Payne Theological SeminaryHigher Education

2025-001: Common Origination and Disbursement (COD) Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster ALN Numbers: 84.268 – Federal Direct Loan Program Award Period: July 1, 2024 through June 30, 2025 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Department of Education requires the College to report the disbursement dates and amounts to the Common Origination and Disbursement (COD) system within 15 days of disbursing Pell (34 CFR 690.83(b)(2) and Direct Loan (34 CFR 685.309) funds to a student. Condition: During our testing, we noted 9 out of the 29 student's disbursement date per the Seminary’s record did not match the date reported to COD. Questioned Costs: None Context: During our testing, it was noted the Seminary does not have a process in place to ensure accurate reporting of disbursement dates to COD based on the regulations set forth by the Department of Education. Cause: The Seminary does not have a process in place to accurately report the date of disbursements. Effect: Students interest accrues based on disbursement date reported to COD, thus interest calculation could be skewed due to the discrepancy in disbursement dates reported. Repeat Finding: Yes – See 2024-001 Recommendation: We recommend the Seminary evaluate its procedures and policies around reporting Unsubsidized loan disbursements to COD to ensure that student information is reported accurately and timely. Views of Responsible Officials: There is no disagreement with the audit finding.

2025-002: Gramm-Leach Bliley Act (GLBA) Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster ALN Numbers: 84.268 – Federal Direct Loan Program Award Period: July 1, 2024 through June 30, 2025 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Gramm-Leach-Bliley Act (GLBA) requires financial institutions to explain their information-sharing practices to their customers and to safeguard sensitive data (16 CFR 314). Institutions are required to develop, implement, and maintain a comprehensive information security program that is written in one or more readily accessible parts. The regulations require the written information security program to include nine elements for institutions with 5,000 or more customers, (16 CFR 314.3(a)). The written information security program (WISP) for institutions with fewer than 5,000 customers must address seven elements (16 CFR 314.3(a) and 16 CFR 314.6). The elements that an institution must address in its written information security program are at 16 CFR 314.4. At a minimum, the institution’s written information security program must address the implementation of the minimum safeguards identified in 16 CFR 314.4(c)(1) through (8) including: Assess apps developed by the institution. In addition, the written security program provides for the institution to regularly test or otherwise monitor the effectiveness of the safeguards it has implemented (16 CFR 314.4(d)). Condition: During our testing, we noted several steps missing from the Written Information Security Program (WISP). Questioned Costs: None Context: There are elements missing from the Seminary’s WISP that are part of the GLBA requirements. Cause: There was not a formal process in place to review against all the new GLBA requirements to ensure compliance. Effect: Student personal information could be vulnerable. Repeat Finding: Yes – See 2024-003 Recommendation: We recommend that the Seminary review the updated GLBA requirements and ensure their WISP includes all required elements. Views of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster ALN Numbers: 84.268 – Federal Direct Loan Program Award Period: July 1, 2023 through June 30, 2024 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Department of Education requires the College to report the disbursement dates and amounts to the Common Origination and Disbursement (COD) system within 15 days of disbursing Pell (34 CFR 690.83(b)(2) and Direct Loan (34 CFR 685.309) funds to a student. Condition: During our testing, we noted 10 out of the 40 student's disbursement date per the Seminary’s record did not match the date reported to COD. Questioned Costs: None Context: During our testing, it was noted the Seminary does not have a process in place to ensure accurate reporting of disbursement dates to COD based on the regulations set forth by the Department of Education. Cause: The Seminary does not have a process in place to accurately report the date of disbursements. Effect: Students interest accrues based on disbursement date reported to COD, thus interest calculation could be skewed due to the discrepancy in disbursement dates reported. Repeat Finding: No Recommendation: We recommend the Seminary evaluate its procedures and policies around reporting Unsubsidized loan disbursements to COD to ensure that student information is reported accurately and timely. Views of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster ALN Numbers: 84.268 – Federal Direct Loan Program Award Period: July 1, 2023 through June 30, 2024 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 668.164(h)(1), A title IV, HEA credit balance must be paid directly to the student or parent as soon as possible, but no later than (i) Fourteen (14) days after the balance occurred if the credit balance occurred after the first day of class of a payment period; or (ii) Fourteen (14) days after the first day of class of a payment period if the credit balance occurred on or before the first day of class of that payment period. Condition: During our testing, we noted 28 out of the 40 students tested had credit balances that were not returned to the student or parent within 14 days of the credit balance occurring. Questioned Costs: None Context: During our testing, it was noted the Seminary does not have a process in place to ensure timeliness of funds being returned to the student based on the regulations set forth by the Department of Education. Cause: The Seminary did not have a process in place to ensure the refunds are completed timely. Effect: The Seminary is not in compliance with Department of Education requirements that states student’s credit balance must be returned no later than 14 days. Repeat Finding: No Recommendation: We recommend that the Seminary implemented a process to ensure credit balances are returned timely based on the regulations set forth by the Department of Education. Views of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster ALN Numbers: 84.268 – Federal Direct Loan Program Award Period: July 1, 2023 through June 30, 2024 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Gramm-Leach-Bliley Act (GLBA) requires financial institutions to explain their information-sharing practices to their customers and to safeguard sensitive data (16 CFR 314). Institutions are required to develop, implement, and maintain a comprehensive information security program that is written in one or more readily accessible parts. The regulations require the written information security program to include nine elements for institutions with 5,000 or more customers, (16 CFR 314.3(a)). The written information security program (WISP) for institutions with fewer than 5,000 customers must address seven elements (16 CFR 314.3(a) and 16 CFR 314.6). The elements that an institution must address in its written information security program are at 16 CFR 314.4. At a minimum, the institution’s written information security program must address the implementation of the minimum safeguards identified in 16 CFR 314.4(c)(1) through (8) including: Assess apps developed by the institution. In addition, the written security program provides for the institution to regularly test or otherwise monitor the effectiveness of the safeguards it has implemented (16 CFR 314.4(d)). Condition: During our testing, we noted several steps missing from the Written Information Security Program (WISP). Questioned Costs: None Context: These new GLBA requirements were applicable beginning on June 9, 2023 and there were several elements missing from their WISP. Cause: There was not a formal process in place to review against all the new GLBA requirements to ensure compliance. Effect: Student personal information could be vulnerable. Repeat Finding: Yes – See 2023-002 Recommendation: We recommend that the Seminary review the updated GLBA requirements and ensure their WISP includes all required elements. Views of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster ALN Numbers: 84.268 – Federal Direct Loan Program Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 685.309(b), states schools must have some arrangement to report student enrollment data to NSLDS through an enrollment roster file. The school is required to report changes in the student’s enrollment status, the effective date of the status, and an anticipated completion date. Also, the Code of Federal Regulations, 34 CFR 682.610, states that institutions must report accurately the enrollment status of all students regardless if they receive aid from the institution or not. Changes to said status are required to be reported within 30 days of becoming aware of the status change, or with the next scheduled transmission of statuses if the scheduled transmission is within 60 days. Condition: During our testing, we noted 4 out of the 8 students tested where the student was not reported in a timely manner after the school determined the students change in status. Furthermore, 4 out of the 8 students effective date per the institution did not match the enrollment effective date. Questioned Costs: None Context: During our testing, it was noted the Seminary did properly report the effective date to NSLDS based on the Seminary’s records. Cause: The Seminary did not determine graduate students effective date correctly due to extenuating circumstance. Effect: The enrollment effective date reported to NSLDS is used to determine when the student’s grace period should begin. By reporting an incorrect effective date, the grace period begin date for the student will be incorrect. Repeat Finding: Yes, 2022-001 Recommendation: We recommend the Seminary reevaluate its procedures and review policies surrounding reporting status changes to NSLDS to ensure timely reporting as well as put a process in place to ensure the enrollment effective date reported to NSLDS is aligning with the Seminary’s last date of attendance. Views of Responsible Officials: There is no disagreement with the audit finding.

Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster ALN Numbers: 84.268 – Federal Direct Loan Program Award Period: July 1, 2022 through June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Gramm-Leach-Bliley Act (GLBA) requires financial institutions to explain their information-sharing practices to their customers and to safeguard sensitive data (16 CFR 314). Institutions are required to develop, implement, and maintain a comprehensive information security program that is written in one or more readily accessible parts. The regulations require the written information security program to include nine elements for institutions with 5,000 or more customers, (16 CFR 314.3(a)). The written information security program (WISP) for institutions with fewer than 5,000 customers must address seven elements (16 CFR 314.3(a) and 16 CFR 314.6). The elements that an institution must address in its written information security program are at 16 CFR 314.4. At a minimum, the institution’s written information security program must address the implementation of the minimum safeguards identified in 16 CFR 314.4(c)(1) through (8) including: Assess apps developed by the institution. In addition, the written security program provides for the institution to regularly test or otherwise monitor the effectiveness of the safeguards it has implemented (16 CFR 314.4(d)). Condition: During our testing, we noted several steps missing from the Written Information Security Program (WISP). Questioned Costs: None Context: These new GLBA requirements were applicable beginning on June 9, 2023 and there were several elements missing from their WISP. Cause: There was not a formal process in place to review against all the new GLBA requirements to ensure compliance. Effect: Student personal information could be vulnerable. Repeat Finding: No Recommendation: We recommend that the Seminary review the updated GLBA requirements and ensure their WISP includes all required elements. Views of Responsible Officials: There is no disagreement with the audit finding.

2022-001: National Student Loan Database System (NSLDS) Reporting Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 685.309(b), states schools must have some arrangement to report student enrollment data to NSLDS through an enrollment roster file. The school is required to report changes in the student?s enrollment status, the effective date of the status, and an anticipated completion date. Also, the Code of Federal Regulations, 34 CFR 682.610, states that institutions must report accurately the enrollment status of all students regardless if they receive aid from the institution or not. Changes to said status are required to be reported within 30 days of becoming aware of the status change, or with the next scheduled transmission of statuses if the scheduled transmission is within 60 days Condition: During our testing, we noted 1 of the 8 students tested were reported to NSLDS in which the status per the Program Enrollment did not match the Campus Enrollment as well as the Seminary's records. There was also 1 of 8 students tested where the student's effective enrollment date report to NSLDS did not match the Seminary's records. Questioned Costs: None Context: During our testing, it was noted the Seminary did properly report the status change at the Program Enrollment level. Furthermore, there was an error of the effective date for the students withdrawal reported to NSLDS. Cause: The Seminary did not determine unofficial withdrawals correctly and did not properly report student statuses to NSLDS. Effect: The enrollment effective date reported to NSLDS is used to determine when the student?s grace period should begin. By reporting an incorrect effective date, the grace period begin date for the student will be incorrect. The Seminary also did not comply with Department of Education (ED) regulations requiring reporting student enrollment status change to NSLDS within 60 days. Repeat Finding: Yes, 2021-001 Recommendation: We recommend the Seminary reevaluate its procedures and review policies surrounding reporting status changes to NSLDS to ensure timely reporting as well as put a process in place to ensure the enrollment effective date reported to NSLDS is aligning with the Seminary's last date of attendance. Views of Responsible Officials: There is no disagreement with the audit finding.

2022-002: Student Refund of Credit Balances within 14 Days Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2021 to June 30, 2022 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 668.164(e) states that whenever an institution disburses title IV, HEA program funds by crediting a student?s account and the total amount of all title IV, HEA program funds credited exceeds the amount of tuition and fees, room and board, and other authorized charges the institution assessed the student, the institution must pay the resulting credit balance directly to the student or parent as soon as possible but? (1) No later than 14 days after the balance occurred if the credit balance occurred after the first day of class of a payment period; or (2) 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 class of that payment period. Condition: During our testing, we noted 3 of 14 students tested did not have the credit balance resulting from federal funds refunded within the 14-day period or form indicating waiver on the refunds being held for further charges. Questioned Costs: None Context: During our testing it was noted that the Seminary failed to refund students within the 14-day period. Cause: The Seminary did not post adjustments to student accounts within the correct time period nor did they receive a waiver form from the students indicating they can hold the refund until future charges on the student account. Effect: The Seminary did not refund students within 14 days for credit balances that arose from federal funds as required by Department of Education regulations. Repeat Finding: No Recommendation: We recommend the Seminary implement a process to ensure they are refunding students credit balances within 14 days. If the Seminary continues their refund practice, we recommend they have an authorization form for every student. Views of Responsible Officials: There is no disagreement with the audit finding.

