Harrisburg Area Community College

Finding Reference: 2025-001 Federal Agency: U.S. Department of Education Federal Program: Student Financial Assistance Cluster Compliance Requirements: Return of Title IV Funds Type of Finding: Material Weakness in Internal Control over Compliance and Noncompliance Criteria: Under 34 CFR 668.21(b), institutions are required to return Title IV funds within 30 days of determining that a student never began attendance. Additionally, 34 CFR 668.173(b) requires institutions to return Title IV funds within the timeframes established under the federal cash management regulations, generally within 45 days of the date the institution determines a return is necessary. Institutions must also maintain internal controls sufficient to ensure accurate calculation and timely processing of required returns. Statement of Condition: The College did not comply with federal requirements related to the timely return of Title IV funds. Specifically, the College failed to return aid for four students who never attended within the 30 day period required under 34 CFR 668.21(b). In addition, the College did not return funds for one student who began attendance but subsequently required a refund within the 45-day timeframe mandated under 34 CFR 668.173(b). Statement of Cause: The College did not comply with federal requirements related to the timely return of Title IV funds. Specifically, the College failed to return aid for four students who never attended within the 30 day period required under 34 CFR 668.21(b). In addition, the College did not return funds for one student who began attendance but subsequently required a refund within the 45-day timeframe mandated under 34 CFR 668.173(b). Possible Asserted Effect: Failure to return Title IV funds within required timeframes places federal funds at risk and results in noncompliance with Title IV regulations. Continued deficiencies may expose the College to potential liabilities for improperly retained funds or increased oversight such as heightened cash monitoring. Questioned Costs: $10,349 Context: A sample of 50 students were selected for return to Title IV testing and 5 students were identified with untimely refunds. The sample was not intended to be, and was not, a statistically valid sample. The College has already returned these funds to the U.S. Department of Education. Repeat Finding: No Recommendation: The College should strengthen its internal controls and monitoring procedures to ensure compliance with federal return of funds requirements. This should include timely verification that calculated refund amounts match what is actually returned, improved review processes to confirm that students who never attended are identified promptly, and training for relevant staff to ensure consistent understanding and execution of federal aid return requirements. Views of Responsible Officials and Planned Corrective Actions: The College acknowledges and accepts this finding. Processes that will mitigate this concern in the future had already been underway in the 2025-2026 aid year, and those practices, in addition to other steps we will take as part of the Corrective Action Plan, should eliminate future findings of this nature.

Finding Reference: 2023-001 Federal Agency: U.S. Department of Education Federal Program: Student Financial Aid Cluster Compliance Requirement: Reporting Type of Finding: Material Weakness in Internal Control over Compliance and Noncompliance Criteria: Institutions are required to report enrollment information under the Pell grant and the Direct loan programs via the National Student Loan Data System (NSLDS). Statement of Condition: Two student’s enrollment changes were not properly reported to NSLDS and this was not initially addressed by the College. Seven students enrollment changes were not timely reported. These students were enrolled during the Spring 2023 semester and the changes were not reported to NSLDS until September 2023, beyond the 60 day reporting requirement. Statement of Cause: Unknown Possible Asserted Effect: The College may not in compliance with reporting required to NSLDS in all circumstances. Questioned Costs: None noted. Context: A sample of 25 students were selected for enrollment testing and 9 students were identified with reporting errors. Repeat Finding: This is a repeat finding. Recommendation: We recommend that the College ensure all error reports are reviewed and followed up on timely to ensure students information is being properly reported to NSLDS. Additionally, we recommend the college review its policies and procedures and training processes to ensure reporting is happening in a timely manner. Views of Responsible Officials and Planned Corrective Actions: The College acknowledges the discrepancies in reporting. These discrepancies were the result of employee turnover and lack of sufficient training. The specific discrepancies will be corrected, and the College will outline a Corrective Action Plan to address the issues going forward.

Finding Reference: 2023-002 Federal Agency: U.S. Department of Education Federal Program: Student Financial Aid Cluster Compliance Requirement: Reporting Type of Finding: Material Weakness in Internal Control over Compliance and Noncompliance Criteria: Institutions are required to report the website (URL) to the Department of Education that explains where students can obtain information concerning the outside organization that is processing refunds for the institution. This is published in the cash management contracts database. Statement of Condition: The URL noted above was not reported to the Department of Education for publication in the cash management contracts database. Statement of Cause: The College was not aware of this reporting requirement. Possible Asserted Effect: The College is not in compliance with reporting required to the Department of Education. Questioned Costs: None noted. Context: N/A Recommendation: We recommend that the College ensure the URL is reported to the Department of Education for publication in the cash management contracts database. Additionally, we recommend the College review reporting requirements and processes to ensure any new requirements are addressed in a timely fashion. Views of Responsible Officials and Planned Corrective Actions: Management acknowledges and agrees with the findings. On February 15, 2024 HACC filed its contract URL with the Department of Education per 34 CFR 668.164(e)(2)(viii).

