FAC Explorer

Finding 547085 (2024-002)

Significant Deficiency
Requirement
N
Questioned Costs
$1
Year
2024
Accepted
2025-03-31
Audit: 351446
Organization: Alverno College (WI)
Auditor: Baker Tilly US LLP

AI Summary

  • Core Issue: The College failed to effectively manage internal controls for returning Title IV funds, leading to noncompliance in issuing student credits.
  • Impacted Requirements: The College did not follow federal requirements for notifying students about owed funds and obtaining their authorization before applying credits.
  • Recommended Follow-Up: Management should enhance internal controls and review refund processes to ensure compliance with Title IV requirements.

Finding Text

2024-002 Agency: U.S. Department of Education Assistance Listing Numbers: 84.007, 84.033, 84.038, 84.063, 84.268 and 84.379 Programs: Student Financial Assistance Cluster Federal Award Identification Number: Various Federal Award Year: June 30, 2024 Criteria: Management is responsible for having internal controls and complying with the requirements when crediting and disbursing funds to a student's account. Condition: The College's internal controls over compliance requirements over the return of title IV funds (R2T4) were not operating effectively in 2024 as the College did not comply with the federal requirements as it relates to issuing a credit to a student. Context: There were 11 students that withdrew with Title IV aid and 2 were haphazardly selected for testing. The R2T4 calculation was correct however one of the students was entitled to have the funds returned. The College applied the funds to the students account without following the required notification process. The College did not notify the student there was an amount owed to them and proceeded with issuing a credit to the student's account without obtaining permission. The sample was not statistically valid sample. Questioned Costs: The amount of known questioned costs was determined to be $418. The projected questioned costs was $3,432. Cause: The College did not have effective internal controls over compliance in place to ensure that the College was following the required procedures when a student had R2T4 funds owed to them. The College did not comply with the grant by obtaining student's authorization regarding funds being returned and the College's controls did not prevent or detect the noncompliance. Effect: The College's internal controls were not operating effectively and did not prevent or detect the noncompliance with R2T4 as the proper procedures were not followed for refunding student credit balances. The noncompliance was not identified by the College. Recommendation: We recommend management review their internal controls over compliance currently in place and consider enhancing the controls to prevent potential noncompliance. We recommend management review their processes on refunding student credit balances related to R2T4 to ensure the College is in compliance with required procedures. Management's Response: Management agrees and has implemented necessary procedures and management oversight to meet the requirements.

Corrective Action Plan

Condition The College’s internal controls over compliance requirements over the return of Title IV funds (R2T4) were not operating effectively in 2024 as the College did not comply with the federal requirements as it relates to issuing a credit to a student. Corrective Action Plan Corrective Action Planned: The College will review processes and data collection related to students’ withdrawal or leave of absence. The result of this review will be a full operational and procedural detail of responsibilities, roles, timelines and documentation associated with the accurate processing of all withdrawals. To include Student Records, Student Accounts, Financial Aid and Return to Title IV. Name(s) of Contact Person(s) Responsible for Corrective Action: Naomi Coe, Financial Aid Director; Mariana Sanabria, VP for Enrollment Services; Marlene Neises, Executive Director for Institutional Effectiveness and Sponsored Programs; David Brzeczkowski, Controller; and Amanda Hodgson, CIO. Anticipated Completion Date: A preliminary meeting is scheduled for March 31, 2025 to discuss the implementation of the processes and responsibilities pertaining to a student withdraw and leave of absence. This meeting will provide an outline of the internal controls and processes to be implemented by July 31, 2025.

Categories

Questioned Costs Internal Control / Segregation of Duties Student Financial Aid HUD Housing Programs

Other Findings in this Audit

  • 547079 2024-001
    Significant Deficiency
  • 547080 2024-001
    Significant Deficiency
  • 547081 2024-001
    Significant Deficiency
  • 547082 2024-001
    Significant Deficiency
  • 547083 2024-001
    Significant Deficiency
  • 547084 2024-001
    Significant Deficiency
  • 547086 2024-002
    Significant Deficiency
  • 547087 2024-002
    Significant Deficiency
  • 547088 2024-002
    Significant Deficiency
  • 547089 2024-002
    Significant Deficiency
  • 547090 2024-002
    Significant Deficiency
  • 547091 2024-003
    Significant Deficiency
  • 547092 2024-003
    Significant Deficiency
  • 547093 2024-003
    Significant Deficiency
  • 547094 2024-003
    Significant Deficiency
  • 547095 2024-003
    Significant Deficiency
  • 547096 2024-003
    Significant Deficiency
  • 1123521 2024-001
    Significant Deficiency
  • 1123522 2024-001
    Significant Deficiency
  • 1123523 2024-001
    Significant Deficiency
  • 1123524 2024-001
    Significant Deficiency
  • 1123525 2024-001
    Significant Deficiency
  • 1123526 2024-001
    Significant Deficiency
  • 1123527 2024-002
    Significant Deficiency
  • 1123528 2024-002
    Significant Deficiency
  • 1123529 2024-002
    Significant Deficiency
  • 1123530 2024-002
    Significant Deficiency
  • 1123531 2024-002
    Significant Deficiency
  • 1123532 2024-002
    Significant Deficiency
  • 1123533 2024-003
    Significant Deficiency
  • 1123534 2024-003
    Significant Deficiency
  • 1123535 2024-003
    Significant Deficiency
  • 1123536 2024-003
    Significant Deficiency
  • 1123537 2024-003
    Significant Deficiency
  • 1123538 2024-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $19.30M
84.063 Federal Pell Grant Program $2.33M
84.031 Strengthening Institutions Program $411,204
84.033 Federal Work-Study Program $352,758
84.184 Mental Health Service Professional Demonstration Grant Program $332,874
47.076 Retention, Graduation, and Entry of Women Into Stem Careers $270,701
84.038 Federal Perkins Loan Program $266,924
43.008 National Aeronautics and Space Administration $161,703
47.074 New Futures in Science and Mathematics: Supporting Engagement $126,257
84.335 Clasp: Childcare for Low-Income Alverno Student Parents $86,646
84.325 Special Education - Personnel Development to Improve Services and Results for Children with Disabilities $76,707
84.007 Federal Supplemental Educational Opportunity Grants $62,163
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $14,858