Finding 577820 (2023-003)

Material Weakness
Requirement
N
Questioned Costs
-
Year
2023
Accepted
2023-11-08
Audit: 2584
Organization: McMurry University (TX)
Auditor: Eide Bailly LLP

AI Summary

  • Core Issue: McMurry failed to notify students about Direct Loan disbursements within the required timeframe, affecting 39 out of 60 tested cases.
  • Impacted Requirements: Compliance with 34 CFR 668.165(a) regarding timely disbursement notifications to students or parents.
  • Recommended Follow-Up: Conduct refresher training for financial aid staff on loan disbursement notification procedures to prevent future issues.

Finding Text

Finding 2023-003 Federal Agency Name: U.S. Department of Education Program Name: Student Financial Assistance Cluster ALN: 84.268 Federal Award Number: P268K222290, P268K232290 Award Year: 2022-2023 Type of Finding: Material Weakness in Internal Control over Compliance and Material Noncompliance Compliance Requirement: Special Tests and Provisions – Disbursements to or on Behalf of Students Criteria: Per 34 CFR 668.165(a), if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of the anticipated date and amount of the disbursement, the student or parent’s right to cancel all or a portion of the loan, and the procedures by which the institution must be notified if he or she wishes to cancel the loan. McMurry does not require students to provide affirmative confirmation of Title IV award amounts. Per 34 CFR 668.165(a), institutions that do not obtain affirmative confirmation of the accepted loan amounts must provide the aforementioned disbursement notice in writing no earlier than 30 days before, and no later than 7 days after, crediting the student's institutional account. Condition: We tested a sample of 60 students who received Title IV funds during the year. Of those students, we tested disbursement notification records for the students who received Direct Loans during the year. We noted errors in 39 student files. Students were either notified of Fall 2022 and Spring 2023 Direct Loan disbursements more than 7 days after their student accounts were credited with the disbursements, or received no notification of the student loan disbursement. Cause: Loan disbursement notifications are provided to a list of students following each round of aid disbursements. The list of students who require notification comes from a financial aid software report. Financial aid staff provide notifications based on the generated list. The University hired a new loan coordinator during the year under audit. The change in staffing resulted in missed and late student loan notifications. Effect: Certain students may have been temporarily unaware that they had Title IV funds applied to their account and available for their use. Questioned Costs: None reported. Context/Sampling: A nonstatistical sample of 60 students who received $686,202 in Title IV Aid, out of a population of 953 students who received $9,993,184 in Title IV aid. 39 of the students had errors in loan disbursement notification. These students received $495,936 in Title IV aid. Repeat Finding from Prior Year: No Recommendation: We recommend the University perform refresher training with all staff assigned to perform loan disbursement notification procedures. View of Responsible Officials: Management agrees with the finding. See Corrective action plan.

Categories

Student Financial Aid Material Weakness Matching / Level of Effort / Earmarking Special Tests & Provisions Internal Control / Segregation of Duties

Other Findings in this Audit

  • 1368 2023-004
    Material Weakness
  • 1369 2023-004
    Material Weakness
  • 1370 2023-002
    Material Weakness
  • 1371 2023-004
    Material Weakness
  • 1372 2023-002
    Material Weakness
  • 1373 2023-004
    Material Weakness
  • 1374 2023-002
    Material Weakness
  • 1375 2023-003
    Material Weakness
  • 1376 2023-004
    Material Weakness
  • 1377 2023-002
    Material Weakness
  • 1378 2023-003
    Material Weakness
  • 1379 2023-004
    Material Weakness
  • 1380 2023-004
    Material Weakness
  • 1381 2023-004
    Material Weakness
  • 577810 2023-004
    Material Weakness
  • 577811 2023-004
    Material Weakness
  • 577812 2023-002
    Material Weakness
  • 577813 2023-004
    Material Weakness
  • 577814 2023-002
    Material Weakness
  • 577815 2023-004
    Material Weakness
  • 577816 2023-002
    Material Weakness
  • 577817 2023-003
    Material Weakness
  • 577818 2023-004
    Material Weakness
  • 577819 2023-002
    Material Weakness
  • 577821 2023-004
    Material Weakness
  • 577822 2023-004
    Material Weakness
  • 577823 2023-004
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $6.43M
84.031 Higher Education_institutional Aid $607,287
84.042 Trio_student Support Services $308,352
84.038 Federal Perkins Loans $209,969
84.425 Education Stabilization Fund $143,378
84.033 Federal Work-Study Program $142,963
84.007 Federal Supplemental Educational Opportunity Grants $112,920
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $10,844
19.009 Academic Exchange Programs - Undergraduate Programs $7,793
84.063 Federal Pell Grant Program $160