Finding Reference: 2022-003 Federal Agency: U.S. Department of Education Federal Program: Student Financial Aid Cluster Compliance Requirement: Activities Allowed or Unallowed and Eligibility Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria: 34 CFR 668.32 ? a student is eligible to receive Title IV, HEA (Higher Education Act) program assistance if the student is a regular student enrolled, or accepted for enrollment, in an eligible program at an eligible institution. Statement of Condition: Potential noncompliance was identified by the College. It is possible there were students enrolled in ineligible programs during the 2021/2022 fiscal year. Statement of Cause: No cause could be determined. Possible Asserted Effect: The institution may have improperly awarded Title IV funds to students who have not been accepted into an eligible program of study leading to a degree or certificate. The College has reported that the Federal Department of Education initiated a program review during 2022 and the College informed the Department of the potential noncompliance. The College is currently awaiting the final results of that review. Questioned Costs: $ 9,065 Context: During the performance of the prior year audit, the College reported possible noncompliance to the auditors and noted they were working with consultants to review the situation and make programmatic adjustments as necessary. The College has noted these programmatic adjustments were made during the 2021/2022 fiscal year and took effect in January 2022. The College offers a number of health career programs in which prior to programmatic changes that occurred during 2021/2022, a student was initially enrolled and began the program by taking general education courses and in some cases certain major courses as well. Once these courses were completed the student was able to apply to continue in the program through a selective admissions process to transition to the clinical portion of the program which culminated in the student receiving a certificate or degree. The selective admissions process differed from program to program but was generally based on a published criteria which centers around a ranking based on the completion and final grade for certain initial courses, certain test scores and selection of campus location. The possible noncompliance centers on whether the College?s selective admission process to transition to the clinical portion of the programs, in turn, makes the initial portion of these programs ineligible. In that situation, students enrolled in the initial portion of the program may not be considered regular students enrolled or accepted for enrollment for the purpose of obtaining a degree or certificate offered by the College and would not be eligible for Title IV financial aid. The auditor selected a sample of 60 students to review program eligibility. This sample include 25 students from the fall semester, 25 students from the spring semester and, 10 students from the summer semester. The sample included six (6) students enrolled in the health career programs noted above. Of these six (6) students, four (4) students did not advance to the clinical portion of the program or transfer to a program receiving credit for their initial courses. The six (6) students enrolled in the heath career programs were all from the fall semester prior to the changes made in January 2022. The auditor was unable to determine if the College?s selective admission process related to these health career programs is in compliance with federal regulations. As a result, questioned costs which encompass the financial aid received during 2021/2022 are included above for the possible violation related to the four (4) students noted. Based on the fact the auditor is unable to determine the eligibility status of students enrolled in these programs or the overall program eligibility for the initial portion of these programs, the Independent Auditor?s Report on Compliance for Each Major Program and on Internal Control Over Compliance Required by the Uniform Guidance includes a qualified opinion for the Student Financial Aid Cluster. Repeat Finding: This is a repeat finding. Recommendation: We recommend that the College work with the U.S. Department of Education to review the programs in question and determine what additional programmatic changes may be necessary, if any, to ensure the student financial aid program is in compliance with federal regulations. Views of Responsible Officials and Planned Corrective Actions: Management acknowledges and agrees with the findings.

Finding Reference: 2022-004 Federal Agency: U.S. Department of Education Federal Program: Student Financial Aid Cluster Compliance Requirement: Reporting Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria: Institutions are required to report enrollment information under the Pell grant and the Direct loan programs via the National Student Loan Data System (NSLDS). Statement of Condition: One student?s enrollment changes were not properly reported to NSLDS and this was not initially addressed by the College. Statement of Cause: The students name and social security number as submitted by the institution do not agree to the information that in NSLDS and thus the submission was rejected. Possible Asserted Effect: The College may not in compliance with reporting required to NSLDS in all circumstances. Questioned Costs: None noted. Context: A sample of 25 students were selected for enrollment testing and 1 student was identified with reporting errors. NSLDS is utilized by all Institutions. The student?s information as reported in the College?s system was submitted. However, there were errors in the submission because of a conflict in name due to an incorrect social security number. Since all Institutions utilize NSLDS at some point a school (perhaps not the College) submitted the social security number provided by this student with a different name. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the College contact the student to obtain a copy of their social security card to confirm the name and number to correct this situation. The College should also review its internal procedures to ensure controls are in place to timely identify reporting discrepancies and make corrections as necessary. Views of Responsible Officials and Planned Corrective Actions: Management acknowledges and agrees with the findings. The College has developed a process to identify and correct discrepancies.

