Milwaukee Area Technical College

Finding No. 2025-001 – Subrecipient Monitoring Deficiencies Repeat Finding: No ALN and Program: 84.002 – Adult Education State Grant Program Award Amount: $1,384,339 Award Number: 09-401-146-125 Award Year: 7/1/2024-6/30/2025 Criteria: 2 CFR 200.332 specifies requirements for monitoring subaward agreements. Section (b) of the guidance lists required elements to be included in subaward agreements, including subrecipient identifying information, information about the original federal award dates and amounts, contact information, and compliance requirements of the award. Section (c) specifies that grantees evaluate each subrecipient's fraud risk and risk of noncompliance with the subaward. Section (e) requires grantees to assess risk and monitor the activities of a subrecipient as necessary to ensure the subrecipient complies with Federal statutes, regulations, and terms and conditions of the subaward. MATC's system of control is required to be designed and implemented in order to ensure compliance of subawards with the applicable compliance requirements. Condition/Context: In testing compliance with the requirements of 2 CFR 200.332, we noted that MATC's internal controls over subrecipient monitoring requirements were not effectively operating during the year ended June 30, 2025. MATC's subaward agreement with Literacy Services of Wisconsin did not contain all the required information included in Section (b). In particular, the agreement was missing the subrecipient's Unique Entity Identification Number (UEI), the Federal and / or State Award Identification Number (FAIN), Federal and / or State Award Date, and the indirect cost rate for the Federal and / or State Award. Additionally, MATC was not able to produce evidence of the required risk assessment process, and resulting monitoring activities deemed necessary to ensure the subgrantee's compliance with Federal Requirements. MATC's review and approval process for this subaward did not prevent, detect, or identify the missing contract information or the lack of documented risk assessments. Monitoring activities were performed; however, without the documented risk assessment, it is unclear whether the activities were sufficient. Cause: MATC has made subawards under the AEFL program for many years, and the same subaward document has been used without amendment. While the agreement was subjected to the required review and approval process internally, the review did not identify the updated requirements for elements of the agreements. Additionally, MATC has historically performed site monitoring and review of financial reports for all of its sub-awardees; however, in 2025 the individual responsible for performing this process retired and a replacement was not found for several months, resulting in a vacancy in the position and lack of available staffing to complete the monitoring documentation and process. Questioned Costs: None Effect: The subaward agreement is not in compliance with Federal sub-award requirements, and an appropriate risk assessment was not documented, which could result in incorrect reporting of the award by the sub-grantee, or potential non-compliance of the sub-awardee. Recommendation: We recommend MATC evaluate its award approval process and implement clear and robust procedures designed to ensure agreements are compared to the most current set of requirements for compliance.

Finding No. 2024-001 - Untimely Return of Title IV Funds Repeat Finding: No ALN and Program: 84.007; 84.033; 84.063; 84.268 - Student Financial Assistance Cluster Award Amount: $52,741,301 Award Number: N/A Award Year: 7/1/2023-6/30/2024 Criteria: Returns of Title IV funds are required to be deposited or transferred into the SFA account or electronic fund transfers initiated to the Department of Education (ED) as soon as possible, but no later than 45 days after the date the institution determines that the student withdrew. Returns by check are late if the check is issued more than 45 days after the institution determined the student withdrew or the date on the canceled check shows the check was endorsed more than 60 days after the date the institution determined that the student withdrew (34 CFR 668.173(b)). Condition/Context: The auditor tested 15 Title IV returns, and noted that 10 returns were deposited or transferred to the SFA account or EFTs were initiated to ED more than 45 days after the date of determination. Our sample was not statistically valid. Cause: During the year, MATC implemented a retrain of R2T4 return calculations, as well as a secondary check on all calculations, which resulted in increased processing time. Additionally, turnover in the office of the Executive Director and Director positions within the Financial Aid office resulted in a gap in leadership, further delaying processing times. Questioned Costs: None Effect: All returns tested were properly calculated and were deposited or transferred to ED; however, the returns were not made timely. Recommendation: MATC should evaluate staffing levels and processes and implement return of funds calculation timelines to ensure timely returns. District Response: MATC agrees with the finding, and has added supervisory staff and implemented processes to ensure timely return of funds.

