THE UNIVERSITY OF CHICAGO

Finding 2022 001: Inaccurate Enrollment Reporting Federal Agency: U.S. Department of Education (USDE) Program Name: Student Financial Assistance Cluster ALN # and Program Expenditures: 84.063 ($5,001,353), 84.268 ($96,834,902) Federal Award Numbers: P063P20211389, P268K221389 Federal Award Year: July 1, 2021 to June 30, 2022 Questioned Costs: None Compliance Requirement: Enrollment Reporting Condition Found: The University did not accurately and/or timely report student address changes and enrollment status changes at both the campus-level and program-level to the National Student Loan Data System (NSLDS). The U.S. Department of Education (USDE) uses enrollment data reported by the University to determine: (1) eligibility for interest subsidies, (2) loan repayment start dates, and (3) in-school loan deferments. The enrollment information is also used by USDE to measure program completion data to evaluate the effectiveness of financial aid programs. Additionally, changes in a student?s permanent address are used by USDE to service loans. During our testing of 60 borrowers under the Federal Direct Loan Program and/or Federal Pell Grant recipients that had a reduction or increase in attendance levels, graduated, withdrew, dropped out, or enrolled but never attended during the fiscal year, we noted the following: - The status changes for two graduated students were reported incorrectly to the NSLDS as a Full-time (F) status rather than Graduated (G) status. Specifically, the enrollment statuses for these students were not reported as graduated to the NSLDS because the students had conferral dates outside established reporting dates, resulting in the student system incorrectly categorizing these students as full-time students instead of graduated. Upon further review, management evaluated and determined this error potentially impacted 103 public policy graduates who received Federal Direct Loans. - An address change was reported to NSLDS late (greater than 60 days after the change was known by the University for one student tested). In reviewing this exception with management, we noted the University?s third-party servicer (National Student Loan Clearinghouse) identified that this student potentially had been reported by another institution. As a result, the address change for this student was not reported to NSLDS until the University researched and validated the student?s information, which resulted in the address change being reported 62 days late. The University identified 73 additional students who had similar reporting delays. - The campus-level enrollment and the program-level enrollment status reported to the NSLDS did not agree for one student tested. The enrollment status was reported to the NSLDS as Full-time (F) for the campus-level and Withdrawn (W) for the program-level. The University identified an additional 27 students with inconsistent campus-level and program-level enrollment status reporting. We further noted management review controls implemented by the University were not designed at a level of precision to ensure University enrollment and student data submitted to NSLDS was accurate and reported within required timeframes. The University disbursed Federal Direct loans to 2,568 students during the year ended June 30, 2022. Criteria: According to 34 CFR Sections 690.83(b)(2) and 685.309, under the Pell grant and Federal Direct Loan programs, institutions must complete and return the Enrollment Reporting Roster File via NSLDS within 15 days of receipt. Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster File. Unless an institution expects to submit its next updated enrollment report to the USDE within the next 60 days, an institution must notify NSLDS within 30 days after the date that the institution discovers that (1) a Direct loan was made to or on behalf of a student who was enrolled or accepted for enrollment at the institution, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (2) a student who is enrolled at the institution and who received a loan under Title IV has changed his or her permanent address. The November 2020 NSLDS Enrollment Reporting Guide states ?a student?s Program-Level enrollment status should be reported with the same enrollment status as that student?s Campus-Level enrollment status for all programs the student is enrolled in as that location, even if the student is not currently taking coursework that applies to a particular program.? In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include establishing procedures to ensure student campus and program-level enrollment status changes are timely and accurately reported to the NSLDS. Cause: In discussing these conditions with University officials, they stated that the specific issues were caused by inadequate reporting policies, processes, and technology. Possible Asserted Effect: Inaccurate submission of student enrollment status and student information affects the determinations that lenders and servicers of student loans make related to in school deferments, grace periods, and repayment schedules, as well as the federal government?s payment of interest subsidies. Repeat Finding: A similar finding was reported in the prior year audit as finding 2021-001. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: We recommend the University review and revise its procedures to ensure accurate and timely reporting of student information and enrollment status information to the NSLDS. Views of University Officials: The University concurs with the findings and have begun work on the unmitigated issues.