Finding Reference: 2021-001 Federal Agency: U.S. Department of Education Federal Program: Student Financial Aid Cluster Compliance Requirement: Activities Allowed or Unallowed and Eligibility Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria: 34 CFR 668.32 ? a student is eligible to receive Title IV, HEA (Higher Education Act) program assistance if the student is a regular student enrolled, or accepted for enrollment, in an eligible program at an eligible institution. Statement of Condition: Potential noncompliance was identified by the College. It is possible there are students enrolled in ineligible programs. Statement of Cause: No cause could be determined. Possible Asserted Effect: The institution may have improperly awarded Title IV funds to students who have not been accepted in an eligible program of study leading to a degree or certificate. Questioned Costs: $ 13,134 Context: During the performance of the audit, the College reported possible noncompliance to the auditors and noted they are currently working with consultants to review the situation and make programmatic adjustments as necessary. The College offers a number of health career programs in which a student is initially enrolled and begins the program by taking general education courses and in some cases certain major courses as well. Once these courses are completed the student is able to apply to continue in the program through a selective admissions process to transition to the clinical portion of the program which culminates in the student receiving a certificate or degree. The selective admissions process differs from program to program but is generally based on a published criteria which centers around a ranking based on the completion and final grade for certain initial courses, certain test scores and selection of campus location. The possible noncompliance centers on whether the College?s selective admission process to transition to the clinical portion of the programs, in turn, makes the initial portion of these programs ineligible. In that situation, students enrolled in the initial portion of the program may not be considered regular students enrolled or accepted for enrollment for the purpose of obtaining a degree or certificate offered by the College and would not be eligible for Title IV financial aid. The auditor selected a sample of 25 students to review program eligibility. The sample included eight (8) students enrolled in the health career programs noted above. Of these eight (8) students, four (4) students did not advance to the clinical portion of the program or transfer to a program receiving credit for their initial courses. The auditor was unable to determine if the College?s selective admission process related to these health career programs is in compliance with federal regulations. As a result, questioned costs which encompass the financial aid received during 2020/2021 are included above for the possible violation related to the four (4) students noted. Based on the fact the auditor is unable to determine the eligibility status of students enrolled in these programs or the overall program eligibility for the initial portion of these programs, the Independent Auditor?s Report on Compliance for Each Major Program and on Internal Control Over Compliance Required by the Uniform Guidance includes a qualified opinion for the Student Financial Aid Cluster. Repeat Finding: This is not a repeat finding. Recommendation: We recommend that the College contact the U.S. Department of Education to review the programs in question and determine if they are in alignment with current federal regulations. Views of Responsible Officials and Planned Corrective Actions: Management acknowledges and agrees with the findings.

Finding Reference: 2021-002 - Reporting ? COVID-19 Federal Agency: U.S. Department of Education Federal Program: 84.425C ? COVID ? 19 Governors Emergency Education Relief Fund (GEER) II Compliance Requirement: Reporting Type of Finding: Significant Deficiency in Internal Control over Compliance and Noncompliance Criteria: The GEER II award requires a Reconciliation of Cash on Hand Quarterly Report to be completed at end of each quarter throughout the term of the agreement. Statement of Condition: GEER II funds were received during June of 2021; however, a Quarterly Cash on Hand report was not filed for the quarter ended June 30, 2021. Statement of Cause: The College had previously received an award under GEER I that did not include a requirement to file a Quarterly Cash on Hand report. The GEER II reporting requirement was not identified timely by the College. Possible Asserted Effect: The College was not in compliance with the reporting requirements established by the Department of Education and may not receive additional funding until this noncompliance is corrected. Questioned Costs: None noted. Context: For the testing of the GEER program, there was only one quarterly report that was due to be filed for the 2020/2021 fiscal year. Repeat Finding: This is not a repeat finding. Recommendation: As new grants are awarded, the grant agreements should be reviewed in detail to determine applicable compliance requirements. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the recommendation and will review new grants in detail to determine applicable compliance requirements.

