ROWAN UNIVERSITY

2021 001 Reporting U.S. Department of Education: Education Stabilization Fund (ALN 84.425) Federal Grant Numbers and Years: P425F200669 (5/4/2020 ? 5/19/2022) Statistically Valid Sample: No, and it was not intended to be Prior Year Finding: N/A Finding Type: Significant Deficiency and Noncompliance Criteria: For CARES, beginning on May 6, 2020, ED required institutions that received a HEERF I Section 18004(a)(1) Student Aid Portion award to publicly post certain information on their website no later than 30 days after award, and update that information every 45 days thereafter (by posting a new report). This was announced through an electronic announcement (EA). On August 31, 2020, ED revised the EA by decreasing the frequency of reporting after the initial 30-day period from every 45 days thereafter to every calendar quarter. Grantees posting a 45-day report on or after August 31, 2020, should instead post a report every calendar quarter, with the first calendar quarter report due by October 10, 2020, and covering the period from after their last 45-day or 30-day report through the end of the calendar quarter on September 30, 2020. On May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website. Institutions must publicly post their report as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Key Line Items ? The following are identified as critical information for the Quarterly Public Reporting for Student Aid Portion: 1. Item #3: The total amount of Emergency Financial Aid Grants distributed to students under the CARES (a)(1) subprogram and the CRRSAA and ARP (a)(1) subprograms as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). 2. Item #4: The estimated total number of students at the institution that are eligible to receive Emergency Financial Aid Grants to Students under the CARES (a)(1) subprogram and the CRRSAA and ARP (a)(1) subprograms. 3. Item #5: The total number of students who have received an Emergency Financial Aid Grant to students under the CARES (a)(1) subprogram and the CRRSAA and ARP (a)(1) subprograms. 4. Item #6: The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under the CARES (a)(1) subprogram and the CRRSAA and ARP (a)(1) subprograms. Additionally, in accordance with Federal requirements, the University shall maintain internal controls over Federal programs designed to provide reasonable assurance that transactions are executed in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award that could have a direct and material effect on a Federal program. Condition and Context: The University updated the quarterly website posting each quarter, however for HEERF II, for each quarterly update for the website, the University did not update key line item #4 (estimated number of students at the institutional eligible to receive assistance). This amount was rolled forward from previous uploads and not updated for the current quarter student count. The University?s policies and procedures to ensure compliance with the above requirements did not include certain internal controls that were designed properly and operating effectively to ensure that information reported on the website was timely and accurate. Cause: The cause of this noncompliance was due to the control for reviewing the website information not operating at the level of precision it needed to ensure the website included all required information. Effect: The required information being reported on the public website is not accurate. Questioned Costs: None Recommendation: We recommend that the University strengthen its policies and procedures over the student aid quarterly website reporting to ensure all required information is accurate.

2020 001 Enrollment Reporting U.S. Department of Education: Student Financial Assistance Cluster: Federal Pell Grant Program (CFDA #84.063) Federal Direct Student Loan Program (CFDA #84.268) Federal Grant Numbers and Years: P063P200267 (July 1, 2019 ? June 30, 2020); P268K200267 (July 1, 2019 ? June 30, 2020) Statistically Valid Sample: No, and it was not intended to be Prior Year Finding: N/A Finding Type: Significant Deficiency and Noncompliance Criteria: Institutions are required to report enrollment information under the Pell grant and the Direct and FFEL loan programs via the National Student Loan Data System (NSLDS) (OMB No. 1845-0035), although FFEL loans are no longer made or a part of the SFA Cluster, a student may have a FFEL loan from previous years that would require enrollment reporting for that student (Pell, 34 CFR 690.83(b)(2); FFEL, 34 CFR 682.610; Direct Loan, 34 CFR 685.309). The administration of the Title IV programs depends heavily on the accuracy and timeliness of the enrollment information reported by institutions. Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website which the financial aid administrator can access for the auditor. The data on the institution?s Enrollment Reporting Roster, or Enrollment Maintenance page, is what NSLDS has as the most recently certified enrollment information. There are two categories of enrollment information; ?Campus Level? and ?Program Level,? both of which need to be reported accurately and have separate record types. The NSLDS Enrollment Reporting Guide provides the requirements and guidance for reporting enrollment details using the NSLDS Enrollment Reporting Process. Additionally, in accordance with Federal requirements, the University shall maintain internal controls over Federal programs designed to provide reasonable assurance that transactions are executed in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award that could have a direct and material effect on a Federal program. Condition and Context: The University utilizes the National Student Clearinghouse (the Clearinghouse) as a service provider for transmissions of their enrollment reporting requirements to the NSLDS. The University receives the Enrollment Reporting Roster every month and updates it for changes. For a sample of sixty-five students selected for testwork, the following exceptions were noted: ? For two selections who withdrew during fiscal year 2020, the change of status was not reported accurately to NSLDS as it was not reported on the program level. These students were coded for non-degree programs, as they did not choose a major yet, however per the Enrollment Reporting Guide, Section 4.4.7, these students should have been reported as a '99' for the credential level for a non-credential program and should have been reported in the program level. ? For one selection who withdrew and for five who graduated during fiscal year 2020, the incorrect CIP code was used within NSLDS and did not reflect the students correct program of study. ? For two selections who graduated, the students were reported to NSLDS greater than 60 days after the degree audit had occurred. The Organization?s policies and procedures to ensure compliance with the above requirements did not include certain internal controls that were designed properly and operating effectively to ensure that information to NSLDS was timely and accurate at the program level. Cause: For the selections that were not reported on the program level to NSLDS, this was due to a misunderstanding by the University as they thought they did not have to report non-degree programs on a program level basis to NSLDS. For the selections where the incorrect CIP code was used, this was an error that occurred where the wrong CIP code was being used to certain majors and was not caught before being reported to NSLDS. For the selections that were reported to NSLDS over 60 days, the University did not monitor NSLDS to ensure the selection was reported in the appropriate timeframe. Effect: Student status changes not reported to NSLDS in a timely or accurate manner may cause the student to not enter into a repayment status on a timely basis. Questioned Costs: None Recommendation: We recommend that the University strengthen its policies and procedures over the reporting to NSLDS to ensure all of the correct information is being reported and it is being done timely. We also recommend that the University ensure that internal controls in place surrounding review of enrollment reporting are performed as designed. Views of Responsible Officials: Rowan University concurs with the finding with the following responses: ? The students enrollment status was correct and reported accurately and timely, but the deeper dive into the program level with this current audit showed that exploratory studies (what the auditor references as non-degree seeking) was sent at the campus level but not the program level. This issue was resolved upon the finding from the audit and while in communication with the auditor. ? The students were in the correct category (13) but not the correct refined category (13.xxxx). At the time of the audit, the University was simultaneously performing a CIP code review and this issue has now been resolved. We would not expect to experience this error going forward. ? We concur that these students were reported late, but their enrollment status was accurately reflected on NSLDS. Policies and procedures have been strengthened within the graduation audit and reporting processes.

2019-001 Activities Allowed or Unallowed and Allowable Costs/Cost Principles, Period of Performance and Reporting ? Fringe Benefits and Indirect Costs Research and Development Cluster: U.S. Department of Defense: Department of Defense Appropriation Act of 2003 (CFDA #12.116) U.S. Department of Health and Human Services: Allergy, Immunology and Transplantation Research (CFDA #93.855) Health Careers Opportunity Program (CFDA #93.822) Federal Grant Numbers and Years: W913E517C0010 (September 1, 2017 ? August 31, 2019), 1R01AI128202 01A1 (June 1, 2018 ? May 31, 2023), 6D18HP32127 01 01 (September 1, 2018 ? August 31, 2023) Statistically Valid Sample: No, and it was not intended to be Prior Year Finding: N/A Finding Type: Significant Deficiency and Noncompliance Criteria: 2 CFR part 200 establishes principles for determining the costs applicable to research and development, training, and other sponsored work performed by institutions of higher education (IHEs) under Federal awards. These Federal awards