Finding 612594 (2022-001)

Material Weakness
Requirement
E
Questioned Costs
$1
Year
2022
Accepted
2022-12-14

AI Summary

  • Core Issue: The Seminary exceeded federal loan limits for 4 out of 14 loans tested, totaling $7,601 over the allowed amounts.
  • Impacted Requirements: Compliance with 2CFR § 200.91 regarding eligibility and aggregate loan limits for subsidized and unsubsidized loans.
  • Recommended Follow-Up: Enhance procedures for loan disbursement and implement additional reviews of student eligibility, ensuring documentation of management's oversight.

Finding Text

Finding Number: 2022-001 Compliance Requirement: Eligibility ? Aggregate Loan Limits for Subsidized and Unsubsidized Loans 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 the loans disbursed by the Seminary are within the loan limits prescribed in the 2CFR ? 200.91. See below for loan limits for fiscal year ending June 30, 2022. Aggregate Loan Limits for Subsidized and Unsubsidized Loans: Aggregate loan limits for subsidized and unsubsidized loans are: $31,000 for a dependent undergraduate student (except for dependent students whose parents cannot borrow a Federal Parent PLUS (PLUS) loan) (subsidized loan portion may not exceed $23,000 of the aggregate limit amount); $57,500 for an independent student and for a dependent student whose parents cannot borrow a PLUS loan (subsidized loan portion may not exceed $23,000 of the aggregate limit amount); and $138,500 for a graduate or professional student (subsidized portion limited to $65,500). This $138,500 limit includes loans for undergraduate study. Condition: The Seminary is not in compliance with ensuring that certain loans are within loan limits as described above. For 4 out of the 14 loans tested, Federal Direct Loan funds were disbursed in excess of the aggregate subsidized and unsubsidized direct loan limit. The amount over aggregate loan limits totaled $7,601 for the population ($1,147,469) tested. Cause: The Seminary personnel did not follow the Federal requirement for aggregate loan limits. Effect or Potential Effect: Wesley is not in compliance with packaging direct loans within aggregate loan limits. Questioned Costs: Known questioned costs are $7,601. Context: This is a condition based on testing of the Seminary?s compliance with eligibility provisions of the Uniform Guidance. 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 that the Seminary enhance its procedures to ensure that Federal Direct Loans are awarded/disbursed in accordance with federal guidelines. We also recommend the Seminary to implement additional review of student eligibility determinations. Documented evidence of management?s review of this information should be maintained.

Categories

Questioned Costs Student Financial Aid Eligibility Matching / Level of Effort / Earmarking Special Tests & Provisions

Other Findings in this Audit

  • 36150 2022-001
    Material Weakness
  • 36151 2022-002
    Significant Deficiency
  • 36152 2022-001
    Material Weakness
  • 36153 2022-002
    Significant Deficiency
  • 612592 2022-001
    Material Weakness
  • 612593 2022-002
    Significant Deficiency
  • 612595 2022-002
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $1.15M
84.425 Covid-19 - Education Stabilization Fund Higher Education Emergency Relief Fund - Institutional Portion $289,043
84.425 Covid-19 - Education Stabilization Fund Higher Education Emergency Relief Fund - Student Aid Portion $265,017
84.033 Federal Work-Study Program $12,591