Finding Reference: 2021-003 ? HEERF Lost Revenue ? COVID-19 Federal Agency: U.S. Department of Education Federal Program: 84.425F ? COVID ? 19 Higher Education Emergency Relief Fund (HEERF)? Institutional Relief Type of Finding: Material Weakness in Internal Control over Compliance Criteria: In accordance with the Higher Education Emergency Relief Fund (HEERF I, II, and III) Lost Revenue Frequently Asked Questions document published by the U.S. Department of Education, an institution must adequately document its estimate of lost revenue, including its rationale, calculations, methodology, underlying data, and budgets or projections used to determine the amount of lost revenue. Statement of Condition: Upon review of the lost revenue calculation during the audit process, it was determined the original calculation of lost revenue that was used to charge the grant and to report federal expenditures on the Schedule of Expenditures of Federal Awards (SEFA) was incorrect due to various errors in the calculation that were not initially identified during the College?s internal control processes at the time the grant was charged and quarterly and annual reports were completed. This resulted in an over allowance for lost revenue of $ 1,292,377 through June 30, 2021. The College anticipates the calculation of the June 30, 2022 lost revenue will be utilized in the future to appropriately charge the grant award for this over allowance amount. In addition, the final SEFA presented for the year ended June 30, 2021 was updated to reflect the appropriate calculation for lost revenue through June 30, 2021. Statement of Cause: The College did not initially have an adequate internal control process in place to review the underlying data utilized in the calculation of lost revenue for the years ended June 30, 2020 and June 30, 2021. Possible Asserted Effect: The grant award may have been charged too early during the grant award period and quarterly and annual reports do not accurately reflect the actual lost revenue calculation through June 30, 2021. Questioned Costs: None noted. Context: The lost revenue calculation for the period of March 13, 2020 through June 30, 2021 was tested as part of the audit process. Repeat Finding: This is not a repeat finding. Recommendation: The College should review its internal control processes related to the calculation of lost revenue for the HEERF award and ensure adequate review processes are in place prior to the grant award being charged and expenditures being reported on the required quarterly and annual reports. Views of Responsible Officials and Planned Corrective Actions: Management agrees with the recommendation and has reviewed internal control processes to ensure adequate review going forward.

Criteria: The College is to have internal controls in place to demonstrate that distance education students began attending the courses they were enrolled in and have internal controls in place to determine their last date of attendance for Return to Title IV purposes. Statement of Condition: In some cases, the College?s internal controls were not operating effectively to ensure that students enrolled in distance education were attending the courses they were enrolled in. Statement of Cause: The College has a process for instructors to certify that students attended, however instructors were not consistently completing this process within the sample that was tested. Possible Asserted Effect: Students may never attend distance education courses or stop attending distance education courses and not be identified for Return to Title IV purposes. Questioned Costs: None noted. Context: Out of a sample of 29 students enrolled in distance education tested, there were two (2) instances noted in which there was no instructor certification that the student attended the course. Upon review of further supporting documentation, attendance was verified, however, the prescribed internal control policy was not followed. Repeat Finding: No similar finding noted in 2019. Recommendation: We recommend that the College enhance its internal controls to ensure that instructors are certifying that distance education students are attending. Views of Responsible Officials and Planned Corrective Actions: HACC has already evaluated the distance education attendance process to identify and address the material weakness noted. Additional actions have been developed that includes communicating with faculty earlier and more frequently in the process, informing appropriate supervisors of any missed deadlines, and an improved process for documenting attendance if the faculty miss the deadline. These new measures will be deployed for the fall 2021 semester and evaluated to determine if they are working as intended or if further improvements are necessary.

Criteria: Pursuant to 34 CFR section 668.166(b), any Title IV funds drawn down under the advance payment method, but not disbursed by the end of the third business day are considered to be excess cash. The excess cash tolerance threshold is 1% of prior year drawdowns. The excess cash balance is to be eliminated within the next seven calendar days. Statement of Condition: The College had an excess cash balance of approximately $ 2,300,000, which exceeded the excess cash tolerance threshold, and was not eliminated or returned to Department of Education (ED) within seven calendar days. The excess cash balance was returned after 31 calendar days. Statement of Cause: The report the College used to determine the drawdown amounts had an error and this was not identified within the required timeframes. Possible Asserted Effect: The excess cash was not eliminated or returned to ED within the seven calendar days. The College identified the error the following month and returned the excess funds. Questioned Costs: None noted. Context: Performed an analysis over all drawdowns that occurred during the fiscal year and noted one instance out of the population of eight (8) that were tested in which a drawdown occurred and an amount that exceeded the excess cash tolerance threshold was not disbursed within three business days and was not eliminated within seven calendar days. Repeat Finding: No similar finding noted in 2019. Recommendation: We recommend for the College to ensure that the report used to determine drawdowns is reviewed thoroughly and is accurate prior to drawdown of funds from ED. Views of Responsible Officials and Planned Corrective Actions: HACC relies on a system-generated report to monitor and avoid excess cash related to federal grants. In addition to the report, HACC prepares a periodic manual analysis of the restricted cash to ensure the report is accurate. During the fiscal year 2020 that analysis was done twice, but the analysis did not identify the excess cash due to timing of when it was prepared. Since becoming aware of the error in the system-generated report, HACC has researched and fixed the error. In addition, HACC has increased the frequency of the manual restricted cash analysis to monthly to identify any potential errors in the system-generated report timelier.

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