Finding 524785 (2024-003)

Significant Deficiency

Requirement

Questioned Costs

Year

2024

Accepted

2025-02-27

Audit: 344164

Organization: Bethel University and Affiliates (MN)

Auditor: Cliftonlarsonallen LLP

AI Summary

Core Issue: The University incorrectly calculated a return of Title IV funds for a student who completed over 49% of a modular course.
Impacted Requirements: This finding violates 34 CFR 668.22(a)(2)(ii), which outlines conditions under which a student is not considered to have withdrawn.
Recommended Follow-Up: The University should review R2T4 requirements and establish procedures to ensure accurate and timely calculations moving forward.

Finding Text

Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster Federal Assistance Listing Number: 84.268 Federal Award Identification Number and Year: N/A Pass-Through Agency: N/A Pass-Through Number: N/A Award Period: June 1, 2023 – May 31, 2024 Type of Finding: • Significant Deficiency in Internal Control over Compliance • Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 668.22(a)(2)(ii) states that in a program offered in modules, a student is not considered to have withdrawn if the student successfully completes one module that includes 49 percent or more of the number of days in the payment period, excluding scheduled breaks of five or more consecutive days and all days between modules. Condition: During our testing, we noted a return of Title IV (R2T4) calculation was erroneously completely for a student that completed greater than 49% of a modular course. The student returned $925.74 of unsubsidized direct loans, but should not have done so. Questioned Costs: $925 Context: During our testing, we noted a return of Title IV (R2T4) calculation was erroneously completely for a student that completed greater than 49% of a modular course. The student returned $925 of unsubsidized direct loans, but should not have done so. Cause: The University used the proper inputs in the R2T4 calculation, but incorrectly concluded that the student had withdrawn and needed to return funds. Effect: The University is not completing accurate R2T4 calculations as defined by the regulations. Repeat Finding: No Auditor’s Recommendation: We recommend the University review the R2T4 requirements and implement procedures to ensure the R2T4 calculations are completed timely and accurately. Views of Responsible Officials and Planned Corrective Actions: There is no disagreement with the audit finding.

Corrective Action Plan

Student Financial Assistance Cluster – Assistance Listing No. Various Recommendation: We recommend the University review the R2T4 requirements and implement procedures to ensure the R2T4 calculations are completed timely and accurately. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: On October 26, 2024, three modifications were made to the reporting tool the financial aid office uses for Return of Title IV Funds calculations to draw attention to situations when the “student completed more than 49% of a course” exception applies. First, we added a formula to the "5 - Title IV Checklist Revised" sheet in cell D16:F17. If the answer to question 11 "Exemption 3b: Successfully complete >49%?" is Yes, the following narrative will appear in blue, bold, font: "Student Completed more than 49% of a modular course; Exemption 3b applies; NOT a Withdrawal. R2T4 NOT Required. Might need to recalc aid." Second, we modified a formula in cell J34 on the "2 - R2T4 Calc Required" sheet, so that if there is a "yes" in cell C45 (indicating the student qualifies for the "completed more than 49% of a modular course" exemption), then the following phrase will appear in bold, red font: "Student Completed more than 49% of a modular course; Exemption 3b applies; NOT a Withdrawal. R2T4 NOT Required. Might need to recalc aid." Third, we added a formula to cell E36 on the "2 - R2T4 Calc Required" sheet, so that if there is a "yes" in cell C45 (indicating the student qualifies for the "completed more than 49% of a modular course" exemption), then the following phrase will appear in bold, blue font: "Student Completed more than 49% of a modular course; Exemption 3b applies; NOT a Withdrawal. R2T4 NOT Required. Might need to recalc aid." In addition, we completed additional training with the financial aid staff who complete R2T4 calculations to ensure they (a) understand rules related to the “student completed more than 49% of a course” exception, and (b) are aware of the additional warning messages that will appear in our R2T4 calculation spreadsheet. Name of the contact person responsible for corrective action: Jeffrey D Olson, Interim Director of Financial Aid Planned completion date for corrective action plan: October 26, 2024.

Other Findings in this Audit

524779 2024-002

Material Weakness Repeat
524780 2024-002

Material Weakness Repeat
524781 2024-002

Material Weakness Repeat
524782 2024-002

Material Weakness Repeat
524783 2024-002

Material Weakness Repeat
524784 2024-002

Material Weakness Repeat
1101221 2024-002

Material Weakness Repeat
1101222 2024-002

Material Weakness Repeat
1101223 2024-002

Material Weakness Repeat
1101224 2024-002

Material Weakness Repeat
1101225 2024-002

Material Weakness Repeat
1101226 2024-002

Material Weakness Repeat
1101227 2024-003

Significant Deficiency

Programs in Audit

ALN	Program Name	Expenditures
84.268	Federal Direct Student Loans	$20.09M
84.063	Federal Pell Grant Program	$2.52M
84.007	Federal Supplemental Educational Opportunity Grants	$429,582
84.033	Federal Work-Study Program	$378,603
84.038	Federal Perkins Loans	$162,726
84.379	Teacher Education Assistance for College and Higher Education Grants (teach Grants)	$115,927
47.049	Mathematical and Physical Sciences	$27,825