EIN: 420681046
UEI: HVXGEGDQK9U8
Audited by: CliftonLarsonAllen LLP
Oversight agency: 84 [Department of Education]
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Data as of August 28, 2026
Management decision deadline — for entities that funded this organization
The FAC accepted this audit on March 25, 2026. Under 2 CFR 200.521(d), a pass-through entity that provided federal funds to this organization for this audit period must issue a management decision on these findings by September 25, 2026 (25 days from today).
What is a management decision? →During our testing of the Direct Loan and Pell Grant programs, we selected a sample of 40 students to test for accuracy and timeliness of reporting student status changes to the National Student Loan Data System (NSLDS). During our testing, we noted that 1 out of 40 students did not have their enrollment status timely reported. We noted 1 out of 40 students had a discrepancy in Program-level enrollment status, and 1 out of 40 students had a discrepancy in enrollment effective date. In both instances the University’s records did not match what was reported to NSLDS. Questioned Costs: None reported Context: During our testing, we noted the University did not have proper procedures in place to verify the reports sent to NSLDS are timely and accurate. Cause: The University processes and controls did not ensure that student status changes were properly reported to NSLDS. The effective date should reflect the student's last date of attendance and academically-related activity. In addition, students’ enrollment status should be certified every 60 days and the program begin date should be the first day attended at the University. Effect: The NSLDS system is not updated with the correct student information, which can cause a student to not properly enter the repayment period. Repeat Finding: Yes, see finding 2024-001. Recommendation: We recommend the University review its reporting procedures to ensure that students’ statuses are accurately and timely reported to NSLDS as required by regulations. Views of Responsible Officials: There is no disagreement with the audit finding.
Show full finding ▾Hide full finding ▴Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.038, 84.268, 84.033, 84.007, 84.063, 84.379, 93.264 Award Period: July 1, 2024 through June 30, 2025 Type of Finding: Significant Deficiency in Internal Control Over Compliance Other Matter Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 682.610, states that institutions must report accurately the enrollment status of all students regardless of whether they receive aid from the institution. This includes the enrollment effective date and related enrollment status, which must be reported for both the Campus-Level and the Program-Level. In addition, at a minimum, schools are required to certify enrollment every 60 days, and respond within 15 days of the date that NSLDS sends a Roster file to the school or its third-party servicer. Condition: During our testing of the Direct Loan and Pell Grant programs, we selected a sample of 40 students to test for accuracy and timeliness of reporting student status changes to the National Student Loan Data System (NSLDS). During our testing, we noted that 1 out of 40 students did not have their enrollment status timely reported. We noted 1 out of 40 students had a discrepancy in Program-level enrollment status, and 1 out of 40 students had a discrepancy in enrollment effective date. In both instances the University’s records did not match what was reported to NSLDS. Questioned Costs: None reported Context: During our testing, we noted the University did not have proper procedures in place to verify the reports sent to NSLDS are timely and accurate. Cause: The University processes and controls did not ensure that student status changes were properly reported to NSLDS. The effective date should reflect the student's last date of attendance and academically-related activity. In addition, students’ enrollment status should be certified every 60 days and the program begin date should be the first day attended at the University. Effect: The NSLDS system is not updated with the correct student information, which can cause a student to not properly enter the repayment period. Repeat Finding: Yes, see finding 2024-001. Recommendation: We recommend the University review its reporting procedures to ensure that students’ statuses are accurately and timely reported to NSLDS as required by regulations. Views of Responsible Officials: There is no disagreement with the audit finding.
Student Financial Assistance Cluster – Assistance Listing No. Various Recommendation: We recommend the University review its reporting procedures to ensure that students’ statuses are accurately and timely reported to NSLDS as required by regulations. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The University is reviewing its enrollment reporting process in coordination with the Registrar’s Office to identify any potential issues affecting data transmission through the National Student Clearinghouse. As part of this review, the University is evaluating additional reconciliation and verification procedures to confirm that enrollment status data submitted to the Clearinghouse is accurately reflected in NSLDS. The University will continue to monitor enrollment status reporting on an ongoing basis to ensure compliance with federal reporting requirements. Name(s) of the contact person(s) responsible for corrective action: Mark Freed Planned completion date for corrective action plan: 06/30/2026
2024-001
FAC accepted this audit on February 29, 2024 — management decision was due August 29, 2024.
During our testing, we noted for 4 out of 80 Perkins files tested, the MPN was not retained on file. These files were paid in full and the original MPN was sent to the borrower with the paid in full communication. Questioned Costs: None reported Context: The MPNs for the 5 students were not kept for at least three years as required by the regulation. Cause: The loans were paid in full, and the University was not aware of the requirement to retain a copy of the MPN for at least 3 years after the loan was satisfied. Effect: The University was not in compliance with the Perkins recordkeeping regulations. Repeat Finding: No Recommendation: We recommend the University implement a procedure moving forward to ensure that all necessary MPNs are retained for at least 3 years after payment in accordance with the federal regulation. Views of Responsible Officials: There is no disagreement with the audit finding.
Show full finding ▾Hide full finding ▴2023-001 Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.038, 84.268, 84.033, 84.007, 84.063, 84.268, 93.264 Award Period: July 1, 2022 to June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, and Other matter Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 674.19(e) states that Institutions must retain original, true and exact copies of promissory and master promissory notes (MPN), repayment records, and cancellation and deferment requests for each Perkins loan made. An original electronically signed MPN must be retained by the institution for 3 years after all the loans made on the MPN are satisfied. Condition: During our testing, we noted for 4 out of 80 Perkins files tested, the MPN was not retained on file. These files were paid in full and the original MPN was sent to the borrower with the paid in full communication. Questioned Costs: None reported Context: The MPNs for the 5 students were not kept for at least three years as required by the regulation. Cause: The loans were paid in full, and the University was not aware of the requirement to retain a copy of the MPN for at least 3 years after the loan was satisfied. Effect: The University was not in compliance with the Perkins recordkeeping regulations. Repeat Finding: No Recommendation: We recommend the University implement a procedure moving forward to ensure that all necessary MPNs are retained for at least 3 years after payment in accordance with the federal regulation. Views of Responsible Officials: There is no disagreement with the audit finding.
2023-001 Title: Student Financial Assistance Cluster – Assistance Listing Nos. 84.038, 84.268, 84.033, 84.007, 84.063, 93.264 Recommendation: We recommend the University implement a procedure moving forward to ensure that all necessary MPN’s are retained for at least 3 years after payment in accordance with the federal regulation. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The missing Perkins MPNs were from loans that were over 25 years old. I have ensured that our remaining Perkins Loans have MPNs and will be retained for the 3 year period after a loan is paid in full. Name(s) of the contact person(s) responsible for corrective action: Mark Freed Planned completion date for corrective action plan: June 30, 2023
During our testing, we noted there was no documentation of the reconciliations and reviews of a number of federal funds, including direct loans, Pell, SEOG, TEACH, and Perkins funds. Questioned Costs: None reported Context: We noted the proper reviews over reconciliations was not taking place. Cause: We noted there were not the proper policies and controls in place to make sure this review was occurring. Effect: The University is not complying with internal policy and federal requirements to ensure funds are properly reconciled. Repeat Finding: No Recommendation: The University should ensure all necessary employees receive proper training, support, and time to follow the University's policies and federal requirements related to monthly reconciliations. Views of Responsible Officials: There is no disagreement with the audit finding.
