Finding Text
Cluster name: Student Financial Assistance Cluster
Assistance Listings numbers and names: 84.007 Federal Supplemental Educational Opportunity Grants
84.033 Federal Work-Study Program
84.063 Federal Pell Grant Program
84.268 Federal Direct Student Loans
Award numbers and year: P007A220134, P033A220134, P063P222910, and P268K232910; July 1, 2022, through June 30, 2023
Federal agency: U.S. Department of Education
Compliance requirement: Special tests and provisions
Questioned costs: $8
Condition—Contrary to federal regulations and District policies and procedures, the District did not correctly calculate $8 of returns of student financial assistance monies it reported in the federal agency’s Common Origination and Disbursement (COD) system. Specifically, for 1 of 40 students tested, the District used incorrect credit hours when calculating the refund amount it recorded in the COD, resulting in the student being owed a refund of $8. In addition, for 2 of 40 students tested, the District did not timely calculate, report, and return student financial assistance monies owed to the student or the federal government within the required 45 days after the student’s withdrawal from classes, as the District returned these students’ monies 4 days and 17 days late.
Effect—Because of the District’s inaccurate calculation in the COD system, a student was owed a refund of $8 from the District. Further, the District increases the risk that they may not collect monies from the student that are due back to the federal government or may not refund monies it owes to students by not calculating, reporting, and returning student financial assistance monies within the required time frame.
Cause—District management reported it intended to strengthen its policies and procedures to require an independent review of the calculation, but, because of program management turnover, it was unable to prioritize these revisions. Further, District management reported that it did not have sufficient staffing available to calculate, report, and process returns of student financial assistance monies within the required 45 days.
Criteria—Federal regulations and District policies and procedures require the District to accurately calculate, report, and return federal student financial assistance to the federal grantor no later than 45 days after the date of the District’s determination that the student withdrew (34 Code of Federal Regulations [CFR] §§668.22 and 668.173). Also, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal programs are being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303).
Recommendations—The District should allocate staffing and improve its policies and procedures to:
1. Accurately calculate, report, and return student financial assistance monies to the federal government or the student within the required 45 days.
2. Require an independent review of the return of student financial assistance monies calculations prior to their submission to the COD.
The District’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy.
This finding is similar to prior-year finding 2022-102 and was initially reported in fiscal year 2021.