RIVERSIDE HEALTHCARE ASSOCIATION, INC.Non-Profit

Finding 2024-001 Federal Programs: Student Financial Assistance Cluster • Federal Pell Grant Program (ALN 84.063) Federal Agency – U.S. Department of Education Federal Award Year – January 1, 2024 to December 31, 2024 Compliance Requirement - Reporting Criteria Requirement: Under the Pell grant and the Direct and Federal Family Education Loan programs, Institutions must submit Direct Loan and Pell Grant disbursement records to the COD System no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. See Federal Register Volume 86, Number 119, June 24, 2021. The Department considers that Title IV funds are disbursed on the date that schools (a) credit those funds in their general ledger or any subledger to a student’s account or (b) pay those funds to a student or parent directly. Title IV aid is disbursed even if schools use their own funds in advance of receiving program funds from the Department. Failure to submit disbursement records within the required time frame may result in a rejection of all or part of the reported disbursement, an audit or program review finding, or possible fines or other penalties. The disbursement record reports the actual disbursement date and the amount of the disbursement. ED processes origination and/or disbursement records and returns acknowledgments to the institution. Key items to test on origination records, if applicable, are: award amount, enrollment date, verification status code (when the applicant is selected for verification), transaction number, cost of attendance, and the “Academic Start Date” and “Academic End Date”. Key items to test on disbursement records are Under the Pell grant and the Direct and Federal Family Education Loan programs, Institutions must submit Direct Loan and Pell Grant disbursement records to the COD System no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. Failure to submit disbursement records within the required time frame may result in a rejection of all or part of the reported disbursement, an audit or program review finding, or possible fines or other penalties. The disbursement record reports the actual disbursement date and the amount of the disbursement. ED processes origination and/or disbursement records and returns acknowledgments to the institution. Key items to test on origination records, if applicable, are: award amount, enrollment date, verification status code (when the applicant is selected for verification), transaction number, cost of attendance, and the “Academic Start Date” and “Academic End Date”. Key items to test on disbursement records are disbursement date and amount. The information may be accessed by the institution for the auditor. Condition Found: For 3 students out of 60 selected for testwork, the institution inaccurately reported the date of enrollment of the student to the COD system, which represents one out of the nine required data elements to be reported to the COD. The differences in enrollment dates were 2 - 16 days. Cause and Possible Asserted Effect: The institution’s control to reconcile the data between the institution’s records and COD system was not designed effectively to ensure accurate data is reported to COD on a timely basis. Identification of Questioned Costs: There are no questioned costs related to this finding. Sampling: The sample was not intended to be and was not a statistically valid sample. Identification of Repeat Finding: This audit finding is not a repeat finding in the prior year. Recommendation: Our recommendation is for management to reinforce and provide training to individuals responsible for compliance control ownership. This will help ensure that controls are designed and implemented effectively; as well as functioning as intended and control ownership is established, thereby preventing or promptly identifying and rectifying instances of noncompliance. Further, management should maintain appropriate documentation evidencing the control performance. In particular, it is advised to enhance processes and controls related to the accurate reporting of Institution’s records to COD system for all required data elements. Views of Responsible Officials: The College agrees with the recommendation provided. The College is in process to include a full review of processes and controls related to monthly COD/NLSDS reconciliation. The College’s third-party servicer is assisting in this training as well as the update of policies, processes, and controls, as well as the maintenance of evidentiary documentation, to ensure accuracy moving forward.

