Eastern Nazarene CollegeHigher Education

Criteria According to 34 CFR 690.62(a): Calculation of a Federal Pell Grant: The amount of a student's Pell Grant for an academic year is based upon the payment and disbursement schedules published by the Secretary for each award year. According to 34 CFR 690.2(c): Annual award: The Federal Pell Grant award amount a full-time student would receive under the payment schedule for a full academic year in an award year, and the amount a three-quarter time, half-time, and less-than-half-time student would receive under the appropriate disbursement schedule for being enrolled in that enrollment status for a full academic year in an award year. Disbursement Schedule: A table showing the annual awards that three-quarter, half-time, and less-than-half-time students at term-based institutions using credit hours would receive for an academic year. This table is published annually by the Secretary and is based on: (1) A student's expected family contribution, as determined in accordance with Title IV, Part F of the HEA; and (2) A student's attendance costs as defined in Title IV, Part F of the HEA. (3) The amount of funds available for making Federal Pell Grants. Condition Federal regulations require institutions to award Federal Pell Grants in accordance with the appropriate disbursement schedule for three-quarter, half-time, and less-than-half-time students based on the students’ estimated financial contribution and cost of attendance. During our testing, we noted 1 student, out of a sample of 40, that were not awarded the proper amount of Pell Grant funds. Cause The College did not use the student’s correct Pell disbursement schedule when awarding the student Pell Grant funds. The student was awarded Pell Grant funds based on a cost of attendance of $3,400, however, the student’s cost of attendance was $10,420. Effect By using the incorrect enrollment status, the student was under awarded Federal Pell Grant funds. Questioned Costs Federal Pell Grant underpayment of $492.50. Perspective Our sample was not, and was not intended to be, statistically valid. Of the 40 students selected for testing, 1 student, or 2.5% of our sample, received incorrect Federal Pell Grant award. Identification as a Repeat Finding, if applicable Not applicable Recommendation We recommend that management of the College review, and if necessary, update, the policies and procedures for awarding aid and ensuring cost of attendances are correct to ensure Federal Pell Grant award amounts are properly calculated. Additionally, financial aid awards should be reviewed by management prior to disbursing funds to students. View of Responsible Officials The College agrees with the finding.

Criteria The College has an informal policy to get signed agreements with students to document an understanding between both the College and student the terms of the work-study including position, pay rate and eligible earnings. Condition The College was unable to provide two work-study agreements as part of the single audit testing. Cause The College is in the process of winding down operations and while they believe they originally had the students fill out the agreements they were unable to be located the agreements because of the wind down process. Effect The College was unable to sufficiently document they followed their established internal control for federal work-study. Questioned Costs None Perspective Our sample was not, and was not intended to be, statistically valid. Of the four students selected for testing, two students, or 50% of our sample, had agreements that were not able to be located. Identification as a Repeat Finding, if applicable Not applicable Recommendation We recommend the College try and locate the agreements and ensure they are being properly maintained. View of Responsible Officials The College agrees with the finding.

Finding number: 2020-001 Federal agency: U.S. Department of Education Programs: Student Financial Assistance Cluster CFDA #?s: 84.063, 84.268 Award year: 2020 Criteria According to 34 CFR 685.309(b)(2): Unless [the institution] it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that ? (i) A loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under Title IV of the Act has changed his or her permanent address. The Dear Colleague Letter GEN-12-6 issued by the U.S. Department of Education (?ED?) on March 30, 2012, states that in addition to student loan borrowers, Enrollment Reporting files will include two additional groups of students: Pell Grant and Perkins Loan recipients. According to 2 CFR Part 200, Appendix XI Compliance Supplement updated August 2020: Under the Pell Grant and loan programs, institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway mailboxes sent by ED via the National Student Loan Data System (?NSLDS?). The institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every 60 days. Once received, the institution must update for changes in student status, report the date the enrollment status was effective, enter the new anticipated completion date, and submit the changes electronically through the batch method or the NSLDS website. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Condition The Federal Government requires the College to report student enrollment changes to the National Student Loan Data System (?NSLDS?) within 60 days. During our testing, we noted 2 students, out of a sample of 28, who had incorrect effective dates reported to NSLDS. Cause The College did not have adequate procedures in place to ensure that students with status changes had their effective dates correctly reported to NSLDS. Effect The College did not report the students? correct effective dates to NSLDS, which may impact the students? loan grace periods. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 28 students selected for testing, 2 students, or 7.1% of our sample, had incorrect effective dates reported to NSLDS. Identification as a Repeat Finding, if applicable See findings 2019-001, 2018-003, and 2017-004 included in the summary schedule of prior year findings. Recommendation The College should provide training to employees responsible for processing information for the NSLDS and ensure that they have adequate knowledge of the related rules and regulations. This training should include an explanation of the status changes, the importance of reporting the correct status changes, and the consequences of incorrect reporting. Additionally, the College should implement reconciliation procedures between enrollment records and NSLDS to ensure that information is properly maintained. Views of Responsible Officials The College agrees with the finding.