2021-001: National Student Loan Database System (NSLDS) Reporting Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2020 to June 30, 2021 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR ? 685.309 requires that enrollment statuses for students be reported to NSLDS at least every 60 days. Also, the Code of Federal Regulations, 34 CFR 682.610, states that institutions must report accurately the enrollment status of all students regardless if they receive aid from the institution or not. Changes to said status are required to be reported within 30 days of becoming aware of the status change, or with the next scheduled transmission of statuses if the scheduled transmission is within 60 days. Regulations require the effective date of status change to be the date of withdrawal for students who have withdrawn in accordance with Code of Federal Regulations, 34 CFR ? 668.22(b) or (c). Condition: During our testing, we noted 4 of the 8 students tested were reported to NSLDS with an incorrect enrollment effective date. There was also 2 of 8 students tested where the student's status was not reported to NSLDS within 60 days of determining the status change as required by regulations. Questioned Costs: None Context: During our testing, it was noted the Seminary did not properly report the change in status within 60 days of the determination. Furthermore, CliftonLarsonAllen, LLP (CLA) noted errors of the effective date for the students withdrawal report on the program level enrollment to NSLDS. Cause: The Seminary did not determine unofficial withdrawals correctly and did not properly report student statuses to NSLDS. Effect: The enrollment effective date reported to NSLDS is used to determine when the student?s grace period should begin. By reporting an incorrect effective date, the grace period begin date for the student will be incorrect. The Seminary also did not comply with Department of Education (ED) regulations requiring reporting student enrollment status change to NSLDS within 60 days. Repeat Finding: Yes, 2020-001 Recommendation: We recommend the Seminary reevaluate its procedures and review policies surrounding reporting status changes to NSLDS to ensure timely reporting as well as put a process in place to ensure the enrollment effective date reported to NSLDS is aligning with the Seminary's last date of attendance. Views of Responsible Officials: There is no disagreement with the audit finding.

2021-002: Return of Title IV Funds Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2020 to June 30, 2021 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: A school must document a student?s withdrawal date and maintain that documentation as of the date of the school?s determination that the student withdrew. A school must determine the attendance records that most accurately support its determination of a student?s withdrawal date and the school?s use of one date over another if the school has conflicting information. The determination of a student?s withdrawal date is the responsibility of the school. Condition: In our testing of refunds of Title IV aid, we noted 2 of the 5 students tested did not have their R2T4 calculation completed timely after determining the student's withdrawal from the Seminary. Questioned Costs: None Context: During our audit procedures, it was noted 2 of the 5 students tested did not have their R2T4 calculation completed timely after determining the student's withdrawal from the Seminary. Cause: The Seminary determines unofficial withdrawals after each term and had miscommunication with their 3rd Party Servicers in regards to completing the R2T4 timely. Effect: Completing the R2T4 in a timely manner helps to ensure incorrect amounts are not returned to the Department of Education or to the student. Repeat Finding: No Recommendation: We recommend the school implement a process by which the proper effective withdrawal date is determined for each student who withdraws from a program at the Seminary and subsequently reported to the 3rd Party Servicer right away to ensure there is no delay in completing the R2T4 calculation. Views of Responsible Officials: There is no disagreement with the audit finding.

2021-003: Eligibility Certification Approval Report (ECAR) Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2020 to June 30, 2021 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 668.25(e) states that an institution must notify the Department of Education by way of the ECAR within 10 days of a change in position of an official at the University. Condition: During our testing, we noted that the change in Director of Financial Aid was not reported timely to the Department of Education. Questioned Costs: None Context: During our testing, we noted the Director of Financial Aid was not updated on the ECAR subsequent to their departure within 10 days. Cause: The Seminary had a change in the Director of Financial Aid at the beginning of fiscal 2021, however; never reported the change thus it was not completed timely. Effect: The Seminary is not in compliance with Department of Education requirements that state the ECAR must have accurately reported information. Repeat Finding: No Recommendation: We recommend the Seminary review its reporting procedures surrounding updating the ECAR to ensure reporting is accurate and completed timely. Views of Responsible Officials: There is no disagreement with the audit finding.

