United Theological Seminary of the Twin Cities

Finding - Special Tests and Provisions: Enrollment Reporting - Federal Direct Student Loans, Assistance Listing Number 84.268; June 30, 2022 Award Year, U.S. Department of Education Criteria or Specific Requirement Changes in enrollment to less than half time, graduated or withdrawn must be reported to National Student Loan Data System within 30 days. However, if a roster file is expected within 60 days of the status change, a school may provide the data on that roster file. Because enrollment changes must be reported within 30 days, or there is a chance that not all scheduled rosters will fulfill this requirement; ad hoc reporting can fulfill this requirement. (National Student Loan Data System Enrollment Reporting Guide, November 2020, page 6.) (34 CFR 682.610(c)(1)-(c)(2)) Condition and Context Of the three students within the sample of students tested that had status changes, all were reported to NSLDS outside of the required timeline, and two were reported to NSLDS inaccurately subsequent to the 2021-2022 fiscal year. Cause Due to a failure to follow controls, the requirement to submit status changes and roster information to the NSLDS was not met. As such, this information was not reported during the 2021-2022 fiscal year. Effect or Potential Effect The NSLDS System was not updated within the proper timeframe, thus the Seminary was out of compliance with the NSLDS reporting provisions. Questioned Costs None noted. Identification as a Repeat Finding This is a repeat finding. Recommendation We recommend procedures be implemented to include the review of scheduled submissions to NSLDS for the purpose of ensuring accurate reporting and identifying any time gaps that could violate reporting requirements. A Seminary representative should be tasked with reviewing all scheduled submissions to NSLDS. Views of Responsible Officials and Planned Corrective Actions See Corrective Action Plan.

Finding - Special Tests and Provisions: Borrower Transmission Data - Federal Direct Student Loans, Assistance Listing Number 84.268. June 30, 2022 Award Year, U.S. Department of Education Criteria or Specific Requirement Colleges must report all loan disbursements and submit required records to the Direct Loan Servicing System (?DLSS?) via the Common Origination and Disbursement (?COD?) within 30 days of disbursement. Disbursement dates and amounts in the DLSS must be supported by the Seminary?s records (34 CFR sections 685.102(b), 685.301 and 303). The date of disbursement determines when a student becomes a federal student aid (?FSA?) recipient and has the rights and responsibilities of an FSA recipient. A disbursement occurs when the college credits a student?s account or pays a student or parent directly with: ? FSA program funds received from the Department; ? FSA program funds received from a Direct Loan lender, or ? Seminary funds labeled as FSA program funds in advance of receiving actual FSA program funds. (Student Financial Aid Handbook, Volume 4, Chapter 1, pages 4-9) Condition and Context Out of thirteen students selected for testing, one student had a date reported to COD outside of the required timeframe. Cause Due to staff turnover and a failure to follow controls, the Seminary did not report to COD with timely data following disbursement to student accounts. Effect or Potential Effect Delayed reporting of disbursement dates affect accurate administration of loan period start and end dates. Questioned Costs None noted. Identification as a Repeat Finding This is a repeat finding. Recommendation Following each disbursement, the Financial Aid Office should review and agree COD data to student accounts data to ensure accurate and timely reporting of borrower information. Views of Responsible Officials and Planned Corrective Actions See Corrective Action Plan.

Finding - Special Tests and Provisions: Enrollment Reporting - Federal Direct Student Loans, Assistance Listing Number 84.268; June 30, 2021 Award Year, U.S. Department of Education Criteria or Specific Requirement Changes in enrollment to less than half time, graduated or withdrawn must be reported to National Student Loan Data System within 30 days. However, if a roster file is expected within 60 days of the status change, a school may provide the data on that roster file. Because enrollment changes must be reported within 30 days, or there is a chance that not all scheduled rosters will fulfill this requirement; ad hoc reporting can fulfill this requirement. (National Student Loan Data System Enrollment Reporting Guide, November 2020, page 6.) (34 CFR 682.610(c)(1)-(c)(2)) Condition and Context Of the two students within the sample of students tested that had status changes, one was reported to NSLDS inaccurately and both were reported to NSLDS outside of the required timeline, and one was reported to NSLDS inaccurately subsequent to the 2020-2021 fiscal year. Cause Due to staff turnover, the requirement to submit status changes and roster information to the NSLDS was not known as a job responsibility of the Student Support Specialist until shortly after the fiscal year. As such, this information was not reported during the 2020-2021 fiscal year. Effect For students entering into repayment, the change in enrollment effective date and status determines when the grace period begins and how soon a student must begin repaying loan funds. Therefore, timely and accurate notification to NSLDS is important. Questioned Costs None noted. Identification as a Repeat Finding This is not a repeat finding. Recommendation We recommend procedures be implemented to include the review of scheduled submissions to NSLDS for the purpose of ensuring accurate reporting and identifying any time gaps that could violate reporting requirements. A Seminary representative should be tasked with reviewing all scheduled submissions to NSLDS.

