FREDERICK COMMUNITY COLLEGEHigher Education

Condition: During our testing of Return of Title IV calculations, we reviewed whether the Return of Title IV funds were returned within the 45-day window. We noted that for 7 out of the 40 students selected, funds were not returned timely. Criteria: Uniform Guidance requires that non-Federal entities receiving Federal awards establish and maintain internal controls designed to reasonably ensure compliance with Federal statutes, regulations, and terms and conditions of the Federal award. The characteristics of internal controls are presented in the context of the components of internal controls discussed in Internal Control ? Integrated Framework (COSO Report), published by the United States Government Accountability Office?s Standards for Internal Control in the Federal Government. The COSO Report provides a framework for organizations to design, implement, and evaluate controls that will facilitate compliance with the requirements of Federal laws, regulations, and program compliance requirements.Per Uniform Guidance: 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. If the total amount of Title IV assistance earned by the student is less than the amount that was disbursed to the student or on his or her behalf as of the date of the institution?s determination that the student withdrew, the difference must be returned to the Title IV programs as outlined in this section and no additional disbursements may be made to the student for the payment period or period of enrollment. If the amount the student earned is greater than the amount disbursed, the difference between the amounts must be treated as a post-withdrawal disbursement (34 CFR 668.22(a)(1) through (a)(5)). Returns of Title IV funds are required to be deposited or transferred into the SFA account or electronic fund transfers initiated to ED as soon as possible, but no later than 45 days after the date the institution determines that the student withdrew. Returns by check are late if the check is issued more than 45 days after the institution determined the student withdrew or the date on the canceled check shows the check was endorsed more than 60 days after the date the institution determined that the student withdrew (34 CFR 668.173(b)). Cause: For the 7 selections, the College did not return the Return of Title IV funds within the 45-day window. Management stated that there was a temporary employee responsible for this task during fiscal year 2021 and the employee did not submit the information timely. Effect or Potential Effect: The College was not in compliance with the 45-day requirement to return the Return of Title IV funds. Recommendation: We recommend the College to establish and implement a process to ensure Return of Title IV funds are returned timely. Views of Responsible Officials: Management agrees with the finding. Refer to the Corrective Action Plan section in this report.

Criteria 2 CFR part 200.305 (b) requires that grantees funded on a reimbursement basis must pay for program cost before reimbursement is requested from the Federal government. Condition During our testing, we noted that an amount requested on a draw down request in September 2018 was for more than the amount disbursed. The College reduced the draw down for October 2018 by the amount of the excess draw down in September 2018. Cause The College?s procedures to ensure it calculates draw downs correctly was not able to catch the error before the request was submitted. Effect The College had excess Federal funds until its next draw down. Recommendation We recommend the College perform a closer review of its calculation for a request of draw down. Questioned costs Unknown. Corrective Action Plan The College agrees with this finding. See Corrective Action Plan.