Finding 2022 002: Inaccurate Property Management Records Federal Agency: U.S. Department of Agriculture (USDA) U.S. Department of Commerce (USDOC) U.S. Department of Defense (USDOD) U.S. Director of National Intelligence (USDNI) U.S. Department of Housing and Urban Development (USHUD) U.S. Department of Interior (USDOI) U.S. Department of Justice (USDOJ) U.S. Department of Transportation (USDOT) National Aeronautics and Space Administration (NASA) National Endowment for the Humanities (NEH) National Science Foundation (NSF) U.S. Department of Veteran Affairs (USDVA) U.S. Environmental Protection Agency (USEPA) U.S. Department of Energy (USDOE) U.S. Department of Education (USDE) Smithsonian Institution U.S. Department of Health and Human Services (USDHHS) Corporation for National and Community Service All Pass-Through Entities Program Name: Research and Development Cluster ALN # and Program Expenditures: Various ($482,298,931) Federal Award Numbers: Various ? See schedule of award numbers Federal Award Year: Various ? See schedule of award numbers Questioned Costs: None Compliance Requirement: Equipment Condition Found: The University did not consistently follow its property management policies and procedures related to equipment purchased with federal funding from the Research and Development (R&D) Cluster program. The University conducts research at multiple locations throughout their campus, where equipment purchased with federal funds is utilized and maintained. The University identifies all equipment in its property management records with individually assigned asset numbers and each individual asset record includes the specific location of the asset, the federal award general ledger account number that funded the purchase of the asset, and other required information. An asset tag with the assigned asset number is affixed to each asset in accordance with University policy. During our physical observation of 60 pieces of equipment purchased with R&D Cluster funds (with a total cost value of $1,542,384), we noted the following: - Nine items (with a total cost value of $200,035) did not have property management tags affixed at the time of our observation. - Eight items (with a total cost value of $103,583) had property management tags with asset numbers that were inconsistent with the equipment listing. Upon further review, we noted the property management records contained a temporary asset tag number that had not been updated for the permanent tag subsequently affixed by department personnel. Further, we noted adequate management review controls had not been established to ensure property management records were accurately updated and equipment was properly tagged. The net book value of equipment related to the R&D Cluster program totaled $217,101,257 at June 30, 2022. Criteria: According to 2 CFR 200.313(d)(1), property records must be maintained that include a description of the property, a serial number or other identification number, the source of funding for the property, who holds title, the acquisition date, and cost of the property, percentage of Federal participation in the project costs for the Federal award under which the property was acquired, the location, use and condition of the property, and any ultimate disposition data including the date of disposal and sale price of the property. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include procedures to ensure that accurate property records are maintained and equipment items are properly tagged. Cause: In discussing these conditions with University officials, they stated the University?s procedures for tagging equipment were delayed because the University?s personnel operated in a remote environment during fiscal years 2021 and 2022. Additionally, physical inventory procedures, which are designed detect differences between perpetual and actual information, were waived during fiscal years 2020 and 2021 as a result of the pandemic. Possible Asserted Effect: Failure to maintain accurate property records may prohibit the University from properly safeguarding and maintaining equipment and may result in federal programs not receiving the appropriate share of proceeds from the disposals of equipment purchased with federal funds. Repeat Finding: A similar finding was not reported in the prior year audit. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: We recommend the University review its procedures for updating property records to ensure they accurately reflect equipment information. We also recommend the University properly tag equipment in accordance with its policy. Views of University Officials: The University agrees with the finding. All departments of the University will be reminded that tagging is an integral part of the internal control process for capital assets and training will be made available before June 30, 2023.

