Finding Text
Criteria: Awards must be coordinated among the various programs and with other federal and nonfederal aid (need and non-need based aid) to ensure that total aid is not awarded in excess of thestudent?s financial need (34 CFR ? 668.42 FWS and 34 CFR ? 682.301). Per 34 CFR ? 685.200, a Direct Subsidized Loan borrower must demonstrate financial need in accordance with Title IV, Part F of the Higher Education Act of 1965. Upon packaging a student's aid, schools are required to calculate the student's need based on the expected family contribution, estimated financial assistance, and estimated cost of attendance.Condition/context: A sample of 40 students out of a population of 735 students who received disbursements of student financial assistance federal awards was selected. The financial need was calculated for each student, with the student?s estimated financial assistance also deducted. One student was identified as being overawarded by $134.Our sample was not, and was not intended to be, statistically valid.Questioned costs: Less than the questioned cost threshold of $25,000.Cause/Effect: This occurred because of a lack of proper understanding of estimated financial assistance as defined by the Federal regulations. Because of the lack of understanding, the system controls in place, while operating as designed, were established using the same lack of understanding. One student was overawarded by $134.Repeat finding: NoRecommendation: We recommend the University further educate and train those involved in the Financial Aid department regarding the Eligibility rules surrounding Federal awards, specifically regardingtypes of and scenarios using estimated financial assistance. We also recommend the University revise the inputs within the PowerFAIDS system so that the control established to prevent (and subsequently detect) overawards is appropriately considering all scholarships and institutional grants as estimated financial assistance, regardless of need-based or not. Lastly, as a monitoring control, we recommend an overaward report showing both Federal and non-Federal overawards be developed and be run and reviewed at a set frequency by the Director. Views of responsible officials and planned corrective actions: Heritage University is to give individuals working in the financial aid office more information and training about the eligibility requirements for federal awards, particularly with regard to the several forms and potential uses of anticipated financial aid. Additionally, the University is to update the PowerFAIDS system's inputs so that all institutional grants and scholarships, regardless of whether they are need-based or not, are adequately taken into account by the control mechanism created to avoid (and consequently detect) overawards. As a monitoring measure, the Director of Financial Aid will create an overaward report that lists both Federal and non-Federal overawards and runs it on a regular basis.