Finding 551506 (2024-003)

Finding No.: 2024 003 – Verification Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster – Federal Pell Grant Program and Federal Direct Loan Program ALN Number: 84.063 and 84.268 Federal Award Year: July 1, 2023 – June 30, 2024 Criteria An institution is required to establish written policies and procedures that incorporate the provisions of 34 CFR 668.51 through 668.61 for verifying applicant information for those applicants selected for verification by ED. The institution shall require each applicant whose application is selected by ED to verify the information required for the Verification Tracking Group to which the applicant is assigned. For students who are assigned to the Standard Verification Group (V1), the institution must verify the following: adjusted gross income; U.S. income tax paid; untaxed portions of IRA distributions; untaxed portions of pensions; IRA deductions and payments; tax-exempt interest income; education credits; household size; number in college. For students who are assigned to the Custom Verification Group (V4), the institution must verify identity/statement of educational purpose (SEP). For students who are assigned to the Aggregate Verification Group (V5), the institution must verify identity/SEP in addition to the items in the Standard Verification Group. If any discrepancies are identified, the institution is required to submit a correction and obtain an updated SAR. Additionally, Title 2 U.S. Code of Federal Regulations Part 200 (2CFR 200) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, section 303(a) states, the 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 statues, 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). Conditions Found For one (1) out of 2140 students selected for testwork, one (1) of the ten (10) required verification elements, specifically the student's income earned from work, was not verified by the University. Cause The condition resulted from the University’s internal control processes not operating consistently to ensure that each specified data element was appropriately verified. Specifically, the University’s control of completely reviewing all specified data elements was not operating at a level of precision that would cover all specified data elements. Possible Asserted Effect Failure to perform verification procedures over all required data elements could result in awarding students more or less aid than they would otherwise qualify for. Questioned Costs No questioned costs were identified. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Repeat Finding The conditions found do not constitute a repeat finding from the prior year. Views of Responsible Officials Management accepts this finding. The error on the verification (1 student) was made by a former staff that did not verify the student wages. Clarkson’s procedure clearly states the income is required to be verified, however the former staff member made an error in processing this verification. Improvements to the training process have been implemented including emphasis on the requirement that staff verify income as part of the review process. A multi-tier review system has been implemented whereby after the initial review process has been completed, verification documents are submitted to the Director who then performs a second review to ensure that the initial review process was correctly followed and that the data is reliable.