Finding 964021 (2023-001)

Finding 2023-001 - Reporting - Direct Loan and Pell Common Origination and Disbursement (Significant Deficiency) U.S. Department of Education - Student Financial Assistance Cluster Federal Pell Grant Program (84.063) Federal Direct Loan Program (84.268) Federal Award Year: 2021-2022 Criteria and Context: Pursuant to Federal Register Volume 87, Number 105, an institution must submit Pell Grant and Direct Loan disbursement records to the Common Origination and Disbursement (“COD”) system no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. In accordance with 34 CFR 668.164(a), Title IV program funds are disbursed on the date that the institution credits a student’s account at the institution or pays a student or parent directly. Title IV program funds are disbursed even if an institution uses its own funds in advance of receiving program funds from the Department. Condition, Cause, and Effect: During our testing surrounding the College’s COD reporting process, the College did not report all Direct Loan and Pell Grant disbursements to COD within the 15-day timeframe stipulated in Federal Register Volume 87, Number 105. Of the one hundred eleven (111) individual Direct Loan disbursements for thirty-four (34) students selected for testing, we noted two (2) records that were not reported within the aforementioned 15-day timeframe. These two (2) Direct Loan records were reported two hundred seventy-three (273) days after the actual disbursement date. Of the thirty-eight (38) individual Pell Grant disbursements for twenty-one (21) students selected for testing, we noted two (2) records that were not reported within the aforementioned 15-day timeframe. These two (2) Pell Grant records were reported between thirty-two (32) and thirty-nine (39) days after the actual disbursement date. Questioned Costs: None noted Identified as a Repeat Finding: Yes Recommendation: The College should review the effectiveness of its internal controls governing the timely submission of Federal Direct Loan and Pell Grant disbursements to ensure such records are submitted within the appropriate timeframe.