Finding 962532 (2023-002)

United States Department of Education Federal Program: Student Financial Assistance Cluster Reference Number: 2023-002 Federal Award Identifiers: P007A229034; P033A229034; P063P226291; P268K236291 Type of Finding: Non-Compliance and Significant Deficiency in Internal Control Compliance Requirement: Special Tests and Provisions - Return of Title IV Funds Condition: One of three student withdrawals selected for testing required a return of unearned Title IV funds. This student’s unearned Title IV Funds were not returned. Context: The College correctly calculated the unearned Title IV Funds upon the student’s withdrawal. The College did not process the return of funds in Common Origination and Disbursements. Fifteen students that received Title IV funds withdrew during the year ended June 30, 2023. Criteria: 34 CFR 668.22(a)(1) through (a)(5) requires the College to calculate and return unearned Title IV Funds. 34 CFR 668.173(b) requires the College to return the unearned Title IV Funds no later than 45 days after the date the College determines that the student withdrew. Questioned Costs: $3,359 of unearned Title IV Funds for one student were not reported or returned. Cause: A shortage of staff resulted in the control deficiency. Effect: The College did not timely report return of unearned Title IV Fund resulting in an overstatement of the students’ federal loan balances. Recommendation: We recommend management implement procedures to ensure returns of Title IV Funds are timely calculated and processed upon student withdrawal.