BJU, INC.Higher Education

Untimely Returns of Title IV Funds Significant Deficiency DEPARTMENT OF EDUCATION ALN #: 84.268, 84.063 Federal Award Identification #: 2022-23 Financial Aid Year Condition: When online students withdrew officially, the Organization did not always return unearned Title IV aid in a timely manner due to incorrect withdrawal dates being used in the R2T4 calculation. There were two students who had incorrect R2T4 calculations, originally determined to be beyond the 60% point and therefore the University did not return any funds. Criteria: 34 CFR 668.22 Questioned Costs: $4,216 Context: Out of 6 students tested, 2 online students who officially withdrew during the Summer 2022 and Spring 2023 terms had a total of $1,304 in Pell grants and $2,912 in Federal Direct Loans returned late, ranging from 107 to 402 days. Funds were returned during the audit. Cause: The School for Continuing, Online, and Professional Education (SCOPE) determined incorrect last dates of attendance (LDA) for the financial aid office to use for withdrawal evaluations. Effect: Title IV funds were not returned timely. Identification as repeat finding, if applicable: not applicable Recommendation: We recommend that the financial aid office review the online activity reports provided by SCOPE to confirm the correct LDA to use in withdrawal evaluations. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.

Pell Grants Other Matter DEPARTMENT OF EDUCATION ALN #: 84.063 Federal Award Identification #: 2022-2023 Financial Aid Year Condition: Nontraditional and tuition-benefitted students who had Pell eligibility and enrolled in courses for at least half-time during the Summer 2023 term were not always packaged for Pell awards. Criteria: 34 CFR 690.67 Questioned Costs: $0 Context: Out of 38 Pell eligible students tested, 2 students did not receive Pell awards in the Summer 2023 term, totaling $1,548. This was corrected during the audit. Cause: Nontraditional and tuition-benefitted students are processed differently in the summer term and have the potential to completely bypass the financial aid office’s standard procedures for packaging awards for students. Effect: Pell eligible students were not awarded Pell in the summer 2023 term. Identification as repeat finding, if applicable: not applicable Recommendation: We recommend that the financial aid office perform checks before, during, and after the summer term to make sure all Pell-eligible students that are enrolled in the summer terms are packaged and disbursed Pell awards. Views of Responsible Officials and Planned Corrective Action: Management agrees with the finding. See corrective action plan.

Finding 2022-002: HEERF Student Aid Quarterly Public Reporting Federal Agency: Department of Education Program: Higher Education Emergency Relief Fund (?HEERF?), 84.425Q Criteria or Specific Requirement: Under 2 CFR Part 200, Appendix XI section 4.84.425-ESF, 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 (Quarterly Reporting Form), as applicable; and 3) the annual report. Effective May 13, 2021, student aid public reporting under Coronavirus Response and Relief Supplemental Appropriations Act (?CRRSAA?) and American Rescue Plan (?ARP?) requires that institutions publicly post certain information on their website. Institutions must publicly post their report 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). The following are identified as critical information for the Quarterly Public Reporting for Student Aid Portion: Item #3: The total amount of Emergency Financial Aid Grants distributed to students under the Coronavirus Aid, Relief, and Economic Security Act (?CARES?) (a)(1) subprogram and the CRRSAA and ARP (a)(1) subprograms as of the date of submission (i.e., as of the initial report and every calendar quarter thereafter). Item #4: The estimated total number of students at the institution that are eligible to receive Emergency Financial Aid Grants to Students under the CARES (a)(1) subprogram and the CRRSAA and ARP (a)(1) subprograms. Item #5: The total number of students who have received an Emergency Financial Aid Grant to students under the CARES (a)(1) subprogram and the CRRSAA and ARP (a)(1) subprograms. Item #6: The method(s) used by the institution to determine which students receive Emergency Financial Aid Grants and how much they would receive under the CARES (a)(1) subprogram and the CRRSAA and ARP (a)(1) subprograms. Condition/Context: During our audit testing over HEERF Student Aid Quarterly Public Reporting, we determined that the University did not provide the required level of detail to meet the reporting requirements for Item #6 above for the quarter ended December 31, 2021. On January 5, 2022, the University provided a quarterly student aid public update on its website to disclose the awarding of student grants under CRRSAA and ARP. While the University did state grants were awarded to enrolled students with priority given to those with exceptional need, the specific method used by the University to determine which students would receive the Emergency Financial Aid Grants and the amount each student would receive were not disclosed. Identification as a repeat finding, if applicable: This is not a repeat finding. Cause: The University?s interpretation of the level of detail required for Item #6 differed from what was required. Effect: The University was not in compliance with HEERF student aid quarterly public reporting requirements. Questioned Costs: None Recommendation: The University should revise its January 5, 2022, HEERF student aid quarterly public reporting for the quarter ending December 31, 2021, to provide the level of detail as required for Item #6. Views of Responsible Officials: The January 5, 2022 quarterly student aid public update posted by Bob Jones University provided general information regarding the Emergency Financial Aid Grants awarded under CRRSAA and ARP. It did not include detailed information regarding the method used to determine the awards or the amount awarded to each student. The University plans to update its website posting to meet the level of detail that is required for Item #6.