Federal Programs: Student Financial Assistance Cluster • Federal Direct Student Loans (ALN 84.268) • Federal Pell Grant Program (ALN 84.063) Federal Agency – U.S. Department of Education Federal Award Year – January 1, 2024 to December 31, 2024 Compliance Requirement – Special Tests and Provisions – Enrollment Reporting Criteria Requirement: Under the Pell grant and the Direct and Federal Family Education Loan programs, institutions are required to report enrollment information via the National Student Loan Data System (NSLDS) (OMB No.1845-0035). The administration of the Title IV programs depends heavily on the accuracy and timeliness of the enrollment information reported by institutions. Institutions must review, update and verify student enrollment statuses, program information and effective dates that appear on the Enrollment Reporting Roster file or on the Enrollment Maintenance page of the NSLDS Professional Access (NSLDSFAP) website. The data on the institution’s Enrollment Reporting Roster, or Enrollment Maintenance page, is what NSLDS has as the most recently certified enrollment information. There are two categories of enrollment information; “Campus Level” and “Program Level,” both of which need to be reported accurately and have separate record types. Institutions are responsible for accurately reporting the following significant data elements under the Campus-Level Record that the Department of Education (ED) considers high risk: • OPEID number, enrollment effective date, enrollment status and certification date Institutions are responsible for accurately reporting the following significant data elements under the Program-Level Record that ED considers high risk • OPEID number, CIP code, CIP year, credential level, published program length measurement, published program length, program begin date, program enrollment status and program enrollment effective date Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Institutions must complete and return the Enrollment Reporting roster file placed in their Student Aid Internet Gateway (SAIG) (OMB No. 1845-0002) mailboxes sent by ED via NSLDS within 15 days. An institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every 60 days. Once received, the institution must update for changes in the data elements for the Campus Record and the Program Record identified above, and submit the changes electronically through the batch method, spreadsheet submittal or the NSLDS website. Additionally, in accordance with Federal requirements, the University shall maintain internal controls over Federal programs designed to provide reasonable assurance that transactions are executed in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award that could have a direct and material effect on a Federal program. Condition Found: The Institution utilizes the National Student Clearinghouse (the Clearinghouse) as a service provider for transmissions of its enrollment reporting changes to the National Student Loan Data System (NSLDS). The University receives the Enrollment Reporting Roster and updates it for changes in student status. The file is sent to the Clearinghouse who transmits the updated information to NSLDS. For a sample of 60 students who were recipients of Direct Loans or Pell Grants between January 1, 2024 and December 31, 2024 who had been identified as having withdrawn, graduated, or modified their enrollment status as defined by the University’s Satisfactory Academic Progress Policy through a change in course load, the following were noted: • For 2 of the 60 students selected for enrollment reporting testing, the student’s effective date of the status change was inaccurately reported to NSLDS and did not agree to the data per the institution’s records, 1 of which was also reported 48 days late. Therefore, management did not report the status change to NSLDS within the required timeframe of 60 days from the date they became aware of the change. • For 1 out of 60 students selected for testwork, comparison of the institution’s records to that of NSLDS evidenced that enrollment reporting status for these students were not reported to NSLDS accurately or on a timely basis. Therefore, management did not report the status changes to NSLDS within the required timeframe of 60 days from the date they became aware of the change. Cause and Possible Asserted Effect: The Institution’s controls over its review of the recording and communication of these status changes is not designed effectively to ensure that individuals’ enrollment statuses are completely and accurately communicated to NSLDS. Further, the institution failed to maintain adequate review and documentation over student enrollment status changes, resulting in a delay in timeliness and inaccuracy of reporting to NSLDS. Identification of Questioned Costs: There are no questioned costs related to this finding. Sampling: The sample was not intended to be and was not a statistically valid sample. Identification of Repeat Finding: This audit finding is not a repeat finding in the prior year. Recommendation: Our recommendation is for management to design and implement a control in order to ensure the compliance requirement objectives are met. In particular, it is advised to implement a system of control within the institution related to the review of enrollment statuses to ensure information is transmitted to NSLDS accurately and timely. Additionally, management should maintain appropriate documentation evidencing the control performance. Further, management should reinforce and provide training to individuals responsible for compliance control ownership. This will help ensure that there are controls in place to ensure compliance and control ownership is established, thereby preventing or promptly identifying and rectifying instances of noncompliance and ensuring the controls are appropriately designed and operate as intended. Views of Responsible Officials: The College agrees with the recommendations provided. Additional training for Registrar staff is in progress to include a full review of processes and controls related to monthly Student Information System – Clearinghouse – NLSDS reconciliation. This review will include a review of how program start dates (semester and session) vs. course starts affect reporting, as well as how multiple student status changes to registration affect reporting. The College’s third-party servicer, National Student Clearinghouse, is assisting in this training as well as the update of policies, processes, and controls, as well as the maintenance of evidentiary documentation, to ensure accuracy moving forward.