Show full finding ▾Hide full finding ▴2023-002 Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.038, 84.268, 84.033, 84.007, 84.063, 84.268, 93.264 Award Period: July 1, 2022 to June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, and Other matter Criteria or Specific Requirement: The Code of Federal Regulations, 34 CFR 685.300(b)(5) requires the University on a monthly basis, to reconcile the institutional records with the federal funds received from the Secretary and the Direct Loan disbursement records submitted to and accepted by the Secretary. Condition: During our testing, we noted there was no documentation of the reconciliations and reviews of a number of federal funds, including direct loans, Pell, SEOG, TEACH, and Perkins funds. Questioned Costs: None reported Context: We noted the proper reviews over reconciliations was not taking place. Cause: We noted there were not the proper policies and controls in place to make sure this review was occurring. Effect: The University is not complying with internal policy and federal requirements to ensure funds are properly reconciled. Repeat Finding: No Recommendation: The University should ensure all necessary employees receive proper training, support, and time to follow the University's policies and federal requirements related to monthly reconciliations. Views of Responsible Officials: There is no disagreement with the audit finding.
Title: Student Financial Assistance Cluster – Assistance Listing Nos. 84.038, 84.268, 84.033, 84.007, 84.063, 93.264 Recommendation: The University should ensure all necessary employees receive proper training, support, and time to follow the University's policies and federal requirements related to monthly reconciliations. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: A policy has been implemented to have a review of reconciliations. The Director of Financial Aid will perform the reconciliations and the Assistant Director of Financial Aid will review and approve the reconciliation. Name(s) of the contact person(s) responsible for corrective action: Mark Freed Planned completion date for corrective action plan: June 30, 2023
Under an institutions 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 reported Context: We noted that the Organization did not meet the Single Audit compliance requirements over the GLBA Safeguards Rule. Audit procedures required the new Safeguards Rule components to be outlined within the Written Information Security Program and associated policies and procedures. We noted the following areas were not covered in existing, current policies at the University: - Access Controls, - Data Encryption Cause: The University has not created appropriate policies that address all GLBA Safeguards Rules. Effect: The University was not in compliance with the GLBA Safeguards Rule regulations. Repeat Finding: No Recommendation: We recommend that the Organization enhance its policies and procedures to meet GLBA compliance pertaining to the following control areas: - Implement and periodically review access controls, - Encrypt sensitive information at rest and in transit, and - Dispose of customer information securely and follow appropriate data retention requirements Views of Responsible Officials: There is no disagreement with the audit finding.
Show full finding ▾Hide full finding ▴2023-003 Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.038, 84.268, 84.033, 84.007, 84.063, 84.268, 93.264 Award Period: July 1, 2022 to June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, and Other matter 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 institutions 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 reported Context: We noted that the Organization did not meet the Single Audit compliance requirements over the GLBA Safeguards Rule. Audit procedures required the new Safeguards Rule components to be outlined within the Written Information Security Program and associated policies and procedures. We noted the following areas were not covered in existing, current policies at the University: - Access Controls, - Data Encryption Cause: The University has not created appropriate policies that address all GLBA Safeguards Rules. Effect: The University was not in compliance with the GLBA Safeguards Rule regulations. Repeat Finding: No Recommendation: We recommend that the Organization enhance its policies and procedures to meet GLBA compliance pertaining to the following control areas: - Implement and periodically review access controls, - Encrypt sensitive information at rest and in transit, and - Dispose of customer information securely and follow appropriate data retention requirements Views of Responsible Officials: There is no disagreement with the audit finding.
Title: Student Financial Assistance Cluster – Assistance Listing Nos. 84.038, 84.268, 84.033, 84.007, 84.063, 93.264 Recommendation: CLA recommends that the Organization enhance its policies and procedures to meet GLBA compliance pertaining to the following control areas: - Implement and periodically review access controls - Encrypt sensitive information at rest and in transit - Dispose of customer information securely and follow appropriate data retention requirements Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: Mount Mercy University’s Information Technology department will update its Information Security Program to include statements related to implementing and periodically reviewing access controls. The following statements will be included: o Authentication methods are performed to ensure access is only provided to authorized individuals to protect against harmful use of sensitive information o There is a formal review of user access rights on a periodic basis to ensure changes are accurately reflected for access controls o Authorized users are further limited to access only sensitive information which is required to perform individual roles and responsibilities (role-based access) Name(s) of the contact person(s) responsible for corrective action: Curtis Sanders Planned completion date for corrective action plan: June 1, 2024
During our testing of the Direct Loan and Pell Grant programs, we selected a sample of students to test for timeliness of reporting student status changes to the National Student Loan Data System (NSLDS). During our testing, we noted that 9 out of 30 students did not have their enrollment status timely reported. Questioned Costs: None reported Context: The students did not notify the University of their intent not to return, so they were not identified until the start of the next semester. Cause: The University does not have a process in place to identify non-returning students timely. Effect: The NSLDS system is not updated with the student information which can cause over awarding should the student transfer to another institution and the students may not properly enter the repayment period. Repeat Finding: No Recommendation: We recommend the Institute review its reporting procedures to ensure that students statuses are accurately and timely reported to NSLDS as required by regulations. Views of Responsible Officials: There is no disagreement with the audit finding.
Show full finding ▾Hide full finding ▴2023-004 Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.038, 84.268, 84.033, 84.007, 84.063, 84.268, 93.264 Award Period: July 1, 2022 to June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, and Other matter 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 the student with the status change will be reported on a scheduled transmission within 60 days of the change in status. Condition: During our testing of the Direct Loan and Pell Grant programs, we selected a sample of students to test for timeliness of reporting student status changes to the National Student Loan Data System (NSLDS). During our testing, we noted that 9 out of 30 students did not have their enrollment status timely reported. Questioned Costs: None reported Context: The students did not notify the University of their intent not to return, so they were not identified until the start of the next semester. Cause: The University does not have a process in place to identify non-returning students timely. Effect: The NSLDS system is not updated with the student information which can cause over awarding should the student transfer to another institution and the students may not properly enter the repayment period. Repeat Finding: No Recommendation: We recommend the Institute review its reporting procedures to ensure that students statuses are accurately and timely reported to NSLDS as required by regulations. Views of Responsible Officials: There is no disagreement with the audit finding.
Title: Student Financial Assistance Cluster – Assistance Listing Nos. 84.038, 84.268, 84.033, 84.007, 84.063, 93.264 Recommendation: We recommend the Institute review its reporting procedures to ensure that students’ statuses are accurately and timely reported to NSLDS as required by regulations. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: The Registrar’s Office has implemented a review to help identify students who may not be returning the following semester so they can be reported in a timely manner. Name(s) of the contact person(s) responsible for corrective action: Mark Freed Planned completion date for corrective action plan: June 30, 2023
During our testing, we noted 1 of the 40 students tested had a disbursement not reported within the required 15 days. Questioned Costs: None reported Context: The disbursement was not reflected in COD until a monthly reconciliation performed outside the fifteen day window. Cause: The University does not have a process in place to accurate report Direct Loan disbursements to COD within the required 15 days. Effect: Students interest accrues based on disbursement date reported to COD, thus interest calculation could be incorrect due to incorrect reporting. Repeat Finding: No Recommendation: We recommend the University evaluate its procedures and policies around reporting Direct 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.