2020-001: National Student Loan Database System (NSLDS) Reporting Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2019 to June 30, 2020 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR ? 685.309 requires that enrollment statuses for students be reported to NSLDS at least every 60 days. Also, the Code of Federal Regulations, 34 CFR 682.610, states that institutions must report accurately the enrollment status of all students regardless if they receive aid from the institution or not. Changes to said status are required to be reported within 30 days of becoming aware of the status change, or with the next scheduled transmission of statuses if the scheduled transmission is within 60 days. Regulations require the effective date of status change to be the date of withdrawal for students who have withdrawn in accordance with Code of Federal Regulations, 34 CFR ? 668.22(b) or (c). Condition: During our testing of student status changes and reporting, we noted one of the eight students tested was reported to NSLDS with an incorrect enrollment effective date. We also noted, out of eight students tested, one student's status was not updated on NSLDS rosters at least every 60 days as required by regulations. Questioned Costs: None Context: During our testing, it was noted the Seminary did not properly verify enrollment to NSLDS every 60 days. Furthermore, CLA noted an error in the effective date of withdrawal reported to NSLDS in the case of one student. Cause: The Seminary did not determine unofficial withdrawals correctly and did not properly report student statuses to NSLDS. Effect: The enrollment effective date reported to NSLDS is used to determine when the student?s grace period should begin. By reporting an incorrect effective date, the grace period begin date for the student will be incorrect. The Seminary also did not comply with Department of Education (ED) regulations requiring reporting student enrollment status at least every 60 days to NSLDS. Repeat Finding: Yes, 2019-003 Recommendation: We recommend the Seminary reevaluate its procedures and review policies surrounding reporting status changes to NSLDS to ensure timely reporting as well as put a process in place to ensure the enrollment effective date reported to NSLDS is aligning with the student?s last date of attendance as determined by the Seminary. Views of Responsible Officials: There is no disagreement with the audit finding.

2020-002: Return of Title IV Funds Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2019 to June 30, 2020 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: A school must document a student?s withdrawal date and maintain that documentation as of the date of the school?s determination that the student withdrew. A school must determine the attendance records that most accurately support its determination of a student?s withdrawal date and the school?s use of one date over another if the school has conflicting information. The determination of a student?s withdrawal date is the responsibility of the school. Condition: During our testing of R2T4?s, we noted the Seminary had determined an incorrect withdrawal date for 2 of 4 students tested. Questioned Costs: None Context: During our audit procedures, it was noted that the date of withdrawal for 2 of the 4 students in our R2T4 sample was incorrect based on the Seminary?s records. Cause: The Seminary determines unofficial withdrawals after each term and used the incorrect date of separation when determining the withdrawal dates. Effect: Using the improper withdrawal date when calculating R2T4's can lead to incorrect amounts returned to the Department of Education or to the student. Repeat Finding: No Recommendation: We recommend the Seminary implement a process by which the proper effective withdrawal date is determined for each student who withdraws from a program at the Seminary. Views of Responsible Officials: There is no disagreement with the audit finding.

2019-001: Program Eligibility Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2018 to June 30, 2019 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR ? 600.20, requires institutions wishing to add an educational program and disburse Title IV funds to students enrolled in that program to obtain approval from the Department of Education prior to disbursing aid to students enrolled in that program. By submitting an application for approval, the institution has represented that it has obtained all necessary accreditations and state authorizations for the program. Condition: During the recertification process of the Seminary, the U.S. Department of Education discovered that Payne had not received required state authorization from the state of Ohio in 2015 for the Doctor of Ministry program and voided federal authorization of the program, effective April 1, 2016. Therefore, all federal aid disbursed to students in the program from the beginning of the program through the 2018-19 award year was disbursed to an ineligible program. Questioned Costs: $497,683. This is the entire amount of Title IV funds disbursed to students enrolled in the Doctor of Ministry program in the 2018-19 award year. Context: During the additional audit procedures as required by the 2019 OMB Compliance Supplement, it was noted the Seminary had not obtained the required state authorization for the Doctor of Ministry program prior to disbursing Title IV aid to students enrolled in the program. It was also noted the Seminary has obtained the proper state authorizations and has been approved to disburse Title IV funds to students enrolled in the Doctor of Ministry program beginning in the 2019-20 award year. Cause: The Seminary was not aware of the requirement for authorization from the state of Ohio for the Doctor of Ministry program prior to disbursing Title IV funds to students enrolled in the program beginning in the 2015-16 award year. Effect: The Seminary disbursed approximately $2,052,332 to students enrolled in the ineligible Doctor of Ministry program from 2015 to 2019. Repeat Finding: No Recommendation: We recommend that the Seminary ensure required state authorizations are obtained prior to applying for approval to disburse Title IV aid to students enrolled in a new program. Views of Responsible Officials: There is no disagreement with the audit finding.