Finding 2021-001: Inaccurate Enrollment Reporting Federal Agency: U.S. Department of Education (USDE) Program Name: Student Financial Assistance Cluster ALN # and Program Expenditures: 84.063 ($4,316,534), 84.268 ($102,768,754) Federal Award Numbers: P063P20201389, P268K211389 Federal Award Year: July 1, 2020 to June 30, 2021 Questioned Costs: None Compliance Requirement: Enrollment Reporting Condition Found: The University did not accurately report student enrollment status changes at both the campus-level and program-level to the National Student Loan Data System (NSLDS). The U.S. Department of Education (USDE) uses enrollment data reported by the University to determine: (1) eligibility for interest subsidies, (2) loan repayment start dates, and (3) in-school loan deferments. The enrollment information is also used by USDE to measure program completion data to evaluate the effectiveness of financial aid programs. Additionally, changes in a student?s permanent address are used by USDE to service loans. During our testing of 65 borrowers under the Direct Loan program and/or Pell Grant recipients that had a reduction or increase in attendance levels, graduated, withdrew, dropped out, or enrolled but never attended during the fiscal year, we noted the following: - The status change for eleven graduated students was reported incorrectly to the NSLDS as Withdrawn (W) rather than Graduated (G) status. Upon further review, it was determined that all eleven of these students had conferral dates outside of the established term end date of June 5, 2021, resulting in the student system incorrectly categorizing these students as withdrawn instead of graduated when reporting to NSLDS. As a result of the errors identified, management performed an evaluation and determined that this system error impacted all 821 business students who graduated on June 9, 2021, of which 164 received federal direct loans. On December 15, 2021, management corrected the reporting errors to the NSLDS for all students impacted. - The program start date was inaccurately reported to the NSLDS in the program-level records for 8 students tested. The program start date for these students was updated to report the start date after changing to a different curriculum with the same classification of instruction program (CIP) code. Further, we noted management review controls implemented by the University were not designed at a level of precision to ensure University enrollment and student data submitted to NSLDS accurately. The University disbursed FDL loans to 2,749 students during the year ended June 30, 2021 for which enrollment reporting requirements applied. The number of undergraduate students enrolled in the University during fiscal year 2021 was 6,222. Criteria: According to 34 CFR Sections 690.83(b)(2) and 685.309, under the Pell grant and Federal Direct loan programs, institutions must complete and return the Enrollment Reporting Roster File via NSLDS within 15 days of receipt. Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster File. Unless an institution expects to submit its next updated enrollment report to the USDE within the next 60 days, an institution must notify NSLDS within 30 days after the date that the institution discovers that (1) a Direct loan was made to or on behalf of a student who was enrolled or accepted for enrollment at the institution, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (2) a student who is enrolled at the institution and who received a loan under Title IV has changed his or her permanent address. The November 2020 NSLDS Enrollment Reporting Guide states ?a student?s Program-Level enrollment status should be reported with the same enrollment status as that student?s Campus-Level enrollment status for all programs the student is enrolled in as that location, even if the student is not currently taking coursework that applies to a particular program.? In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include establishing procedures to ensure student campus and program-level enrollment status changes are accurately reported to the NSLDS. Cause: In discussing these conditions with University officials, they stated that the specific issues are caused by reporting policies, processes and technology. Possible Asserted Effect: Inaccurate submission of student enrollment status and student information affects the determinations that lenders and servicers of student loans make related to in-school deferments, grace periods, and repayment schedules, as well as the federal government?s payment of interest subsidies. Repeat Finding: A similar finding was reported in the prior year audit as finding 2020-001. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: We recommend the University review its procedures to ensure accurate reporting of student information and enrollment status information to the NSLDS. Views of University Officials: The University concurs with the findings and have begun work on the unmitigated issues.

Finding 2021-002: Improper Costs Reported in the PRF Reporting Portal Federal Agency: U.S. Department of Health and Human Services (USDHHS) Program Name: COVID-19 ? Public Health and Social Services Emergency Fund for Provider Relief ALN # and Program Expenditures: 93.498 ($203,389,012) Federal Award Numbers: HHS-07077570776, HHS-60821907710, HHS-24508614591, HHS- 35432403065, HHS-34399157446, HHS-99492989543, HHS- 46251478163, HHS-51964833908, HHS-95690089267, HHS-44689612101, HHS-76753589162, HHS-90638498101, HHS-14206516800 Federal Award Year: April 10, 2020 to June 30, 2021 Questioned Costs: $1,100,000 Compliance Requirement: Activities Allowed or Unallowed Condition Found: The University and Medical Center reported $203,389,012 of federal funding from the USDHHS COVID-19 ? Public Health and Social Services Emergency Fund for Provider Relief program (PRF) during the year ended June 30, 2021. The University and the Medical Center primarily used PRF funding for lost revenue and for other COVID-19 related costs incurred. These costs were reported in the PRF Reporting Portal for the period from March 20, 2020 through June 30, 2021. During our