Finding 519860 (2024-001)

Significant Deficiency
Requirement
N
Questioned Costs
$1
Year
2024
Accepted
2025-01-21
Audit: 339156
Organization: Salem State University (MA)

AI Summary

  • Core Issue: Two students had incorrect Return of Title IV calculations, leading to miscalculated amounts of aid returned to the Department of Education.
  • Impacted Requirements: Compliance with 34 CFR 668.22(e) regarding the calculation of earned Title IV funds upon student withdrawal.
  • Recommended Follow-Up: Implement a formal review process for Return of Title IV calculations to ensure accuracy and compliance.

Finding Text

Finding number: 2024-001 Federal agency: U.S. Department of Education Programs: Student Financial Assistance Cluster AL #: 84.063 and 84.268 Award year: 2024 Criteria According to 34 CFR 668.22(e): 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 equal to the percentage of the payment period or period of enrollment that the student completed 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) Sixty 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. Condition Federal regulations state that when a recipient of Title IV funds withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the institution should determine the proper amount of Title IV funds to be refunded as of the recipient’s withdrawal date. Once a recipient’s withdrawal date is determined, an institution should complete a Return of Title IV (“R2T4”) calculation. The R2T4 is used to calculate the percentage of the payment period or period of enrollment completed, establish the amount of Title IV funds earned by the recipient, and determine the amount required to be returned to the Department of Education. During our testing, we noted 2 students, out of a sample of 40, where the Return of Title IV calculation was calculated incorrectly. SALEM STATE UNIVERSITY (an Agency of the Commonwealth of Massachusetts) Schedule of Findings and Questioned Costs Year Ended June 30, 2024 Cause The University has policies and procedures in place to perform this calculation for all students who withdraw. However, in the above instances when completing the R2T4 calculation, the University made calculation errors with one student having the incorrect number of earned days in the semester and the second student having the incorrect amount of disbursed aid used in their R2T4 calculation. Effect The University calculated the student’s percentage of earned aid incorrectly which resulted in an incorrect amount of Title IV funds returned to the Department of Education. Questioned Costs $192 Perspective Our sample was not, and was not intended to be, statistically valid. Of the 40 students selected for testing, 2 students, or 5% of our sample, had returns of Title IV funds that were miscalculated. Identification as a Repeat Finding, if applicable Not applicable Recommendation The University should implement a formal review process of the Return of Title IV calculations to ensure an accurate calculation is made. View of Responsible Officials The University agrees with the finding. All questioned costs were returned by the University in October 2024.

Corrective Action Plan

Finding number: 2024-001 Federal agency: U.S. Department of Education Programs: Student Financial Assistance Cluster AL #: 84.063 and 84.268 Award year: 2024 Corrective Action Plan: The R2T4 calculations were done in a timely manner. These errors were due to human error and is considered isolated incidents. The Financial Aid office has taken great steps over the years and improved the processes for identifying and processing R2T4 calculations in a timely manner. Timeline for Implementation of Corrective Action Plan: The corrective action plan was implemented as of October 2024. Contact Person Scott Jewell, Director of Financial Aid

Categories

Questioned Costs Student Financial Aid Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 519861 2024-001
    Significant Deficiency
  • 1096302 2024-001
    Significant Deficiency
  • 1096303 2024-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $27.04M
84.063 Federal Pell Grant Program $9.81M
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $748,215
84.033 Federal Work-Study Program $539,193
84.042 Trio_student Support Services $501,546
59.037 Small Business Development Centers $493,891
84.007 Federal Supplemental Educational Opportunity Grants $415,000
84.047 Trio_upward Bound $369,270
93.364 Nursing Student Loans $99,953
93.173 Research Related to Deafness and Communication Disorders $62,868
84.016 Undergraduate International Studies and Foreign Language Programs $51,132
11.417 Sea Grant Support $36,619
47.076 Stem Education (formerly Education and Human Resources) $31,832
93.217 Family Planning Services $23,803
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $23,577
19.415 Professional and Cultural Exchange Programs - Citizen Exchanges $5,987
84.116 Fund for the Improvement of Postsecondary Education $5,887
66.456 National Estuary Program $5,796
19.009 Academic Exchange Programs - Undergraduate Programs $3,370
84.038 Federal Perkins Loan Program $0