2019-002: Common Origination and Disbursement (COD) Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2018 to June 30, 2019 Type of Finding: Material Weakness in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: Department of Education regulations require that disbursement dates reported to COD be the date funds were posted (disbursed) to the student?s account and all disbursements of Title IV aid be reported to COD within 15 days after the disbursement is made or the institution becomes aware of the need to adjust a student?s previously reported disbursement. Condition: During our audit procedures testing compliance with COD disbursement reporting requirements, it was noted that the disbursements were reported late or incorrectly. Questioned Costs: None Context: During our audit procedures, it was noted that the date of disbursement per COD did not match the date of disbursement per the student account for 13 of the 60 disbursements tested. It was also noted that the disbursement was not reported within 15 days for 29 of the 60 disbursements tested. Cause: The Seminary did not have adequate controls in place to ensure timely and accurate reporting of disbursements. Effect: Disbursements reported incorrectly to COD could cause Title IV funds to be unavailable or drawn down incorrectly. Repeat Finding: Yes, 2018-002 Recommendation: We recommend the Seminary create a process to ensure the disbursements are reported accurately and timely to COD. In addition, if there are any changes to the disbursement, the Seminary needs to create a process to identify the changes timely and report them to COD within the required 15 days. Views of Responsible Officials: There is no disagreement with the audit finding.

2019-003: National Student Loan Data System (NSLDS) Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2018 to June 30, 2019 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR ? 685.309 requires that enrollment status changes for students be reported to NSLDS within 30 days or within 60 days if a scheduled transmission is due. Regulations require the effective date of status change to be the date of withdrawal for students who have withdrawn in accordance with Code of Federal Regulations, 34 CFR ? 668.22(b) or (c). Condition: In our testing of 7 status changes, we noted 2 students had an effective date of withdrawal per NSLDS which did not match the correct effective date of the status change. This was due to the students' unofficial withdrawal date not being determined correctly, resulting in the term end date being used as effective date of status change. Questioned Costs: None Context: During our testing of NSLDS reporting, it was noted 2 out of 7 students tested had an effective date per NSLDS that did not match the correct effective date of the status change per the Seminary?s student records. Cause: The Seminary did not correctly report the effective date of the status change due to the incorrect determination of students? effective date of withdrawal. Effect: Status changes reported incorrectly to NSLDS could cause overawarding of Title IV funds to students should students transfer to another institution. Incorrect reporting of status changes could also impact the calculation of when students enter into the repayment period for federal loans. Repeat Finding: Yes, 2018-003 Recommendation: We recommend that the school continues to improve their review processes to ensure that student's statuses are accurately and timely reported to NSLDS as required by regulations. Views of Responsible Officials: There is no disagreement with the audit finding.

2019-004: Gramm-Leach-Bliley Act Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2018 to June 30, 2019 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: The Gramm-Leach-Bliley Act (Public Law 106-102) requires financial institutions to explain their information-sharing practices to their customers and to safeguard sensitive data. (16 CFR 314) The Federal Trade Commission considers Title IV-eligible institutions that participate in Title IV Educational Assistance Programs as ?financial institutions? and subject to the Gramm-Leach-Bliley Act (16 CFR 313.3(k)(2)(vi). Condition: Under an institution?s Program Participation Agreement with the Department of Education and the Gramm-Leach-Bliley Act, schools must protect student financial aid information, with particular attention to information provided to institutions by the Department or otherwise obtained in support of the administration of the federal student financial aid programs. Questioned Costs: None Context: During our audit procedures, it was noted that the Seminary did not designate an individual to coordinate the information security program; perform a risk assessment that addresses the three areas noted in 16 CFR 314.4 (b) which are (1) employee training and management, (2) information systems, including network and software design, as well as information processing, storage, transmission and disposal, and (3) detecting, preventing and responding to attacks, intrusions, or other systems failures; nor document safeguards for identified risks. Cause: The Seminary did not designate an individual to coordinate the information security program, perform an IT risk assessment tailored specifically to the organization, identify risks, or address risks identified as required by the Gramm-Leach-Bliley Act. Effect: Student personal information could be vulnerable. Repeat Finding: No Recommendation: We recommend that the Seminary designate an individual to oversee the information security program, engage a third party to perform or perform themselves the risk assessment for the three areas required by the Gramm-Leach-Bliley Act, and ensure that there are documented safeguards for identified risks. Views of Responsible Officials: There is no disagreement with the audit finding.