Federal Programs: Student Financial Assistance Cluster • Federal Direct Student Loans (ALN 84.268) • Federal Pell Grant Program (ALN 84.063) Federal Agency – U.S. Department of Education Federal Award Year – January 1, 2024 to December 31, 2024 Compliance Requirement - Special Tests and Provisions – Disbursements to or on behalf of students Criteria Requirement: Per the Uniform Guidance, when Title IV funds are credited to a student account and they exceed the amount of tuition and fees, room and board, and other authorized charges assessed the student, a credit balance is created. The institution must pay the resulting credit balance directly to the student or parent borrower within 14 days after: (1) the first day of class of a payment period if the credit balance occurred on or before that day, or (2) the balance occurred if that was after the first day of class. An institution is permitted to hold credit balances if it obtains a voluntary authorization from the student. Regardless of any authorization obtained by the institution, the institution must pay any remaining loan balance by the end of the loan period and any other remaining Title IV funds by the end of the last payment period in the award year for which the funds were awarded. Condition Found: For 15 out of 47 students selected for testwork, the Title IV funds credited to the student resulted in a credit balance owed to the student. The institution did not refund the credit balances back to the student for more than a period of 14 days and did not obtain proper authorization from the student to retain the balance. The delay in repayment ranged from 18 to 83 days. Cause and Possible Asserted Effect: This is a repeat finding from the prior year. As such for the Spring semester, management did not yet design and implement a control to address the findings. Therefore, this resulted in continued failure by the institution to make payments to the students within the 14-day timeframe required by the Department of Education and did not obtain voluntary authorization from the student to retain the credit balances for the Spring semester. Therefore, this evidenced the lack of an appropriately designed control by the institution to ensure credit balances are refunded to students within the timeframe requirements. Identification of Questioned Costs: There are no questioned costs related to this finding. All credit balances were appropriately refunded by the end of the semester and therefore there were no questioned costs or misstatements that occurred as it relates to the SEFA or financial statements. Sampling: The sample was not intended to be and was not a statistically valid sample. Identification of Repeat Finding: This audit finding is a repeat of finding 2023-002 in the immediately prior year. Recommendation: Our recommendation is for management to design and implement a control in order to ensure the compliance requirement objectives are met. In particular, it is advised to implement a system of control within the institution for refunds of credit balances to be paid to students within the 14-day timeframe. Further, management should reinforce and provide training to individuals responsible for compliance control ownership. This will help ensure that there are controls in place to ensure compliance and control ownership is established, thereby preventing or promptly identifying and rectifying instances of noncompliance and ensuring the controls operate as designed. Views of Responsible Officials: The College agrees with the recommendation provided and remediated the finding for the Fall semester such that there was no further noncompliance. The College has performed a full review of processes and controls related to credit-balance payments within 14-days to ensure accuracy moving forward.

Condition Found: For 12 students out of 40 selected for testwork, the institution inaccurately reported their date of disbursement of the award to the COD system, which represents one out of the six required data elements to be reported to the COD. The differences in disbursement dates ranged from 1 to 4 days. For 2 students out of 40 selected for testwork, the institution inaccurately reported the date of enrollment of the student to the COD system, which represents one out of the six required data elements to be reported to the COD. The differences in enrollment dates were 3 days. For 15 students out of 40 selected for testwork, the institution inaccurately reported the Academic End dates of the student to the COD system, which represents one out of the six required data elements to be reported to the COD. However, the differences in academic end dates ranged from 1 to 75 days, the majority of which were within 1 to 2 days, 1 sample was had a 46-day variance, 1 sample had a 74-day variance and the 1 sample had a 75-day variance. Out of the 29 discrepancies identified above, 9 of the samples had inaccurate data for 2 elements (disbursement date and academic end date) and the remaining samples had inaccurate data for 1 element each. Cause and Possible Asserted Effect: The institution’s control to reconcile the data between the institution’s records and COD system did not operate consistently to ensure accurate data is reported to COD on a timely basis.

