Donnelly College

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2025 Criteria or Specific Requirement - Return of Title IV Funds. According to 34 CFR 668.22(a)(6(ii)(B)(1), the institution shall require post withdrawal disbursements of grant funds may be credited to the student's account, without the student's authorization, for any outstanding charges for tuition and fees on the student's account, up to the amount of those outstanding changes. Any grant funds not disbursed to the student's account must be disbursed to the student no later than 45 days after the date of the institution's determination that the student withdrew. Condition - The College did not reimburse the student's account within the required 45 days from the date of determination of student withdraw. The College completed the disbursement to the student's account 151 days after the student withdrew from classes. Cause - Lack of review and oversight when refund information is completed.Effect - The information included into the refunds worksheet was completely timely. The federal funds were disbursed after the required refund period. Questioned Costs - None.Context - Out of a population of 24 students selected for refund, a sample of four students was selected for testing. Out of these four students selected for testing, there was one instance in which the federal funds were refunded after the proper period of the student refund. The sample was not, and was not intended to be, a statistically valid sample. Identification as a Repeat Finding - NoneRecommendation - The College should implement an automated control to ensure that federal aid be refunded during the proper period. Views of Responsible Officials and Planned Corrective Actions - The College has procedures in place that are supposed to prevent the delay of students refunds. This was an unusual circumstance where the student was withdrawn form the college before they were awarded any federal aid. Therefore, the college put in place procedures to review the eligibility for federal aid of any student who withdraws to determine whether a post withdraws to determine whether post withdrawal disbursement is appropriate.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2025 Criteria or Specific Requirement – Reporting: Financial Reporting 34 CFR Section 690.83 the institution is required to report key items to test on origination records for the fiscal year including: award amount, enrollment date, verification status code, transaction number, cost of attendance, and the “Academic Start Date” and “Academic End Date”. Condition - Out of 25 students tested, there were three students with federal awards that had reported an an incorrect Cost of Attendance to COD system. Cause - The Financial Aid department does not have adequate processes and controls around updating the origination records when changes occur. Effect - COD reporting was not properly completed for Direct Loan and Pell Grant recipients. Questioned Costs - None.Context - Out of a population of 327 students receiving Pell or Direct Loans and requiring reporting to COD, a sample of 25 students were selected for testing. Our sample was not and was not intended to be statistically valid. The Cost of Attendance for 3 students that received federal awards did not agree to the Cost of Attendance on the COD system. Identification as a Repeat Finding - None Recommendation - The Financial Aid department should review processes and controls around COD reporting and consider changes to updates information back to the COD system. Views of Responsible Officials and Planned Corrective Actions - Management concurs with the finding. The College experienced some turnover during the year. The new director was unaware that the Cost of Attendance was not being updated when a change in the award was submitted COD due to a change in the student’s schedule. The director is now aware that these changes must be updated manually in COD and has implemented procedures to ensure that the COA is reviewed whenever a revision to the student award is submitted to COD. The college will also confer with the software vendor to determine if any settings in the student information need to be corrected for this update to be automated. The new director of financial aid has been through substantial training in the last six months to better understand how the college’s software communicates with COD, and has implemented procedures to ensure the timely submission of disbursements to COD after the disbursements have been made in the student information system.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2024 Criteria or Specific Requirement - Verification. According to 34 CFR 668.51 through 668.61, the institution shall require each applicant whose application is selected by the Department of Education to verify the information required for the Verification Tracking Group to which the applicant is assigned. Condition - The College did not ensure accurate information on the student's aid files against the information included in the V1 Verification Worksheet. Additionally, the College did not verify the completion of the student verification before the disbursement of federal aid for one student. Cause - Lack of communication and oversight when verification information is completed. Effect - The information included into the verification worksheet was not accurate. The federal funds were disbursed before the proper completion of all the student verification. Questioned Costs - None. Context - Out of a population of 42 students selected for verification, a sample of seven students was selected for testing. Out of these seven students selected for testing, there was one instance in which the information included on the verification of the student's award was misstated between the number of household members enrolled in post secondary. Out of these seven students selected for testing, there was one instance in which the federal funds were disbursed before the completion of the student verification. The sample was not, and was not intended to be, a statistically valid sample. Identification as a Repeat Finding - None Recommendation - The College should review and update its processes and controls to ensure student records for federal awards are obtained to properly support the verification worksheet. Additionally, the College should implement an automated control to ensure that federal aid not be disbursed until verification procedures are completed. Views of Responsible Officials and Planned Corrective Actions - The College has procedures in place that are supposed to prevent the awarding of students in verification. The Student Information System (Empower) has a feature for tracking students in verification. That tracking system did not prevent the awarding of Title IV aid. Therefore, the college will implement a back up tracking system to help track students in verification.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2023 Criteria or Specific Requirement - Reporting. According to 34 CFR 690.83, Dear Colleague Letter Gen 13-13, and Federal Register Volume 84, Number 212, November 1, 2019 an institution must submit Pell and Direct Loan origination records and disbursement records to the Common Origination and Disbursement (COD) in a timely and accurate manner. Condition - The College did not ensure accurate and timely notification to the Common Origination and Disburement (COD) website for disburement dates and amounts. Questioned Costs - None. Context - Out of a population of 477 records, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were six instances in which the date of the student's award was misstated between the institutional record and the COD. Additionally, there were two students selected where the amount of the federal award was not consistent between the institutional records and the COD. The sample was not, and was not intended to be, a statistically valid sample. Effect - The COD reporting system was not accurately notified of the student award dates and amounts. Cause - Lack of communication and oversight when reporting information on the COD website. Identification as a Repeat Finding - 2022-002, 2021-002, 2020-004, 2019-003. Recommendation - The College should review and update its processes and controls to ensure student records for federal awards are properly stated on the COD website. Additionally, we recommend that a formal reconciliation process is completed to validate the procedure is completed on a regular basis. Views of Responsible Officials and Planned Corrective Actions - Donnelly College concurs with the finding. The Director of Financial Aid has implemented procedures to post aid in batches and to coordinate the timing of the postings with the Business Office. Financial Aid staff review documentation from each batch posted and compare the data to the awards posted on COD. Each month the Director reconciles her records to COD.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Reporting. According to 34 CFR 690.83, Dear Colleague Letter Gen 13-13, and Federal Register Volume 84, Number 212, November 1, 2019 an institution must submit Pell and Direct Loan origination records and disbursement records to the Common Origination and Disbursement (COD) in a timely and accurate manner. Condition - Federal Direct Loan and Pell disbursement dates per the College's billing system did not agree with the reported dates per the Common Origination Disbursement (COD) records. Cost of attendance, transaction numbers, and the Pell award amount did not agree between the student?s files and COD records. Questioned Costs - None. Context - Out of a population of 159 students receiving Direct Loan awards during the year, a sample of 24 students was selected for testing. Out of these 24 students selected for testing, there were three instances in which the student's transaction code per the College's origination records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Out of a population of 251 students receiving Pell awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were nine instances in which the student's Cost of Attendance were not consistent with the COD. There were four instances in which the student's disbursement date per the College's records was not consistent with the COD. Finally, there was one instance in which the student's disbursement amount per the College's records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Effect - The College did not report the accurate data (e.g., disbursement dates, amounts, and cost of attendance) to the COD. Cause - Lack of reconciliation of student origination records to data provided to the COD. Identification as a Repeat Finding - Yes, see 2021-002, 2020-004 and 2019-003. Recommendation - The College should review and update its processes and controls to ensure a formal reconciliation is provided for student origination records to the COD. Views of Responsible Officials and Planned Corrective Actions - This was neglected due to staffing issues and high turnover. Pell and Direct Loan origination records and disbursement records are submitted to the Common Origination Disbursement (COD) either same business day, or next business day. Formal reconciliation process is now completed every 1-2 months in order to verify disbursement dates, amounts, and cost of attendance in COD.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions - Disbursements To or On Behalf of Students According to 34 CFR section 668.165, the College is required to notify the student, or parent in writing of (1) the date and amount of the disbursement; (2) the student?s right, or parent?s right, to cancel all or a portion of that loan or loan disbursement and have the loan proceeds returned to the holder of that loan; and (3) the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel the loan. Condition - The College did not ensure communication of all three elements to students before disbursement of the direct student loans. Questioned Costs - None. Context - Out of a population of 286 students receiving federal awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were seven instances in which the College did not send notification to the student or parent of the required conditions. The sample was not, and was not intended to be, a statistically valid sample. Effect - Students or parents were not notified of disbursements or notified of their right to cancel all or a portion of the loan disbursement. Cause - The College had a lack of policy, procedure, and follow-up to ensure communications were sent. Identification as a Repeat Finding - Yes, see findings 2021-003 and 2020-006. Recommendation - The College should establish a process and controls to ensure disbursement notification letters are sent when required to ensure ongoing compliance. Views of Responsible Officials and Planned Corrective Actions - This was neglected due to staffing issues and high turnover. Disbursement Letters are sent to students as they request Direct Loan funding amounts. The Disbursement Letter includes the three elements as required by DOE (per FSA handbook).