Show full finding ▾Hide full finding ▴2023-005 Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.038, 84.268, 84.033, 84.007, 84.063, 84.268, 93.264 Award Period: July 1, 2022 to June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, and Other matter Criteria or Specific Requirement: The Department of Education requires the University 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 1 of the 40 students tested had a disbursement not reported within the required 15 days. Questioned Costs: None reported Context: The disbursement was not reflected in COD until a monthly reconciliation performed outside the fifteen day window. Cause: The University does not have a process in place to accurate report Direct Loan disbursements to COD within the required 15 days. Effect: Students interest accrues based on disbursement date reported to COD, thus interest calculation could be incorrect due to incorrect reporting. Repeat Finding: No Recommendation: We recommend the University evaluate its procedures and policies around reporting Direct 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.
Title: Student Financial Assistance Cluster – Assistance Listing Nos. 84.038, 84.268, 84.033, 84.007, 84.063, 93.264 Recommendation: We recommend the University evaluate its procedures and policies around reporting Direct Loan disbursements to COD to ensure that student information is reported accurately and timely. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: We disburse aid weekly and we have implemented a plan to review the reported disbursements in COD to ensure they are being reported accurately. Name(s) of the contact person(s) responsible for corrective action: Mark Freed Planned completion date for corrective action plan: June 30, 2023
During our testing, we noted for 3 out of 40 students tested an over award over the total cost of attendance totaling $20,993. Questioned Costs: $20,993 Context: During our testing, it was noted that some other aid amounts were not factored into the calculation of need based aid, resulting in the total aid being over the cost of attendance. Cause: Management incorrectly calculated federal awards without factoring in all other aid. Effect: The University is not in compliance with Department of Education Requirements. Repeat Finding: No Recommendation: We recommend the University review its policies to ensure they follow Department of Education regulations. Views of Responsible Officials: There is no disagreement with the audit finding.
Show full finding ▾Hide full finding ▴2023-006 Federal Agency: Department of Education Federal Program Title: Student Financial Assistance Cluster Assistance Listing Number: 84.038, 84.268, 84.033, 84.007, 84.063, 84.268, 93.264 Award Period: July 1, 2022 to June 30, 2023 Type of Finding: Significant Deficiency in Internal Control over Compliance, and Other matter Criteria or Specific Requirement: Per the Code of Federal Regulations, 34 CFR 673.5, students may not be awarded need based aid in excess of their calculated need. Condition: During our testing, we noted for 3 out of 40 students tested an over award over the total cost of attendance totaling $20,993. Questioned Costs: $20,993 Context: During our testing, it was noted that some other aid amounts were not factored into the calculation of need based aid, resulting in the total aid being over the cost of attendance. Cause: Management incorrectly calculated federal awards without factoring in all other aid. Effect: The University is not in compliance with Department of Education Requirements. Repeat Finding: No Recommendation: We recommend the University review its policies to ensure they follow Department of Education regulations. Views of Responsible Officials: There is no disagreement with the audit finding.
Title: Student Financial Assistance Cluster – Assistance Listing Nos. 84.038, 84.268, 84.033, 84.007, 84.063, 93.264 Recommendation: We recommend the University review its policies to ensure they follow Department of Education regulations. Explanation of disagreement with audit finding: There is no disagreement with the audit finding. Action taken in response to finding: All 3 students were over-awarded due to outside scholarship funds they received. We did revise our policy to properly reflect the federal regulations for awarding outside scholarship funds against a student’s cost of attendance. Name(s) of the contact person(s) responsible for corrective action: Mark Freed Planned completion date for corrective action plan: June 30, 2023
2022-002
FAC accepted this audit on December 22, 2022 — management decision was due June 22, 2023.
An undergraduate student was improperly awarded and disbursed a TEACH grant that did not meet the GPA requirements to be eligible. Cause: The student was awarded and disbursed the TEACH grant without verifying that the student had an eligible GPA. Effect: Noncompliance with federal regulations of the TEACH grant program. Context: One of six students that received the TEACH grant. All recipients of grant were tested. Questioned costs: Over award of $3,772 in TEACH grant funds. Recommendation: Management should review its awarding policies and controls to verify eligibility determination for TEACH grants are in compliance with federal regulations.
Show full finding ▾Hide full finding ▴2022-001 U.S. Department of Education Student Financial Assistance Program Cluster Teacher Education Assistance for College and Higher Education Grants (TEACH Grants) (Federal Assistance Listing Number 84.379) Federal Award Year: 2021-2022 Finding: A student was improperly awarded and disbursed a TEACH grant. This is a repeat finding of 2021-005. Criteria: Per 34 CFR 686.11, (a)(1)(iv)(B), ?If the student is beyond the first year of a program of undergraduate education as determined by the institution, a cumulative undergraduate GPA of at least 3.25 on a 4.0 scale, or the numeric equivalent, through the most-recently completed payment period.? Condition: An undergraduate student was improperly awarded and disbursed a TEACH grant that did not meet the GPA requirements to be eligible. Cause: The student was awarded and disbursed the TEACH grant without verifying that the student had an eligible GPA. Effect: Noncompliance with federal regulations of the TEACH grant program. Context: One of six students that received the TEACH grant. All recipients of grant were tested. Questioned costs: Over award of $3,772 in TEACH grant funds. Recommendation: Management should review its awarding policies and controls to verify eligibility determination for TEACH grants are in compliance with federal regulations.
Identifying Number: 2022-001 Finding: A student was improperly awarded and disbursed a TEACH grant. Corrective Actions Taken or Planned: In April 2021, Financial Aid Staff collected TEACH Grant counseling for two academic years (20-21 and 21-22) at the same time and awarded the grant for both academic years based on the GPA as of that date. The student was eligible for 20-21, but at the end of the 20-21 academic year, their GPA had dropped below the 3.25 requirement, making them ineligible for the grant in 21-22. The Financial Aid Staff did not double check the GPA after 20-21. The TEACH Grant was refunded to the Department on 6/30/22. An additional step was added to our manual that requires all TEACH Grants set up prior to the first origination will be double-checked to verify eligibility. Persons Responsible and Completion Date: Mark Freed, Director of Financial Aid, June 30, 2022
2021-005
A student was awarded and disbursed $262.50 FSEOG funds for the spring term but was eligible for $350 FSEOG funds. Another student was awarded $0 direct subsidized loans and $7,500 direct unsubsidized loans but was eligible for $370 direct subsidized loans and $7,130 direct unsubsidized loans. Another student was awarded $4,500 direct subsidized loans and $2,000 direct unsubsidized loans but was eligible for $5,500 direct subsidized loans and $2,000 direct unsubsidized loans. Cause: For one student, the FSEOG award for spring was incorrectly calculated. A student received $175 of FSEOG funds for the fall term and $262.50 of FSEOG funds in spring term; however, the student was enrolled full-time and should have been awarded $350 of FSEOG funds in spring term based on the University?s FSEOG awarding policies. For another student, the FDL award for both fall and spring was incorrectly calculated. The student enrolled in additional credits prior to starting the fall term and the student?s award was not properly updated. The student enrolled in additional classes, which caused her to have a financial need of $370, however was not awarded or disbursed and federal direct subsidized loans to meet this need. She should have been awarded an additional $370 of direct subsidized loans for the year and her direct unsubsidized loans should have been reduced by $370. For another student, the FDL award for both fall and spring was incorrectly calculated. The student had earned 61 credit hours, and by the University's policy was a 3rd year student, and should have been awarded federal aid accordingly. However, the student was awarded as being a second year student. She should have been awarded an additional $1,000 of direct subsidized loans for the year. Effect: Noncompliance with federal regulations for FSEOG and FDL programs. Context: One of eleven students tested with FSEOG awards. One of forty students tested with FDL awards. Questioned costs: Under award of $87.50 of FSEOG funds, under award of $1,370 direct subsidized loans and over award of $370 direct unsubsidized loans. Recommendation: Management should review its awarding policies and controls to verify awarding of FSEOG and FDL funds are in compliance with the University?s awarding policy and federal regulations.