review of the expenditures claimed by the Medical Center, we noted approximately $58 million of the expenditures reported were general and administrative (G&A) costs that were allocated to PRF based upon the number of COVID individuals served. In testing expenditures included in the G&A cost pools, we identified two items totaling $1,133,000 (out of 40 totaling $2,986,000) that were actually budgetary charges for net losses derived from the provision of transplant services rather than actual expenditures related to such services. While the Medical Center provided a service line income statement to evidence that these net losses resulted from expenses exceeding revenues for the transplant service line, the nature of these two items is not consistent with the Medical Center?s reporting of them as ?costs? or with other costs reported as G&A charged to PRF. As a result, they do not meet the allowability requirements of the PRF program. In evaluating the population of expenditures included in the G&A cost pool, we identified an additional $27,077,000 of similar budgetary charges for other service lines. After applying the applicable COVID-19 allocation metrics to these costs, we noted the total amount of such charges to PRF (including the two items discussed in the previous paragraph from our sample) was approximately $1.1 million. Criteria: According to the Terms and Conditions of PRF and Public Law No. 116-139, 134 Stat. 622 and 623, funds appropriated under this Act shall be available for building or construction of temporary structures, leasing of properties, medical supplies and equipment, including personal protective equipment and testing supplies, increased workforce and trainings, emergency operation centers, retrofitting facilities, and surge capacity. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include procedures to verify costs reported in the PRF Reporting Portal meet the activities allowed criteria. Cause: In discussing these conditions with Medical Center officials, they noted the evolving guidance for activities allowed or unallowed under COVID-19 related funding and necessary interpretation of this guidance resulted in these items being reported in the PRF Reporting Portal. Possible Asserted Effect: Reporting costs for activities not allowed under the PRF program may result in the disallowance of costs by USDHHS. Repeat Finding: This is not a repeat finding. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: We recommend the Medical Center review its procedures to ensure only costs for activities allowed under the PRF program are claimed/reported. Views of University Officials: The University of Chicago Medical Center had a rigorous process in monitoring the guidance from the Department of Health and Human Services who disbursed the Provider Relief Funds. This reporting guidance evolved, however, and specific to the General and Administrative Expenses allowed for providers to leverage their existing cost accounting systems and allocations for accumulation of these expenses for reporting purposes. The Medical Center implemented the guidance and assured that Healthcare Expenses and G&A Expenses were reported for the Provider Relief Funds to HHS prior to lost revenues. The transplant related costs are specific to a service line and are directly allocated to that service line and were to be incurred regardless of volume and revenue, thus allocated as indirect fixed costs and identified as G&A Expenses. The Medical Center in future reporting periods will be reporting lost revenues and does not anticipate the need to report future G&A Expenses.

Finding 2020 001 Inaccurate and Untimely Enrollment Reporting Federal Agency: U.S. Department of Education (USDE) Program Name: Student Financial Assistance Cluster ? Federal Direct Loan Program CFDA # and Program Expenditures: 84.268 ($93,643,427) Federal Award Numbers: P268K201389 Federal Award Year: July 1, 2019 to June 30, 2020 Questioned Costs: None Condition Found The University did not accurately and/or timely report student address changes and student enrollment status changes at both the campus-level and program-level to the National Student Loan Data System (NSLDS). The U.S. Department of Education (USDE) uses enrollment data reported by the University to determine: (1) eligibility for interest subsidies, (2) loan repayment start dates, and (3) in-school loan deferments. The enrollment information is also used by USDE to measure program completion data to evaluate the effectiveness of financial aid programs. Additionally, changes in a student?s permanent address are used by USDE to service loans. During our testing of 45 borrowers under the Direct Loan program whose enrollment status changed during the fiscal year, we noted the following: ? The campus-level enrollment status and the program-level enrollment status reported to the NSLDS did not agree for 1 student tested. The enrollment status was reported to the NSLDS as full time for campus-level and withdrawn for program-level. The University identified an additional 3 students with inconsistent campus-level and program-level enrollment status reporting. ? Program start dates were inaccurately reported to the NSLDS in the program-level records for 6 students tested. The program start dates for these students were updated to report their start date after returning from a leave of absence rather than the student?s original program start date. The University identified similar inaccurate program start dates were reported for an additional 476 students. ? The program start date was inaccurately reported to the NSLDS in the program-level records for 1 student tested. The program start date for this student was updated to report the start date after changing to a different curriculum with the same classification of instruction program (CIP) code. The University identified similar inaccurate program start dates were reported to NSLDS for an additional 267 students. ? Address changes were reported late (greater than 60 days after the change was known by the University) to the NSLDS for 2 students tested. Delays in reporting these changes were 19 and 95 days after