Finding 2021-002: NSLDS Transfer Monitoring Federal Agency: Department of Education Criteria or Specific Requirement: Under 34 CFR section 668.19 (b), "(1) If a student transfers from one institution to another institution during the same award year, the institution to which the student transfers must request from the Secretary, through NSLDS, updated information about that student so it can make the determinations required under paragraph (a) of this section; and (2) The institution may not make a disbursement to that student for seven days following its request, unless it receives the information from NSLDS in response to its request or obtains that information directly by accessing NSLDS, and the information it receives allows it to make that disbursement." Per the Student Financial Aid (SFA) Handbook for 2020-2021, Volume 1, Chapter 3 - NSLDS Financial Aid History, "When you initiate transfer monitoring for a student, NSLDS will alert you to significant award changes since you last received an ISIR or alert for her; this will continue for 30 to 120 days (depending on the monitoring duration you?ve established) after the enrollment begin date. If you start transfer monitoring before you receive ISIRs for a student, NSLDS will track changes in her financial aid history from the date of your request or a future monitoring begin date you choose. The regulations state that a school may not make a disbursement to the student for seven days following the transfer monitoring request to NSLDS, unless it receives an earlier response from NSLDS or checks the student?s current financial aid history by accessing NSLDS directly. Therefore, it?s usually a good idea to submit the student?s name to NSLDS for monitoring as soon as possible, even if he has not yet decided to enroll at your school." Condition/Context: During our audit testing over SFA Eligibility, we identified one student in our sample of 60 who transferred mid-year to the University that was disbursed Title IV aid prior to the 7-day NSLDS transfer monitoring waiting period requirement. Our sample was not intended to be and was not statistically valid. As a result of our testing, the University performed an internal review and identified an additional 8 mid-year transfer students who were disbursed Title IV aid before the 7-day waiting period requirement. Identification as a repeat finding, if applicable: This is not a repeat finding. Cause: A delay in the University informing the NSLDS of mid-year transfers occurred due to an attempt by the University to implement a new University student information management system for the Spring 2021 semester. This implementation was initiated mid-December. In January, before the semester began, a decision was made to reverse the implementation and return to the University?s prior system. Sending the Transfer Monitoring list to the NSLDS was delayed because of this process, and Title IV aid for students on this list was disbursed prior to the 7-day waiting period requirement as a result. Effect: The University was not in compliance with Department of Education 7-day hold disbursement requirements for Title IV Fund disbursements made to transfer students. Questioned Costs: None Recommendation: The University should implement procedures to ensure Title IV aid for transfer students is not disbursed prior to the 7-day NSLDS transfer waiting period requirement. Views of Responsible Officials: Due to an unsuccessful attempt to implement a new Student Information Software System University-wide, the NSLDS Transfer Monitoring list was submitted later than anticipated. As a result, disbursement of aid at the end of the drop/add period occurred within the 7-day wait period rather than after the wait period. When an alert was received following this disbursement of aid, the student was reviewed and adjustments to aid were made as required. A review of all students was made as a result of this finding, and it was confirmed that no student received aid for which they were not qualified.