Condition Found: For 19 out of 40 students selected for testwork, the Title IV funds credited to the student resulted in a credit balance owed to the student. The institution did not refund the credit balances back to the student for more than a period of 14 days and did not obtain proper authorizations from the student to retain the balance. The delay in repayment ranged from 15 to 102 days. Cause and Possible Asserted Effect: It was identified that management had turnover in the financial aid department, which caused delays in recording and processing refunds among the accounting and accounts payable departments. This resulted in a failure by the institution to make payment to the students within the 14-day timeframe required by the Department of Education and did not obtain voluntary authorization from the student to retain the credit balances. Therefore, this evidenced the lack of an appropriately designed control by the institution to ensure credit balances are refunded to students within the timeframe requirements.

Condition Found: The Institution utilizes the National Student Clearinghouse (the Clearinghouse) as a service provider for transmissions of its enrollment reporting changes to the National Student Loan Data System (NSLDS). The University receives the Enrollment Reporting Roster and updates it for changes in student status. The file is sent to the Clearinghouse who transmits the updated information to NSLDS. For a sample of 40 students who were recipients of Direct Loans or Pell Grants between January 1, 2023 and December 31, 2023 who had been identified as having withdrawn, graduated, or modified their enrollment status as defined by the University’s Satisfactory Academic Progress Policy through a change in course load, the following were noted: • 2023-003: For 2 of the 40 students selected for enrollment reporting testing, the student’s program level enrollment effective date did not agree to that of their campus level data and/or the data per the institution’s records. This represents 1 out of 9 high-risk data elements within the program level data element requirements. • 2023-004: For 1 student out of 40 selected for testwork, comparison of the institution’s records to that of NSLDS evidenced that enrollment reporting for these students were not reported to NSLDS on a timely basis. Therefore, management did not report the status changes to NSLDS within the required timeframe of 60 days from the date they became aware of the change. Cause and Possible Asserted Effect: 2023-003: The Institution’s controls over its review of the recording and communication of these status changes does not operate consistently to ensure that individuals’ enrollment statuses are completely and accurately communicated to NSLDS at the program level details. 2023-004: Management’s review over its enrollment reporting requirements for SFA was not operating as designed to ensure timely reporting of status changes. Management sent the status change to the Clearinghouse within the required timeframe; however, NSC did not send the data to NSLDS until after the 60-day requirement. As such, management’s control did not operate at a precise enough level to detect and prevent noncompliance. Further, the institution failed to maintain adequate review and documentation over student enrollment status changes, resulting in a delay timeliness and inaccuracy of reporting to NSLDS.

Condition Found: The Institution utilizes the National Student Clearinghouse (the Clearinghouse) as a service provider for transmissions of its enrollment reporting changes to the National Student Loan Data System (NSLDS). The University receives the Enrollment Reporting Roster and updates it for changes in student status. The file is sent to the Clearinghouse who transmits the updated information to NSLDS. For a sample of 40 students who were recipients of Direct Loans or Pell Grants between January 1, 2023 and December 31, 2023 who had been identified as having withdrawn, graduated, or modified their enrollment status as defined by the University’s Satisfactory Academic Progress Policy through a change in course load, the following were noted: • 2023-003: For 2 of the 40 students selected for enrollment reporting testing, the student’s program level enrollment effective date did not agree to that of their campus level data and/or the data per the institution’s records. This represents 1 out of 9 high-risk data elements within the program level data element requirements. • 2023-004: For 1 student out of 40 selected for testwork, comparison of the institution’s records to that of NSLDS evidenced that enrollment reporting for these students were not reported to NSLDS on a timely basis. Therefore, management did not report the status changes to NSLDS within the required timeframe of 60 days from the date they became aware of the change. Cause and Possible Asserted Effect: 2023-003: The Institution’s controls over its review of the recording and communication of these status changes does not operate consistently to ensure that individuals’ enrollment statuses are completely and accurately communicated to NSLDS at the program level details. 2023-004: Management’s review over its enrollment reporting requirements for SFA was not operating as designed to ensure timely reporting of status changes. Management sent the status change to the Clearinghouse within the required timeframe; however, NSC did not send the data to NSLDS until after the 60-day requirement. As such, management’s control did not operate at a precise enough level to detect and prevent noncompliance. Further, the institution failed to maintain adequate review and documentation over student enrollment status changes, resulting in a delay timeliness and inaccuracy of reporting to NSLDS.