Finding - Special Tests and Provisions: Borrower Transmission Data - Federal Direct Student Loans, Assistance Listing Number 84.268. June 30, 2021 Award Year, U.S. Department of Education Criteria or Specific Requirement The Seminary must report all loan disbursements and submit required records to the Direct Loan Servicing System (?DLSS?) via the Common Origination and Disbursement (?COD?) within 30 days of disbursement. Disbursement dates and amounts in the DLSS must be supported by the College?s Seminary?s records (34 CFR sections 685.102(b), 685.301 and 303). The date of disbursement determines when a student becomes a federal student aid (?FSA?) recipient and has the rights and responsibilities of an FSA recipient. A disbursement occurs when the College Seminary credits a student?s account or pays a student or parent directly with: ? FSA program funds received from the Department; ? FSA program funds received from an Direct Loan lender, or ? Seminary funds labeled as FSA program funds in advance of receiving actual FSA program funds. (Student Financial Aid Handbook, Volume 4, Chapter 1, pages 4-9) Condition and Context Out of thirteen students selected for testing, three had a date reported to COD that was other than the date shown on the student?s account statement, and one student had a date reported to COD outside of the required timeframe. Cause Due to staff turnover and a failure to follow controls, the Seminary did not update COD with accurate data following disbursement to student accounts. Effect Incorrect disbursement dates affect accurate administration of loan period start and end dates. Questioned Costs None noted. Identification as a Repeat Finding This is not a repeat finding. Recommendation Following each disbursement, the Financial Aid Office should review and agree COD data following each disbursement to student accounts data to ensure accurate reporting of borrower information.

Finding - Cash Management and Disbursements to or on Behalf of Students - Federal Direct Student Loans, Assistance Listing Number 84.268. June 30, 2021 Award Year, U.S. Department of Education Criteria or Specific Requirement Under the advance payment method an institution submits a request for funds to the Secretary. The institution's request for funds may not exceed the amount of funds the institution needs immediately for disbursements the institution has made or will make to eligible students and parents. The institution must disburse the funds requested as soon as administratively feasible but no later than three business days following the date the institution received those funds. (34 CFR 668.162(b)) Condition and Context Of the thirteen disbursements selected for direct loan cash management testing, for one borrower, the Seminary drew down the related funds from the Department of Education prior to three business days in advance of posting to the student?s account. Cause The process for drawing down funds and posting to student accounts is handled by multiple departments and individuals in the Seminary. Due to staff turnover and a lack of communication between departments, timely review of posting to the student accounts relative to the related draw down of funds from the Department of Education did not occur. Effect By drawing funds down in advance of the three day disbursement requirement, the Seminary was noncompliant with federal regulation. Questioned Costs None noted. Identification as a Repeat Finding This is not a repeat finding. Recommendation The Financial Aid Office should ensure that disbursements are posted to students accounts prior to scheduled draw down dates to ensure compliance.

Finding - Special Tests and Provisions: Disbursements to or on Behalf of Students ? Federal Direct Student Loans, Assistance Listing Number 84.268, June 30, 2021 Award Year, Department of Education Criteria or Specific Requirement If FSA disbursements to the student?s account at the school creates an FSA credit balance, you must pay the credit balance directly to the student or parent as soon as possible, but no later than 14 days after: the date the balance occurred on the student?s account, if the balance occurred after the first day of class of a payment period, or; the first day of classes of the payment period if the credit balance occurred on or before the first day of class of that payment period (SFA Handbook, Volume 4, Chapter 2, pg 4-19). Condition and Context Two out of thirteen students tested required a repayment of a credit balance, however, the payment was not made within the required 14 day period. Cause Due to staff turnover, the Seminary did not have in place procedures, in all cases, to ensure that FSA disbursements to student's accounts that resulted in a credit balance were returned to either the student or funding agency within the required time period. Effect Disbursements that are not returned within the required time period are in jeopardy of being inappropriately retained by the institution. Questioned Costs None noted. Identification as a Repeat Finding This is not a repeat finding. Recommendation The Seminary should put procedures in place to monitor credit balances and ensure proper payment to students or funding agencies within the required time.