Finding 625385 (2022-001)

Material Weakness
Requirement
A
Questioned Costs
-
Year
2022
Accepted
2022-11-16
Audit: 42168
Organization: Belhaven University (MS)
Auditor: Forvis LLP

AI Summary

  • Core Issue: The university applied emergency grants to student accounts without getting explicit permission from the students.
  • Impacted Requirements: This practice violates guidelines set by the CARES Act and related legislation regarding how funds should be distributed.
  • Recommended Follow-Up: Management should enhance procedures to ensure proper authorization for applying funds and verify compliance with federal award regulations.

Finding Text

COVID-19 ? Education Stabilization Fund, Assistance Listing No. 84.425 U.S. Department of Education Award Year 2021-2022 Criteria or specific requirement ? Activities Allowed or Unallowed? CARES Act Section 18004(c); CRRSAA section 314(c)(3) and ARP section 2003 Condition ? The institution applied emergency grants to students and applied amounts to students? outstanding account balances without obtaining explicit authorization from students. Questioned costs ? ALN 84.425E ? $10,645 ? Questioned costs include amounts applied to students? outstanding account balances for students who requested a cash grant. Context ? Out of a population of 1,028 grants to students, 25 student grants were selected for testing. Our sampling method was not, and was not intended to be, statistically valid. Of the transactions tested, 4 were applied to students? outstanding account balances without obtaining explicit authorization for applying the amount to the outstanding balances. Three of the students request both to have the funds assist with tuition and other institutional charges and to have a cash grant, and one student only selected to get a cash grant. There was no documentation of clarification with the student how much they needed as a cash grant and how much they wanted to apply to tuition or institutional charges. Effect ? The University reduced outstanding accounts receivable balances rather than distributing emergency grants to students. Cause ? The University?s controls did not ensure that the amounts applied to students? outstanding account balances were only applied with authorization from the students. Identification as a repeat finding, if applicable ? N/A Recommendation ? Management should review procedures around expenditures of federal awards to ensure that controls are properly designed to ensure expenditures on allowable activities. Views of responsible officials and planned corrective actions ? Belhaven University personnel are verifying 100 percent of CARES grant applications to be sure the University awarded CARES grant monies consistently and based on explicit authorization from students.

Categories

No categories assigned yet.

Other Findings in this Audit

  • 48940 2022-002
    Significant Deficiency
  • 48941 2022-002
    Significant Deficiency
  • 48942 2022-001
    Material Weakness
  • 48943 2022-001
    Material Weakness
  • 48944 2022-001
    Material Weakness
  • 48945 2022-001
    Material Weakness
  • 625382 2022-002
    Significant Deficiency
  • 625383 2022-002
    Significant Deficiency
  • 625384 2022-001
    Material Weakness
  • 625386 2022-001
    Material Weakness
  • 625387 2022-001
    Material Weakness

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $30.05M
84.063 Federal Pell Grant Program $3.78M
84.007 Federal Supplemental Educational Opportunity Grants $427,643
84.033 Federal Work-Study Program $394,721
84.379 Teacher Education Assistance for College and Higher Education Grants (teach Grants) $141,383
84.031 Higher Education_institutional Aid $103,158
84.425 Education Stabilization Fund $20,000