Finding number: 2020-002 Federal agency: U.S. Department of Education Programs: Federal Supplemental Education Opportunity Grant Federal Pell Grant Program CFDA #'s: 84.007, 84.063 Award year: 2020 Criteria According to 34 CFR Section 668.164(h): (1) Notwithstanding any State law, an institution must return to the Secretary, lender, or guaranty agency, any Title IV, HEA program funds, except FWS program funds, that it attempts to disburse directly to a student or parent, but the student or parent does not receive or negotiate those funds. For FWS program funds, the institution is required to return only the federal portion of the payroll disbursement. (2) If an institution attempts to disburse the funds by check and the check is not cashed, the institution must return the funds no later than 240 days after the date it issued that check. (3) (i) If a check is returned to the institution, or an EFT is rejected, the institution may make additional attempts to disburse the funds, provided that those attempts are made no later than 45 days after the funds were returned or rejected. In cases where the institution does not make another attempt, the funds must be returned before the end of this 45-day period; and (ii) No later than the 240-day period described in paragraph (h)(2) of this section, the institution must cease any additional disbursement attempts and immediately return those funds. Condition Federal regulations require an institution to return unclaimed Title IV funds issued by check or EFT within 240 days. We tested 6 outstanding checks on the bank reconciliation and noted 1 outstanding checks that had unclaimed federal financial funds exceeding the 240-day limit. Cause The College had developed and implemented policies and procedures to resolve outstanding checks containing Title IV funds that are outstanding over 240 days. However, in this instance, the College mistakenly overlooked these specific checks. Effect The College did not return Title IV unclaimed funds to the Department of Education within the required 240-day time frame. Questioned Costs The one check outstanding totaled $283, which pertained specifically to federally-sourced funds. Perspective Our sample was not, and was not intended to be, statistically valid. Of six students selected for testing, one student had unclaimed funds pertaining to federal sources that were not returned to the Department of Education within the 240-day required time frame (16.67% of the total sample). Identification as a Repeat Finding, if applicable Not applicable Recommendation We recommend that management continue to work to fully comply with its policies to ensure that the College will be in compliance with federal regulations. Views of Responsible Officials Eastern Nazarene College agrees with the finding.

Finding number: 2019-001 Federal agency: U.S. Department of Education Programs: Student Financial Assistance Cluster CFDA #?s: 84.063, 84.268 Award year: 2019 Criteria According to 34 CFR 685.309(b)(2): Unless [the institution] it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that ? (i) A loan under title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under title IV of the Act has changed his or her permanent address. The Dear Colleague Letter GEN-12-6 issued by the U.S. Department of Education (?ED?) on March 30, 2012, states that in addition to student loan borrowers, Enrollment Reporting files will include two additional groups of students: Pell Grant and Perkins Loan recipients. According to 2 CFR Part 200, Appendix XI Compliance Supplement updated August 2019: Under the Pell Grant and loan programs, institutions must complete and return within 15 days the Enrollment Reporting roster file placed in their Student Aid Internet Gateway mailboxes sent by ED via the National Student Loan Data System (?NSLDS?). The institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every 60 days. Once received, the institution must update for changes in student status, report the date the enrollment status was effective, enter the new anticipated completion date, and submit the changes electronically through the batch method or the NSLDS website. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Condition The Federal Government requires the College to report student enrollment changes to the National Student Loan Data System (?NSLDS?) within 60 days. During our testing, we noted 1 student, out of a sample of 30, that was reported to NSLDS as withdrawn after the student graduated. Cause The College did not have adequate procedures in place to ensure that status changes were properly reported to NSLDS. Effect The College did not report the student correct status change to NSLDS, which may impact enrollment reporting statistics collected by the Department of Education. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 30 students selected for testing, 1 student, or 3.3% of our sample, had incorrect status changes reported to NSLDS. Identification as a Repeat Finding, if applicable See finding 2018-003 and 2017-004 included in the summary schedule of prior year findings. Recommendation The College should provide training to employees responsible for processing information for the NSLDS and ensure that they have adequate knowledge of the related rules and regulations. This training should include an explanation of the status changes, the importance of reporting the correct status changes and the consequences of incorrect reporting. Additionally, the College should implement reconciliation procedures between enrollment records and NSLDS to ensure that information is properly maintained. Views of Responsible Officials The College agrees with the finding.

