Finding Text
2024-007: Student Credit Balances from Title IV Awards
Significant Deficiency
Federal Program: Student Financial Assistance Cluster
Assistance Listing Number(s):
Student Financial Assistance Cluster
• 84.007
• 84.033
• 84.038
• 84.063
• 84.268
• 84.379
• 93.925
Criteria: Auditee requirements contained in Title 2 U.S. Code of Federal Regulations (2 CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, Subpart D – Post Federal Award Requirements, Section 200.303 – Internal Controls, requires the auditee to establish and maintain effective internal control over the Federal award that provides reasonable assurance that the nonfederal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with a framework such as the “Internal Control Integrated Framework,” issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
Condition: When Title IV funds are credited to a student account and they exceed the amount of tuition and fees, food and housing, and other authorized charges assessed the student, a credit balance is created. The institution must pay the resulting credit balance directly to the student or parent borrower within 14 days after (1) the first day of class of a payment period if the credit balance occurred on or before that day, or (2) the balance occurred if that was after the first day of class. The College does not have a control in place with physical indication of review over refund process for student credit balances.
Cause: Lack of control in place over refunds from student credit balances
Effect or Potential Effect: Student credit balances may not be refunded within the 14-day requirement.
Questioned Costs: None
Context: During our control assessment over student credit balance refunds, we noted there is no control in place and no physical indication of review taking place to ensure student credit balances are properly refunded within the 14-day requirement.
Repeat Finding: No
Recommendation: We recommend the College review its process and controls in place for student credit balances to include an independent review and sufficient documentation to support the application of the control.
Views of Responsible Officials: Management agrees with the finding. See corrective action plan.