Finding Text
Criteria or Specific Requirement:
Internal Control – Per 2 CFR section 200.303(a), a non-Federal entity must: Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal 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 guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
Compliance – The Code of Federal Regulations, 34 CFR 674.16 states that before an institution makes its first disbursement to a student, the student shall sign the promissory note and the institution shall provide the student with certain repayment information.
Condition:
There is no Perkins loam promissory note on file for certain students with open and retired loans. These promissory notes could not be located.
Questioned costs: $12,159
Context: This condition occurred in 5 out of 40 students tested with open loans and for 3 out of 8 students tested with retired loans.
Cause: The University was not able to locate these promissory notes.
Effect: The University cannot provide documentation showing proper completion of promissory note as required by DOE requirements.
Repeat Finding: No
Recommendation: We recommend that the University implement a procedure be put in place to ensure proper record retention documenting the completion of promissory notes.
Views of responsible officials: There is no disagreement with the audit finding.