Finding 2021-003: Special Tests and Provisions ? Disbursements: Financial Student Aid Credit Balance Payment Federal Agency: Department of Education Program: Student Financial Assistance Cluster Criteria or Specific Requirement: Under 34 CFR section 668.164(h), ?(1) A title IV, HEA [Higher Education Act] credit balance occurs whenever the amount of title IV, HEA program funds credited to a student's ledger account for a payment period exceeds the amount assessed the student for allowable charges associated with that payment period as provided under paragraph (c) of this section. (2) A title IV, HEA credit balance must be paid directly to the student or parent as soon as possible, but no later than ? (i) Fourteen (14) days after the balance occurred if the credit balance occurred after the first day of class of a payment period; or (ii) Fourteen (14) days after the first day of class of a payment period if the credit balance occurred on or before the first day of class of that payment? Per the Student Financial Aid (SFA) Handbook for 2020-2021, Volume 4, Chapter 1 ? Requesting and Managing FSA (Federal Student Aid) Funds, ?Notwithstanding any authorization obtained by a school from a student or parent to hold any Title IV credit balance funds, the school must pay: ? any remaining balance from loan funds by the end of the loan period; and ? other remaining FSA funds by the end of the last payment period in the award year for which they were awarded.? Condition/Context: In a sample of 15 FSA credit balances tested, we found one FSA credit balance that was not paid to the student within the 14-day regulatory requirement noted above. The student did not voluntarily authorize a credit balance hold. The sample was not intended to be and was not statistically valid. As a result of our testing, the University performed an internal review and identified no additional FSA credit balances that did not meet the 14-day payment regulatory requirement discussed above. The University's review was limited to students who elected to change their class schedule from on-campus to online only for the Fall of 2020 semester. Questioned Costs: None Effect: The University was not in compliance with the FSA credit balance requirements discussed above. The student did not receive the funds awarded to them in excess of their charges in a timely manner. Cause: As a result of the ongoing COVID-19 Pandemic, new incoming students who had originally registered for on-campus classes for the Fall of 2020 were offered the opportunity to change their schedule to online only. In the case of the FSA credit balance discussed above, the student had originally enrolled in on-campus classes for the semester. At that time, the student?s cost of attendance (COA) was in excess of their total Title IV aid awarded, and therefore, no credit balance was due. Once the student elected to change their class schedule from on-campus to online only for the semester, their COA was reduced and a credit balance resulted. Per the regulatory requirements noted above, the FSA credit balance was due to the student within 14 days. The credit balance remained on the student?s account until the Spring 2021 semester. The credit balance report, used by the University to capture and review all credit balances to determine if a refund is due to students, did not include this student as the student?s original COA was utilized as the basis of the credit balance calculation. Identification as a repeat finding, if applicable: Not a repeat finding. Recommendation: We recommend the University review its current process over the hold of student FSA credit balances for compliance with regulatory requirements. Views of Responsible Officials: The internal report, based on charges and aid posted to student accounts, is used to identify students who have credit balances based on FSA during the semester. At the beginning of the Fall 2020 semester, this report did not record the identified student as having a credit balance. The student also did not appear on any subsequent report. Between the first billing in July and the start of the semester, the student identified switched from a campus classroom enrollment to a special First Semester Online Program instituted for Fall 2020 due to COVID. This change in enrollment impacted the calculation as the report used the original charges rather than the updated charges to determine the credit balance. We cannot determine definitively what caused this anomaly in the report. All students who appear on the report are also reviewed individually to ensure that credit balances are disbursed as required. This student?s absence from the report resulted in a failure to disburse the amount in the required time frame.

