Finding Text
Special Tests – 240 Day Checks
Federal Agency: Department of Education
Federal Program Title: Student Financial Assistance Cluster
ASSISTANCE LISTING Numbers: 84.268 – Federal Direct Student Loans
84.063 – Federal Pell Grant Program.
Federal Award Identification Number and Year: P063P220362, 2023 AND P268K230362, 2023
Award Period: June 1, 2022 to June 30, 2023
Type of Finding: Significant Deficiency in Internal Control Over Compliance, Other Matter
Criteria or specific requirement: As outlined under 34 CFR 668.164(l), an institution must have a process that ensures SFA funds are never escheated to a state, revert to the institution, or revert to any other third party. Additionally, if a check sent to a student or parent is not returned to the institution and is not cashed, the institution must return the funds to the Secretary no later than 240 days after the date it issued the check. Additionally, Institutions are required to ensure adequate internal controls over compliance are established and maintained in accordance with 2 CFR 200.303.
Condition: During our testing of outstanding SFA checks, we identified nine checks outstanding that had not been returned to the Department of Education within 240 days.
Questioned costs: Federal Pell Grant - $2,691; Federal Direct Student Loans - $3.
Context: Out of our population and sample of nine outstanding SFA checks, we noted all nine had the exception described above.
Cause: The University had been under the impression that Pell checks may go stale dated and escheat to the state as unclaimed until an internal auditor informed the School that all Title IV aid is to be returned to the DOE and not allowed to escheat, including the Federal Pell Grant. After the internal audit, it was identified that two of the checks were Direct Loans and not Pell.
Effect: The University did not return all SFA funds timely.
Repeat finding: No
Recommendation: We recommend that the University enhance its policies and procedures regarding stale-dated check escheatment to ensure that the funds are returned to the appropriate program within 240 days from the date of issue.
View of responsible official: The University agrees with the finding.