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions: Enrollment Reporting Pell, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309. Federal regulations require the institution to notify the Department of Education of changes in student enrollment information at the Campus Level and Program Level in a timely and accurate manner. These changes include reductions or increases in attendance levels, withdrawals, graduations, drop outs, or enrolled but never attended during the audit period. Institutions are responsible for timely reporting, whether they report directly or via a third-party service. Additionally, institutions are required to accurately report the student?s Campus-Level and Program-Level enrollment data. Condition - The College did not ensure accurate and timely notification to the National Student Loan Data System (NSLDS) of student status changes and program-level enrollment data. Questioned Costs - None. Context - Out of a population of 400 student enrollment status changes requiring notification, a sample of 40 students was selected for testing. Out of these 40 students selected for testing, there were four instances in which the student's status change was reported after the 60 day requirement. Additionally, there were four students selected where the campus and program-level record information was not in agreement between the NSLDS and the campus level information. The sample was not, and was not intended to be, a statistically valid sample. Effect - The NSLDS was not notified of the student enrollment status or program-level records on a timely and accurate basis. Cause - Lack of communication and oversight when reporting student status changes and program-level records to the NSLDS system. Identification as a Repeat Finding - Yes, see prior year findings 2021-005, 2020-005 and 2019-004. Recommendation - The College should review and update its processes and controls to ensure student status changes for program-level records are reported to the NSLDS in a timely and accurate manner. Additionally, we recommend that a formal reconciliation process is completed to validate the procedure is completed on a regular basis. Views of Responsible Officials and Planned Corrective Actions - Registrar Office automatically reports changes in student enrollment information to National Student Clearinghouse, which then goes into NSLDS on a monthly basis. The four students that failed this test for Audit Finding 2022-004 were due to student completion issues and Donnelly College overriding the add/drop policy to retroactively drop students. Registrar clearly provides the information and application process requirements to students who are graduating, and will not process their graduation until requirements are met. Once Registrar is made aware of a retroactive drop that overrides the add/drop policy, it is reported on the next month?s automatic report sent through National Student Clearinghouse to NSLDS.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans 84.268 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions, Verification. In accordance 34 CFR 668.51 through 338.61, the institution shall require each applicant whose application is selected by ED to verify the information required for the Verification Tracking Group to which the applicant is assigned. Additionally, in accordance with Title 2 CFR 200.303, a non-federal entity must establish and maintain effective internal control over the federal award that provides reasonable assurance that the non-federal entity is managing the federal award in compliance with federal statutes, regulations, and the terms and conditions of the federal award. Condition - A verification checklist is used by management to validate that a preparer and reviewer both formally signed off on the verification work. For one student selected there was no information regarding their tax returns or supporting schedules for required verification data. Questioned Costs - None Context - Out of a population of 87 students that were selected by ED for verification, a sample of 14 students was selected for testing. One of the 14 students selected for testing did not have records supporting the required verification procedures. The sample was not, and was not intended to be, a statistically valid sample. Effect - College records did not support that the verification was performed for one student. Cause - Management oversight of the control in place. Identification as a Repeat Finding - No Recommendation - Assigned reviewers of the verification worksheet should review for and ensure that all supporting documentation is included within the file. Views of Responsible Officials and Planned Corrective Actions - This was neglected and documents missing due to staffing issues and high turnover. Verification is completed for enrolled students as soon as their ISIR is available to Donnelly through Empower. Verification worksheets are completed by the student and verified by the FA staff as required by DOE (per FSA handbook). All student documents are kept in student's file in the FA office locked cabinet.

