Pfeiffer University

2025-001 – Incorrect Return of Title IV (R2T4) Calculations (Significant Deficiency) Department of Education, SFA Cluster, Special Tests and Provisions Condition: From a population of 17 students that officially or unofficially withdrew during the term, we tested four students. All four students required Return of Title IV (R2T4) refund calculations. During our review, we noted that the University excluded only five days from the total number of days in the semester for the Fall 2024 and Spring 2025 breaks. However, each break period included five weekdays plus the surrounding weekend days, resulting in a total of nine days that should have been excluded. The University did not exclude the four weekend days adjacent to the breaks, leading to incorrect total day counts in the R2T4 calculations. Criteria: Under 34 CFR §668.22(f)(2)(i), the total number of calendar days in a payment period includes all days within the period that a student was scheduled to complete, except scheduled breaks of at least five consecutive days, which must be excluded from both the total number of days and the number of days completed. When classes end on a Friday and resume the following Monday after a week‑long break, both weekends (four days) and the five weekdays of the break are excluded from the R2T4 calculation, for a total exclusion of nine days. Cause: Controls to ensure proper calculation of Title IV refunds did not function as related to the condition above. Effect: R2T4 calculations for the students tested who withdrew during the Fall 2024 and Spring 2025 terms were incorrect. As a result, funds were returned in incorrect amounts to both the students and the U.S. Department of Education. Repeat Finding: No. Recommendation: We recommend the University implement and document enhanced procedures to ensure the accurate preparation and review of all Title IV refund calculations, including verification of the correct number of days excluded for scheduled breaks. View of Responsible Officials: The University acknowledges the condition identified. For the Fall 2024 and Spring 2025 terms, the R2T4 calculations excluded only the five instructional weekdays associated with each break and did not exclude the adjacent weekend days. As a result the total number of days in the payment period was overstated, which affected the R2T4 calculations for the students tested.

Finding 2021-001 Higher Education Emergency Relief Fund (HEERF) Reporting Federal Agency: Department of Education Program: Education Stabilization Fund, HEERF ? Student Portion (84.425E), HEERF ? Institutional Portion (84.425F), and HEERF ? Strengthening Institutions Program (84.425M) Criteria or Specific Requirement: There are three components to reporting for HEERF: 1) public reporting on the (a)(1) Student Aid Portion; 2) public reporting on the (a)(1) Institutional Portion (a)(2) and (a)(3) subprograms, as applicable; and 3) the annual report. Quarterly Public Reporting for (a)(1) Student Aid Portion (Assistance Listing 84.425E) ? In accordance with the Coronavirus Aid, Relief, and Economic Security (CARES) Act, beginning on May 6, 2020, ED required institutions that received a HEERF I Section 18004(a)(1) Student Aid Portion award to publicly post certain information on their website no later than 30 days after award, and update that information every 45 days thereafter (by posting a new report). On August 31, 2020, this requirement was revised to decrease the frequency of reporting after the initial 30-day period from every 45 days thereafter to every calendar quarter. Grantees posting a 45-day report on or after August 31, 2020, should instead post a report every calendar quarter, with the first calendar quarter report due by October 10, 2020, and covering the period from after their last 45-day or 30-day report through the end of the calendar quarter on September 30, 2020. On May 13, 2021, ED published an additional notice for student aid public reporting under CRRSAA and ARP, which requires that institutions publicly post certain information on their website as soon as possible, but no later than 30 days after the publication of the notice or 30 days after the date ED first obligated funds under HEERF I, II, or III to the institution for Emergency Financial Aid Grants to Students, whichever comes later. The report must be updated no later than 10 days after the end of each calendar quarter (September 30, and December 31, March 31, June 30). Quarterly Public Reporting for (a)(1) Institutional Portion, (a)(2), and (a)(3) funds (Assistance Listings 84.425F and 84.425M) ? The CARES, CRRSAA, and ARP institutional quarterly portion reporting requirements involve publicly posting completed forms on the institution?s website. The forms must be conspicuously posted on the institution?s primary website on the same page the reports of the IHE?s activities as to the emergency financial aid grants to students (Student Aid Portion) are posted (discussed above). A new, separate form must be posted covering aggregate amounts spent for HEERF I, HEERF II, and HEERF III funds each quarterly reporting period (September 30, December 31, March 31, June 30), concluding after an institution has expended and liquidated all (a)(1) Institutional Portion, (a)(2), and (a)(3) funds and checks the ?final report? box. IHEs must post this quarterly report form no later than 10 days after the end of each calendar quarter (October 10, January 10, April 10, July 10) apart from the first report, which was due October 30, 2020, and the report covering the first quarter of 2021, which is due July 10, 2021. Annual Reporting ? In accordance with the CARES Act, institutions are required to submit HEERF annual performance reports to the Department of Education via the Annual Report Data Collection System, with the first annual report due on February 1, 2021 and covering the period from March 13, 2020 to December 31, 2020. Condition/Context: During the HEERF reporting compliance testing, the following instances were noted where the information disclosed did not agree to the underlying accounting records or information was missing: a) In testing the University?s conformity with the compliance requirements for the HEERF Student Aid Portion Quarterly Public Reporting, we noted that the University was unable to provide support that the reports were completed and posted publicly to its campus website. As a result, we were unable to determine if posting was timely and we were unable to agree key line items to underlying documentation. b) In testing the University?s conformity with the compliance requirements for the HEERF Institutional Portion Quarterly Public Reporting, we reviewed the four reports due for fiscal year 2021. We noted that while posted timely, the amounts disbursed were inaccurately reported for the reports for the quarters ending September 30, 2020, March 31, 2021 and June 31, 2021. c) In testing the University?s conformity with the compliance requirements for the Annual Reporting, we reviewed the report for the period from March 13, 2020 to December 31, 2020 and noted student counts and dollar amounts disbursed were inaccurately reported for nine of thirteen line items within the report. Cause: The information reported in the annual report, as well as the information publicly posted on the University?s website was not reviewed in sufficient detail to ensure the accuracy and completeness of the disclosed information. For the student reporting, the institution was not aware of these requirements. Effect: The University is not in compliance with the HEERF reporting requirements. Federal oversight agencies, including the Department of Education, depend on accurate reports to measure program results. Questioned Costs: None noted. Identification as a repeat finding, if applicable: Not a repeat finding. Recommendation: We recommend the University enhance its controls and procedures to around the preparation and review of these reports to ensure the information reported is complete and accurate and in conformance with compliance requirements. Views of Responsible Officials: The university understands the importance of accurate and timely reporting. While there were delays or missed deadlines in reporting on the website, there were no questioned costs. During the time funds were allocated to the university, guidance was issued and changing rapidly. As noted in the audit on page 8 above, the requirement criteria were revised repeatedly. Currently, the university is reporting on its website in accordance with the quarterly deadlines. While the university met its deadline for the HEERF Institutional Portion Quarterly Public Reporting (section b above), we mistakenly included student emergency grants funded through the HEERF grants. Each of these quarterly reports have been corrected and updated on our website. As grants were being allocated, management was attending many webinars to understand the requirements, as guidance was changing rapidly. The university also received state grants with different requirements and guidance. In addition, the university was transitioning to a work from home or hybrid work environment.

