Finding Text
Finding 2023-003 Return of Funds: (Significant Deficiency)
Federal Agency: Department of Education
Program: Federal Direct Student Loans
AL #: 84.268
Award Year: 2022-2023
Criteria: Per CFR 668.22(e), the unearned amount of Title IV assistance to be returned is calculated by subtracting the amount of Title IV assistance to be earned by the student from the amount of Title IV aid that was disbursed to the student as of the date of the institution’s determination that the student withdrew.
Condition: Two out of thirty-three students tested for return of funds were not returned timely.
Cause: There was a change in the student financial aid system in the current year resulting in delays in the funds being returned within 45 days.
Effect: The institution did not return funds within the required 45 days and therefore held onto funds longer than allowed.
Questioned Costs: None.
Context: Two out of thirty-three students tested for return of funds were not returned timely.
Repeat Finding: Not considered a repeat finding.
Recommendation: We recommend the University implement a control to track potential return of funds in order to ensure they are returned within the required timeframe.
Views of Responsible Officials: Prior to the student information system transition, regular monitoring of the return of funds took place for Direct Loans, specifically for the returns associated with R2T4 calculations. During the transition, this process was not immediately replaced. It was noted during the audit cycle that issues existed within the new system related to returning funds and tickets were submitted to Jenzabar about the issues, specifically raising concerns about the timing of returns. Not all returns were being picked up by the process that collects the returns and sends them in batches to COD. Adjustments have been made to the system and testing has shown that all of the returns are being picked up now. The Financial Aid Office is also regularly monitoring returns again, similar to the process prior to the transition, and we are now monitoring both Direct Loan and Pell grant returns. This process is managed by an Excel spreadsheet of all Direct Loan and Pell grant returns that have been made in JFA. Any time a return of a Direct Loan or Pell grant is made in JFA, the return is added to the spreadsheet. A Financial Aid Counselor has a regular reminder on their calendar once per week to monitor each return to ensure that the full return process has taken place through COD and that the funds have been returned timely.