FAC Explorer

Finding 578716 (2023-006)

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Requirement
N
Questioned Costs
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Year
2023
Accepted
2023-11-21
Audit: 3911
Organization: Vermont State Colleges (VT)
Auditor: Withumsmith+brown PC

AI Summary

  • Core Issue: The Colleges failed to return unclaimed Title IV funds within the required 240 days, affecting compliance with federal regulations.
  • Impacted Requirements: Institutions must return unclaimed funds to the Secretary of Education, with specific timelines for checks and EFTs.
  • Recommended Follow-Up: Review and improve procedures for monitoring outstanding checks and ensure timely returns of unclaimed funds.

Finding Text

Criteria According to 34 CFR 668.164(l): (1) Notwithstanding any State law (such as a law that allows funds to escheat to the State), an institution must return to the Secretary any title IV, Higher Education Act (“HEA”) program funds, except Federal Work Study (“FWS”) program funds, that it attempts to disburse directly to a student or parent that are not received by the student or parent. For FWS program funds, the institution is required to return only the Federal portion of the payroll disbursement. (2) If an EFT to a student's or parent's financial account is rejected, or a check to a student or parent is returned, the institution may make additional attempts to disburse the funds, provided that those attempts are made not later than 45 days after the EFT was rejected or the check returned. In cases where the institution does not make another attempt, the funds must be returned to the Secretary before the end of this 45-day period. (3) If a check sent to a student or parent is not returned to the institution but is not cashed, the institution must return the funds to the Secretary no later than 240 days after the date it issued the check. Condition Federal regulations require an institution to return unclaimed Title IV funds issued by check or EFT within 240 days. During our testing, we noted 3 students, out of a sample of 40, that had unclaimed funds exceeding the federal day limit by 27 to 224 days. Cause The Colleges did not have an effective procedures in place to monitor the outstanding check aging to ensure that the 240-day timeframe was met. Effect The Colleges did not return Title IV unclaimed funds to the Department of Education within the required 240-day time frame. Questioned Costs There were 3 outstanding checks totaling $4,729 which pertained specifically to federal-sourced funds. Perspective Our sample was not, and was not intended to be, statistically valid. Of the 40 students selected for testing, 3 students, or 7.5% of our sample, had unclaimed funds pertaining to federal sources that were not returned to the Department of Education within the 240-day required time frame. Recommendation The Colleges should examine its policies and procedures related to unclaimed funds including the process and time frame for identifying aged balances and the process for cancelling checks and returning funds to the Department of Education. View of Responsible Officials The Colleges agrees with the finding.

Categories

Student Financial Aid

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $26.17M
84.063 Federal Pell Grant Program $13.10M
84.042 Trio_student Support Services $1.50M
84.047 Trio_upward Bound $1.31M
93.575 Child Care and Development Block Grant $1.30M
84.033 Federal Work-Study Program $1.27M
59.077 Community Navigator Pilot Program $1.16M
84.007 Federal Supplemental Educational Opportunity Grants $1.11M
59.037 Small Business Development Centers $1.01M
90.601 Northern Border Regional Development $810,690
84.031 Higher Education_institutional Aid $797,633
84.116 Fund for the Improvement of Postsecondary Education $333,171
84.425 Education Stabilization Fund $329,611
94.006 Americorps $308,447
84.048 Career and Technical Education -- Basic Grants to States $292,268
84.217 Trio_mcnair Post-Baccalaureate Achievement $246,016
21.027 Coronavirus State and Local Fiscal Recovery Funds $238,154
16.753 Congressionally Recommended Awards $224,446
93.236 Grants to States to Support Oral Health Workforce Activities $210,251
45.162 Promotion of the Humanities_teaching and Learning Resources and Curriculum Development $175,896
17.285 Apprenticeship USA Grants $169,186
93.859 Biomedical Research and Research Training $150,474
84.334 Gaining Early Awareness and Readiness for Undergraduate Programs $146,104
47.073 National Science Foundation/uvm/ns $123,509
93.959 Block Grants for Prevention and Treatment of Substance Abuse $90,548
93.778 Medical Assistance Program $77,868
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $75,721
11.611 Manufacturing Extension Partnership $67,504
93.958 Block Grants for Community Mental Health Services $64,295
93.243 Substance Abuse and Mental Health Services_projects of Regional and National Significance $62,000
59.059 Congressional Community Project $58,847
47.050 Geosciences $52,669
20.205 Highway Planning and Construction $48,093
93.855 Allergy, Immunology and Transplantation Research $47,906
11.307 Economic Adjustment Assistance $41,778
93.084 Prevention of Disease, Disability, and Death by Infectious Diseases $38,305
84.181 Special Education-Grants for Infants and Families $33,910
10.575 Farm to School Grant Program $20,408
17.720 Disability Employment Policy Development $19,364
10.500 Cooperative Extension Service $17,899
43.001 Science $7,008
93.434 Every Student Succeeds Act/preschool Development Grants $7,000
45.025 Promotion of the Arts_partnership Agreements $3,122
11.467 Meteorologic and Hydrologic Modernization Development $1,066
93.888 Specially Selected Health Projects $944