Finding 2021-002 HEERF Emergency Grants to Students Federal Agency: Department of Education Program: Education Stabilization Fund, HEERF ?Institutional Portion (84.425F), and HEERF ? Strengthening Institutions Program (84.425M) Criteria or Specific Requirement: Section 18004(a)(1) of the CARES Act allows the recipient to use its funding under the Institutional Portion of HEERF and Strengthening Institutions Program to make additional emergency grants to students. If it chooses to do so, then the funds are subject to the requirements under the Student Portion. The requirements under the student portion state that emergency grants to students are required to be made directly to students. Condition/Context: Out of a total population of 488 emergency grants made to students, we selected 40 to test. For 16 out of the 40, we noted that the payment was not made directly to the student and was instead applied to the student?s account, without obtaining their explicit consent. Cause: At the time these grants were made, University personnel were unaware of this requirement. Effect: The University is not in compliance with the Activities Allowed or Unallowed compliance requirement. Questioned Costs: None noted. Identification as a repeat finding, if applicable: Not a repeat finding. Recommendation: We recommend that the University regularly review information, training materials, and updates supplied by the Department of Education related to the program. Views of Responsible Officials: The university understands the importance of accurate disbursement of federal funds. As noted above, at the time these grants were made, the university was not aware that the institutional portion of the HEERF grant distributed to students were subject to the same requirements as the student portion of the HEERF grant. After receiving clarification in January, 2021, management updated its procedures to disburse funds according to required guidance. Please note that management corrected this unintentional error before the audit took place after obtaining clarifying guidance. This only affected a minimum number of students.

Finding 2021-003 HEERF Procurement and Suspension and Debarment Federal Agency: Department of Education Program: Education Stabilization Fund, HEERF Institutional Portion (84.425F) and HEERF ? Strengthening Institutions Program (84.425M) Criteria or Specific Requirement: The Uniform Guidance requires recipients of federal awards to follow the procurement standards set out at 2 CFR sections 200.318 through 200.326. The entity must use its own documented procurement procedures which must meet the procurement requirements identified in 2 CFR 200. Additionally, non-federal entities are prohibited from contracting with or making subawards under covered transactions to parties that are suspended or debarred. ?Covered transactions? include contracts for goods and services awarded under a nonprocurement transaction (e.g., grant or cooperative agreement) that are expected to equal or exceed $25,000 or meet certain other criteria as specified in 2 CFR section 180.220. All non-procurement transactions entered into by a pass-through entity (i.e., subawards to subrecipients), irrespective of award amount, are considered covered transactions, unless they are exempt as provided in 2 CFR section 180.215. Condition/Context: The University received federal funds due to the COVID-19 pandemic and, in accordance with the grant requirements, expended these funds for institutional costs of the University. However, the University did not have a written procurement policy in place that contained all of the necessary elements required by Uniform Guidance. We noted there were a total of 30 transactions, of which three were greater than $25,000. For these three transactions it was further noted that there was no documentation of procedures in place to ensure the vendors were not suspended or debarred at the time of purchase. Cause: The Federal funds received and expended during the year were new to the University due to the COVID-19 pandemic. In recent years, the other programs it has participated in did not allow for direct purchases or include procurement and suspension and debarment as an applicable compliance requirement. Effect: The University did not have formal policies and procedures in place during the fiscal year to ensure compliance with the Procurement, Suspension and Debarment compliance requirement included in the Uniform Guidance. Questioned Costs: None noted. Identification as a repeat finding, if applicable: Not a repeat finding. Recommendation: We recommend the University create and implement procurement and suspension and debarment policies that meet the requirements of federal regulations. Views of Responsible Officials: The university understands the importance of following federal regulations. As stated above, these federal funds were new to the university. Previously, other programs did not have these compliance requirements. Management is currently reviewing vendors on the SAM.gov website as required and will continue this process. Management has updated its purchasing policy to include procurement and suspension and debarment.

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