Finding No. 2022-002 ? Report Filed After Due Date Repeat Finding: No ALN and Program: 84.007; 84.033; 84.063; 84.268 ? Student Financial Assistance Cluster Award Amount: $46,751,524 Award Number: N/A Award Year: 7/1/2021-6/30/2022 Criteria: By October 1 the institution should submit its ED Form 646-1, Fiscal Operations Report, and Application to Participate (FISAP) that includes the Fiscal Operations Report for the preceding award year and the Application to Participate for the upcoming award year (FWS, FSEOG 34 CFR 673.3; Fiscal Operations Report and Application to Participate Instructions). Condition / Context: The FISAP for award year 2021-2022 was filed on October 12, 2022. Our sample was statistically valid. Cause: As MATC approached the deadline for FISAP submission, responsible MATC personnel were not aware of the outstanding reporting items and the immediate need to employ an alternative plan to ensure the timely submission of the FISAP. Questioned Costs: Unknown Effect: This electronic report is submitted annually to receive funds for the campus-based programs. The institution uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. Delays in filing of this report could result in delays with subsequent year funding. Recommendation: MATC should implement a reporting calendar, including deadlines for draft, review and approval of the FISAP to ensure timely filing. District Response: MATC agrees with the finding and has developed, documented and implemented a process and calendar to ensure timely completion of the annual FISAP.

Finding No. 2022-003 ? R2T4 Return Calculation Errors Repeat Finding: No ALN and Program: 84.007; 84.033; 84.063; 84.268 ? Student Financial Assistance Cluster Award Amount: $46,751,524 Award Number: N/A Award Year: 7/1/2021-6/30/2022 Criteria: For returns of Title IV Funding when a student does not complete the enrollment period for which funds were disbursed, the amount of earned Title IV grant or loan assistance is calculated by determining the percentage of Title IV grant or loan assistance that has been earned by the student and applying that percentage to the total amount of Title IV grant or loan assistance that was or could have been disbursed to the student for the payment period or period of enrollment as of the student's withdrawal date. Standard term-based institutions must always use the payment period as the basis for the determination. The unearned amount of Title IV assistance to be returned is calculated by subtracting the amount of Title IV assistance earned by the student from the amount of Title IV aid that was disbursed to the student as of the date of the institution's determination that the student withdrew (34 CFR 668.22(e)). Condition / Context: The auditor selected 21 unenrolled students who had Title IV returns for testing. For each student selected, the return amount was incorrectly calculated because the payment period was not used as the basis for the determination. Our sample was statistically valid. Cause: Unauthorized break periods and start dates were used to determine the base period for calculation. MATC's review process was not effective to detect and correct this error. Staff responsible for calculating R2T4 returns were not properly trained in the requirements. Questioned Costs: $5,097 Effect: MATC has determined that a total of 425 returns were incorrectly calculated, with an estimated net error of $5,097. Recommendation: We recommend MATC re-evaluate its review process for Title IV returns, and provide additional training for management and staff to ensure the calculations and compliance requirements are understood and that control processes are operating effectively to ensure proper returns. District Response: MATC agrees with the finding and has developed, documented and implemented a process and correct the student record errors, provide updated training and update R2T4 procedures to ensure proper calculation going forward.