Federal Agency: Department of Education Program: Student Financial Assistance Cluster (?SFA?) Criteria or Specific Requirement: Under the Pell grant and U.S. Department of Education (ED) loan programs, institutions must complete and return within 15 days the Enrollment Reporting roster file [formerly the Student Status Confirmation Report] placed in their Student Aid Internet Gateway (SAIG) (OMB No. 1845- 0002) mailboxes sent by ED via National Student Loan Data System (NSLDS). The institution must update for changes in student status, report the date the enrollment status was effective, enter the new anticipated completion date and submit the changes electronically through the batch method or the NSLDS website (Pell, 34 CFR section 690.83(b)(2); Direct Loan, 34 CFR section 685.309). A student?s enrollment status determines eligibility for in-school status, deferment, and grace periods, as well as for the payment of interest subsidies to Federal Direct Student Loan Program loan holders by USDE. Enrollment reporting in a timely and accurate manner is critical for effective management of the programs. Enrollment information must be reported within 30 days whenever attendance changes for students, unless a roster will be submitted within 60 days. These changes include reductions or increases in attendance levels, withdrawals, graduations, or approved leaves-of-absence. Condition/Context: During our audit testing over Return of Title IV Funds, we discovered one student out of our sample of nine who withdrew early during the Fall of 2020 and was not reported as withdrawn to the NSLDS. Our sample was not intended to be and was not statistically valid. As a result of our testing, the University conducted an internal review and identified one additional student who withdrew early during the Fall 2020 semester and was not reported as withdrawn to the NSLDS. The University?s review was limited to the Fall 2020 semester. Identification as a repeat finding, if applicable: This is a repeat finding from the immediate previous audit, finding 2020-002. Cause: This student was an early withdrawal at the beginning of the Fall 2020 semester prior to the submission of the first enrollment file to the National Student Clearinghouse (who then reports to the NSLDS). Because the student?s status in the University?s student system reflected that the student was not enrolled, the student was not included in the enrollment file sent to the Clearinghouse. The University established procedures beginning for the Spring 2021 semester to ensure early withdrawals would be properly reported to the NSLDS as a result of a prior year audit finding, 2020-002. Prior year audit finding 2020-002 was identified and communicated to the University as the Fall 2020 semester was near completion. As a result, new procedures that were put in place to prevent future errors beginning with the Spring 2021 semester, were not in place during the beginning of Fall 2020 semester to prevent the error from occurring. Effect: Student enrollment status changes were not submitted to the NSLDS within the required timeframe. Questioned Costs: None Recommendation: The University should implement procedures to ensure early withdrawals are reported to the NSLDS in the appropriate timeframe. Views of Responsible Officials: Based on the similar finding from Spring 2021, changes to our NSLDS reporting process were immediately implemented to ensure that all students who attended the first day of classes were reported as enrolled prior to the end of the drop/add period. These procedures were put in place and have been followed since January 2021. Based on the Spring 2021 finding, we did not, however, review all withdrawn students for Fall 2020 to be sure that they had been reported correctly. We have now updated enrollment records for all students from Fall 2020 who were reported as enrolled and withdrawn before the end of the Fall 2020 drop/add period.

Finding 2020-002: Enrollment Reporting Federal Agency: Department of Education Program: Student Financial Assistance Cluster (?SFA?) Criteria or Specific Requirement: Under the Pell grant and U.S. Department of Education (ED) loan programs, institutions must complete and return within 15 days the Enrollment Reporting roster file [formerly the Student Status Confirmation Report] placed in their Student Aid Internet Gateway (SAIG) (OMB No. 1845- 0002) mailboxes sent by ED via National Student Loan Data System (NSLDS). The institution must update for changes in student status, report the date the enrollment status was effective, enter the new anticipated completion date and submit the changes electronically through the batch method or the NSLDS website (Pell, 34 CFR section 690.83(b)(2); Direct Loan, 34 CFR section 685.309). A student?s enrollment status determines eligibility for in-school status, deferment, and grace periods, as well as for the payment of interest subsidies to Federal Direct Student Loan Program loan holders by USDE. Enrollment reporting in a timely and accurate manner is critical for effective management of the programs. Enrollment information must be reported within 30 days whenever attendance changes for students, unless a roster will be submitted within 60 days. These changes include reductions or increases in attendance levels, withdrawals, graduations, or approved leaves-of-absence. Identification as a repeat finding, if applicable: This is not a repeat finding. Condition/Context: During our audit testing over Return of Title IV Funds, we discovered one student out of our sample of nine who was not reported as withdrawn to the NSLDS. Our sample was not intended to be and was not statistically valid. Cause: This student was an early withdrawal at the beginning of the Fall semester prior to the submission of the first enrollment file to the National Student Clearinghouse (who then reports to the NSLDS). Because the student?s status in the University?s student system reflected that the student was not enrolled, the student was not included in the enrollment file sent to the Clearinghouse. Effect: Student enrollment status changes were not submitted to the NSLDS within the required timeframe. Questioned Costs: None Recommendation: The University should implement procedures to ensure early withdrawals are reported to the NSLDS in the appropriate timeframe. Views of Responsible Officials: It was confirmed that because the student had withdrawn prior to the creation of the first enrollment file, no record of his enrollment was included in the first enrollment file submitted to National Student Clearinghouse. To ensure that all student records are included in the first file, the creation of that file must occur on the first day of classes and sent to National Student Clearinghouse. The Research Specialist, who creates the file, has established a calendar notification for the first day of each term as a reminder that this task be completed as planned.