Show full finding ▾Hide full finding ▴2022-002 U.S. Department of Education Student Financial Assistance Program Cluster Federal Supplemental Educational Opportunity Grants (FSEOG) (Federal Assistance Listing Number 84.007) Federal Direct Student Loan Program (FDL) (Federal Assistance Listing Number 84.268) Federal Award Year: 2021-2022 Finding: Students were under awarded and disbursed FDL funds and under awarded and disbursed FSEOG funds. This is a repeat finding of 2021-006. Criteria: Per 34 CFR 676.16 Payment of an FSEOG (a) (1) Except as provided in paragraphs (b) and (e) of this section, an institution shall pay in each payment period a portion of an FSEOG awarded for a full academic year. (2) The institution shall determine the amount paid each payment period by the following fraction: FSEOG/N where: FSEOG = the total FSEOG awarded for an academic year and N = the number of payment periods that the institution expects the student will attend in that year. (3) An institution may pay the student, within each payment period, at such times and in such amounts as it determines best meets the student's needs. (b) If a student incurs uneven cost or estimated financial assistance amounts during an academic year and needs additional funds in a particular payment period, the institution may pay FSEOG funds to the student for those uneven costs. (c) An institution shall disburse funds to a student or the student's account in accordance with the provisions in ? 668.164. Per 34 CFR 685.200(a)(2) A Direct Subsidized Loan borrower must demonstrate financial need in accordance with title IV, part F of the Act. Per 34 CFR 685.203(a)(3) In the case of an undergraduate student who has successfully completed the first and second years of a program of study of undergraduate education but has not successfully completed the remainder of the program, the total amount the student may borrow for any academic year of study under the Direct Subsidized Loan Program may not exceed the following: (i) $5,550 for a program of study of at least an academic year in length. Condition: A student was awarded and disbursed $262.50 FSEOG funds for the spring term but was eligible for $350 FSEOG funds. Another student was awarded $0 direct subsidized loans and $7,500 direct unsubsidized loans but was eligible for $370 direct subsidized loans and $7,130 direct unsubsidized loans. Another student was awarded $4,500 direct subsidized loans and $2,000 direct unsubsidized loans but was eligible for $5,500 direct subsidized loans and $2,000 direct unsubsidized loans. Cause: For one student, the FSEOG award for spring was incorrectly calculated. A student received $175 of FSEOG funds for the fall term and $262.50 of FSEOG funds in spring term; however, the student was enrolled full-time and should have been awarded $350 of FSEOG funds in spring term based on the University?s FSEOG awarding policies. For another student, the FDL award for both fall and spring was incorrectly calculated. The student enrolled in additional credits prior to starting the fall term and the student?s award was not properly updated. The student enrolled in additional classes, which caused her to have a financial need of $370, however was not awarded or disbursed and federal direct subsidized loans to meet this need. She should have been awarded an additional $370 of direct subsidized loans for the year and her direct unsubsidized loans should have been reduced by $370. For another student, the FDL award for both fall and spring was incorrectly calculated. The student had earned 61 credit hours, and by the University's policy was a 3rd year student, and should have been awarded federal aid accordingly. However, the student was awarded as being a second year student. She should have been awarded an additional $1,000 of direct subsidized loans for the year. Effect: Noncompliance with federal regulations for FSEOG and FDL programs. Context: One of eleven students tested with FSEOG awards. One of forty students tested with FDL awards. Questioned costs: Under award of $87.50 of FSEOG funds, under award of $1,370 direct subsidized loans and over award of $370 direct unsubsidized loans. Recommendation: Management should review its awarding policies and controls to verify awarding of FSEOG and FDL funds are in compliance with the University?s awarding policy and federal regulations.
Identifying Number: 2022-002 Finding: Students were never awarded and disbursed FDL funds and under awarded an disbursed FSEOG funds. Corrective Actions Taken or Planned: Students identified were awarded aid to cover the error on 6/30/22. All student enrollment is checked at the start of the term; however, our modular students are allowed to make schedule changes throughout the semester. A report has been generated to review enrollment changes weekly to properly update any necessary aid changes. Persons Responsible and Completion Date: Mark Freed, Director of Financial Aid, June 30, 2022
2021-006
A student who had left the University in 2019 received debt discharge in the amount of $2,984. However, as the student was not enrolled after March 13, 2020 they were not eligible for debt discharge. Cause: The University?s debt discharge process improperly included this student who had not been enrolled at the University since 2019, resulting in student receiving debt discharge when based on the University?s policy they were not eligible. Effect: Noncompliance with federal regulations for COVID-19 Education Stabilization programs. Context: One of forty students tested with debit discharge. Questioned costs: Over award of $2,984 of debt discharge of COVID-19 Education Stabilization funds. Recommendation: Management should review its control to verify a student was properly enrolled at March 13, 2020 and HEERF funds are in compliance with the University?s policy and federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2022-003 U.S. Department of Education Education Stabilization Fund Cluster COVID-19 - Education Stabilization Fund ? ARPA Institutional Portion (Federal Assistance Listing Number 84.425F) Federal Award Year: 2021-2022 Finding: The University improperly discharged a student?s debt who did not meet the guidelines of their debt discharge policy. Criteria: One of The University?s guidelines for students to be eligible for debt discharge was to be enrolled after March 13, 2020. Condition: A student who had left the University in 2019 received debt discharge in the amount of $2,984. However, as the student was not enrolled after March 13, 2020 they were not eligible for debt discharge. Cause: The University?s debt discharge process improperly included this student who had not been enrolled at the University since 2019, resulting in student receiving debt discharge when based on the University?s policy they were not eligible. Effect: Noncompliance with federal regulations for COVID-19 Education Stabilization programs. Context: One of forty students tested with debit discharge. Questioned costs: Over award of $2,984 of debt discharge of COVID-19 Education Stabilization funds. Recommendation: Management should review its control to verify a student was properly enrolled at March 13, 2020 and HEERF funds are in compliance with the University?s policy and federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Identifying Number: 2022-003 Finding: The University improperly discharged a student's debt who did not meet the guidelines of their debt discharge policy. Corrective Actions Taken or Planned: The procedures surrounding the spending of CARES Act funding, including the discharge of student debt, were established in 2021-2022 and were outside of the normal scope of business. These funds have been exhausted. If additional funding becomes available and student debt is again eligible for discharge, Mount Mercy will add a second layer of detailed review to ensure each student is properly discharged per the guidelines established. Persons Responsible and Completion Date: Brittney Burmahl, Controller, and Anne Gillespie, Vice President for Business & Finance, October 31, 2022
FAC accepted this audit on January 6, 2022 — management decision was due July 6, 2022.