are referred to as sponsored agreements. Direct costs are those costs that can be identified specifically with a particular final cost objective, such as a Federal award, or other internally or externally funded activity, or that can be directly assigned to such activities relatively easily with a high degree of accuracy. At IHEs, indirect costs are accounted for through F&A cost proposals. F&A costs, for the purpose of 2 CFR part 200 and as defined at 2 CFR section 200.56, are synonymous with ?indirect costs? and include costs that are incurred for common or joint objectives and, therefore, cannot be identified readily and specifically with a particular sponsored project, an instructional activity, or any other institutional activity. As described in 2 CFR section 200.414(a), the F&A cost categories include building and equipment depreciation; operations and maintenance expenses; interest expenses; general administrative expenses; departmental administration expenses; sponsored project administration expenses; library expenses; and student administration expenses. F&A costs are referred to as ?indirect costs? in this section. Indirect costs are those costs that are incurred for common or joint objectives and, therefore, cannot be identified readily and specifically with a particular sponsored project, an instructional activity, or any other institutional activity (2 CFR section 200.56). Indirect costs are defined into two broad categories in 2 CFR section 200.414(a). ? ?Facilities? is defined as depreciation on buildings, equipment and capital improvement, interest on debt associated with certain buildings, equipment and capital improvements, operations and maintenance expenses, and library expenses. ? ?Administration? is defined as general administration and general expenses such as the director?s office, accounting, personnel, and all other types of expenditures not listed specifically under one of the subcategories of ?Facilities? (including cross allocations from other pools, where applicable). Additionally, in accordance with Federal requirements, the University shall maintain internal controls over Federal programs designed to provide reasonable assurance that transactions are executed in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award that could have a direct and material effect on a Federal program. Condition and Context: The University charges indirect costs and fringe benefits to Federal awards based on federally approved rates either in the College and University Rate Agreement with the United States Department of Health and Human Services or the rate outlined in the grant agreements. We selected a sample of fifteen grants within the Research and Development Cluster to determine if the correct fringe benefits were charged to the grant. The following differences were noted based upon the results of our procedures: See Schedule of Findings and Questioned Costs for table We selected a sample of fifteen grants within the Research and Development Cluster to determine if the correct indirect costs were charged to the grant. The following differences were noted based upon the results of our procedures: See Schedule of Findings and Questioned Costs for table The difference between the amount charged to the grants and our calculation of fringe benefit and indirect costs results in a net overcharge of $6,298 for Department of Defense Appropriation Act of 2003 (CFDA #12.116), $3,841 for Allergy, Immunology and Transplantation Research (CFDA #93.855), and a net undercharge of $1,026 for Health Careers Opportunity Program (CFDA #93.822) as of June 30, 2019. However, we noted that these amounts were not charged to the respective grants and only represent errors in the SEFA for the amounts reported and do not represent any questioned costs for the programs. Cause: For fringe benefits, there was a FICA adjustment posted to the grant account mistakenly at year end and there was a salary adjustment made in which fringe benefits were not adjusted for. For indirect costs, there was a FICA adjustment posted to the grant account mistakenly at year end and an account missing for the indirect cost calculation. While the University has a process in place and internal controls designed to ensure that the fringe benefits and indirect costs are properly charged to the respective research and development grants, the review of these charges as part of the internal control over compliance was not operating effectively to ensure the correct amounts were recorded in the general ledger. Effect: Certain fringe benefits and indirect costs were improperly charged to the grants. Questioned Costs: None Recommendation: We recommend that the University strengthen its policies and procedures over the reconciliation of grant funds to ensure the correct fringe benefits and indirect costs are calculated for the respective Federal grants throughout the grant period. We also recommend that the University ensure that internal controls in place surrounding review of the fringe benefits and indirect costs charged to research and development grants is performed as designed.

