Montreat College

2025-002 – Student Financial Aid Cluster – (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Pell Grant Program (d) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.063 (d) 84.268 - Year Ended June 30, 2025 Criteria: 34 CFR 682.201 (a) (1-2) notes, “(1) To obtain a Direct Subsidized Loan or a Direct Unsubsidized Loan, a student must complete a Free application for Federal Student Aid and submit it in accordance with instructions in the application. (2) If the student is eligible for a Direct Subsidized Loan or a Direct Unsubsidized Loan, the school in which the student is enrolled must perform the following functions: (i) create a loan origination record and transmit the record to the Secretary. (ii) Ensure that the loan is supported by a completed Master Promissory Note (MPN) and, if applicable, transmit the MPN to the Secretary. (iii) In accordance with 34 CFR 668.162, draw down funds or receive funds from the Secretary, and disburse the funds to the student.” Condition: 4 of the 40 student files (10%) we examined, we noted the students were not properly awarded Direct loans. We consider this condition to be a significant deficiency relating to the Eligibility compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2024-004. Statistical sampling was not used in making sample selections. Questioned Costs: $0 Cause and Effect: Without proper review of eligibility of financial aid, students may receive an incorrect amount of Title IV aid. Recommendation: We recommend the College evaluate policies and procedures to ensure students receive the proper amount of Title IV aid. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2025-003 – Student Financial Aid Cluster – (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Pell Grant Program (d) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.063 (d) 84.268 - Year Ended June 30, 2025 Criteria: 34 CFR 668.22 (a)(1) states “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 grant or loan assistance that the student earned as of the student's withdrawal date in accordance with paragraph (e) of this section.” 34 CFR 668.22 (e)(2) states, “The percentage of title IV grant or loan assistance that has been earned by the student is - (i) Equal to the percentage of the payment period or period of enrollment that the student completed (as determined in accordance with paragraph (f) of this section) as of the student's withdrawal date, if this date occurs on or before - (A) Completion of 60 percent of the payment period or period of enrollment for a program that is measured in credit hours; or…” 34 CFR 668.22(j) notes, “(1) An institution must return the amount of title IV funds for which it is responsible under paragraph (g) of this section as soon as possible but no later than 45 days after the date of the institution's determination that the student withdrew as defined in paragraph (l)(3) of this section. The timeframe for returning funds is further described in § 668.173(b). (2) For an institution that is not required to take attendance, an institution must determine the withdrawal date for a student who withdraws without providing notification to the institution no later than 30 days after the end of the earlier of the – (i) Payment period or period of enrollment, as appropriate, in accordance with paragraph (e)(5) of this section; (ii) Academic year in which the student withdrew; or (iii) Educational program from which the student withdrew” An institution must notify the student of a post-withdrawal disbursement of Federal Direct Loans used to credit the student’s account for outstanding charges (34 CFR 668.22). Condition: The College did not accurately complete refund calculations for 2 out of 9 students (22.2%) tested that both required post-withdrawal disbursements. For one of these students, the College did not notify the student of the post-withdrawal disbursement of Federal Direct Loans before it was applied to the student’s account. We consider this finding to be a significant deficiency in relation to the Special Tests and Provisions compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2024-007. Statistical sampling was not used in making sample selections. Questioned Costs: $319 Effect: Miscalculations in the Return of Title IV funds calculations results in incorrect amounts returned by the College or incorrect amounts disbursed to students in post-withdrawal disbursements. For the post-withdrawal disbursement notification, without notifying the student, direct loans may be applied to the student’s account that they are not aware of or would have wanted to decline the disbursement if they were notified. Recommendation: For the incorrect refund calculations, we recommend the College continually educate themselves on the requirements for the return of title IV fund and ensure the proper controls are implemented accurately to return unearned aid or disburse earned aid in post-withdrawal disbursements. For not notifying the student of the post-withdrawal disburrsement, we recommend the College reviews their policies and procedures written notification is timely provided to the student for post-withdrawal disbursements of Federal Direct Loans to allow them to decline, if they choose to do so. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2025-004 – Student Financial Aid Cluster – (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Pell Grant Program (d) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.063 (d) 84.268 - Year Ended June 30, 2025 Criteria: 34 CFR 668.408 (a)(2) notes, “In accordance with procedures established by the Secretary, an institution offering any group of substantially similar programs… must report to the Department… (2) For each student – (i) Information needed to identify the student and the institution; (ii) The date the student initially enrolled in the program; (iii) The student’s attendance dates and attendance status (e.g., enrolled, withdrawn, or completed) in the program during the award year; (iv) The student’s enrollment status (e.g., full time, three-quarter time, half time, less than half time) as of the first day of the student’s enrollment in the program…” Condition: In our testing of student files, three out of 40 students (7.5%) had enrollment statuses not timely or accurately reported to NSLDS. We consider this finding to be an instance of noncompliance in relation to the Special Tests and Provisions compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2024-008. Cause: The causes for the untimely and incorrect enrollment status reporting was caused by a citizenship/foreign student flag issue that was not identified and resolved timely, an identified error in their reporting system that has since been resolved, and other unknown errors. Effect: The result is that the Department of Education was not made aware of the changes in student statuses in a timely manner and students’ enrollment dates were reported to NSLDS inaccurately or were missing. Questioned Costs: $0 Recommendation: We recommend that the College reviews their policies and procedures to ensure students’ enrollment statuses are reported accurately and timely. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2024-003 – Student Financial Aid Cluster – (a) Federal Pell Grant (b) Federal Supplemental Educational Opportunity Grant (c) Federal Work Study Grant (d) Federal Perkins Loan Program (e) Federal Direct Student Loans (f) Teacher education Assistance for College and Higher Education ALN No. (a) 84.063 (b) 84.007 (c) 84.033 (d) 84.038 (e) 84.268 (f) 84.379 – Year Ended June 30, 2024 Criteria: 34 CFR 690.62 states, “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. Condition: One of the 40 student files (2.5%) we examined, we noted the students were not properly awarded Pell grants. Cause and Effect: Without proper review of eligibility of financial aid, students may receive an incorrect amount of Title IV aid. We consider this condition to be an instance of noncompliance relating to the Eligibility compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2023-003. Statistical sampling was not used in making sample selections. Questioned Costs: $0 Cause and Effect: Without proper review of eligibility of financial aid, students may receive an incorrect amount of Title IV aid. Students should receive the proper amount of aid. Recommendation: We recommend the College evaluate policies and procedures to ensure students receive the proper amount of Title IV aid. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2024-004 – Student Financial Aid Cluster – (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Perkins Loan Program (d) Federal Pell Grant Program (e) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.038 (d) 84.063 (e) 84.268 - Year Ended June 30, 2024 Criteria: 34 CFR 682.201 (a) (1-2) notes, “(1) To obtain a Direct Subsidized Loan or a Direct Unsubsidized Loan, a student must complete a Free application for Federal Student Aid and submit it in accordance with instructions in the application. (2) If the student is eligible for a Direct Subsidized Loan or a Direct Unsubsidized Loan, the school in which the student is enrolled must perform the following functions: (i) create a loan origination record and transmit the record to the Secretary. (ii) Ensure that the loan is supported by a completed Master Promissory Note (MPN) and, if applicable, transmit the MPN to the Secretary. (iii) In accordance with 34 CFR 668.162, draw down funds or receive funds from the Secretary, and disburse the funds to the student.” Condition: 5 of the 40 student files (12.5%) we examined, we noted the students were not properly awarded Direct loans. We consider this condition to be a significant deficiency relating to the Eligibility compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2023-004. Statistical sampling was not used in making sample selections. Questioned Costs: $0 Cause and Effect: Without proper review of eligibility of financial aid, students may receive an incorrect amount of Title IV aid. Recommendation: We recommend the College evaluate policies and procedures to ensure students receive the proper amount of Title IV aid. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2024-005 – Student Financial Aid Cluster – (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Perkins Loan Program (d) Federal Pell Grant Program (e) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.038 (d) 84.063 (e) 84.268 - Year Ended June 30, 2024 Criteria: According to 34 CFR section 685.304, an educational institution must ensure that exit counseling is conducted with each Direct Loan student borrower 30 days after the student withdraws from the institution or falls below half-time status. Condition: During our student file testing, we noted five students out of 40 (12.5%) did not have documentation in their file that exit counseling was sent thirty days after the student withdrew. We consider the missing exit counseling to be a significant deficiency with the Eligibility Compliance Requirement. Statistical sampling was not performed in the selection of the sample. Questioned Costs: $0 Cause and Effect: The College did not send out exit counseling when the student withdrew timely and the College’s controls did not detect the missing exit counseling for the students. Recommendation: We recommend the College closely monitor all students who are receiving loans to make sure they are sent exit counseling timely. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2024-006 – Student Financial Aid Cluster – (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Perkins Loan Program (d) Federal Pell Grant Program (e) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.038 (d) 84.063 (e) 84.268 - Year Ended June 30, 2024 Criteria: 34 CFR 668.164 (a)(1) states “Except as provided under paragraph (a)(2) of this section, a disbursement of title IV, HEA program funds occurs on the date that the institution credits the student’s ledger account or pays the student or parent directly with- (i) Funds received form the Secretary; (ii) Institutional funds received from a lender under title IV, HEA program funds; Condition: The College did not report actual loan disbursement dates to the Common Origination and Disbursement (COD) system for 2 of the 40 students in the sample (5%). We consider this condition to be an instance of noncompliance in internal control over compliance relating to the Eligibility compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2023-005. Statistical sampling was not used in making sample selections. Questioned Costs: N/A Cause and Effect: The College posted the batches incorrectly resulting in a variance in the date of the disbursement per the student account and the date per NSLDS. Recommendation: We recommend the College implement procedures in order to report accurate disbursements dates for Direct Loans to NSLDS. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2024-007 – Student Financial Aid Cluster – (a) Federal Pell Grant (b) Federal Supplemental Educational Opportunity Grant (c) Federal Work Study Grant (d) Federal Perkins Loan Program (e) Federal Direct Student Loans, Assistance Listing No. (a) 84.063 (b) 84.007 (c) 84.033 (d) 84.038 (e) 84.268 - Year Ended June 30, 2024 Criteria: 34 CFR 668.22 (a)(1) states “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 grant or loan assistance that the student earned as of the student's withdrawal date in accordance with paragraph (e) of this section.” 34 CFR 668.22 (e)(2) states, “The percentage of title IV grant or loan assistance that has been earned by the student is - (i) Equal to the percentage of the payment period or period of enrollment that the student completed (as determined in accordance with paragraph (f) of this section) as of the student's withdrawal date, if this date occurs on or before - (A) Completion of 60 percent of the payment period or period of enrollment for a program that is measured in credit hours; or…” 34 CFR 668.22(j) notes, “(1) An institution must return the amount of title IV funds for which it is responsible under paragraph (g) of this section as soon as possible but no later than 45 days after the date of the institution's determination that the student withdrew as defined in paragraph (l)(3) of this section. The timeframe for returning funds is further described in § 668.173(b). (2) For an institution that is not required to take attendance, an institution must determine the withdrawal date for a student who withdraws without providing notification to the institution no later than 30 days after the end of the earlier of the – (i) Payment period or period of enrollment, as appropriate, in accordance with paragraph (e)(5) of this section; (ii) Academic year in which the student withdrew; or (iii) Educational program from which the student withdrew” An institution must notify the student of a post-withdrawal disbursement of Federal Direct Loans used to credit the student’s account for outstanding charges (34 CFR 668.22). Condition: The College did not accurately complete refund calculations for 1 out of 9 students (11.1%) tested. Additionally, funds were not timely returned and withdrawal dates were not timely determined for three out of nine students (33%) tested. We consider this finding to be a significant deficiency in relation to the Special Tests and Provisions compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2023-003. Statistical sampling was not used in making sample selections. Questioned Costs: $926 Effect: Miscalculation of the days in the Return of Title IV funds calculations results in incorrect amounts returned by the College. For the untimely refunds, without proper review of students’ enrollment statuses, refunds may be required that are not determined or completed timely. Recommendation: For the incorrect refund calculation, we recommend the College continually educate themselves on the requirements for the return of title IV fund and ensure the proper controls are implemented to timely and accurately return unearned aid. For the untimely returns, we recommend the College reviews their policies and procedures to ensure withdrawals are determined and funds returned timely for students that withdrew. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2024-008 – Student Financial Aid Cluster – (a) Federal Pell Grant (b) Federal Supplemental Educational Opportunity Grant (c) Federal Work Study Grant (d) Federal Perkins Loan Program (e) Federal Direct Student Loans, Assistance Listing No. (a) 84.063 (b) 84.007 (c) 84.033 (d) 84.038 (e) 84.268 - Year Ended June 30, 2024 Criteria: 34 CFR 668.408 (a)(2) notes, “In accordance with procedures established by the Secretary, an institution offering any group of substantially similar programs… must report to the Department… (2) For each student – (i) Information needed to identify the student and the institution; (ii) The date the student initially enrolled in the program; (iii) The student’s attendance dates and attendance status (e.g., enrolled, withdrawn, or completed) in the program during the award year; (iv) The student’s enrollment status (e.g., full time, three-quarter time, half time, less than half time) as of the first day of the student’s enrollment in the program…” Condition: In our testing of student files, six out of 40 students (15%) had enrollment statuses not timely or accurately reported to NSLDS. We consider this finding to be a significant deficiency in relation to the Special Tests and Provisions compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2023-002. Cause: The causes for the untimely and incorrect enrollment status reporting was caused by a citizenship/foreign student flag issue that was not identified and resolved timely, an identified error in their reporting system that has since been resolved, and other unknown errors. Effect: The result is that the Department of Education was not made aware of the changes in student statuses in a timely manner and students’ enrollment dates were reported to NSLDS inaccurately or were missing. Questioned Costs: $0 Recommendation: We recommend that the College reviews their policies and procedures to ensure students’ enrollment statuses are reported accurately and timely. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2023-002 – Student Financial Aid Cluster – (a) Federal Pell Grant (b) Federal Supplemental Educational Opportunity Grant (c) Federal Work Study Grant (d) Federal Perkins Loan Program (e) Federal Direct Student Loans (f) Teacher education Assistance for College and Higher Education ALN No. (a) 84.063 (b) 84.007 (c) 84.033 (d) 84.038 (e) 84.268 (f) 84.379 – Year Ended June 30, 2023 Criteria: 34 CFR 690.83 (b)(2) states the institution shall submit "in accordance with deadline dates established by the Secretary, through publication in the Federal Register, other reports and information with Secretary requires and shall comply with the procedures the Secretary finds necessary to ensure that the reports are correct.” 34 CFR 685.309(b)(1-2) states “upon receipt of a student status confirmation report from the Secretary, complete and return that report to the Secretary within 30 days of receipt; and unless it expects to submit its next student status confirmation report to the Secretary within the next 60 days, notify the Secretary within the next 60 days, notify the Secretary with 30 days if it discovers that a Direct Subsidized, Direct Unsubsidized, or Direct PLUS Loan has been made to or on behalf of student…" Condition: The College did not report graduate status changes within 60 days for ten out of twenty students (50%) tested. We consider this condition to be a material weakness of internal control over compliance relating to the Special Tests and Provisions compliance requirement. Statistical sampling was not used in making sample selections. Questioned Costs: $0 Effect: The College has not timely and accurately submitted enrollment status information, which has the potential to delay the start of the repayment period for students who have received loans. Recommendation: We recommend the College continually educate themselves on compliance requirements regarding enrollment reporting and implement controls to help timely and accurately report enrollment statuses. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2023-003 – Student Financial Aid Cluster – (a) Federal Pell Grant (b) Federal Supplemental Educational Opportunity Grant (c) Federal Work Study Grant (d) Federal Perkins Loan Program (e) Federal Direct Student Loans, Assistance Listing No. (a) 84.063 (b) 84.007 (c) 84.033 (d) 84.038 (e) 84.268 - Year Ended June 30, 2023 Criteria: 34 CFR 668.22 (a)(1) states “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 grant or loan assistance that the student earned as of the student's withdrawal date in accordance with paragraph (e) of this section.” 34 CFR 668.22 (e)(2) states, “The percentage of title IV grant or loan assistance that has been earned by the student is - (i) Equal to the percentage of the payment period or period of enrollment that the student completed (as determined in accordance with paragraph (f) of this section) as of the student's withdrawal date, if this date occurs on or before - (A) Completion of 60 percent of the payment period or period of enrollment for a program that is measured in credit hours; or…” 34 CFR 668.22(j) notes, “(1) An institution must return the amount of title IV funds for which it is responsible under paragraph (g) of this section as soon as possible but no later than 45 days after the date of the institution's determination that the student withdrew as defined in paragraph (l)(3) of this section. The timeframe for returning funds is further described in § 668.173(b).” An institution must notify the student of a post-withdrawal disbursement of Federal Direct Loans used to credit the student’s account for outstanding charges (34 CFR 668.22). Condition: The College did not accurately complete refund calculations for 2 out of 17 students (11.7%) tested. We consider this finding to be a significant deficiency in relation to the Special Tests and Provisions compliance requirement. Statistical sampling was not used in making sample selections. Questioned Costs: $1,217 Effect: Miscalculation of the days in the Return of Title IV funds calculations results in incorrect amounts returned by the College. Recommendation: We recommend the College continually educate themselves on the requirements for the return of title IV fund and ensure the proper controls are implemented to timely and accurately return unearned aid. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2023-004 – Student Financial Aid Cluster – (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Perkins Loan Program (d) Federal Pell Grant Program (e) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.038 (d) 84.063 (e) 84.268 - Year Ended June 30, 2023 Criteria: 34 CFR 682.201 (a) (1-2) notes, “(1) To obtain a Direct Subsidized Loan or a Direct Unsubsidized Loan, a student must complete a Free application for Federal Student Aid and submit it in accordance with instructions in the application. (2) If the student is eligible for a Direct Subsidized Loan or a Direct Unsubsidized Loan, the school in which the student is enrolled must perform the following functions: (i) create a loan origination record and transmit the record to the Secretary. (ii) Ensure that the loan is supported by a completed Master Promissory Note (MPN) and, if applicable, transmit the MPN to the Secretary. (iii) In accordance with 34 CFR 668.162, draw down funds or receive funds from the Secretary, and disburse the funds to the student.” Condition: 2 of the 40 student files (5%) we examined, we noted the students were not properly awarded Direct loans. We consider this condition to be an instance of noncompliance relating to the Eligibility compliance requirement and is a repeat finding shown in Section IV of this report as prior year finding 2022-003. Statistical sampling was not used in making sample selections. Questioned Costs: $0 Cause and Effect: Without proper review of eligibility of financial aid, students may receive an incorrect amount of Title IV aid. Recommendation: We recommend the College evaluate policies and procedures to ensure students receive the proper amount of Title IV aid. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2023-005 – Student Financial Aid Cluster – (a) Federal Supplemental Educational Opportunity Grant (b) Federal Work Study Grant (c) Federal Perkins Loan Program (d) Federal Pell Grant Program (e) Federal Direct Loan Program, Assistance Listing No. (a) 84.007 (b) 84.033 (c) 84.038 (d) 84.063 (e) 84.268 - Year Ended June 30, 2023 Criteria: 34 CFR 668.164 (a)(1) states “Except as provided under paragraph (a)(2) of this section, a disbursement of title IV, HEA program funds occurs on the date that the institution credits the student’s ledger account or pays the student or parent directly with- (i) Funds received form the Secretary; (ii) Institutional funds received from a lender under title IV, HEA program funds; Condition: The College did not report actual loan disbursement dates to the Common Origination and Disbursement (COD) system for 2 of the 40 students in the sample (5%). We consider this condition to be an instance of noncompliance in internal control over compliance relating to the Eligibility compliance requirement. Statistical sampling was not used in making sample selections. Questioned Costs: N/A Cause and Effect: The College posted the batches incorrectly resulting in a variance in the date of the disbursement per the student account and the date per NSLDS. Recommendation: We recommend the College implement procedures in order to report accurate disbursements dates for Direct Loans to NSLDS. Views of Responsible Officials: Management agrees with this Single Audit Finding and response is included in the Corrective Action Plan.

2022-002: Missing Exit Counseling Documentation - Student Financial Aid Cluster - Assistance Listing #s 84.033, 84.007, 84.063, 84.268, 84.038 - Grant Period - Year Ended June 30, 2022 Criteria: According to 34 CFR section 685.304, an educational institution must ensure that exit counseling is conducted with each Direct Loan student borrower 30 days after the student withdraws from the institution or falls below half-time status. Condition: During our student file testing, we noted three students out of forty did not have documentation in their file that exit counseling was sent thirty days after the student withdrew from the College. We consider the missing exit counseling to be an instance of non-compliance with the Eligibility Compliance Requirement. Statistical sampling was not used when making sample selections. Questioned Costs: $0 Effect: The College did not timely send out exit counseling when the student withdrew from the College. Cause: The College?s internal controls did not detect the missing exit counseling for the student. Recommendation: We recommend the College closely monitor all students who are receiving loans to make sure they are sent exit counseling. Views of Responsible Officials: Management agrees with the Single Audit finding and a response is included in the Corrective Action Plan.