A financial aid counselor inappropriately utilized the financial aid software to access the individual?s financial aid awarding and related individuals? financial aid data and awarding, along with making two errors in the awarding of federal financial aid for two students. Although the errors were minimal, there was the potential for higher level of federal noncompliance for the University. Cause: The University?s control system did not have effective monitoring controls to ensure employee?s accounts or accounts of related individuals were not being accessed and there were enforceable consequences for accessing an account that is a conflict of interest. The University?s controls over reviewing awarding were ineffective to identify two errors of federal aid. Effect: Due to the insufficient monitoring controls over this employee, there could have been significant fraud or errors by this employee. Students were incorrectly awarded federal financial aid. Context: The University reviewed all 703 students who were awarded aid by the financial aid counselor, noting one student with an over award of TEACH grant. We tested a sample of 27 students that were awarded aid by this counselor, noting one additional student with an under award of FSEOG grant and another student was under awarded Federal Direct loans. Questioned costs: The errors included an over award of TEACH grant to one student for $3,772 and an under award of FSEOG funds to one student for $75. No FDL questioned costs as the student declined all loans. See related compliance findings at 2021-004 and 2021-005. Recommendation: Management should review their current controls, policies and procedures and implement additional monitoring controls to detect employees accessing their own aid in the system or the aid of related individuals. Management should also review their controls in place to ensure employees are adhering to federal regulations for awarding federal aid. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2021-003 U.S. Department of Education Student Financial Assistance Program Cluster Federal Assistance Listing Numbers 84.007, 84.033, 84.038, 84.063, 84.268, 84.379, and 93.264) Federal Award Year: 2020-2021 Finding: The University?s controls did not prevent or timely detect for inappropriate use of the University?s financial aid software by a now terminated financial aid counselor. Although no improper awarding took place, after further investigation, two errors were noted in the awarding of financial aid. See related significant deficiency in internal control over the financial statement audit at 2021-001. Criteria: Per Student Financial Aid handbook Volume 4, Appendix B, administrators must convey the message that integrity and ethical values cannot be compromised, and employees must receive and understand that message. Adopting codes of conduct and other policies regarding acceptable institutional practices, conflicts of interest, and expected standards of ethical and moral behavior help establish an organizational climate in which the other components of internal control are able to achieve their purposes. Control activities are the policies and procedures that help ensure a school?s administrative directives are followed. They help guarantee that the actions necessary to reduce risk are carried out. Control activities occur throughout an organization and include a range of activities as diverse as approvals, authorizations, verifications, reconciliations, and periodic reviews of performance, security of funds, and separation of functions. Control activities should be part of new employees? orientation, and the subject of periodic training for continuing employees. Condition: A financial aid counselor inappropriately utilized the financial aid software to access the individual?s financial aid awarding and related individuals? financial aid data and awarding, along with making two errors in the awarding of federal financial aid for two students. Although the errors were minimal, there was the potential for higher level of federal noncompliance for the University. Cause: The University?s control system did not have effective monitoring controls to ensure employee?s accounts or accounts of related individuals were not being accessed and there were enforceable consequences for accessing an account that is a conflict of interest. The University?s controls over reviewing awarding were ineffective to identify two errors of federal aid. Effect: Due to the insufficient monitoring controls over this employee, there could have been significant fraud or errors by this employee. Students were incorrectly awarded federal financial aid. Context: The University reviewed all 703 students who were awarded aid by the financial aid counselor, noting one student with an over award of TEACH grant. We tested a sample of 27 students that were awarded aid by this counselor, noting one additional student with an under award of FSEOG grant and another student was under awarded Federal Direct loans. Questioned costs: The errors included an over award of TEACH grant to one student for $3,772 and an under award of FSEOG funds to one student for $75. No FDL questioned costs as the student declined all loans. See related compliance findings at 2021-004 and 2021-005. Recommendation: Management should review their current controls, policies and procedures and implement additional monitoring controls to detect employees accessing their own aid in the system or the aid of related individuals. Management should also review their controls in place to ensure employees are adhering to federal regulations for awarding federal aid. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Audit Finding 2021-003: The University?s controls did not prevent or timely detect for inappropriate use of the University?s financial aid software by a now terminated financial aid counselor. Although no improper awarding took place, after further investigation by the University, multiple errors were noted in the awarding of institutional aid and limited errors in the awarding of federal aid. Corrective Action Taken: Upon discovery by Beth Davenport on April 22, 2021, the employee was terminated the following day, and additional safeguards have been put into place. This team member was told, on multiple occasions, they were not to award aid to herself, her children or make any adjustments to her own, or family members ISIR data or aid within the financial aid database. Each team member is now required to sign a financial aid Code of Conduct, which is on top of documents they sign upon hire, that explains they are not to award aid to themselves or members of their immediate family. Awarding of employees or their immediate family will be done by either the Director or Associate Director of Financial Aid, who will also review files on a regular basis to ensure compliance. Person Responsible and Completion Date: Beth Davenport, Director of Financial Aid, September 30, 2021
The University did not refund one student?s federal student aid credit balance within 14 days out of forty students tested. After further investigation, it was noted that seventy-five students were not refunded their federal student aid credit balances within 14 days after the first day of spring semester. Cause: Due to campus closures from inclement weather, the University?s processes were delayed, and they were unable to post all refunds within the required 14 days after the first day of spring semester. Effect: Noncompliance with federal regulations for credit balances and program administrative requirements. Context: One of forty students tested and there was a total of seventy-five students with a credit balance from disbursed spring federal aid. Questioned costs: A total of $200,210 federal student aid credit balances were not timely refunded to seventy-five students. Recommendation: Management should update its controls and procedures to ensure timely credit balance refunds, even in instances of inclement weather or other unexpected events. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2021-004 U.S. Department of Education Student Financial Assistance Program Cluster (Federal Assistance Listing Numbers 84.007, 84.033, 84.038, 84.063, 84.268, 84.379, and 93.264) Federal Award Year: 2020-2021 Finding: The University?s controls for processing federal credit balances were ineffective and a population of students were not refunded their federal student aid credit balances within the required timeframe. Criteria: 34 CFR 668.164(h)(2), 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: The University did not refund one student?s federal student aid credit balance within 14 days out of forty students tested. After further investigation, it was noted that seventy-five students were not refunded their federal student aid credit balances within 14 days after the first day of spring semester. Cause: Due to campus closures from inclement weather, the University?s processes were delayed, and they were unable to post all refunds within the required 14 days after the first day of spring semester. Effect: Noncompliance with federal regulations for credit balances and program administrative requirements. Context: One of forty students tested and there was a total of seventy-five students with a credit balance from disbursed spring federal aid. Questioned costs: A total of $200,210 federal student aid credit balances were not timely refunded to seventy-five students. Recommendation: Management should update its controls and procedures to ensure timely credit balance refunds, even in instances of inclement weather or other unexpected events. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Audit Finding 2021-004: The University?s controls for processing federal credit balances were ineffective and a population of students were not refunded their federal student aid credit balances within the required timeframe. Corrective Action Taken: With the understanding that exceptions for inclement weather must be received in advance and with the ability to work remotely MMU personnel will be prepared to meet the deadlines when inclement weather is anticipated. Person Responsible and Completion Date: Mark Freed, Associate Director of Financial Aid and Katie Stevens, Student Accounts Manager, June 30, 2022