2019-002 Procurement and Suspension and Debarment Research and Development Cluster: National Science Foundation: Mathematical and Physical Sciences (CFDA #47.049) U.S. Department of Defense: Department of Defense Appropriation Act of 2003 (CFDA #12.116) Federal Grant Numbers and Years: 1827938 (August 1, 2018 ? July 31, 2021), W913E517C0010 (September 1, 2017 ? August 31, 2019) Statistically Valid Sample: No, and it was not intended to be Prior Year Finding: N/A Finding Type: Significant Deficiency and Noncompliance Criteria: Non-Federal entities other than States, including those operating Federal programs as subrecipients of States, must follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. They must use their own documented procurement procedures, which reflect applicable state and local laws and regulations, provided that the procurements conform to applicable Federal statutes and the procurement requirements identified in 2 CFR part 200. A non-Federal entity must: 1. Meet the general procurement standards in 2 CFR section 200.318, which include oversight of contractors? performance, maintaining written standards of conduct for employees involved in contracting, awarding contracts only to responsible contractors, and maintaining records to document history of procurements. 2. Conduct all procurement transactions in a manner providing full and open competition, in accordance with 2 CFR section 200.319. 3. Use the micro-purchase and small purchase methods only for procurements that meet the applicable criteria under 2 CFR sections 200.320(a) and (b). Under the micro-purchase method, the aggregate dollar amount does not exceed $3,500 ($2,000 in the case of acquisition for construction subject to the Wage Rate Requirements (Davis-Bacon Act)). Small purchase procedures are used for purchases that exceed the micro-purchase amount but do not exceed the simplified acquisition threshold. Micro-purchases may be awarded without soliciting competitive quotations if the non-Federal entity considers the price to be reasonable (2 CFR section 200.320(a)). If small purchase procedures are used, price or rate quotations must be obtained from an adequate number of qualified sources (2 CFR section 200.320(b)). See discussion regarding higher thresholds for micro-purchase and small purchase methods in the NDAA 2017 and 2018 sections in this Part. 4. Ensure that every purchase order or other contract includes applicable provisions required by 2 CFR section 200.326. These provisions are described in Appendix II to 2 CFR part 200, ?Contract Provisions for Non-Federal Entity Contracts Under Federal Awards.? Non-Federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include contracts for goods and services awarded under a non-procurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a passthrough entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. When a non-Federal entity enters into a covered transaction with an entity at a lower tier, the non-Federal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. This verification may be accomplished by (1) checking the Excluded Parties List System (EPLS) maintained by the General Services Administration (GSA) and available at https://governmentcontractregistration.com/sam-registration-and-renewal/, (2) collecting a certification from the entity, or (3) adding a clause or condition to the covered transaction with that entity (2 CFR section 180.300). Non-Federal entities receiving contracts from the Federal Government are required to comply with the contract clause at FAR 52.209-6 before entering into a subcontract that will exceed $30,000, other than a subcontract for a commercially available off-the-shelf item. Additionally, in accordance with Federal requirements, the University shall maintain internal controls over Federal programs designed to provide reasonable assurance that transactions are executed in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award that could have a direct and material effect on a Federal program. Condition and Context: The University conducts all procurement procedures related to Federal awards based off of the University?s procurement policy, which is accordance with the standards outlined in the Uniform Guidance. The University?s suspension and debarment policy is to perform a check on all vendors before entering into an agreement with them if they are above the covered transaction threshold, and includes a clause in the contract that the vendor is not suspended or debarred from participating in Federal awards. We selected a sample of twenty-five procurement transactions within the Research and Development Cluster to determine if the University properly procured these transactions. We noted for one procurement transaction, the proper procedures were not followed as it was a ?small purchase? under Uniform Guidance and the University did not obtain any quotes. We selected a sample of eleven procurement transactions within the Research and Development Cluster that exceeded the covered transaction threshold to determine if the University properly checked the suspension and debarment status of the vendor before entering into the procurement transaction. The University was not able to provide sufficient evidence that they checked the suspension and debarment status of one vendor. We did note however, that the vendor was not suspended or debarred by performing a search on the System for Award Management. Cause: For the procurement selections, the buyer did not ensure that the small purchase requirements were followed for the one procurement transaction due to an error in the determination of the actual dollar amount of the transaction and the buyer believed that this could have been a sole source procurement however the documentation was not completed to be considered a sole source. For the suspension and debarment selection, the University could not find evidence that they checked the suspension and debarment status of the vendor prior to entering into the covered transaction. While the University has a process in place and internal controls designed to ensure that the procurement and suspension and debarment processes are properly followed, the review of these procurement transactions as part of the internal control over compliance was not operating effectively to ensure the correct procedures were followed. Effect: For the procurement selection, not enough vendors were quoted before awarding the contract. For the suspension and debarment selection, the status of the vendor was not documented before entering into the contract with them which could pose a risk for the University to enter into contracts with vendors who are suspended or debarred. However, this vendor was not suspended or debarred. Questioned Costs: None Recommendation: We recommend that the University strengthen its policies and procedures over the review of the contracts that are being entered into to ensure that proper procurement and suspension and debarment procedures are being followed. We also recommend that the University ensure that internal controls in place surrounding review of procurement transactions is performed as designed.

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