Finding 634851 (2022-002)

-
Requirement
N
Questioned Costs
-
Year
2022
Accepted
2022-12-14
Audit: 54014
Organization: St. Thomas University Inc. (FL)
Auditor: Bdo USA LLP

AI Summary

  • Core Issue: The University failed to issue refunds for Federal Student Aid credit balances within the required 14-day timeframe.
  • Impacted Requirements: Non-compliance with federal regulations regarding disbursements to students, specifically 34 CFR 668.164(h).
  • Recommended Follow-Up: Implement a regular review process for credit balances to ensure timely refunds and maintain compliance with federal guidelines.

Finding Text

Federal Program Information: Federal Direct Student Loans (ALN #84.268) Criteria or Specific Requirement: Special Tests and Provisions ? Disbursements to or on Behalf of Students ? Federal Student Aid (?FSA?) Credit Balances - Where disbursements created a credit balance in the student account and the student or parent did not provide an authorization for the institution to retain funds, the institution must provide the credit balance amount to the student within 14 days of the date the balance was created (34 CFR 668.164(h)). Condition: Instances where the University did not issue a refund within the required timeframe. Cause: Lack of administrative oversight with respect to disbursements to or on behalf of students, including inadequate review and tracking of refunds due. Effect or Potential Effect: The University was not in compliance with disbursements to or on behalf of students. Questioned Costs: None. Context: For 2 of 25 students selected for testing, the University did not issue the refund within the required 14 days. Identification as a Repeat Finding: There was no similar finding in the prior year. Recommendation: We recommend the University complete a timely review of credit balances in order to issue all refunds with respect to FSA credit balances within the required timeframe. We also recommend timely review of refunds due. Views of Responsible Officials: The Policy and Procedures manual has been updated to reflect the following updated process: The Business Office processes student refunds within 14 days after a Title IV credit balance appears on a student?s account. At least once per week, the Refunds Coordinator generates a refund report (ARTM) which lists students with credit balances. The University?s policy is that all refunds are processed via ACH (direct deposit), and all students are required to provide their bank account information. Communication is sent to students throughout the semester reminding them to sign up for direct deposit. To ensure that all students receive their refunds by the required 14 days, a paper check is issued to students missing banking information. Checks are sent to the mailing address on file. Communication will continue to be sent to all students encouraging them to sign up for ACH refunds. However, refunds are processed timely even if the banking information is not available.

Categories

Special Tests & Provisions Student Financial Aid Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $58.08M
84.063 Federal Pell Grant Program $5.25M
84.038 Federal Perkins Loan Program $1.87M
84.425 Higher Education Emergency Relief Fund - Student Portion $1.10M
93.566 Refugee and Entrant Assistance - Discretionary Grants/ State Administered Programs $718,694
84.033 Federal Work-Study Program $654,194
84.425 Higher Education Emergency Relief Fund - Institutional Portion $246,101
84.120 Minority Science & Engineering Improvement Program $168,528
84.007 Federal Supplemental Educational Opportunity Grants $149,708
84.031 Stem Space $71,666
93.264 Nurse Faculty Loan Program (nflp) $17,250
10.223 Hispanic Serving Institutions Education Grants $8,718