Chowan UniversityNon-Profit

Finding 2025-001 Federal Program Information: Federal Direct Student Loan Program (ALN#: 84.268), Federal Pell Grant Program (ALN#: 84.063) Criteria or Specific Requirement: N. Special Tests and Provisions – Campus Level Enrollment Reporting Institutions are required to report enrollment information under the Pell grant and the Direct and FFEL loan programs via the NSLDS (OMB No. 1845-0035), although FFEL loans are no longer made or a part of the SFA Cluster, a student may have a FFEL loan from previous years that would require enrollment reporting for that student (Pell, 34 CFR 690.83(b)(2); FFEL, 34 CFR 682.610; Direct Loan, 34 CFR 685.309; Perkins 34 CFR 674.19(f)). 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 certify 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 which the financial aid administrator can access for the auditor. The data on the institution’s Enrollment Reporting Roster, or Enrollment Maintenance page, is what NSLDS has as the most recently certified enrollment. 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. Condition: An instance was identified where a student’s status was not accurately reported. Cause: Administrative oversight with respect to Campus Level enrollment reporting compliance requirements. Effect or Potential Effect: The University was not in compliance with the Campus Level enrollment reporting compliance requirements. Questioned Costs: None. Context: For 1 of 40 students selected for testing, the student status was not accurately reported in NSLDS. Repeat Finding: There was a similar finding, 2024-001, identified during the prior year. Recommendation: We recommend the University enhance its procedures to ensure Campus Level enrollment reporting is submitted accurately. Views of Responsible Officials: The University Financial Aid Office will provide the Registrar with a report of enrolled student social security numbers from the financial aid system prior to the creation of an enrollment file for National Student Clearinghouse reporting. The financial aid file will be used to identify and correct any Social Security number discrepancies. Updates and corrections may include subsequent reporting to the Clearinghouse and/or manual reporting to NSLDS.

Federal Program Information: Federal Direct Student Loan Program (ALN#: 84.268), Federal Pell Grant Program (ALN#: 84.063) Criteria or Specific Requirement: N. Special Tests and Provisions – Campus Level Enrollment Reporting Institutions are required to report enrollment information under the Pell grant and the Direct and FFEL loan programs via the NSLDS (OMB No. 1845-0035), although FFEL loans are no longer made or a part of the SFA Cluster, a student may have a FFEL loan from previous years that would require enrollment reporting for that student (Pell, 34 CFR 690.83(b)(2); FFEL, 34 CFR 682.610; Direct Loan, 34 CFR 685.309; Perkins 34 CFR 674.19(f)). 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 certify 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 which the financial aid administrator can access for the auditor. The data on the institution’s Enrollment Reporting Roster, or Enrollment Maintenance page, is what NSLDS has as the most recently certified enrollment. 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. Condition: An instance was identified where a student’s status was not accurately reported. Cause: Administrative oversight with respect to Campus Level enrollment reporting compliance requirements. Effect or Potential Effect: The University was not in compliance with the Campus Level enrollment reporting compliance requirements. Questioned Costs: None. Context: For 1 of 25 students selected for testing, the student status was not accurately reported in NSLDS. Repeat Finding: There was no similar finding identified during the prior year. Recommendation: We recommend the University enhance its procedures to ensure Campus Level enrollment reporting is submitted accurately. Views of Responsible Officials: The University Financial Aid Office will work alongside the Registrar’s Office to identify and correct any enrollment reporting errors which may arise. Corrections may include subsequent reporting to the Clearinghouse and/or manual reporting to NSLDS.