Finding 2020-001 Special Tests and Provisions: Enrollment Reporting Program, CFDA No., Program Year, Federal Agency Student Financial Assistance Cluster, CFDA Nos. 84.268 and 84.063 2019-2020 and 2020-2021, U.S. Department of Education Criteria or Requirement: According to 2 CFR Part 200, Appendix V Compliance Supplement updated August 2020, institutions are responsible for accurately reporting the following significant data elements under the Program-Level Record that ED considers high risk: Published Program Length - Published Program Length should be reported based on the definition of ?normal time? to completion in the regulations at 34 CFR 668.41(a), as follows: If the school has published, in its catalog, on its website, or in any promotional materials, the length of the program in weeks, months, or years, the program length reported must a be the same as the program length that the school has published. Condition Found: Out of a sample of 40 students, we noted exceptions in 15 students who had the incorrect published program length in National Students Loan Data System (NSLDS). These students belonged to four specific programs which had incorrect program lengths reported. The four programs were as follow: Physical Therapist Assistant, Radiologic Technology, Surgical Technology, and Practical Nursing (Evening/Weekend). Cause and Possible Asserted Effect: The College publishes their academic catalog program length by weeks and program hours, while NSLDS reporting showed program length by year. The College?s control over the review of the program length within NSLDS to match its published academic catalog was not operating effectively. Identification of Questioned Costs: There are no questioned costs associated with this finding. Sampling: The sample was not intended to be, and was not, a statistically valid sample. Identification of Repeat Finding: None.

Finding 2020-002 Eligibility Program, CFDA No., Program Year, Federal Agency Student Financial Assistance Cluster, CFDA No. 84.063, 2020-2021, U.S. Department of Education Criteria or Requirement: According to 34 CFR ? 690.62, the amount of a student?s Pell Grant for an academic year is based upon the payment and disbursement schedules published by the Secretary for each award year. Actual Pell awards are unique to each student and are based upon and limited by their enrollment status, EFC, COA, and Lifetime Eligibility Used (U.S. Department of Education, 2020-2021 Federal Student Aid Handbook, volume 3, chapter 3). Condition Found: Out of a sample of forty students who received $273,503 in student financial assistance selected from the period under audit, we noted an exception related to one student whose enrollment status was incorrect and therefore had been over awarded. The student was 3/4-time in the fall semester and less-than-1/2-time in the spring semester, however, the student was awarded as full-time in the fall semester and half-time in the spring semester. The student was over awarded $650 in the semester included in period under audit and a total of $1,300 for the academic year 2020-2021. Cause and Possible Asserted Effect: The College failed to make the adjustments to the student?s ledger based on the student?s enrollment status. The College?s control over the review of the changes in enrollment status was not operating effectively. Identification of Questioned Costs: $1,300 Sampling: The sample was not intended to be, and was not, a statistically valid sample. Identification of Repeat Finding: None.

