Finding 609149 (2022-001)

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Requirement
E
Questioned Costs
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Year
2022
Accepted
2023-03-20
Audit: 36678
Organization: Stevenson University, Inc. (MD)
Auditor: Bdo USA LLP

AI Summary

  • Core Issue: The University failed to accurately calculate the Cost of Attendance (COA) and Pell Grant awards for some students.
  • Impacted Requirements: This oversight violates federal regulations regarding Title IV aid eligibility and proper disbursement.
  • Recommended Follow-Up: Enhance policies and procedures to ensure compliance with federal regulations for calculating and awarding Title IV aid.

Finding Text

Program Information: Federal Supplemental Educational Opportunity Grants (ALN: 84.007), Federal Work-Study Program (ALN: 84.033), Federal Pell Grant Program (ALN: 84.063), Federal Direct Student Loans (ALN: 84.268) Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): E. Eligibility ? Calculation of Benefits ? Awards must be coordinated among the various programs and with other federal and nonfederal aid (need and non-need based aid) to ensure that total aid is not awarded in excess of the student?s financial need or cost of attendance (?COA?) (34 CFR 668.42, FWS, and FSEOG, 34 CFR 673.5 and 673.6; Direct Loan, 34 CFR 685.301). For Title IV programs, the COA is generally the sum of the following: tuition and fees; an allowance for books, supplies, transportation, and miscellaneous personal expenses; an allowance for room and board; when applicable, allowances for costs for dependent care; costs associated with study abroad and cooperative education; costs related to disabilities; and fees charged for student loans. E. Eligibility ? Federal Pell Grant (Assistance Listing 84.063) ? Each year, based on the maximum Pell Grant established by Congress, the U.S. Department of Education (?ED?) provides to institutions Payment and Disbursement Schedules for determining Pell awards. The Payment Schedule provides the maximum scheduled award a student would receive for a full academic year as a full-time student based on their expected family contribution (?EFC?) and COA. The Disbursement Schedules are used to determine annual awards for full-time, three-quarter time, half-time, and less-than-half-time students. The steps to determine Pell awards are as follows: (a) Determine the student?s enrollment status, (b) calculate the cost of attendance, (c) determine the annual award, (d) determine the payment period, (e) calculate the payment for the payment periods, and (f) disburse funds at prescribed times. Condition: For certain students identified through our testing, the University did not properly calculate the student?s COA. Additionally, for certain students the University improperly calculated the student?s Pell award. Cause: Administrative oversight with respect to Title IV aid award eligibility. Effect or Potential Effect: The University is not in compliance with aid awarding criteria under the eligibility requirements. Failure to properly determine students? COAs and calculate eligible award amounts could result in improper disbursements of Title IV funds. Questioned Costs: Below reporting threshold. Context: We noted the following exceptions: ? For 2 of 25 students selected for testing, the University did not properly calculate the student?s COA and for 1 of 25 students, the student was disbursed aid in excess of their COA. ? For 1 of 25 students selected for testing, the University did not properly calculate the student?s Pell award. Identification of Repeat Finding: No similar findings noted in the prior year. Recommendation: We recommend the University enhance its policies and procedures to ensure that Title IV aid is properly calculated, awarded and disbursed, consistent with federal regulations.

Categories

Student Financial Aid Matching / Level of Effort / Earmarking Eligibility Reporting

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $25.74M
84.063 Federal Pell Grant Program $4.22M
84.425 Covid-19 - Education Stabilization Fund - Higher Education Emergency Relief Fund Student Portion $3.59M
84.425 Coivd-19 - Education Stabilization Fund - Higher Education Emergency Relief Fund Institutional Portion $3.51M
84.007 Federal Supplemental Educational Opportunity Grants $341,616
84.033 Federal Work-Study Program $184,188
84.425 Covid-19 - Education Stabilization Fund - Governor's Emergency Education Relief Fund $20,930