2022-003 Incorrect Direct Loans Disbursement Amount - Student Financial Aid Cluster Assistance Listing Number 84.007, 84.033, 84.063, 84.268, 84.038 Grant Period - Year Ended June 30, 2022 Criteria: According to 34 CFR 685.203 an eligible dependent student in their first year of school can borrow up to $3,500 in Subsidized Direct Loans and $2,000 in Unsubsidized Direct Loans. As the student receives more credit hours and advances to the next year of school the student can borrow additional Subsidized Direct Loans. Condition: During our student file testing we noted four students out of forty were not disbursed the correct Direct Loans award. Based on the student?s enrollment status and need, the College over awarded Direct Loans to the students by $2,993. We consider this to be a significant deficiency relating to the Eligibility Compliance Requirement. See Schedule of Findings and Questioned Costs for chart/table. Statistical sampling was not used when making sample selections. Questioned Costs: $2,993 Effect: Four students received an incorrect amount of Direct Loans and was over awarded an amount of $2,993. Cause: The College?s internal controls did not identify that the incorrect amount of Direct Loans was awarded to the students and students were over awarded amount of $2,993. Recommendation: We recommend the College closely monitor all student?s enrollment status to ensure all students receiving financial aid are disbursed the correct amount. Views of Responsible Officials: Management agrees with the Single Audit finding and a response is included in the Corrective Action Plan.

Finding 2019-001: Special Tests and Provisions Significant Deficiency in Controls/Non-Compliance U.S. Department of Education: Student Financial Aid Program Cluster: Federal Supplemental Educational Opportunity Grant 84.007 Federal Work-Study 84.033 Federal Pell Program 84.063 Federal Direct Loan Program 84.268 Return of Title IV Funds Criteria: In accordance with 34 CFR 668.22, 682.607, and 685.305, which prescribe priorities and the time frames for the return of Title IV funds to the various student financial assistance programs, institutions are required to return Title IV funds as soon as possible, but no later than 45 days after the date of determination that the student withdrew. Condition: Title IV funds for 1 of 10 students examined was not timely returned to the student financial assistance program. Effect: The College failed to return funds within the 45-day regulatory requirement, which permitted the improper retention of federal funds. Cause: Due to oversight, $3,128 of the unearned award was not timely returned to the Pell & FDL programs. Questioned costs: $0 Context: Of 681 recipients of student financial aid, 100 case files examined. Recommendation: The College should ensure Title IV funds are returned timely according to the federal timeframe. Repeat finding: Return of Title IV Funds is a repeat finding from the 2018 audit. Repeat findings from prior audits indicate an impaired ability to administer the Title IV programs. Views of responsible officials: The College agrees with the finding as a carry-over from the previous year and has already adhered to the Corrective Action Plan. Additionally, the College has noted this student?s COD file was late and has added a corrective action step. Exit Loan Counseling Criteria: Regulations require the College to conduct exit counseling with borrowers when the borrower ceases at least half-time enrollment or during the exit interview. The College must provide disclosures to the borrower in writing within 30 days upon discovering the borrower has entered the repayment period. Documentation of timely compliance with these requirements was not present in certain students? files. [34 CFR 685.304(b), (1) & 34 CFR 674.42(b)]. Condition: 1 of 16 students exit counseling was not conducted timely. Effect: Students with a break in enrollment exit counseling was not conducted within the timeframe established by the Secretary. Cause: The College experienced a change of personnel within the Financial Aid Office. The personnel changes resulted in exit counseling not being performed timely. Questioned costs: $0. Context: Of the 681 recipients of student financial aid, 100 case files were examined. Recommendation: The College should increase its efforts through training to ensure that exit counseling is timely. Views of responsible officials: The College agrees with the finding and will adhere to the following corrective action plan. Common Origination and Disbursement (COD) System Criteria: The College must submit subsequent disbursement records, including adjustments and cancellation records, to the Department no later than 15 days following the date of the disbursement, adjustment, or cancellation is made. [2018 ? 2019 Technical Manual Volume II, Section 1, page 221] Condition: 1 of 100 students? COD dates was not timely reported to COD. Effect: COD must reflect the actual date students had access to the funds (date funds were posted to student accounts), because, for unsubsidized loans, interest begins to accrue at the time of disbursement. By not updating the dates with the actual disbursements date, students could be paying interest on funds they have not received. Cause: This finding is the result of oversight to timely report COD adjustments. Questioned costs: $0 Context: Of 681 recipients of student financial aid, 100 case files were examined. Recommendation: We recommend the College should increase its efforts through training and stricter adherence to controls already in place to ensure that COD reporting is timely. Repeat finding - Common Origination and Disbursement (COD) System is a repeat finding from the 2018 audit. Repeat findings from prior audits indicate an impaired ability to administer the Title IV programs. Views of responsible officials: The College agrees with the finding and will adhere to the following corrective action plan.

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