Finding Text
Finding 2023-001 - Cash Management - Significant Deficiency in Internal Control
Federal Program: Student Financial Assistance Cluster
Federal Assistance Listing Number: 84.268 Federal Direct Student Loans Program
Federal Agency: Department of Education
Award Year: July 1, 2022 - June 30, 2023
Criteria: Per 34 CFR Section 685.300(b)(5), an institution that participates in the Direct Loan program is required to reconcile Federal funds received with actual disbursement records submitted to the Common Origination and Disbursement (COD) system monthly.
Condition and Context: During our testwork over the Direct Loan Reconciliations, we noted the College failed to reconcile the Direct Loan School Account Statement (SAS) data files on a monthly basis to the internal records, and instead only performed five reconciliations for the 2022-2023 award year.
Isolated or Systemic: Systemic.
Cause and Effect: The College’s control failed to ensure that Direct Loan SAS data files are reconciled monthly.
Questioned Costs: None noted.
Whether the sampling was a statistically valid sample: The sample was not intended to be, and was not, a statistically valid sample.
Repeat Finding: No.
Recommendation: We recommend that the College enhance its internal controls to ensure that Direct Loan SAS data files are reconciled monthly.
View of Responsible Officials: The Financial Aid Office concurs with the audit finding of the monthly SAS reconciliation requirement to be done internally. Whittier College Financial Aid Staff failed to send the SAS files monthly to our Accounting Department for reconciliation. As of September 2023, Whittier College Financial Aid Office has calendared a monthly reconciliation report to be sent to the Accounting Department to meet the guidelines set forth by the Department of Education. This reconciliation report will be sent monthly through out the calendar year. In the summer months of June and July we may not have any funds to reconcile, however, a report will be sent regardless for compliance.