An undergraduate, first year student was improperly awarded and disbursed a TEACH grant that did not meet the GPA requirements to be eligible. See related finding 2021-003. Cause: The student was awarded and disbursed the TEACH grant without verifying that the student had an eligible GPA. Effect: Noncompliance with federal regulations of the TEACH grant program. Context: One of two students tested. Questioned costs: Over award of $3,772 in TEACH grant funds. Recommendation: Management should review its awarding policies and controls to verify eligibility determination for TEACH grants are in compliance with federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2021-005 U.S. Department of Education Student Financial Assistance Program Cluster Teacher Education Assistance for College and Higher Education Grants (TEACH Grants) (Federal Assistance Listing Number 84.379) Federal Award Year: 2020-2021 Finding: A student was improperly awarded and disbursed a TEACH grant. Criteria: Per 34 CFR 686.11, (a)(1)(iv)(A), ?If the student is in the first year of a program of undergraduate education as determined by the institution -(1) A final cumulative secondary school grade point average (GPA) upon graduation of at least 3.25 on a 4.0 scale, or the numeric equivalent; or (2) A cumulative GPA of at least 3.25 on a 4.0 scale, or the numeric equivalent, based on courses taken at the institution through the most-recently completed payment period.? Condition: An undergraduate, first year student was improperly awarded and disbursed a TEACH grant that did not meet the GPA requirements to be eligible. See related finding 2021-003. Cause: The student was awarded and disbursed the TEACH grant without verifying that the student had an eligible GPA. Effect: Noncompliance with federal regulations of the TEACH grant program. Context: One of two students tested. Questioned costs: Over award of $3,772 in TEACH grant funds. Recommendation: Management should review its awarding policies and controls to verify eligibility determination for TEACH grants are in compliance with federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Audit Finding: A student was improperly awarded and disbursed a TEACH grant. Corrective Action Taken: Error was made by employee who was terminated. She did not double check the student?s GPA. The TEACH Grant was refunded to the Department on 7/1/21. One additional step has been added to our internal TEACH Grant counseling process, which we require every recipient to do, to verify the GPA. The team member who verifies the GPA will record it on the form and sign off on it. Person Responsible and Completion Date: Beth Davenport, Director of Financial Aid, July 1, 2021
A student was awarded and disbursed $75 of FSEOG funds for the spring term but was eligible for $150 of FSEOG funds. Another student was awarded $2,200 of Federal Direct Subsidized loans and $12,228 of Federal Direct Unsubsidized loans but was eligible for $2,567 of Federal Direct Subsidized loans and $12,677 of Federal Direct Unsubsidized loans. See related finding 2021-003. Cause: For one student, the FSEOG award for spring was incorrectly calculated. A student received $300 of FSEOG funds for the fall term and $75 of FSEOG funds in spring term; however, the student was enrolled half-time and should have been awarded $150 of FSEOG funds in spring term based on the University?s FSEOG awarding policies. For another student, the FDL award for both fall and spring was incorrectly calculated. The student enrolled in additional credits prior to starting the fall term and the student?s award was not properly updated. The student graduated at end of fall term and enrolled as a graduate student in spring term changing her loan eligibility. She should have been awarded an additional $367 of direct subsidized loans for fall term and an additional $449 of direct unsubsidized loans for the full year. Effect: Noncompliance with federal regulations for FSEOG and FDL programs. Context: One of twenty-two students tested with FSEOG awards. One of sixty-five students tested with FDL awards. Questioned costs: Under award of $75 of FSEOG funds. No FDL questioned costs as the student declined all loans. Recommendation: Management should review its awarding policies and controls to verify awarding of FSEOG and FDL funds are in compliance with the University?s awarding policy and federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2021-006 U.S. Department of Education Student Financial Assistance Program Cluster Federal Supplemental Educational Opportunity Grants (FSEOG) (Federal Assistance Listing Number 84.007) Federal Direct Student Loan Program (FDL) (Federal Assistance Listing Number 84.268) Federal Award Year: 2020-2021 Finding: Students were under awarded FDL funds and under awarded and disbursed FSEOG funds. Criteria: Per 34 CFR 676.16 Payment of an FSEOG (a) (1) Except as provided in paragraphs (b) and (e) of this section, an institution shall pay in each payment period a portion of an FSEOG awarded for a full academic year. (2) The institution shall determine the amount paid each payment period by the following fraction: FSEOG/N where: FSEOG = the total FSEOG awarded for an academic year and N = the number of payment periods that the institution expects the student will attend in that year. (3) An institution may pay the student, within each payment period, at such times and in such amounts as it determines best meets the student's needs. (b) If a student incurs uneven cost or estimated financial assistance amounts during an academic year and needs additional funds in a particular payment period, the institution may pay FSEOG funds to the student for those uneven costs. (c) An institution shall disburse funds to a student or the student's account in accordance with the provisions in ? 668.164. Per 34 CFR 685.203 (ii) For a one-year program of study with less than a full academic year remaining, FDL loans are prorated based on the number of semester, trimester, quarter, or clock hours enrolled divided by the number of semester, trimester, quarter, or clock hours in the academic year. Condition: A student was awarded and disbursed $75 of FSEOG funds for the spring term but was eligible for $150 of FSEOG funds. Another student was awarded $2,200 of Federal Direct Subsidized loans and $12,228 of Federal Direct Unsubsidized loans but was eligible for $2,567 of Federal Direct Subsidized loans and $12,677 of Federal Direct Unsubsidized loans. See related finding 2021-003. Cause: For one student, the FSEOG award for spring was incorrectly calculated. A student received $300 of FSEOG funds for the fall term and $75 of FSEOG funds in spring term; however, the student was enrolled half-time and should have been awarded $150 of FSEOG funds in spring term based on the University?s FSEOG awarding policies. For another student, the FDL award for both fall and spring was incorrectly calculated. The student enrolled in additional credits prior to starting the fall term and the student?s award was not properly updated. The student graduated at end of fall term and enrolled as a graduate student in spring term changing her loan eligibility. She should have been awarded an additional $367 of direct subsidized loans for fall term and an additional $449 of direct unsubsidized loans for the full year. Effect: Noncompliance with federal regulations for FSEOG and FDL programs. Context: One of twenty-two students tested with FSEOG awards. One of sixty-five students tested with FDL awards. Questioned costs: Under award of $75 of FSEOG funds. No FDL questioned costs as the student declined all loans. Recommendation: Management should review its awarding policies and controls to verify awarding of FSEOG and FDL funds are in compliance with the University?s awarding policy and federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Audit Finding: Students were under awarded FDL funds and under awarded and disbursed FSEOG funds. Corrective Action Taken: These errors were made by the employee who was terminated and are not repeat findings. The FDL error was made during the initial awarding process, however, the student declined loans, so they were not inappropriately disbursed. We have systems in place to prevent awarding errors, however this employee chose not to follow policies and procedures and was terminated. Person Responsible and Completion Date: Beth Davenport, Director of Financial Aid, July 1, 2021
