Finding 623398 (2022-002)

Significant Deficiency
Requirement
N
Questioned Costs
-
Year
2022
Accepted
2023-02-22
Audit: 48971
Organization: Hendrix College (AR)
Auditor: Forvis LLP

AI Summary

  • Core Issue: The College failed to maintain Perkins loan records as required by 34 CFR 674.19(e), specifically missing master promissory notes (MPNs) for several loans.
  • Impacted Requirements: Compliance with federal regulations on recordkeeping and retention for Perkins loans, affecting documentation integrity.
  • Recommended Follow-up: The College should review and improve its record retention processes, including an inventory of loan documents, by May 31, 2023.

Finding Text

Criteria: Special Tests and Provisions ? Perkins Loan Recordkeeping and Record Retention ? Institutions are required to properly maintain its Perkins loan records in the manner set forth in 34 CFR 674.19.(e). Condition: The College did not maintain Perkins loan records in the manner set forth in 34 CFR 674.19.(e). (Other Instance of Noncompliance) Questioned Costs: None. Context: During testing of Perkins loan recordkeeping and record retention, for open loans at year end 5/31/22, 5 of 25 selections did not have records of the related master promissory note (MPN). A sample of 25 were selected for testing from a population of 384. For loans retired or assigned within the previous three years, 4 of 19 selections did not have records of the related MPN. A sample of 19 were selected for testing from a population of 182. Our sample selection was not, and was not intended to be, statistically valid. Effect: The College does not have documentation of MPNs for the errors identified. Cause: The College?s processes did not ensure MPNs were properly retained. Identification as a Repeat Finding, if Applicable: N/A Recommendation: The College should revisit the record retention for student related files. Views of Responsible Officials and Planned Corrective Actions: Administration concurs with the findings. Effective with the Fiscal Year 2014, the College engaged with a third-party provider which put the Perkins loan processing on a digital platform. The College will review its record storage system of both hardcopy documentation as well as digital document storage and access for protection, preservation and completeness. Further the College will perform an inventory of loan documents currently in storage to identify additional files that are missing master promissory notes. Anticipated Completion Date: May 31, 2023

Categories

Special Tests & Provisions Student Financial Aid Equipment & Real Property Management Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 46956 2022-002
    Significant Deficiency
  • 46957 2022-001
    Significant Deficiency
  • 46958 2022-001
    Significant Deficiency
  • 46959 2022-003
    Significant Deficiency
  • 46960 2022-003
    Significant Deficiency
  • 623399 2022-001
    Significant Deficiency
  • 623400 2022-001
    Significant Deficiency
  • 623401 2022-003
    Significant Deficiency
  • 623402 2022-003
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $4.80M
84.425 Higher Education Emergency Relief Fund (heerf) Student Aid Portion $1.55M
84.063 Federal Pell Grant Program $1.31M
84.038 Federal Perkins Loan Program $696,041
93.859 Biomedical Research and Research Training $241,880
84.033 Federal Work-Study Program $208,596
84.007 Federal Supplemental Educational Opportunity Grants $167,839
47.076 Stem Education $151,553
47.074 Biological Sciences $144,553
84.425 Higher Education Emergency Relief Fund (heerf) Institutional Portion $100,000
47.050 Geosciences $72,324
45.160 Promotion of the Humanities Fellowships and Stipends $10,000
15.615 Cooperative Endangered Species Conservation Fund $4,928
15.634 State Wildlife Grants $3,703