Finding Text
SIGNIFICANT DEFICIENCY 2022-007 Student Financial Assistance Program Cluster ? Title IV ? Federal Direct Student Loans (Direct Loan) ? 84.268 ? Eligibility Criteria or specific requirement The determination of need-based student financial assistance amounts is based upon financial need. Internal controls should be in place to ensure that students are awarded loans based upon the limits set by eligibility requirements. Condition During testing, it was discovered that two students were over awarded subsidized direct loans. Cause The institution did not recognize that an over award existed within the subsidized direct loans and that a portion of the subsidized loans would need to be changed to unsubsidized loans in order to avoid it. Effect Total over awards are $1,276. Total estimated over awards are $6,178. Context A total of 17 students were examined for proper award of direct loans. Of that number, there were two instances where the subsidized award amount was calculated incorrectly. This resulted in over awards totaling $1,276. Recommendation We recommend that the institution implement controls to ensure that direct loan award amounts are reviewed for accuracy prior to making awards to students. Views of responsible officials and planned corrective actions See corrective action plan.