Finding Text
Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster Federal Assistance Listing Number: 84.268 Award Period: June 1, 2021 ? May 31, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 685.203 specifies the annual and aggregate loan limits the Institutions may not exceed for an academic year of study under the Direct Loan program and also requires loans to be prorated for a program of student that is less than a full academic year in length. Condition: During our testing, we noted one out of the 40 students? tested for eligibility were not properly awarded subsidized Stafford loans. A student reported themselves as a sophomore during the 2021-22 academic year; however, the student was actually a freshman. The student?s Stafford loans were incorrectly overawarded $1,000 of subsidized loans. Questioned Costs: $1,000 Context: The student reported on his FAFSA that he would be a sophomore in the 2021-22 academic year. This response pulls through Banner which triggers the Grade Level and Subsidized Loan amount to be offered. The student was awarded $4,500 as a Sophomore; however, did not reach Sophomore status during the academic year therefore should have been awarded the maximum Subsidized loan amount for a Freshman of $3,500. Ultimately, the University over awarded the student in the amount of $1,000. Cause: The University's processes and controls did not ensure that student was correctly awarded based on their academic level causing the student to be over awarded for the 2021-22 academic year. Effect: The University is awarding subsidized Stafford loans for which the student is not eligible. However, the over awarded subsidized loan can be corrected by awarding an unsubsidized loan in place of it. Repeat Finding: No Auditor?s Recommendation: We recommend the University review its procedures to ensure the students' academic level is correctly reported to ensure proper awarding. Views of Responsible Officials and Planned Corrective Actions: There is no disagreement with the audit finding.