Finding 2020-003: Reporting ? Fiscal Operations Report and Application to Participate Federal Agency: Department of Education Program: Student Financial Assistance Cluster Criteria or Specific Requirement: According to 34 CFR 673.3, an institution is required to file an application to participate in the Federal Perkins Loan (FPL), Federal Work-Study (FWS), and Federal Supplemental Education Opportunity Grant (FSEOG) programs, which includes all information required by the Department of Education. In addition, Uniform Guidance in 2 CFR 200.303, requires nonfederal entities receiving federal awards to establish and maintain effective internal control designed to reasonably ensure compliance with federal laws, regulations and program compliance requirements. Effective internal controls should include procedures to ensure amounts reported in the FISAP are adequately supported. Condition/Context: The FISAP is submitted annually to report award expenditures for the previous year and to apply to participate in the following year. During our testing of the FISAP for the program award year ended June 30, 2019, we noted there was a lack of controls over the review process for the FISAP prior to submission, resulting in certain costs and enrollment numbers being reported inaccurately as noted in the table below. See Schedule of Findings and Questioned Costs for chart/table. Identification as a repeat finding, if applicable: This is not a repeat finding. Cause: The enrollment number errors occurred due to inadvertently double counting certain students, and other errors occurred due to keying errors which were not detected when compiling the report. Due to the small size of the financial aid department, the FISAP is prepared by one person with no review process in place prior to submission of the FISAP. Effect: Although this finding has no current year impact on funding, errors in the amounts reported on the FISAP result in noncompliance and inhibits the ability of the Department of Education to properly monitor and evaluate the performance of the campus-based programs. The lack of internal controls over the FISAP preparation and review process could result in misstated line items that do impact the amount of funding awarded to the University. Questioned Costs: None Recommendation: We recommend that procedures be implemented and internal controls strengthened to ensure that the information on the FISAP is accurately reported in accordance with the FISAP instructions and agrees to the University?s records. Views of Responsible Officials: To date, the Financial Aid Director has been responsible for the completion of the annual Fiscal Operations Report and Application to Participate (FISAP). Appropriate data is entered into the online application form by the FA Director who uses the online review process to confirm that the data has been entered correctly. The process has not, however, included a review by another party to ensure that there have been no clerical errors when the numbers are entered into the application. Beginning with the 20-21 FISAP, a review will be done by the Assistant Director of Financial Aid to be sure that all numbers entered match the data provided by other departments. Prior to the submission of the FISAP each year, the data will be checked for accuracy by the Assistant Director of Financial Aid.

Finding 2019-001 Overaward of Subsidized Loans Federal Agency: Department of Education Program: Student Financial Assistance Cluster (?SFA?) Criteria or Specific Requirement: The determination of SFA award amounts is based on financial need as defined by Section 471 of the Higher Education Act (?HEA?). Financial need is generally defined as the student?s cost of attendance (?COA?) minus expected family contribution (?EFC?) minus estimated financial assistance (?EFA?) not received under Title IV. The student?s EFC is the amount a student and the student?s family may be reasonably expected to contribute toward the student?s postsecondary education for the academic year and is calculated by the central processor and reported on the student?s institutional student information record (?ISIR?) provided to the institution. The student?s EFA includes grants, scholarships, private scholarships, all other federal need-based aid and similar programs used to cover postsecondary educational expenses. All awards must be coordinated among the various programs and with other Federal and non-Federal aid (need and non-need based aid) to ensure that total aid is not awarded in excess of the student?s cost of attendance. Title IV need-based aid, including subsidized loans, cannot be awarded in excess of remaining need as calculated using the HEA formula (34 CFR 685.301). According to 2 CFR Part 200, Appendix XI Office of Management and Budget?s Compliance Supplement updated August 2019: In determining loan amounts for subsidized Stafford loans, the financial aid administrator subtracts from the COA, the EFC and the estimated financial assistance (?EFA?) for the period of enrollment that the student (or parent on behalf of the student) will receive from Federal, State, institutional or other sources. Unsubsidized Stafford loans, PLUS loans, loans made by a school to assist the student, and State-sponsored loans may be used to substitute for EFC (34 CFR 685.102 and 685.200(d)). According to 34 C.F.R. Sections 685.203(j): Maximum loan amounts. In no case may a Direct Subsidized, Direct Unsubsidized, or Direct PLUS Loan amount exceed the student?s estimated cost of attendance for the period of enrollment for which the loan is intended, less ? (1) The student?s estimated financial assistance for that period; and (2) In the case