Student Financial Assistance Cluster U.S. Department of Education Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Special Tests and Provisions: Return of Title IV Funds - When a recipient of Title IV grant or loan assistance withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the institution must determine the amount of Title IV aid earned by the student as of the student?s withdrawal date and any refund of aid requirement (34 CFR 668.22(a)(1) through (a)(5)). Condition - The College utilized incorrect dates for calculation of a student?s refund, resulting in a variance in calculation of the student?s post-withdrawal disbursement. Questioned Costs - Error resulted in questioned costs of $9 for the Federal Pell Grant Program (ALN 84.063), calculated by independent recalculation of the student?s post-withdrawal disbursement. Context - Out of a population of nine that withdrew and had received federal aid, a sample of two students was selected for testing. During our testing, one student's refund calculation utilized incorrect dates, causing an error in the refund calculation. One other student?s refund calculation used an incorrect date; however, the student?s refund calculation was not impacted by the error. The sampling method was not, and was not intended to be, a statistically valid sample. Effect - The student?s post-withdrawal disbursement was calculated incorrectly for one student out of the two tested. Cause - Management oversight of the control in place to determine scheduled breaks. Identification as a Repeat Finding - No Recommendation - The College should have a procedure to review and lock down the scheduled breaks each year to determine the proper number of days for any refund calculations. Views of Responsible Officials and Planned Corrective Actions - 21-22 semester dates were input incorrectly by a previous DFA and have now been corrected for the 22-23 school year to reflect DOE (per FSA handbook) requirements.

Student Financial Assistance Cluster U.S. Department of Education Federal Pell Grant Program 84.063 Award Year 2022 Criteria or Specific Requirement - Eligibility - Each year, based on the maximum Pell Grant established by Congress, ED provides to institutions Payment and Disbursement Schedules for determining Pell awards. The Payment Schedule provides the maximum scheduled award a student would receive for a full academic year as a full-time student based on their EFC and COA. Additionally, students that receive Pell may not receive more than six Scheduled Awards (12 semesters, or the equivalent) as measured by the percentage of ?lifetime eligibility used? (LEU) field in COD (tracked by ED) (20 USC 1070a(c)(5)). The LEU maximum percentage for student eligibility is 600 percent (Chapter 3 in Volume 3, Calculating the Pell and Iraq & Afghanistan Service Grant Awards, of the FSA Handbook). Condition - The amount of a student?s Federal Pell Grant for an academic year is based upon payment and disbursement schedules published by the Secretary of Education for each award year, and the calculation of a Federal Pell Grant is based on the student?s enrollment status from the Payment Schedule for full-time students or the Disbursement Schedule for three-quarter time, half-time, or less than-half time students. The College utilized an incorrect Pell table when calculating the amount of Pell disbursed to a student. Additionally, the College is limited in its Pell Grant funding to be the equivalent of 6 years--600 percent lifetime threshold. Questioned Costs - An error resulted in questioned costs of $2,185 as a result of using the wrong Pell table. There was an additional error in a Pell Grant calculated because the student had exceeded the 600 percent threshold for lifetime Pell resulting in an over award of $3. Context - Out of a population of 286 students receiving federal awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there was one instance in which the College used the incorrect Pell table and one instance in which the Pell award exceeded the 600 percent lifetime threshold. The sample was not, and was not intended to be, a statistically valid sample. Effect - Two students out of the 25 tested received an over-award of Pell. Cause - Management oversight of the control in place to validate the Pell table and Lifetime Maximum table. Identification as a Repeat Finding - No Recommendation - The College should have a procedure to review each students credit hours to determine the proper Pell table. Additionally, review procedures should be implemented to ensure that no student exceeds 600% of their maximum lifetime Pell award. Views of Responsible Officials and Planned Corrective Actions - These Pell recipients are from the 2nd Chance Pell Grant Experiment and guidance has been inconsistent in the awarding process, resulting from staffing issues and high turnover. Student credit hours are now determined using the correct Pell Grant Payment Schedule and awarded accordingly. Verification process includes reviewing student's maximum lifetime Pell award percentage of 600%.