Findings and Questioned Costs Relating to Federal Awards Finding 2019-002: Special Tests and Provisions: Disbursements To or On Behalf of Students Program, CFDA No., Program Year, Federal Agency Student Financial Assistance Cluster, CFDA No. 84.268, 2018-2019 and 2019-2020, U.S. Department of Education Criteria or Requirement: In accordance with 34 CFR 668.165, the institution must 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 or the TEACH Grant payments returned to the Department of Education; 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. Institutions that do not implement an affirmative confirmation process must notify a student no earlier than 30 days before, but no later than 7 days after, crediting the student?s account and must give the student 30 days to cancel all or part of the loan.Condition Found: Out of a sample of 40 students, we noted exceptions in 21 students. During the Spring 2019 academic semester, Riverside College of Health Careers (RCHC) did not provide any notification letters to any of the 20 selected students selected for the Spring semester. For 1 student out of 20 who was selected for the Fall 2019 semester, RCHC did not provide the correct Direct Loan disbursement amount in the notification letter to the student. The amount of Direct Loan disbursement for the 21 students was $90,560. Cause and Possible Asserted Effect: During the Spring semester of 2019, RCHC did not send out notifications letters to the students. For the Fall semester of 2019, RCHC did not properly notify the student of their disbursement amount. RCHC?s control over the notification of disbursement to student accounts was not operating effectively. Identification of Questioned Costs: There are no questioned costs associated with this finding. Sampling: The sample was not intended to be, and was not, a statistically valid sample. Identification of Repeat Finding: Similar findings were reported in the prior years? audits as finding 2018-001, 2017-002 and 2016-03. Recommendations: We recommend that Riverside implement an updated notification process in which they include a review of the transmission of the accurate and required information. Views of Responsible Officials: As provided in the Summary of Prior Year findings, the internal controls put in place in August 2019 remain in effect. An internal review of 2019 disbursement notifications after the KPMG audit of FY 2018 in July 2019 did find that the spring 2019 notifications were not completed. Since the August 2019 corrective action was put into place, all notifications have been completed according to the established calendar and process. In June 2020, RCHC contracted with third-party financial aid servicer, Global Financial Aid Services. Within Global?s scope of services are included email notifications and text messages at predetermined milestones to lead the student through the financial aid process, inclusive of disbursement notifications. Global will begin packaging financial aid for the RCHC fall 2020 day-division cohort of students.

Finding 2019-003: Eligibility Program, CFDA No., Program Year, Federal Agency Student Financial Assistance Cluster, CFDA No. 84.268, 2019-2020, U.S. Department of EducationCriteria or Requirement: In accordance with 34 CFR 685.200, a Direct Subsidized Loan borrower must demonstrate financial need in accordance with title IV, part F of the Act. Under Title IV part F, the amount of need of any student for financial assistance under this subchapter is equal to ? (1) the cost of attendance of such student, minus (2) the expected family contribution for such student, minus (3) estimated financial assistance not received. In accordance with 34 CFR 685.203(e), aggregate loan limits for subsidized and unsubsidized loans are $31,000 for a dependent undergraduate student. Condition Found: Out of a sample of 40 students, we noted exceptions in two students. One student had an effective family contribution (EFC) amount that was greater than her cost of attendance (COA). The student should not have been awarded subsidized Direct Loans, but could have received the same amount as unsubsidized Direct Loans. The amount of disbursement for the student was $1,750. One student received Aggregated Federal Direct Loan (FDL) disbursement of $31,250 in the Spring 2019 semester. The Aggregated FDL limit for this undergraduate student of $31,000, therefore the questioned costs for this students is $250. The amount of FDL disbursement for the student during Spring 2019 was $4,075. Total FDL disbursed for the 40 students sampled was $187,747. Cause and Possible Asserted Effect: RCHC control over its review of students whose EFC is greater than COA and its review of disbursement for students whose loans are close to the aggregate loan limits was not operating effectively. Identification of Questioned Costs: Questions costs were below the reporting threshold of $25,000. Sampling: The sample was not intended to be, and was not, a statistically valid sample. Identification of Repeat Finding: None. Recommendations: We recommend that RCHC strengthens its processes and controls to ensure the correct Direct Loan funds are made available to students. Views of Responsible Officials: The student file found in the initial audit sample with the erroneous subsidized loan was reviewed by the financial aid team immediately. RCHC?s Financial Aid Coordinator contacted the student to discuss the error and received acceptance to move the loan to unsubsidized and corrected the record in COD. Documentation of the correction was provided to the audit team.In June 2020, RCHC contracted with third-party financial aid servicer, Global Financial Aid Services. Within Global?s scope of services are compliance reviews of each student?s electronic financial aid file inclusive of eligibility determination, certification and origination of Direct Loans and Pell Grants, and reporting consistent with Title IV. Global will begin packaging financial aid for the RCHC fall 2020 day-division cohort of students.

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