the individual withdrawal date. Effect: All students who withdrew over 45 days from the date the College returns the Title IV funds and that did not earn all their title IV funds are out of compliance. Questioned Cost: None Effect: The College retuned the Title IV funds; however, the returns were outside of the 45 day requirement. Repeat Finding: The finding is not a repeat finding. Recommendation: The College should reevaluate the existing process and related control to ensure that the Title IV funds are returned to the Department of Education on a timely manner. View of Responsible Officials: Management agrees with the finding. See Corrective Action Plan.

Corrective Action Plan

Finding 2024-001 Significant Deficiency in Internal Control over Compliance and Other Matters Odessa College will implement the following to ensure compliance with federal regulations, improve internal processes, and prevent future occurrences. Additionally, the college is moving forward with comprehensive financial aid advisory services with Ellucian, the College’s enterprise student information system. The engagement/advisory priorities include establishing an R2T4 Process that complies with the 45-day reporting requirement. The engagement period is contracted for the next 14 months. Review and Update Withdrawal Procedures:  Conduct a comprehensive review of current student withdrawal procedures to identify any weaknesses or delays in processing withdrawal dates and the return of Title IV funds.  Ensure that the withdrawal process is thoroughly documented, and that all departments (registrar, financial aid, student accounts) are aligned on their responsibilities related to withdrawal processing. Strengthen Communication between Departments:  Establish a clear communication protocol among the registrar’s office, financial aid office, and student accounts to ensure that withdrawals are processed promptly.  Designate specific individuals to monitor the return of Title IV funds and ensure deadlines are met.  Implement an internal checklist for verifying that all Title IV funds are returned within the required time frame. Implement a Monitoring System:  Set up an automated system or a shared calendar to track Title IV refund timelines for students who withdraw.  Use alerts or reminders to notify responsible staff members when a Title IV refund is due to be returned within the 45-day window.  Monitor and document all returns of Title IV funds to maintain compliance. Staff Training:  Conduct training for staff involved in student withdrawals, financial aid, and compliance to ensure they are knowledgeable about the 45-day return requirement and the importance of adhering to it.  Include a review of the audit finding and corrective actions during departmental Develop a Compliance Audit Checklist:  Create a detailed audit checklist for Title IV refund procedures to be used in periodic internal audits to ensure that all financial aid disbursements, returns, and related processes comply with federal regulations.  Review the checklist regularly to ensure the process is effective and compliant with regulatory changes. Monitoring and Reporting:  Schedule and conduct regular internal audits of Title IV funds return procedures and withdrawal processes to ensure ongoing compliance.  Review audit findings, staff performance, and timelines to identify potential areas for improvement. Compliance Reporting:  Prepare a report for the administrative team outlining corrective actions taken, including the return of funds, updated procedures, and staff training. Responsible Officials: Kim McKay – Vice President Student Services Anticipated Date of Completion: May 2025 meetings to reinforce the importance of compliance.

Categories

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

Other Findings in this Audit

  • 518508 2024-001
    Significant Deficiency
  • 518509 2024-001
    Significant Deficiency
  • 518510 2024-001
    Significant Deficiency
  • 518511 2024-001
    Significant Deficiency
  • 518512 2024-001
    Significant Deficiency
  • 518513 2024-001
    Significant Deficiency
  • 518514 2024-001
    Significant Deficiency
  • 1094949 2024-001
    Significant Deficiency
  • 1094950 2024-001
    Significant Deficiency
  • 1094951 2024-001
    Significant Deficiency
  • 1094952 2024-001
    Significant Deficiency
  • 1094953 2024-001
    Significant Deficiency
  • 1094954 2024-001
    Significant Deficiency
  • 1094955 2024-001
    Significant Deficiency
  • 1094956 2024-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.063 Federal Pell Grant Program $4.57M
84.048 Career and Technical Education -- Basic Grants to States $547,431
93.596 Child Care Mandatory and Matching Funds of the Child Care and Development Fund $151,513
84.002 Adult Education - Basic Grants to States $132,510
84.007 Federal Supplemental Educational Opportunity Grants $40,000
84.033 Federal Work-Study Program $7,600
84.425 Education Stabilization Fund $6,532
84.268 Federal Direct Student Loans $2,634