The University was unable to locate promissory notes for two former students who were awarded and disbursed Federal Perkins loans in the 1980?s and 1990?s. Cause: The University did not maintain original promissory notes for two students with Federal Perkins loans that were originated 20 to 30 years ago. Effect: The Federal Perkins loans for two former students may not be enforceable since the promissory notes cannot be located. Context: Two of twenty-five students tested. Questioned costs: None Recommendation: Management should keep the original promissory notes and repayment schedules until the loans are satisfied. The University should keep the original paper promissory note or original paper MPN and repayment schedules in a locked, fireproof container. If the promissory note is signed electronically, the University must store it electronically and the promissory note must be retrievable in a coherent format. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2021-007 U.S. Department of Education Student Financial Assistance Program Cluster Federal Perkins Loan Program (Federal Assistance Listing Number 84.038) Federal Award Year: 2020-2021 Finding: The University was unable to locate promissory notes for two former students who were awarded and disbursed Federal Perkins loans. Criteria: Per 34 CFR 674.19, institutions must retain original or true and exact copies of promissory and master promissory notes (MPN), repayment records, and cancellation and deferment requests for each Perkins loan made. Condition: The University was unable to locate promissory notes for two former students who were awarded and disbursed Federal Perkins loans in the 1980?s and 1990?s. Cause: The University did not maintain original promissory notes for two students with Federal Perkins loans that were originated 20 to 30 years ago. Effect: The Federal Perkins loans for two former students may not be enforceable since the promissory notes cannot be located. Context: Two of twenty-five students tested. Questioned costs: None Recommendation: Management should keep the original promissory notes and repayment schedules until the loans are satisfied. The University should keep the original paper promissory note or original paper MPN and repayment schedules in a locked, fireproof container. If the promissory note is signed electronically, the University must store it electronically and the promissory note must be retrievable in a coherent format. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Audit Finding: The University was unable to locate promissory notes for two former students who were awarded and disbursed Federal Perkins loans. Corrective Action Taken: These two students borrowed on the Perkins loan decades ago. We are unable to resolve missing promissory notes dating back to the 1980?s and 1990?s. We moved to electronic promissory notes more than 15 years ago, so this is not an issue for most of our Perkins portfolio. Person Responsible and Completion Date: Beth Davenport, Director of Financial Aid, June 30, 2022
The University did not refund one student?s federal student aid credit balance within 14 days out of forty students tested. After further investigation, it was noted that seventy-five students were not refunded their federal student aid credit balances within 14 days after the first day of spring semester. See related internal control finding at 2021-004. Cause: Due to campus closures from inclement weather, the University?s processes were delayed, and they were unable to post all refunds within 14 days after the first day of spring semester. Effect: Noncompliance with federal regulations for credit balances and program administrative requirements. Context: One of forty students tested and a total of seventy-five students with a credit balance from disbursed spring federal aid. Questioned costs: A total of $200,210 federal student aid credit balances were not timely refunded to seventy-five students. Recommendation: Management should review policies and procedures to ensure timely refunds, even in instances of inclement weather or other unexpected events. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2021-008 U.S. Department of Education Student Financial Assistance Program Cluster (Federal Assistance Listing Numbers 84.007, 84.033, 84.038, 84.063, 84.268, 84.379, and 93.264) Federal Award Year: 2020-2021 Finding: A population of students were not refunded their federal student aid credit balances within the required timeframe. Criteria: 34 CFR 668.164(h)(2), 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: The University did not refund one student?s federal student aid credit balance within 14 days out of forty students tested. After further investigation, it was noted that seventy-five students were not refunded their federal student aid credit balances within 14 days after the first day of spring semester. See related internal control finding at 2021-004. Cause: Due to campus closures from inclement weather, the University?s processes were delayed, and they were unable to post all refunds within 14 days after the first day of spring semester. Effect: Noncompliance with federal regulations for credit balances and program administrative requirements. Context: One of forty students tested and a total of seventy-five students with a credit balance from disbursed spring federal aid. Questioned costs: A total of $200,210 federal student aid credit balances were not timely refunded to seventy-five students. Recommendation: Management should review policies and procedures to ensure timely refunds, even in instances of inclement weather or other unexpected events. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Audit Finding 2021-008: A population of students were not refunded their federal student aid credit balances within the required timeframe. Corrective Action Taken: With the understanding that exceptions for inclement weather must be received in advance and with the ability to work remotely MMU personnel will be prepared to meet the deadlines when inclement weather is anticipated. Person Responsible and Completion Date: Mark Freed, Associate Director of Financial Aid and Katie Stevens, Student Accounts Manager, June 30, 2022
FAC accepted this audit on May 13, 2021 — management decision was due November 13, 2021.
The University received federal funds due to the COVID-19 pandemic and in accordance with the grant requirements expended these funds for institutional costs of the University. However, the University did not have a written procurement policy in place and procurement is considered a material compliance requirement of the program. Cause: The Federal funds received and expended during the year were new to the University due to COVID-19 pandemic. In recent years, the other programs it has participated in did not allow for direct purchases or include procurement as a material compliance requirement. Although the University did not have a written procurement policy in place, it did have documented approval limits for expenses made over certain dollar amounts to ensure purchases are made within authority limits and followed its established procurement procedures. Effect: The University did not comply with certain applicable federal regulations. Context: We noted the University did not have a procurement policy prior to making institutional purchases under the Education Stabilization Program. The sample of procurement expenditures tested were considered valid expenditures under the program. Questioned costs: None. Recommendation: The University should create a written procurement policy to ensure expenditures made with federal funds conform to applicable federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2020-001 U.S. Department of Education Education Stabilization Fund COVID-19-Education Stabilization Fund-Institutional Portion (84.425F) Federal Award Year: 2019-2020 Finding: The University does not have a written procurement policy which is required under Uniform Guidance for direct purchases under federal programs. Criteria: Per 200.318(a), ?General procurement standards, the non-Federal entity must use its own documented procurement procedures which reflect applicable State and local laws and regulations, provided that the procurements conform to applicable Federal law. (b) Non-Federal entities must maintain oversight to ensure that contractors perform in accordance with the terms, conditions, and specifications of their contracts or purchase orders. (c)(1) The non-Federal entity must maintain written standards of conduct covering conflicts of interest and governing the performance of its employees engaged in the selection, award and administration of contracts.? Condition: The University received federal funds due to the COVID-19 pandemic and in accordance with the grant requirements expended these funds for institutional costs of the University. However, the University did not have a written procurement policy in place and procurement is considered a material compliance requirement of the program. Cause: The Federal funds received and expended during the year were new to the University due to COVID-19 pandemic. In recent years, the other programs it has participated in did not allow for direct purchases or include procurement as a material compliance requirement. Although the University did not have a written procurement policy in place, it did have documented approval limits for expenses made over certain dollar amounts to ensure purchases are made within authority limits and followed its established procurement procedures. Effect: The University did not comply with certain applicable federal regulations. Context: We noted the University did not have a procurement policy prior to making institutional purchases under the Education Stabilization Program. The sample of procurement expenditures tested were considered valid expenditures under the program. Questioned costs: None. Recommendation: The University should create a written procurement policy to ensure expenditures made with federal funds conform to applicable federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Identifying Number: 2020-001 Finding: The University did not have a written procurement policy which is required under Uniform Guidance for direct purchases under federal programs. Corrective Actions Taken or Planned: The University is in the process of creating a written procurement policy that is reviewed and approved by the Cabinet. Person Responsible and Completion Date: Associate Director of Business and Finance. Corrective action will be completed May 2021.
FAC accepted this audit on November 19, 2019 — management decision was due May 19, 2020.