2019-005: Return of Title IV Funds Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2018 to June 30, 2019 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: For all students who withdraw from an institution during a payment period or period of enrollment, the Code of Federal Regulations, 34 CFR ? 668.22, requires institutions to determine the amount of Title IV grant or loan assistance earned by the student as of the date of the student?s withdrawal. If a student withdraws prior to completing 60 percent of the payment period or period of enrollment, any unearned Title IV assistance must be returned to the applicable federal loan or grant program. If a student who began attendance and has not officially withdrawn fails to earn a passing grade in at least one course offered over an entire period, the institution must assume, for Title IV purposes, that the student has unofficially withdrawn, unless the institution can document that the student completed at least 60 percent of the period. Condition: In our testing of students who withdrew from the Seminary, we noted 1 of the 6 students tested did not have an R2T4 calculation performed as required for unofficial withdrawals. Questioned Costs: $2,190 Context: During our audit procedures, it was noted that 1 of the 6 withdrawn students tested did not have an R2T4 calculation performed. This student did not earn a passing grade in at least one course offered in the period from which they withdrew and was unofficially withdrawn. In our testing, it was noted that no documentation showing academic activity beyond the midpoint of the period of enrollment could be provided. Per the Seminary?s policy, when the date of last academic activity cannot be determined, the midpoint of the period of enrollment must be used in the determination of the earned percentage of Title IV assistance, which should have resulted in a return of Title IV funds for this student. Cause: The Seminary did not complete a required R2T4 calculation. Effect: The Seminary did not return Title IV funds to the Federal Direct Loan Program as required. Repeat Finding: No Recommendation: We recommend the Seminary implement a review of the listing of all unofficial withdrawals and period completion calculations to ensure that R2T4 calculations are performed for any students who are required to have R2T4 calculations performed. Views of Responsible Officials: There is no disagreement with the audit finding.

2019-006: Return of Title IV Funds Federal Agency: Department of Education Federal Program: Student Financial Assistance Cluster CFDA Numbers: 84.268 ? Federal Direct Loan Program Award Period: July 1, 2018 to June 30, 2019 Type of Finding: Significant Deficiency in Internal Control over Compliance and Other Matters Criteria or Specific Requirement: For all students who withdraw from an institution during a payment period or period of enrollment, the Code of Federal Regulations, 34 CFR ? 668.22, requires institutions to determine the amount of Title IV grant or loan assistance earned by the student as of the date of the student?s withdrawal. If a student withdraws prior to completing 60 percent of the payment period or period of enrollment, any unearned Title IV assistance must be returned to the applicable federal loan or grant program. A school must document a student?s withdrawal date and maintain that documentation as of the date of the school?s determination that the student withdrew. A school must determine the attendance records that most accurately support its determination of a student?s withdrawal date and the school?s use of one date over another if the school has conflicting information. The determination of a student?s withdrawal date is the responsibility of the school. A student?s certification of attendance that is not supported by institutional documentation is not acceptable. Condition: In our testing of students who withdrew from the Seminary, we noted all 6 students tested did not have a documented date of determination of withdrawal from the Seminary. Questioned Costs: None Context: During our audit procedures, it was noted that the Seminary could not provide documentation of the date the Seminary determined that 6 of the 6 students tested withdrew from the Seminary and therefore, it could not be determined if the Seminary is timely identifying and completing the return of Title IV calculations. Cause: The Seminary determines unofficial withdrawals after the end of each term. However, the Seminary did not document the date each student was determined to have withdrawn. Effect: The Seminary could be noncompliant with the requirement to return Title IV funds to the applicable federal program within 45 days of determining a student was an unofficial withdrawal. Repeat Finding: No Recommendation: We recommend the Seminary implement a process to formally document dates of determination of withdrawal for all unofficial withdrawals. Views of Responsible Officials: There is no disagreement with the audit finding.

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