Finding Text
2022-003 Return of Title IV Calculations (R2T4) Federal Agency: U.S. Department of Education Federal Program Title: Student Financial Aid Cluster ALN Number: 84.268 Award Period: October 1, 2021 to September 30, 2022 Type of Finding: - Significant Deficiency in Internal Control over Compliance - Other Matters Criteria or specific requirement: The Department of Education (ED) requires that R2T4 calculations are performed unless one module that includes 49% or more of the number of days in the payment period has been completed (34 CFR 668.22(a)). In addition, the Federal Student Aid Handbook, published by the Department of Education, states that percentages are calculated to four decimal places and is rounded to three decimal places for R2T4 calculations. Condition: During our testing, we noted 4 of the 18 students tested completed the first module which included over 49% of the days in the payment period and withdrew either before or during the second module, but incorrectly had R2T4 calculations applied, and funds returned to ED. The University also did not properly round to three decimal places for one of the student?s R2T4 calculations in the 18 students tested. The total dollars that the University returned to ED (but did not need to) was $9,588. Questioned costs: None Context: The University calculated R2T4 for modular students that had completed more than 49% of the days in the payment period. In addition, the University calculated one student's return without the form and did not properly round the completed percentage. Cause: There was a misinterpretation of the new regulations from ED. The University also did not use the form for the R2T4 calculation for every calculation. Effect: Loan funds were returned to ED that were supposed to go to the students ($9,567 in the sample) and a student's R2T4 was calculated incorrectly ($20 returned to ED over the required amount). Repeat finding: No Recommendation: We recommend the University update their R2T4 calculation process to eliminate the students that completed 49% of the payment period days in their modular classes. We also recommend the University use the R2T4 form for all calculations to avoid any potential rounding errors. Views of responsible officials: There is no disagreement with the audit finding.