Finding number: 2019-002 Federal agency: U.S. Department of Education Programs: Federal Pell Grant CFDA #: 84.063 Award year: 2019 Criteria According to 34 CFR 668.164(h): Title IV, Higher Education Act (?HEA?) credit balances. (1) A title IV, HEA credit balance occurs whenever the amount of title IV, HEA program funds credited to a student's ledger account for a payment period exceeds the amount assessed the student for allowable charges associated with that payment period. (2) A title IV, HEA credit balance must be paid directly to the student or parent as soon as possible, but no later than ? (i) No later than 14 days after the balance occurred if the balance occurred after the first day of class of a payment period; or (ii) No later than 14 days after the first day of class of a payment period if the credit balance occurred on or before the first day of that payment period. Condition The Federal Government requires that whenever Title IV aid is disbursed on a student?s account, the account must be reviewed to determine if the disbursement caused a credit balance. If the credit balance was caused by Title IV funds, the College must refund the balance directly to the student within 14 days of the disbursement of funds. During our testing, we noted 1 student, that was not refunded credit balances within the required timeframe by 2 days. Cause The College failed to identify Title IV credit balances after federal aid was disbursed on the student accounts. Effect The College did not refund Title IV credit balances within the required 14-day time frame and therefore was not in compliance with federal requirements. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 40 students selected for testing, 21 students, or 52.5% of our sample, had credit balances caused by financial aid. Of these 21 students, 1 student credit balance caused by Title IV funds was not refunded within the required time frame (4.8% of students who had credit balances). Identification as a Repeat Finding, if applicable Not applicable Recommendation Student accounts should continue to develop their procedures to identify credit balances caused by changes on students? accounts as well as disbursements. This includes reviewing accounts after late disbursement of Title IV aid as well as tuition and fee adjustments, health insurance waivers and bookstore credits. Views of Responsible Officials The College agrees with the finding.

Finding number: 2019-003 Federal agency: U.S. Department of Education Programs: Federal Direct Student Loans CFDA #: 84.268 Award year: 2019 Criteria According to 34 CFR Section 668.165(a): (1) Before an institution disburses title IV, HEA program funds for any award year, the institution must notify a student of the amount of funds that the student or his or her parent can expect to receive under each title IV, HEA program, and how and when those funds will be disbursed. If those funds include Direct Loan program funds, the notice must indicate which funds are from subsidized loans, which are from unsubsidized loans, and which are from PLUS loans. Condition According to the College?s policy, each student that is approved for direct loans should receive an e-mail from the Student Account Office that shows loan information and procedures to cancel the loan prior to loan disbursement. During our testing, we noted 1 student, out of a sample of 39, that did not receive such notification. Cause The e-mail was not sent to the students by the Student Accounts Office due to an isolated incident which resulted in the students being missed. Effect The College is not in compliance with notification requirements. Questioned Costs Not applicable Perspective Our sample was not, and was not intended to be, statistically valid. Of the 39 students selected for testing, 1 student, or 2.6% of our sample, did not receive timely distribution notifications. Identification as a Repeat Finding, if applicable Not applicable Recommendation The financial aid office should update its policies and procedures to ensure every student receives the proper notification. View of Responsible Officials The College agrees with the finding.

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