Finding Text
Finding Number: 2022-002 Compliance Requirement: Eligibility ? Maintain good standing or satisfactory academic progress Federal Program Information: United States Department of Education Assistance Listing Number: # 84.268 Assistance Listing Name: Student Financial Assistance Cluster -Federal Direct Student Loans Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation): Eligibility ? The Seminary shall ensure that students maintain a good standing or satisfactory academic progress in order to be eligible for the Federal direct student loans per the OMB Compliance Supplement. See below for policies and procedures on this matter. Students receiving Federal loans must be held to both qualitative as well as quantitative Satisfactory Academic Progress (SAP) standards set forth by the Seminary. It is the Seminary?s policy that students must maintain a cumulative Grade Point Average (GPA) of 2.3 in order to continue receiving federal funding. At the conclusion of spring semester each year, SAP will be evaluated on each student receiving merit aid, needing grants and/or Stafford loans. If the Financial Aid Committee makes the determination that a student is not meeting SAP requirements, either at the required pace or through the required GPA, the student is put on financial aid warning. Students not meeting the minimum requirement will be notified and be given an opportunity to appeal. Students must submit an appeal letter explaining the cause of the academic issues or mitigating personal circumstances that may have led to poor performance and a plan to improve his or her GPA. The Financial Aid Committee will then render a decision on whether to grant the appeal. If the appeal is granted, the student will be awarded his/her aid for the following academic year after which SAP will be re-evaluated. If at the end of the probationary/appeal year, if the student has met the required minimum GPA for the type of aid received, the aid will be reinstated. If SAP is not met by the end of the probationary/appeal year, the aid will not be reinstated. Second appeals are rare and at the discretion of the Financial Aid Committee. If the student has not met SAP a second time, but has shown significant progress over the probationary year rather than repeating the same level of poor performance, a second appeal may be granted. Condition: For 1 out of the 14 loans tested, the loan was awarded to a student who did not meet the GPA requirement as set forth in the Seminary?s policy. No appeal letter was provided for the student, and no documentation was maintained to evidence management?s decision to award the loan. Cause: The Seminary personnel did not adhere to the Seminary?s documented policies and procedures for ensuring that the loans are distributed to students who maintain good standing or satisfactory academic progress. Effect or Potential Effect: The Seminary is not in compliance with the eligibility requirement which could lead to questioned costs. Questioned Costs: Not determinable. Context: This is a condition based on testing of the Seminary?s compliance with specified requirements. The prevalence of these findings is detailed in the condition section above. The samples were selected using a non-statistical method. Identification as a Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Seminary enhance its procedures to ensure that Federal Direct Loans are awarded/disbursed in accordance with federal guidelines and we recommend the Seminary implement additional review on student eligibility determinations. In the case where a student submits an appeal, such appeal should undergo two levels of review, not only by the Student Financial Aid Director but also by management. The appeal should be retained file and the review should be properly documented.