U.S. Department of Education Higher Education Institutional Aid CFDA 84.031 Award Year 2022 Criteria or Specific Requirement - Allowable Costs. According to 2 CFR Section 200.403(b), allowable costs must conform to any limitations or exclusions set forth in these principles or in the Federal award as to types or amount of cost items. Condition - The College charged faculty and staff wages unrelated to the Title V program to the grant during the fiscal year ended June 30, 2022. Questioned Costs - Grant Award Number: P031S190265 - 21. Error resulted in questioned costs of $34,056 awarded to the College. During review of the detailed listed of Title V revenue recorded, we identified certain expenses that did not appear consistent with the detailed federal grant schedule provided by management. Context - Out of a population of 26 payroll periods totaling $261,616, we selected one key item for $34,056 and a sample of four payroll periods totaling $27,661 to review the salaries paid to employees and charged to the federal award. The entire balance of the $34,056 key item was drawn down in error for staff wages and fringe benefits which were not related to the approved federal grant services. The sample was not, and was not intended to be, a statistically valid sample. Effect - College records did not support the salary expenses charged to the federal award. Cause - Management oversight when completing salary reconciliation. Identification as a Repeat Finding - Yes, see findings 2021-004 and 2020-009. Recommendation - The College should implement processes and controls to ensure that all employees paid with federal grant funds are compared against the budget amounts provided to the grant administrator. Views of Responsible Officials and Planned Corrective Actions - Adjustments have been made to drawdowns in April and June of 2022 in order to correct for these overdraws. However, even after these corrections, $694.47 was still overdrawn from FY22. This amount will be corrected in a future Title V draw for this amount. Salary drawdowns will be required to have backup payroll documentation for each draw in the future.

Education Stabilization Fund, Higher Education Emergency Relief Fund (HEERF) - Institutional Portion #84.425F U.S. Department of Education Award Year 2022 Criteria or Specific Requirement - Allowable Costs. According to 2 CFR Section 200.407 reasonable direct administrative costs and indirect costs at an institution's approved negotiated indirect cost rate may be charged against Assistance Listing 84.425F (Institutional portion). Condition - The College improperly charged an indirect cost to the federal grant for an ineligible expense that was ineligible based on the Indirect Cost Rate Agreement. The College has an approved Indirect Cost rate of 49.90 percent. Under the rate agreement, the College is approved to charge an indirect cost fee based on modified total direct costs. Modified total direct costs include direct salaries and wages, applicable fringe benefits, material and supplies, services, travel and up to the first $25,000 of each subaward. Modified total direct costs shall exclude equipment and capital expenditures if they have a useful life greater than one year and a per-unit acquisition costs which equal or exceeds $5,000. Questioned Costs - Grant Award Number: P425F201877 - 20B. Error resulted in questioned costs of $34,291 awarded to the College. Context - Out of a population of 114 institutional expenses totaling $598,317, we selected 18 institutional expenses for $416,864 to test and trace back to supporting documentation to support the charge to the federal award. For one of 18 institutional expenses selected for testing, the entire balance of the $34,291 was not considered an allowable costs since the expenditure was an indirect fee charge based on a capital expenditure. The sample was not, and was not intended to be, a statistically valid sample. Effect - The College was not in compliance with the allowable costs of the Education Stabilization Fund program. Cause - Management made an error in interpreting the indirect cost agreement associated with the equipment and capital expenditure for one of the items selected for testing. Identification as a Repeat Finding - No. Recommendation - We recommend that management review this area and establish procedures to ensure all requirements are met. View of Responsible Official and Planned Corrective Actions ? In including the questioned indirect cost as a HEERF expense, management only considered the per unit cost threshold, rather than both the per unit cost and the expected life of the items. The audit clarified the regulations and Donnelly promptly notified our program officer, posted a corrected quarterly report and refunded the funds to the Department of Education.

