Finding 52055 (2022-003)

Finding Reference: 2022-003 Federal Agency: U.S. Department of Education Federal Program: Student Financial Aid Cluster Compliance Requirement: Activities Allowed or Unallowed and Eligibility Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria: 34 CFR 668.32 ? a student is eligible to receive Title IV, HEA (Higher Education Act) program assistance if the student is a regular student enrolled, or accepted for enrollment, in an eligible program at an eligible institution. Statement of Condition: Potential noncompliance was identified by the College. It is possible there were students enrolled in ineligible programs during the 2021/2022 fiscal year. Statement of Cause: No cause could be determined. Possible Asserted Effect: The institution may have improperly awarded Title IV funds to students who have not been accepted into an eligible program of study leading to a degree or certificate. The College has reported that the Federal Department of Education initiated a program review during 2022 and the College informed the Department of the potential noncompliance. The College is currently awaiting the final results of that review. Questioned Costs: $ 9,065 Context: During the performance of the prior year audit, the College reported possible noncompliance to the auditors and noted they were working with consultants to review the situation and make programmatic adjustments as necessary. The College has noted these programmatic adjustments were made during the 2021/2022 fiscal year and took effect in January 2022. The College offers a number of health career programs in which prior to programmatic changes that occurred during 2021/2022, a student was initially enrolled and began the program by taking general education courses and in some cases certain major courses as well. Once these courses were completed the student was able to apply to continue in the program through a selective admissions process to transition to the clinical portion of the program which culminated in the student receiving a certificate or degree. The selective admissions process differed from program to program but was generally based on a published criteria which centers around a ranking based on the completion and final grade for certain initial courses, certain test scores and selection of campus location. The possible noncompliance centers on whether the College?s selective admission process to transition to the clinical portion of the programs, in turn, makes the initial portion of these programs ineligible. In that situation, students enrolled in the initial portion of the program may not be considered regular students enrolled or accepted for enrollment for the purpose of obtaining a degree or certificate offered by the College and would not be eligible for Title IV financial aid. The auditor selected a sample of 60 students to review program eligibility. This sample include 25 students from the fall semester, 25 students from the spring semester and, 10 students from the summer semester. The sample included six (6) students enrolled in the health career programs noted above. Of these six (6) students, four (4) students did not advance to the clinical portion of the program or transfer to a program receiving credit for their initial courses. The six (6) students enrolled in the heath career programs were all from the fall semester prior to the changes made in January 2022. The auditor was unable to determine if the College?s selective admission process related to these health career programs is in compliance with federal regulations. As a result, questioned costs which encompass the financial aid received during 2021/2022 are included above for the possible violation related to the four (4) students noted. Based on the fact the auditor is unable to determine the eligibility status of students enrolled in these programs or the overall program eligibility for the initial portion of these programs, the Independent Auditor?s Report on Compliance for Each Major Program and on Internal Control Over Compliance Required by the Uniform Guidance includes a qualified opinion for the Student Financial Aid Cluster. Repeat Finding: This is a repeat finding. Recommendation: We recommend that the College work with the U.S. Department of Education to review the programs in question and determine what additional programmatic changes may be necessary, if any, to ensure the student financial aid program is in compliance with federal regulations. Views of Responsible Officials and Planned Corrective Actions: Management acknowledges and agrees with the findings.