Finding Text
Criteria: In accordance with CFR section 685.200(a)(2)(i), "A Direct Subsidized Loan borrower must
demonstrate financial need in accordance with title IV, part F of the Act". 20 U.S. Code 1087kk, "Except
as otherwise provided therein, the amount of need of any student for financial assistance under this
subchapter (except subparts [1] 1 or 2 of part A of this subchapter) is equal to: the cost of attendance of
such student, minus the expected family contribution for such student, minus estimated financial
assistance not received under this subchapter (as defined in section 1087vv(j) of this title)."
Condition: We reviewed a sample of 40 students who received financial aid during the fiscal year. Out of
the 40 students tested, 1 student was awarded aid in excess of the calculated financial need for the
semester.
Effect: The student being granted federal aid in an amount higher than the calculated need can result in
unintended financial burden on the student, resulting in increased debt obligations upon graduation. On
a systematic level, this condition may result in the College over-rewarding students who do not have a
need for aid.
Cause: The process for calculating financial need is the responsibility of the College. The Financial Aid
Office is responsible for determining student financial need and making adjustments to federal loan
amounts when scholarships and grants are received by the students, as well as if the enrollment status
changes between full time and part time. This student dropped from full time to part time during the
semester, and the adjustment to the subsidized loan amount was not made or transferred to the
unsubsidized loan.
Recommendation: We recommend the College evaluate and enhance the college's financial aid awarding
procedures to prevent future instances of over-awarding. We recommend the College establish a system
for ongoing monitoring of financial aid awards to identify and address discrepancies in a timely manner.
Regularly review and update policies and procedures to adapt to changes in regulations and best
practices.
Views of responsible official and planned corrective actions:
Management agrees with the finding as noted above and the financial aid office will review and update
policies and procedures in the Clarendon College Financial Aid Handbook to establish system for ongoing
monitoring of financial aid awards in order to identity and address discrepancies and potential overawards
in a timely manner. The system will include monitoring Cost Of Attendance, enrollment status,
and unmet need. The policy/procedure will be reviewed and submitted for adoption by the CC Board of
Regents for the Clarendon College Financial Aid Handbook by February 2024.