Education Stabilization Fund, Higher Education Emergency Relief Fund (HEERF) - Student Portion #84.425E U.S. Department of Education Award Year 2022 Criteria or Specific Requirement - Under the CARES Act 18004(e) and the CRRSAA 314(e), there are three components to reporting HEERF, public reporting on student aid portion, public reporting on the institutional portion, and annual reporting. The public reporting on student aid requires institutions to publicly post certain information no later than 10 days after the end of each calendar quarter. Condition - The College posted one quarterly student aid HEERF report to the website after the required deadline. Questioned Costs - None noted Context - Out of a population of nine reports (one annual, four quarterly public reports for institutional aid and four quarterly public reports for student aid), we selected five reports and noted the one instance of noncompliance with the timely reporting requirement of the student aid report on September 30, 2021. Effect - The College was not in compliance with the reporting requirements of the Education Stabilization Fund program. Cause - Management was not aware of the reporting requirements associated with the HEERF funds. Identification as a Repeat Finding - No Recommendation - We recommend that management review this area and establish procedures to ensure required reports are completed timely and accurately. View of Responsible Official and Planned Corrective Actions ? Initial guidance from the Department of Education did not specify that quarterly reports were required for quarters in which no funds were expended. The late report noted in the audit was for a quarter in which no Student Aid funds were expended. As soon as the Department of Education clarified in a webinar that quarterly reports were required even for quarters where no funds were expended, Donnelly posted the missing report showing zero expenditures.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans CFDA 84.268 Federal Pell Grant Program CFDA 84.063 Award Year 2021 Criteria or Specific Requirement - Reporting. According to 34 CFR 690.83, Dear Colleague Letter Gen 13-13, and Federal Register Volume 84, Number 212, November 1, 2019 an institution must submit Pell and Direct Loan origination records and disbursement records to the Common Origination Disbursement (COD) in a timely and accurate manner. Condition - Federal Direct Loan and Pell disbursement dates per the College's billing system did not agree with the reported dates per the Common Origination Disbursement (COD) records. Cost of attendance, transaction numbers, and the Pell award amount did not agree between the student?s files and COD records. Questioned Costs - None. Context - Out of a population of 124 students receiving Direct Loan awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were 5 instances in which the student's disbursement date per the College's origination records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Out of a population of 262 students receiving Pell awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were 4 instances in which the student's Cost of Attendance and Transaction numbers were not consistent with the COD. Lastly, there were 7 instances in which the student's disbursement date per the College's records was not consistent with the COD. The sample was not, and was not intended to be, a statistically valid sample. Effect - The College did not report the accurate data (e.g. disbursement dates, amounts, transaction numbers and cost of attendance) to the COD. Cause - Lack of reconciliation of student origination records to data provided to the COD. Identification as a Repeat Finding - Yes, see 2020-004 and 2019-003 Recommendation - The College should review and update its processes and controls to ensure a formal reconciliation is provided for student origination records to the COD. Views of Responsible Officials and Planned Corrective Actions - We are currently sending the COD origination files the same day we disburse. We have also incorporated the transaction number issue into our ISIR pull-in process and we are now ensuring students are locking on the most recent ISIR transaction. The Cost of attendance issue is fixed as well and we hired another FA counselor to combat the workload to ensure this is getting done.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans CFDA 84.268 Award Year 2021 Criteria or Specific Requirement - Special Tests and Provisions - Disbursements To or On Behalf of Students According to 34 CFR section 668.165, the College is required to notify the student, or parent in writing of (1) the date and amount of the disbursement; (2) the student?s right, or parent?s right, to cancel all or a portion of that loan or loan disbursement and have the loan proceeds returned to the holder of that loan; and (3) the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel the loan. Condition - The College did not ensure communication of all three elements to students before disbursement of the direct student loans. Questioned Costs - None. Context - Out of a population of 278 students receiving federal awards during the year, a sample of 25 students was selected for testing. Out of these 25 students selected for testing, there were 8 instances in which the College did not send notification to the student or parent of the required conditions. The sample was not, and was not intended to be, a statistically valid sample. Effect - Students or parents were not notified of disbursements or notified of their right to cancel all or a portion of the loan disbursement. Cause - The College had a lack of policy, procedure, and follow-up to ensure communications were sent. Identification as a Repeat Finding - Yes, see finding 2020-006. Recommendation - The College should establish a process and controls to ensure disbursement notification letters are sent when required to ensure ongoing compliance. Views of Responsible Officials and Planned Corrective Actions - This was neglected due to staffing issues and high turnover. We are now sending out disbursement notifications to students regularly as direct loan funds are disbursed to the business office, with all the elements required by the DOE (per FSA handbook).

