Finding 538259 (2024-001)

Significant Deficiency Repeat Finding
Requirement
P
Questioned Costs
-
Year
2024
Accepted
2025-03-27
Audit: 349245
Organization: University of Hartford (CT)

AI Summary

  • Core Issue: The University failed to locate original promissory notes for 4 out of 40 tested Perkins loans, indicating a significant deficiency in recordkeeping.
  • Impacted Requirements: Institutions must retain original promissory notes and repayment schedules until loans are satisfied, as per federal regulations.
  • Recommended Follow-Up: The University should review and improve its policies and procedures for recordkeeping and retention to prevent future occurrences.

Finding Text

2024-001 – Perkins Loan Recordkeeping and Record Retention Federal Agency: U.S. Department of Education Federal Program Title: Federal Perkins Loan Program Federal Assistance Listing Number: 84.038 Award Period: 7/1/2023 – 6/30/2024 Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matters Criteria or specific requirement: An institution shall keep original promissory notes and repayment schedules until Perkins loans are satisfied. If required to release original documents in order to enforce the loan, the institution must retain certified true copies of those documents. An institution shall keep the original paper promissory note or original paper master promissory note (MPN) and repayment schedules in a locked, fireproof container (34 CFR 674.19(e)(4)). Condition: Original promissory notes were unable to be located. Questioned costs: None. Context: During our testing, we noted 4 instances out of 40 open Perkins loans tested where the University was unable to locate the original promissory note. Cause: The University did not have the appropriate policies and procedures in place when Perkins loans were awarded to students in order to ensure that recordkeeping and retention regulations were being followed. Effect: Open loan balances for these loans are not supported by an original promissory note. Repeat finding: Yes, 2023-001. Recommendation: We recommend the University evaluate its procedures and policies around recordkeeping and record retention. Views of responsible officials: Management agrees with the finding. Please refer to the attached corrective action plan.

Corrective Action Plan

2024-001 Student Financial Assistance Cluster – Federal Assistance Listing No. 84.038 Recommendation: We recommend the University evaluate is procedures and policies around recordkeeping and retention. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Management of the University agrees with the finding. We do have policies and procedures in regard to recordkeeping and retention of Perkins loan documents. Active, Assigned and Retired Perkins loans are maintained in a locked, fireproof container in the Bursar office. The repayment schedules are electronically kept in our borrower files with Heartland ECSI. The cancellation and deferment request for each Perkins loan made are electronically kept in our borrower files with Heartland ECSI. We typically retain original or true and exact copies of Master Promissory Notes (MPN). In some cases, the MPN may have been returned to the student during their entrance counseling. The Perkins loan program expired September 30, 2017. We are currently in the process of Assigning the remaining borrowers to close out our Perkins Loan Program. We are working as quickly and efficiently as possible. Staff availability will determine the completion date for this process. Name(s) of the contact person(s) responsible for corrective action: Diane Purcell, Bursar Senior Accountant, (860) 768-4361 Planned completion date for corrective action plan: June 30, 2025 If the United States Department of Education has questions regarding this plan, please call Elaine Daly, Assistant Vice President for Finance & Controller at 860-768-4652 or Katherine Presutti, Director of Student Financial Aid at 860-768-4300.

Categories

Student Financial Aid Significant Deficiency Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 1114701 2024-001
    Significant Deficiency Repeat

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $47.97M
84.063 Federal Pell Grant Program $7.67M
84.038 Federal Perkins Loan Program_federal Capital Contributions $2.22M
43.008 Office of Stem Engagement (ostem) $832,072
84.033 Federal Work-Study Program $704,149
84.007 Federal Supplemental Educational Opportunity Grants $489,622
93.866 Aging Research $235,889
14.218 Community Development Block Grants/entitlement Grants $94,654
47.076 Stem Education (formerly Education and Human Resources) $45,003
12.420 Military Medical Research and Development $38,352
21.027 Coronavirus State and Local Fiscal Recovery Funds $34,264
59.043 Women's Business Ownership Assistance $33,811
77.008 U.s. Nuclear Regulatory Commission Scholarship and Fellowship Program $29,022
93.191 Graduate Psychology Education $15,135
93.788 Opioid Str $14,626
93.243 Substance Abuse and Mental Health Services Projects of Regional and National Significance $14,064
16.593 Residential Substance Abuse Treatment for State Prisoners $12,667
84.215 Innovative Approaches to Literacy; Promise Neighborhoods; Full-Service Community Schools; and Congressionally Directed Spending for Elementary and Secondary Education Community Projects $11,741
84.425 Education Stabilization Fund $11,741
20.205 Highway Planning and Construction $8,362
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $7,544
84.037 Perkins Loan Cancellations $6,891
43.001 Science $5,000
93.110 Maternal and Child Health Federal Consolidated Programs $1,923