the required timeframe. These 2 errors were reported by the University as part of a reporting error identified by the University in Fall 2019. Specifically, the University determined that when address changes were being reported to NSLDS, the student system did not always select the physical address type to be included in the reported file, sometimes sending other address types instead. The University processed address changes for the impacted students in December 2019. A total of 2,369 late address changes were reported in the December 2019 Roster File, of which 226 students were enrolled students who received Title IV financial aid from the University in fiscal year 2020. The remaining 2,143 students were enrolled at the University but did not receive Title IV financial aid from the University in fiscal year 2020. ? The status change for 1 withdrawn student was not accurately reported to the NSLDS. Specifically, the enrollment status was reported as full-time rather than withdrawn as the student retroactively withdrew from all courses after the conclusion of the academic term and subsequent to the submission of the final roster for the term. As the student enrolled full-time for the next academic term, the withdrawn status was never reported. ? The University identified the status changes for 6 graduated students were not accurately reported to the NSLDS as a result of the condition reported in a prior year finding. Specifically, the program enrollment statuses for these students were not reported as graduated to the NSLDS because the student graduated in an academic term in which the student was not enrolled. Further, we noted management review controls implemented by the University were not designed at a level of precision to ensure University enrollment and student data submitted to NSLDS was accurate and sent in accordance with required timeframes. The University disbursed FDL loans to 2,598 students during the year ended June 30, 2020 for which enrollment reporting requirements applied. The number of students included on the University?s Roster files ranged from 5,253 to 5,982 students during fiscal year 2020. Criteria According to 34 CFR Section 685.309, under the Federal Direct loan program, institutions must complete and return the Enrollment Reporting roster file via NSLDS within 15 days of receipt. Enrollment information must be reported within 30 days whenever attendance changes for students, unless a roster will be submitted within 60 days. An institution must notify the Secretary of Education if it discovers that a loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half time basis or failed to enroll on at least a half time basis for the period for which the loan was intended. The 2019-2020 NSLDS Enrollment Reporting Guide states ?a student?s Program-Level enrollment status should be reported with the same enrollment status as that student?s Campus-Level enrollment status for all programs the student is enrolled in as that location, even if the student is not currently taking coursework that applies to a particular program.? In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include establishing procedures to ensure student campus and program-level enrollment status changes and address changes are accurately and timely reported to the NSLDS. Cause In discussing these conditions with University officials, they stated that the specific issues are caused by reporting policies, processes and technology. Possible Asserted Effect Inaccurate and delayed submission of student enrollment status and student information affects the determinations that lenders and servicers of student loans make related to in school deferments, grace periods, and repayment schedules, as well as the federal government?s payment of interest subsidies. Repeat Finding A similar finding was reported in the prior year audit as finding 2019-001. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Recommendation We recommend the University review its procedures to ensure timely and accurate reporting of student information and enrollment status information to the NSLDS. Views of University Officials The University concurs with the findings and have begun work on the unmitigated issues.

Finding 2019 001 Inaccurate Enrollment Reporting Federal Agency: U.S. Department of Education (USDE) Program Name: Student Financial Assistance Cluster CFDA # and Program Expenditures: 84.268 ($100,819,766) Federal Award Numbers: P268K191389 Federal Award Year: July 1, 2018 to June 30, 2019 Questioned Costs: None Condition Found The University did not accurately report student enrollment status changes to the National Student Loan Data System (NSLDS). A student?s enrollment status determines eligibility for in school status, deferment, and grace periods, as well as for the payment of interest subsidies to Federal Direct Loan Program loan holders by the U.S. Department of Education (USDE). Reporting enrollment data in a timely and accurate manner is critical for effective management of the programs. The University uses the services of the National Student Clearinghouse (NSC) to report status changes to the NSLDS. Under this arrangement, the University reports all students enrolled and their status to the NSC. The NSC completes the roster file on behalf of the University and communicates status changes to the NSLDS. Although the University uses the services of the NSC, it is still ultimately the University?s responsibility to submit timely, accurate, and complete records to the NSLDS. During our testwork of 85 borrowers under the Direct Loan program that graduated or withdrew during the fiscal year, we noted the status changes for 4 graduated students were not accurately reported to the NSLDS as of the date of our testing (February 12, 2020). The enrollment statuses were reported to the NSLDS as Withdrawn (W) status rather than Graduated (G) status. Upon further review by the University, an additional 26 students were identified as being reported as Withdrawn (W) status rather than Graduated (G) status. Further, we noted management review controls implemented by the University were not designed at a level of precision to ensure University enrollment data submitted to NSLDS was accurate and sent in accordance with required timeframes. Criteria According to 34 CFR Section 685.309, under the Federal Direct loan program, institutions must complete and return the Enrollment Reporting roster file via NSLDS within 15 days of receipt. Enrollment information must be reported within 30 days whenever attendance changes for students, unless a roster will be submitted within 60 days. An institution must notify the Secretary of Education if it discovers that a loan under Title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half time basis or failed to enroll on at least a half time basis for the period for which the loan was intended. