Finding 971483 (2023-002)

Finding No. 2023-002 Special Tests: Enrollment Reporting and Gramm-Leach-Bliley Act Compliance/Material Weakness Federal program: Student Financial Aid Cluster – Federal Direct Student Loans (ALN 84.268), U.S. Department of Education Criteria: Auditee requirements contained in Title 2 U.S. Code of Federal Regulations (2 CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, requires the auditee to comply with Federal statues, regulations, terms and conditions of Federal awards that may have a direct and material effect on each of its major programs. The enrollment reporting compliance requirement, which falls under special tests, requires the Institute to certify enrollment information under the Direct loan programs every 60 days. The Gramm-Leach-Bliley Act over student information security, which falls under special tests, requires the Institute to have a written information security program that addresses seven specific required elements. Condition: Instances of noncompliance have been identified around major compliance requirements Enrollment Reporting and Gramm-Leach-Bliley Act, which are both part of special tests identified in the 2023 Compliance Supplement. Cause: The cause is due to a lack of sufficient internal control procedures in place to ensure compliance with material compliance requirements in the 2023 Compliance Supplement for its federal award. Effect: The findings resulted in a qualified opinion on the auditor’s report issued on compliance for major programs. Questioned costs: None Context: All of the Institute’s May 2023 graduates enrollment information was not reported within the 60 day requirement. In addition, the Institute does not have a formalized written information security program in place that addresses the required elements in the 2023 Compliance Supplement. Repeat finding: No Recommendation: We recommend that the Institute review the most recent Compliance Supplement, which outlines all compliance requirements for Direct loans under the Student Financial Assistance federal program to ensure all compliance requirements are being met. We encourage the Institute to monitor for any updates to the Compliance Supplement annually. Views of responsible officials: Management agrees with the finding. See corrective action plan.