Enrollment status changes for two students were not reported within the required time period to NSLDS. Criteria: Per 685.309(b) Enrollment reporting process. (1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return to the report to the Secretary (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary; and (2) Unless it expects to submit its next enrollment report to the Secretary within the next 60 days, notify the Secretary within 30 days if it discovers that (i) 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 half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under title IV of the Act has changed his or her permanent address. Cause: Respective offices did not timely communicate the withdrawal of these students from the University timely to the Student Financial Aid office; therefore, the students were not reported to NSLDS within 60 days as required. Effect: A student may not be placed into repayment status on a timely basis. Context: Two of 25 students tested were not reported timely or accurately to NSLDS. Questioned costs: None. Recommendation: The University should improve communication of all withdrawals between departments on a timely basis and verify reporting is completed timely. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2019-001 U.S. Department of Education Student Financial Assistance Programs Cluster Federal Direct Student Loans, Stafford Loans (CFDA 84.268) Federal Award Year: 2018-2019 Finding: The University did not timely report enrollment changes to the National Student Loan Data System (NSLDS). Condition: Enrollment status changes for two students were not reported within the required time period to NSLDS. Criteria: Per 685.309(b) Enrollment reporting process. (1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return to the report to the Secretary (i) In the manner and format prescribed by the Secretary; and (ii) Within the timeframe prescribed by the Secretary; and (2) Unless it expects to submit its next enrollment report to the Secretary within the next 60 days, notify the Secretary within 30 days if it discovers that (i) 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 half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or (ii) A student who is enrolled at the school and who received a loan under title IV of the Act has changed his or her permanent address. Cause: Respective offices did not timely communicate the withdrawal of these students from the University timely to the Student Financial Aid office; therefore, the students were not reported to NSLDS within 60 days as required. Effect: A student may not be placed into repayment status on a timely basis. Context: Two of 25 students tested were not reported timely or accurately to NSLDS. Questioned costs: None. Recommendation: The University should improve communication of all withdrawals between departments on a timely basis and verify reporting is completed timely. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Identifying Number: 2019-001 Finding: The University did not timely report enrollment changes to the National Student Loan Data System (NSLDS). Corrective Actions Taken or Planned: The University offices of financial aid and academic affairs met to discuss the process and agreed additional steps needed to be implemented to correct the issue and prevent future findings. As a result, weekly meetings are now occurring between financial aid, the Registrar?s office and the adult program director to review withdrawals. Reports are being reviewed after the start of each module, by the adult program director, to catch students who need to be withdrawn. Persons Responsible and Completion Date: Director of Financial Aid. Corrective action completed October 2019.
The University had excess federal funds on hand that were not properly disbursed to other students or returned to the Department of Education within the required timeframe. Criteria: Per 34 CFR 668.162(b)(3), an institution must disburse the funds requested as soon as administratively feasible, but no later than three business days by the institution. Per 34 CFR 668.166(a) and (b), an excess cash balance tolerance is allowed if that balance is less than 1% of its prior year drawdowns and is eliminated within the next seven calendar days. Cause: The Business Office was not aware the excess funds were on hand until the month-end reconciliation process, which was beyond the seven calendar day refund period. Effect: Noncompliance with federal compliance requirements. Context: Two of 33 drawdowns. Questioned costs: $467 in TEACH and $14,164 in FSEOG were in excess of federal expenditures for more than seven calendar days. Recommendation: The University should improve its review process that occurs prior to drawing down funds and monitor excess cash to ensure compliance with federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2019-002 U.S. Department of Education Student Financial Assistance Programs Cluster TEACH Grant (CFDA 84.379) and Federal Supplemental Educational Opportunity Grant (CFDA 84.007) Federal Award Year: 2018-2019 Finding: The University did not return excess TEACH Grant funds (TEACH) and Federal Supplemental Educational Opportunity Grant funds (FSEOG) to the Department of Education within the required timeframe. This is a repeat finding of 2018-005. Condition: The University had excess federal funds on hand that were not properly disbursed to other students or returned to the Department of Education within the required timeframe. Criteria: Per 34 CFR 668.162(b)(3), an institution must disburse the funds requested as soon as administratively feasible, but no later than three business days by the institution. Per 34 CFR 668.166(a) and (b), an excess cash balance tolerance is allowed if that balance is less than 1% of its prior year drawdowns and is eliminated within the next seven calendar days. Cause: The Business Office was not aware the excess funds were on hand until the month-end reconciliation process, which was beyond the seven calendar day refund period. Effect: Noncompliance with federal compliance requirements. Context: Two of 33 drawdowns. Questioned costs: $467 in TEACH and $14,164 in FSEOG were in excess of federal expenditures for more than seven calendar days. Recommendation: The University should improve its review process that occurs prior to drawing down funds and monitor excess cash to ensure compliance with federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Identifying Number: 2019-002 Finding: The University did not return excess TEACH Grant funds (TEACH) and Federal Supplemental Educational Opportunity Grant funds (FSEOG) to the Department of Education within the required timeframe. Corrective Actions Taken or Planned: The University has implemented a spreadsheet calculating the exact amount that can be drawn for TEACH Grant funds (TEACH) and Federal Supplemental Education Opportunity Grant funds (FSEOG) so that overdraws will no longer occur. Persons Responsible and Completion Date: AVP for Business and Finance/Controller. Corrective action completed September 2019.
2018-005
A student was awarded and disbursed excess Federal Pell Grant funds for the summer term in which the student was not enrolled at least half-time. Criteria: Per the Student Financial Aid handbook volume 3, page 62 and Consolidated Appropriations Act of 2017, to be eligible to receive Federal Pell Grant funds in excess of 100% of a student?s scheduled award during a single award year, a student must be enrolled at least half-time. Cause: The student was awarded and disbursed 100% of eligible Federal Pell Grant funds during the fall and spring term. The student was also awarded and disbursed excess Federal Federal Pell Grant funds for the summer term but the student was not enrolled at least half-time during the summer term. Effect: Student was improperly awarded. Context: One of 18 students tested. Questioned costs: The student was over awarded $718 of Federal Pell Grant funds. Recommendation: Management should review its awarding policies and parameters to verify eligibility determination for year round Federal Pell Grant is in compliance with federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Show full finding ▾Hide full finding ▴2019-003 U.S. Department of Education Student Financial Assistance Programs Cluster Federal Pell Grant Program (CFDA 84.063) Federal Award Year: 2018-2019 Finding: A student was awarded and disbursed excess Federal Pell Grant funds. Condition: A student was awarded and disbursed excess Federal Pell Grant funds for the summer term in which the student was not enrolled at least half-time. Criteria: Per the Student Financial Aid handbook volume 3, page 62 and Consolidated Appropriations Act of 2017, to be eligible to receive Federal Pell Grant funds in excess of 100% of a student?s scheduled award during a single award year, a student must be enrolled at least half-time. Cause: The student was awarded and disbursed 100% of eligible Federal Pell Grant funds during the fall and spring term. The student was also awarded and disbursed excess Federal Federal Pell Grant funds for the summer term but the student was not enrolled at least half-time during the summer term. Effect: Student was improperly awarded. Context: One of 18 students tested. Questioned costs: The student was over awarded $718 of Federal Pell Grant funds. Recommendation: Management should review its awarding policies and parameters to verify eligibility determination for year round Federal Pell Grant is in compliance with federal regulations. Views of responsible officials: Management agrees with this finding. Please see corrective action plan.
Identifying Number: 2019-003 Finding: A student was awarded and disbursed excess Federal Pell Grant funds. Corrective Actions Taken or Planned: The University conducted additional training with the financial aid team on calculating year-round pell grant eligibility. At the beginning of the summer semester, a report of pell grant recipients will be run and each recipient reviewed to determine eligibility, and make appropriate adjustments based on enrollment status and prior disbursements for the year. This process should ensure future errors do not occur. Persons Responsible and Completion Date: Director of Financial Aid. Corrective action completed September 2019.
FAC accepted this audit on December 16, 2018 — management decision was due June 16, 2019.
GSA_MIGRATION
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2017-003
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Show full finding ▾Hide full finding ▴FAC accepted this audit on December 19, 2017 — management decision was due June 19, 2018.
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2016-003
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FAC accepted this audit on February 20, 2017 — management decision was due August 20, 2017.
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2015-003
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