U.S. Department of Education Higher Education Institutional Aid CFDA 84.031 Award Year 2021 Criteria or Specific Requirement - Allowable Costs. According to 2 CFR Section 200.403(f), in order to be allowable under a federal award, a cost may not be included as a cost of any other federally financed program in either the current or prior period. Additionally, 2 CFR 200.430(i)(iii), requires support for salaries and wages must be based on records that reasonably and accurately reflect the total activity for which the employee is compensated by the non-federal entity, not exceeding 100 percent of compensated activities. Condition - The College did not ensure the appropriate amount of salaries was included within the draw for salaries for one employee that worked on two federal grants. Questioned Costs - $490 for award P031S190265 - 20 The questioned costs were computed as the difference between the total overdrawn amount of $10,490 related to salary amounts charged to the award over the stated cap amount and duplicate amounts charged to other federal awards and the $10,000 which had been returned as of June 30, 2021. Context - Out of a population of 26 payroll periods totaling $193,468, we selected 5 payroll periods totaling $43,402 to review the salaries paid to employees and charged to the federal award. Out of the sample of 4 payrolls tested, 1 employee during 2 of the payroll periods tested had improper salary amounts charged to the federal award based on salary caps documented within the federal award and the same salary expenses being charged to and submitted for reimbursement under a separate federal award. The College remediated the error in the Spring of 2021; however, the repayment of all overdrawn funds has not been completed. The sample was not, and was not intended to be, a statistically valid sample. Effect - College records did not support the salary expenses charged to the federal award. Cause - Management oversight when completing salary reconciliation. Identification as a Repeat Finding - Yes, see finding 2020-009 Recommendation - The College should implement processes and controls to ensure that all employees paid with federal grant funds are compared to ensure the proper amount is applied to each grant based on the approved payrate and payroll records properly support 100% of personnel time. Views of Responsible Officials and Planned Corrective Actions - Adjustments were to draws made during FYE June 2021 to correct these overdraws. However, after these corrections, $490 was left to correct. An adjustment to a future Title V draw will be made for this amount. Salary drawdowns will be reviewed for every Title V drawdown.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans CFDA 84.268 Federal Pell Grant Program CFDA 84.063 Award Year 2021 Criteria or Specific Requirement - Special Tests and Provisions: Enrollment Reporting Pell, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309. Federal regulations require the institution to notify the Department of Education of changes in student enrollment information at the Campus Level and Program Level in a timely and accurate manner. These changes include reductions or increases in attendance levels, withdrawals, graduations, drop outs, or enrolled but never attended during the audit period. Institutions are responsible for timely reporting, whether they report directly or via a third-party service. Additionally, institutions are required to accurately report the student?s Campus-Level and Program-Level enrollment data. Condition - The College did not ensure accurate and timely notification to the National Student Loan Data System (NSLDS) of student status changes and program-level enrollment data. Questioned Costs - None. Context - Out of a population of 377 student enrollment status changes requiring notification, a sample of 40 students was selected for testing. Out of these 40 students selected for testing, there were 16 instances in which the student's status change was reported after the 60 day requirement. Additionally, there were 2 students selected where the program-level record for the program enrollment effective date was not reported accurately to the NSLDS. The sample was not, and was not intended to be, a statistically valid sample. Effect - The NSLDS was not notified of the student enrollment status or program-level records on a timely and accurate basis. Cause - Lack of communication and oversight when reporting student status changes and program-level records to the NSLDS system. Identification as a Repeat Finding - Yes, see prior year finding 2020-005 and 2019-004 Recommendation - The College should review and update its processes and controls to ensure student status changes for program-level records are reported to the NSLDS in a timely and accurate manner. Additionally, we recommend that a formal reconciliation process is completed to validate the procedure is completed on a regular basis. Views of Responsible Officials and Planned Corrective Actions - This wasn?t being done due to high turnover in our office and is now being done regularly as enrollment data or program level changes by the registrar?s office.

Student Financial Assistance Cluster U.S. Department of Education Federal Pell Grant Program CFDA 84.063 Award Year 2020 Criteria or Specific Requirement - Reporting. According to 34 CFR 690.83, an institution must submit Pell origination records and disbursement records to the Common Origination Disbursement (COD) in a timely and accurate manner. Condition - Pell Grant verification status per the College supporting documents did not agree with the reported codes per the COD website. Questioned Costs - None. Context - Out of a population of 371 students disbursements receiving Pell, 25 students were tested to ensure the College?s records were consistent with the COD records. 12 instances were noted in which information that was maintained by the College was not consistent with the information reported in the COD system related to verification status. Additionally, the control surrounding reconciliation between the COD and the College?s system was not in place. The sample used was not, and was not intended to be, a statistically valid sample. Effect - College records did not agree with the verification status codes reported to the COD. Cause - Management oversight when reporting verification status codes to the COD system was not effective. Identification as a Repeat Finding - Yes, see prior year finding 2019-003 Recommendation - The College should implement processes and controls to ensure information reported to the COD system matches the College?s records. Views of Responsible Officials and Planned Corrective Actions - The past processes and procedures needed to be reevaluated and revamped as the department has had significant staffing changes in the recent month. This is an ongoing process and will continually be evaluated to ensure that students are serviced in the most effective manner possible.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans CFDA 84.268 Federal Pell Grant Program CFDA 84.063 Award Year 2020 Criteria or Specific Requirement - Special Tests and Provisions: Enrollment Reporting Pell, 34 CFR 690.83(b)(2); Direct Loan, 34 CFR 685.309. Federal regulations require the institution to notify the Department of Education of changes in student enrollment information at the Campus Level and Program Level in a timely and accurate manner. These changes include reductions or increases in attendance levels, withdrawals, graduations, drop outs, or enrolled but never attended during the audit period. Institutions are responsible for timely reporting, whether they report directly or via a third-party service. Additionally, institutions are required to accurately report the student?s Campus-Level and Program-Level enrollment data. Condition - The College did not ensure accurate and timely notification to the National Student Loan Data System (NSLDS) of student status changes or program-level enrollment data. Questioned Costs - None. Context - Out of a population of 198 student enrollment status changes requiring notification, a sample of 20 students was selected for testing. Out of these 20 students selected for testing, there were 2 instances in which the student's status change was reported after the 60 day requirement. Additionally, there was 1 student selected where the program-level record for the program enrollment effective date was not reported accurately to the NSLDS. The sample was not, and was not intended to be, a statistically valid sample. Effect - The NSLDS was not notified of the student enrollment status or program-level records on a timely and accurate basis. Cause - Lack of communication and oversight when reporting student status changes and program-level records to the NSLDS system. Identification as a Repeat Finding - Yes, see prior year finding 2019-004 Recommendation - The College should review and update its processes and controls to ensure student status changes program-level records are reported to the NSLDS in a timely and accurate manner. Views of Responsible Officials and Planned Corrective Actions - The records in NSLDS have been reviewed and updated, this is an ongoing process as students? records need to be certified multiple times in order to have them removed from the system. The financial aid department is actively working to ensure that the students records are reported and updated in a timely manner.

Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans CFDA 84.268 Award Year 2020 Criteria or Specific Requirement - Special Tests and Provisions - Disbursements To or On Behalf of Students According to 34 CFR section 668.165, the College is required to notify the student, or parent in writing of (1) the date and amount of the disbursement; (2) the student?s right, or parent?s right, to cancel all or a portion of that loan or loan disbursement and have the loan proceeds returned to the holder of that loan; and (3) the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel the loan. Condition - The College did not ensure communication of all three elements to students before disbursement of the direct student loans. Questioned Costs - None. Context - A sample of 24 students was selected for testing out of a total population of 231 to determine whether written notifications were sent to students, or parents after disbursements. The College did not complete the required notifications for 13 of the students selected for testing. Our sample selection was not, and was not intended to be, statistically valid. Effect - Students or parents were not notified of disbursements or notified of their right to cancel all or a portion of the loan disbursement. Cause - The College had a lack of policy, procedure, and follow-up to ensure communications were sent. Identification as a Repeat Finding - None Recommendation - The College should establish a process and controls to ensure disbursement notification letters are sent when required to ensure ongoing compliance. Views of Responsible Officials and Planned Corrective Actions - The reporting process has been changed as the personnel have changed, originally the director of financial aid was operating under the impression that the CFO would be providing this notification. This has turned out not to be true, going forward the financial aid department will be sending this notice directly. This covers a small number of our student population as a majority of students do not need loans to cover the cost to attend Donnelly College.

U.S. Department of Education Higher Education Institutional Aid CFDA 84.031 Award Year 2020 Criteria or Specific Requirement - Procurement. 2 CFR Sections 200.318(i) and 200.320 and the College's procurement policy, require the College to retain documentation of its procurement decisions and for purchases over $3,000 (micro-purchase threshold as defined by the College), obtain and evaluate two bids. Condition - The College did not retain documentation or obtain two bids as required by the federal regulations and the College's internal policy. Questioned Costs - $59,058 for award P031S190265 - 20 Context - Out of a population of 69 purchases totaling $282,181, 11 purchases totaling $245,980 were sampled to ensure proper procurement policies were followed. From the sample, 2 purchases for a total of $59,058 did not contain support for two bids in compliance with the College's policy and federal regulations. The sample used was not, and was not intended to be, a statistically valid sample. Effect - College records did not support two bids for a purchase in excess of the micro-purchase threshold. Cause - Lack of management review to ensure procurement procedures outlined in the College's policy are followed and documentation is properly retained. Identification as a Repeat Finding - No Recommendation - The College should implement processes and controls to ensure that all purchases above the required threshold follow the appropriate procurement procedures. Views of Responsible Officials and Planned Corrective Actions - The Internal Controls Manual for Title V will be updated with clarified language regarding procurement bid thresholds to indicate that total purchase (not just individual items) count toward bid thresholds. In cases of purchases financed by multiple departments, the CFO?s office will cross-check college-wide purchases that accumulate toward Title V bid thresholds.

U.S. Department of Education Higher Education Institutional Aid CFDA 84.031 Award Year 2020 Criteria or Specific Requirement - Debarment and Suspension. According to 2 CFR section 180.220, when a non-federal entity enters into a covered transaction with an entity at a lower tier, the nonfederal entity must verify that the entity, as defined in 2 CFR section 180.995 and agency adopting regulations, is not suspended or debarred or otherwise excluded from participating in the transaction. Condition - The College did not maintain contemporaneous documentation of its review on the System for Award Management (SAM) Exclusions maintained by the General Services Administration (GSA) and available at https://www.sam.gov/SAM/ Questioned Costs - None Context - Out of a population of 69 purchases totaling $282,181, 11 purchases totaling $245,980 were sampled to ensure they were not from vendors that were suspended or debarred. From the sample, 3 vendors did not have documentation indicating the College had reviewed and verified the vendor was not suspended or debarred. It was determined the vendors were not suspended or debarred; however, no review was completed by the College prior to entering into a purchase agreement. The sample used was not, and was not intended to be, a statistically valid sample. Effect - College records did not support the review of the SAMs website and could lead to potential contracting with suspended or debarred vendors. Cause - Management is not properly ensuring vendors are not suspended or debarred prior to entering into a purchase agreement. Identification as a Repeat Finding - No Recommendation - The College should implement processes and controls to ensure that all purchases above the required threshold follow the appropriate procurement procedures. Views of Responsible Officials and Planned Corrective Actions - The College's process did not ensure that all the documentation was retained to verify debarment and suspension status. All property and service purchases above the required threshold will be maintained by the College to validate the federal requirement.