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include establishing procedures to ensure student enrollment status changes are accurately and timely reported to the NSLDS. Cause In discussing these conditions with University officials, they stated that there were two issues causing untimely data submission to NSC/NSLDS. First, the Chicago Booth School of Business submitted their graduate student data after the University?s graduated student file was sent to NSC. Second, the data feed sending graduation information for students who were no longer enrolled sent information to the Degree profile in NSC, not the Enrollment profile from which NSLDS retrieves information. Possible Asserted Effect Inaccurate and delayed submission of student enrollment status information affects the determinations that lenders and servicers of student loans make related to in school status, deferments, grace periods, and repayment schedules, as well as the federal government?s payment of interest subsidies. Repeat Finding A similar finding was not reported in the prior year audit. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Recommendation We recommend the University review its procedures to ensure timely and accurate reporting of student enrollment status information to the NSLDS. Views of University Officials The University agrees with the finding. Management has reminded staff of the importance of receiving the Chicago Booth graduated student information in a timely manner. Staff will verify that Chicago Booth students are included in each graduated student file or send a separate file to NSC, as needed. The data feed to NSC will be revised to send all graduated student information to the Enrollment profile. Until the data feed is updated, files will be generated and manually sent to NSC to update graduated students in FY20.

Finding 2019 002 Untimely and Inaccurate Reporting of Pell Grant Payment Data Federal Agency: U.S. Department of Education (USDE) Program Name: Student Financial Assistance Cluster CFDA # and Program Expenditures: 84.063 ($3,477,689) Federal Award Numbers: P063P181389 Federal Award Year: July 1, 2018 to June 30, 2019 Questioned Costs: None Condition Found The University did not report Pell grant disbursement data to the Common Origination and Disbursement (COD) system accurately and within required timeframes. During our testwork of 50 students (with 141 disbursements totaling $227,140) who were awarded and disbursed funds under the Pell Grant program, we noted the following: ? 3 Pell disbursement dates for Pell disbursements (totaling $4,846) to 3 students were not reported accurately to the COD. Upon further review by the University, 1 additional disbursement for 1 student was identified as being inaccurately reported. ? 5 Pell disbursements (totaling $5,506) to 5 students were not reported to the COD within 15 days. Delays in reporting Pell disbursements ranged from 6 to 35 days, with an average delay of 22 days. Further, we noted the University did not have adequate supervisory review or monitoring controls in place to ensure that Pell disbursement data was reported accurately and in a timely manner. Criteria According to OMB No. 1845 0039, an institution must submit Pell Grant origination and disbursement records to the USDE through the COD system. Origination records may be sent in advance of any disbursements, as early as the institution chooses to submit them, for any student the institution believes will be eligible for payment. The disbursement record reports actual disbursement date and the amount of the disbursement. Institutions must report student payment data within 15 calendar days after the institution makes a payment or becomes aware of the need to make an adjustment to previously reported student payment data or expected student payment data. Institutions may do this reporting once every 15 days, biweekly, weekly, or may set up their own system to ensure changes are reported in a timely manner. In addition, 2 CFR 200.303 requires nonfederal entities to, among other things, establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. Effective internal controls should include maintaining adequate controls over Pell Grant origination and disbursements records and related documentation. Cause In discussing these conditions with University officials, they stated that staff processing errors led to inaccurate and untimely reporting of Federal Pell Grant data. Possible Asserted Effect Failure to report Pell payment data to the COD accurately and in a timely manner results in noncompliance with program requirements and inhibits the ability of the USDE to monitor Pell disbursements. Repeat Finding A similar finding was reported in the prior year audit as finding 2018-003. Statistical Sampling The sample was not intended to be, and was not, a statistically valid sample. Recommendation We recommend the University review its internal control procedures and implement additional management review procedures to ensure data reported to the COD is accurately reported within required timeframes. Views of University Officials The University agrees with the finding. The University Financial Aid Office made a staffing change and has a new team charged with Federal Pell Grant reporting. In addition, we have added enhanced review items to the monthly required reconciliation process.

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