Finding Text
2024-001 - Student Financial Aid Cluster - (a) Federal Pell Grant (b) Federal Supplemental Educational Opportunity Grant (c) Federal Work Study Grant (d) Federal Perkins Loan Program (e) Federal Direct Student Loans (f) Teacher education Assistance for College and Higher Education ALN No. (a) 84.063 (b) 84.007 (c) 84.033 (d) 84.038 (e) 84.268 (f) 84.379 - Year Ended June 30, 2024.
Criteria: 34 CFR 668.163, 668.166 notes, “the Secretary considers excess cash to be any amount of title IV, HEA program funds, other than Federal Perkins Loan program funds, that an institution does not disburse to students by the end of the third business day following the date the institution received those funds from the Secretary or deposited or transferred to its depository account previously disbursed title IV, HEA program funds, such as those resulting from award adjustments, recoveries, or cancellations. An institution may maintain for up to seven days an amount of excess cash that does not exceed one percent of the total amount of funds the institution drew down in the prior award year. The institution must return immediately to the Secretary any amount of excess cash over the one-percent tolerance and any amount of excess cash remaining in its account after the seven-day tolerance period.(34 CFR 668.163, 668.166)”.
Condition: During our testing of thirty-seven draw downs, we noted four individuals (11%) that resulted in having cash on hand that exceeded the immediate disbursement need for three working days and the excess cash tolerances were not eliminated within seven working days. We consider this condition to be a significant deficiency relating to the Cash Management compliance requirement. Statistical sampling was not used in making sample selections.
Questioned Costs: $25,712
Cause and Effect: The condition was caused by changes in students enrollment statuses that were not caught in their reconciliation process which resulted in them requesting funds from the Common Origination and Disbursement (COD) system although they were no longer eligible for disbursements in the Spring semester due to graduating, withdrawing, or other circumstances. As a result, the College is retaining federal monies longer than allowed.
Recommendation: We recommend that the College implement procedures and cash controls to avoid having excess cash.
Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.