Finding Text
Need Analysis
DEPARTMENT OF EDUCATION
ALN #: 84.268 Federal Direct Loans
Federal Award Identification: 2022-2023 Award Year
Condition: Students were not appropriately awarded subsidized loans based on need.
Criteria: 34 CFR 668.42 and 34 CFR 685.301
Questioned Costs: $2,234
Context: Out of 60 students tested, 3 students were not awarded aid appropriately based on need analysis. One student received a subsidized loan exceeding need by $2,234, corrected by returning this over award or getting permission from the student to award as a unsubsidized loan. Two students received subsidized loans exceeding need by $236 and $2,692, respectively, corrected by reallocating the amounts from subsidized to unsubsidized.
Cause: The University incorrectly set up endowed scholarships as excluded from estimated financial assistance in their new system.
Effect: Students received subsidized federal aid for which they were not eligible and incorrect allocation of subsidized versus unsubsidized which affects the amount and timing of interest the student must repay.
Identification as repeat finding, if applicable: N/A
Recommendation: We recommend the University ensure that all endowed scholarships are marked as estimated financial assistance and an awarding check is done accurately before disbursement is completed for the student.
Views of Responsible Officials and Planned Corrective Action: Management is in agreement with this finding. See attached corrective action plan.