Finding 796 (2023-002)

Significant Deficiency
Requirement
P
Questioned Costs
-
Year
2023
Accepted
2023-10-27
Audit: 1535
Organization: Art Academy of Cincinnati (OH)

AI Summary

  • Core Issue: Two students were incorrectly reported as having a leave of absence instead of being classified as withdrawn, violating federal guidelines.
  • Impacted Requirements: The Academy failed to meet the conditions outlined in the Federal Student Aid Handbook for approved leaves of absence, necessitating an R2T4 calculation.
  • Recommended Follow-Up: The Academy should review and update its policies on reporting leaves of absence to ensure compliance with federal requirements.

Finding Text

Federal Program: Federal Direct Student Loans [AL #84.268]. Criteria: Per the Federal Student Aid Handbook, a leave of absence must meet certain conditions to be counted as a temporary interruption in a student’s education instead of being counted as a withdrawal requiring a school to perform an R2T4 calculation. If an LOA does not meet the conditions for an approved leave of absence, the student is considered to have ceased attendance and to have withdrawn from the school, and the school is required to perform an R2T4 calculation. Condition: 1 out of 17 students selected for enrollment reporting was incorrectly determined and reported as having a leave of absence. Additionally, 1 out of 6 students selected for return of funds testing was incorrectly determined and reported as having a leave of absence. Neither of the students met the conditions for an approved leave of absence and therefore should have been reported as withdrawn from the Academy. Cause: Both students mentioned to registrar they were considering a leave of absence. Once the semester ended, the Academy issued an administrative leave of absence. Effect: The Academy incorrectly reported two students as having a leave of absence when they should have been reported as withdrawn from the Academy. Questioned Costs: None Context: This is not a systemic problem. Repeat Finding: This is not a repeat finding. Recommendation: We recommend the Academy review their policy and procedures with regards to reporting leave of absences for students to ensure they meet the requirements. Views of Responsible Officials: When the leave of absence (LOA) notices are sent by the Registrar to Financial Aid, the Registrar will provide confirmation to Financial Aid the proper approved LOA criteria has been reviewed.

Corrective Action Plan

When leave of absence (LOA) notices are sent by the Registrar to Financial Aid, the Registrar will provide confirmation to Financial Aid the proper approved LOA criteria has been reviewed.

Categories

Reporting Matching / Level of Effort / Earmarking

Other Findings in this Audit

  • 795 2023-001
    Significant Deficiency
  • 797 2023-001
    Significant Deficiency
  • 798 2023-001
    Significant Deficiency
  • 799 2023-001
    Significant Deficiency
  • 577237 2023-001
    Significant Deficiency
  • 577238 2023-002
    Significant Deficiency
  • 577239 2023-001
    Significant Deficiency
  • 577240 2023-001
    Significant Deficiency
  • 577241 2023-001
    Significant Deficiency

Programs in Audit

ALN Program Name Expenditures
84.268 Federal Direct Student Loans $2.33M
84.063 Federal Pell Grant Program $704,513
84.007 Federal Supplemental Educational Opportunity Grants $25,250
84.033 Federal Work-Study Program $25,000
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $10,178