U.S. Department of Education Higher Education Institutional Aid CFDA 84.031 Award Year 2020 Criteria or Specific Requirement - Allowable Costs. According to 2 CFR Section 200.403(f), in order to be allowable under a federal award, a cost may not be included as a cost of any other federally financed program in either the current or prior period. Additionally, 2 CFR 200.430(i)(iii), requires support for salaries and wages must be based on records that reasonably and accurately reflect the total activity for which the employee is compensated by the non-federal entity, not exceeding 100% of compensated activities. Condition - The College did not ensure the appropriate amount of salaries was included within the draw for salaries for one employee that worked on two federal grants. Questioned Costs - $923 for award P031S190265 - 20 Context - Out of a population of 26 payroll periods totaling $193,468, we selected 5 payroll periods totaling $38,655 to review the salaries paid to employees and charged to the federal award. Out of the sample of 5 payrolls tested, 1 employee during 3 of the payroll periods tested had improper salary amounts charged to the federal award based on salary caps documented within the federal award and the same salary expenses being charged to and submitted for reimbursement under a separate federal award. The sample was not, and was not intended to be, a statistically valid sample. Effect - College records did not support the salary expenses charged to the federal award. Cause - Management oversight when completing salary reconciliation. Identification as a Repeat Finding - No Recommendation - The College should implement processes and controls to ensure that all employees paid with federal grant funds are compared to ensure the proper amount is applied to each grant based on the approved payrate and payroll records properly support 100% of personnel time. Views of Responsible Officials and Planned Corrective Actions - The College?s Grant Financial Officer will keep monthly payroll records indicating full and partial grant-paid positions and provide itemized monthly draw-down records to cross check with the grant Project Director. The Project Director and CFO?s office will conduct random checks of the record-keeping at least quarterly.

2019-003 Student Financial Assistance Cluster U.S. Department of Education Federal Pell Grant Program CFDA 84.063 Award Year 2019 Criteria or Specific Requirement - Reporting. According to 34 CFR 690.83, an institution must submit Pell origination records and disbursement records to the Common Origination Disbursement (COD) in a timely and accurate manner. Condition - Pell Grant verification status per the College supporting documents did not agree with the reported codes per the COD website. Questioned Costs - None. Context - Out of a population of 432 students receiving Pell, 25 students were tested to ensure the College?s records were consistent with the COD records. Nine instances were noted in which information that was maintained by the College was not consistent with the information reported in the COD system related to verification status. Additionally, the control surrounding reconciliation between the COD and the College?s system was not in place. The sample used was not, and was not intended to be, a statistically valid sample. Effect - College records did not agree with the verification status codes reported to the COD. Cause - Management oversight when reporting verification status codes to the COD system was not effective. Identification as a Repeat Finding - None. Recommendation - The College should implement processes and controls to ensure information reported to the COD system matches the College?s records. Views of Responsible Officials and Planned Corrective Actions - College procedures require that verification status be verified in file sent to the Department of Education. In addition, procedures now include that a monthly reconciliation be performed to compare Department and school records for accuracy. The policy has been reviewed with current staff to ensure compliance.

2019-004 Student Financial Assistance Cluster U.S. Department of Education Federal Direct Student Loans CFDA 84.268 Federal Pell Grant Program CFDA 84.063 Award Year 2019 Criteria or Specific Requirement - Special Tests and Provisions: Enrollment Reporting Pell 34 CFR Section 690.83(b)(2); FDL, 34 CFR Section 685.309. Federal regulations state that enrollment information must be reported to the NSLDS website within 30 days of whenever attendance changes for students, unless a complete roster will be submitted within 60 days. These changes include reductions or increases in attendance levels, withdrawals, graduations or approved leave of absence. Institutions are responsible for timely reporting, whether they report directly or via a third-party service. Condition - The College did not ensure accurate and timely notification to the National Student Loan Data System (NSLDS) of student status changes. Questioned Costs - None. Context - Out of a population of 223 student enrollment status changes requiring notification, a sample of 23 students were selected for testing. Out of these 23 students selected for testing, there were 10 instances in which the effective date of the change in student status did not agree between the College?s records and what was reported to NSLDS. The sample was not, and was not intended to be, a statistically valid sample. Effect - The NSLDS was not notified of the student enrollment status on a timely and accurate basis. Cause - Lack of communication and oversight when reporting student status changes to the NSLDS system. Identification as a Repeat Finding - None. Recommendation - The College should review and update its processes and controls to ensure student status changes are reported to the NSLDS in a timely and accurate manner. Views of Responsible Officials and Planned Corrective Actions - It is the College?s policy to submit all student statuses to the Clearinghouse on the first of each month. The Registrar also spot checks to verify that data has been submitted to NSLDS by the Clearinghouse. In addition, withdrawals are updated manually within seven days to both NSLDS and Clearinghouse. The College received communication from the Clearinghouse regarding their failure to process transmissions timely and to report rejections.

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