Federal Program Information: Federal Direct Student Loan Program (ALN#: 84.268) Criteria or Specific Requirement: L. Reporting – Common Origination and Disbursement (“COD”) System – All institutions receiving Direct Loans submit payment data to the Department of Education through the COD System. Institutions must report all loan disbursements and submit required records to the Direct Loan Servicing System (DLSS) via the COD no earlier than 7 days prior to making a disbursement of funds to a student (under the Advance or Heightened Cash monitoring 1 payment method), and no later than 15 days after the school makes a payment or becomes aware of the need to make an adjustment to previously reported student payment data or expected student payment data. (ED Notice, July 14, 2020, Federal Register (85 Federal Register 42368)). Condition: Instance was identified where the student payments data was not submitted within the required timeframe. Cause: Administrative oversight with respect to disbursement compliance requirements. Effect or Potential Effect: The University was not in compliance with the Direct Loan reporting compliance requirements. Questioned Costs: None. Context: For 1 of 25 students selected for testing, the student payment data was not submitted within the required timeframe. Repeat Finding: There was no similar finding identified during the prior year. Recommendation: We recommend the University enhance its procedures to ensure Direct Loan payment data is submitted to the Department of Education within the required timeframe. Views of Responsible Officials: The University Financial Aid Office has restructured the disbursement process as noted below: • Staff members will be retrained on the importance of timely reporting and record compliance. • A disbursement and documentation process will be created to track, manage, and reconcile the disbursement requests sent to COD. This process will aid in recognizing approved disbursements, rejected requests, and posting of disbursements. • The disbursement and reconciliation log will be reviewed by the Asst. Vice President for Student Financial Services as well as the Asst Vice President for Analytics & Audit.

Federal Program Information: Federal Direct Student Loan Program (ALN#: 84.268) Criteria or Specific Requirement: Special Tests and Provisions – Disbursements to or on Behalf of Students – Federal Student Aid (“FSA”) Credit Balances - Where disbursements created a credit balance in the student account and the student or parent did not provide an authorization for the institution to retain funds, the institution must provide the credit balance amount to the student within 14 days of the date the balance was created (34 CFR 668.164(h)). Condition: Instance was identified where the University did not issue a refund within the required timeframe. Cause: Administrative oversight with respect to disbursement to or on behalf of students. Effect or Potential Effect: The University was not in compliance with disbursement to or on behalf of students. Questioned Costs: None. Context: For 1 of 10 students selected for testing, the University did not issue the refund within the required 14 days. Repeat Finding: There was no similar finding identified during the prior year. Recommendation: We recommend the University complete a timely review of credit balances in order to issue all refunds with respect to FSA credit balances within the required timeframe. Views of Responsible Officials: This instance was an administrative error. Measures are in place to process refunds on a weekly basis.

Federal Program Information: Federal Direct Student Loan Program (ALN#: 84.268) Criteria or Specific Requirement: N. Special Test and Provisions ? Disbursements To or On Behalf of Students ? Loan Disbursement Notification - Federal regulations (34 CFR section 668.165 (a)(6)(i)) require that the institution 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 U.S. 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, TEACH Grant, or TEACH Grant disbursement. Institutions that implement an affirmative confirmation process (as described in 34 CFR section 668.165 (a)(6)(i)) must make this notification to the student or parent no earlier than 30 days before, and no later than 30 days after, crediting the student?s account at the institution with Direct Loan or TEACH Grants. The Federal Student Aid Handbook further clarifies that in general, there are two types of notifications a school must provide: (1) a general notification to parent Direct PLUS borrowers and all students receiving Federal Student Aid (?FSA?) funds, and (2) a notice when FSA loan funds or TEACH Grant funds are credited to a student?s account. Condition: Certain borrowers did not receive a loan disbursement notification timely. Cause: Administrative oversight with respect to loan disbursement notifications. Effect or Potential Effect: Students and/or parents were not notified of loan disbursements and/or their right to cancel/decline loan awards in a timely manner. Questioned Costs: None. Context: For 2 of 25 students selected for testing, the University did not send the disbursement notification within the required timeframe. Repeat Finding: There was no similar finding identified during the prior year. Recommendation: We recommend the University enhance its procedures over loan disbursement notifications to ensure that such notifications are sent to student and/or parent borrowers within the required timeframe. Views of Responsible Officials: The University Financial Aid Office has restructured the disbursement notification schedule as noted below: ? Disbursement notification letters are to be printed every 21 days. The federal requirement for notification is every 30 days. ? The Direct Loan Officer and Director of Financial Aid have access to create and print the letters. ? Electronic calendar notices for the disbursement notifications are sent to the Direct Loan Officer, Director of Financial Aid and the Asst. Vice President for Analytics & Audit. ? Task completion will be verified by the Asst. Vice President for Analytics & Audit on a monthly basis.

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