Finding No. 2022-004 ? Reporting Discrepancies - Enrollment Repeat Finding: 2021-001 ALN and Program: 84.007; 84.033; 84.063; 84.268 ? Student Financial Assistance Cluster Award Amount: $46,751,524 Award Number: N/A Award Year: 7/1/2021-6/30/2022 Criteria: Institutions are required to report enrollment information under the Pell grant and the Direct and FFEL loan programs via the NSLDS (OMB No. 1845-0035). Institutions must review, update and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP). Condition / Context: We selected a sample of 25 Pell and Direct Loan students from the institution's records that had a reduction or increase in attendance levels, graduated, withdrew, dropped out or enrolled but never attended during the audit period. We compared the data in the students' NSLDS Enrollment Detail to the students' academic files and other institutional records and verified that the institution is accurately reporting the significant Campus-Level and Program-Level enrollment data elements that ED considers high risk. Of the 25 sampled, 10 had discrepancies between the status documented in MATC's institutional records and the status reported on the NSLDS. Our sample was not statistically valid. Cause: In April 2021, the National Student Clearinghouse made a change to its reporting process, which resulted in errors in MATC's data uploads. MATC has begun the process of testing and correcting its process, but this was not completed as of June 30, 2022. MATC believes this update error has caused the continued discrepancies between MATC and the NSLDS. Questioned Costs: Unknown Effect: The administration of the Title IV programs depends heavily on the accuracy and timeliness of the enrollment information reported by institutions. Incorrect reporting of enrollment status could result in incorrect distribution of Title IV funds to institutions or individuals. Recommendation: We recommend MATC re-evaluate its review process for Title IV returns, and provide additional training for management and staff to ensure the calculations and compliance requirements are understood and that control processes are operating effectively to ensure proper returns. District Response: The Office of the Registrar has developed and implemented an action plan to ensure correct reporting through the National Clearinghouse and NSLDS. The process includes additional staff training, review and update of the submissions process and schedule and enlisting support from specific contacts at the Clearinghouse. These steps were completed by September 2022. Additional steps, including review of the reporting setup the SIS system with the IT department, discussing and resolving existing issues with the Clearinghouse, performing checks of individual current and prior year students to identify and correct additional gaps, incorporating a regular review of a sample of students for proper reporting and hiring additional staff for reporting enrollment ? all to be completed by December 2022. Beginning in 2023, staff will also create and submit an additional report to the Clearinghouse for each submission of graduates.

CFDA No. and Program: 84.007; 84.033; 84.063; 84.268 ? Student Financial Assistance Cluster Award Amount: $57,763,446 Award Number: N/A Award Year: 07/01/2020-06/30/2021 Criteria: Institutions are required to report enrollment information under the Pell grant and the Direct and FFEL loan programs via the NSLDS (OMB No. 1845-0035). Institutions must review, update, and verify student enrollment statuses, program information, and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP). Condition/Context: We selected a sample of 25 Pell and Direct Loan students from the institution?s records that had a reduction or increase in attendance levels, graduated, withdrew, dropped out, or enrolled but never attended during the audit period. We compared the data in the students? NSLDS Enrollment Detail to the students? academic files and other institutional records and verified that the institution is accurately reporting the significant Campus-Level and Program-Level enrollment data elements that ED considers high risk. Of the 25 sampled, 14 had discrepancies between the status documented in MATC's institutional records and the status reported on the NSLDS. Our sample was not statistically valid. Cause: In April 2021, the National Student Clearinghouse made a change to its reporting process, which resulted in errors in MATC?s data uploads. Communications regarding the errors were not made to the appropriate individuals to properly resolve the errors in a timely manner. MATC believes this update error has caused the discrepancies between MATC and the NSLDS. Questioned Costs: Unknown Effect: The administration of the Title IV programs depends heavily on the accuracy and timeliness of the enrollment information reported by institutions. Incorrect reporting of enrollment status could result in incorrect distribution of Title IV funds to institutions or individuals. Recommendation: MATC should ensure that all correspondence from federal agencies are routed to appropriate individuals. District Response: On April 5, 2021, the National Student Clearinghouse notified via emailed MATC?s Director of Financial Aid, Client Services regarding an upcoming change in their work with Federal Student Aid (FSA). The specifics of the change detailed the National Student Clearinghouse working with Federal Student Aid to replace their mid-month process with an ad hoc NSLDS SSCR roster distribution. The purpose of this process change was to assist in the transition from CIP Year 2010 to CIP Year 2020 Year value. The Executive Director, Financial Aid was made aware of this issue on October 14, 2021 and requested the statue of MATC?s institutional responsibility. MATC is now aware that the lack of follow up information has not been properly reported to the National Student Clearinghouse. A corrective action plan and timeline has been developed to resolve this issue.