of a Direct Subsidized Loan, the borrower?s expected family contribution for that period.Condition/Context: In July 2019, the University?s Financial Aid Office (?FAO?) discovered an issue regarding the overawarding of Direct Subsidized loan funds dating back at least four years. The FAO awarded students Direct Subsidized loans based on students? original calculated need, but did not recalculate the total amount of Direct Subsidized loans students were actually eligible for after total estimated financial assistance was awarded. After self-reporting this finding to the Department of Education in August 2019, the FAO reviewed all student files for potential overawards occurring during the 2018-19 award year. It was determined that the University never awarded Title IV funds exceeding a student?s COA. During our audit procedures, we discovered out of a sample of 61 students, five students received subsidized loan money in excess of their remaining financial need after all other EFA was awarded. Our sample was not, and was not intended to be, statistically valid. Cause: The overawards were the result of a misunderstanding between federal training, software guidance, and institutional packaging philosophy. FAO personnel interpreted financial aid guidance to mean that subsidized loans could be awarded based on original need but never over cost of attendance. When notification of additional aid was received from the Financial Services office, loan amounts were not adjusted, because at no point did the awards exceed cost of attendance or original need. The overawards were not the result of negligence on the part of the FAO, but the result of a lack of clarification and emphasis in training concerning what funds could count toward EFC and which must count toward need. Effect: The University overawarded Direct Subsidized loans that exceeded certain students? remaining financial need after all other aid had been subtracted from need. The University did not allow any students to over-borrow subsidized loans based on annual limits, aggregate limits or eligibility. Based on the University?s review of all student files for potential overawards during the 2018-19 award year as discussed above, the University overawarded part or all of a subsidized loan to 80 students resulting in total overawards of Direct Subsidized loans of $184,177. Questioned Costs: $184,177 Recommendation: The University should implement revised training and policies to ensure all FAO personnel understand the federal guidelines for calculating the student?s financial need after total estimated financial assistance has been awarded. Additionally, the University should implement procedures to ensure the University?s packaging policy and packaging formulas used in the University?s packaging software are reviewed for compliance with federal guidelines.Views of Responsible Officials: At the time the issue was discovered, all student files were reviewed for possible overawards. Because the academic year was closed, and the Direct Loan Closeout had been submitted, no adjustments were attempted. All awards for the upcoming 2019-2020 academic year were meticulously reviewed to ensure that no overawards had been made. The following corrective action plan was put in place to ensure that this issue would not be repeated. We have instituted safeguards to prevent this from happening for the 2019?2020 academic year and forward. We have checked our packaging formulas to ensure that this error will not continue and have written into our policies a much clearer explanation of the need calculation and how that impacts the need-based federal aid awards. Clear definitions for the following are now included in our Policies and Procedures manual: overawards, Cost of Attendance, awards over need and financial need calculation. The following process is now in place to prevent future overawards: 1) All scholarship checks received by Financial Services will be reported to the Financial Aid Office for inclusion in a student?s financial aid package. This includes aid received from organizations such as churches and community groups. 2) Federal loans are packaged after all other known aid at the time the financial aid award information is provided to the students. As additional aid is received, adjustments will be made to the financial aid package in the following order: a) Subsidized Loan ? i) if not disbursed, amount will be adjusted or loan will be canceled to accommodate additional aid; ii) if loan has been disbursed for Fall semester, the Spring amount will be reduced or canceled. iii) Loan funds that must be reduced or canceled from the subsidized loan may be offered to the student as unsubsidized loans as long as the total aid does not exceed Cost of Attendance. b) FWS ? If no subsidized loan has been requested and FWS is the only federal need-based aid, wages may be reduced to resolve an overaward. c) FSEOG ? If FSEOG is the only federal need-based aid and the total EFA exceeds financial need, the FSEOG award will be reduced or canceled. Office procedure: Weekly reports will be run to ensure that no student has exceeded need or cost of attendance.

Finding 2019-002 Approval of Time Sheets Federal Agency: Department of Education Program: CFDA 84.033, Federal Work Study Criteria or Specific Requirement: Federal work study regulations include, among other requirements, provisions that the institution must establish and maintain program and fiscal records that include a certification by the student's supervisor, an official of the institution or off-campus agency, that each student has worked and earned the amount being paid. The certification must include or be supported by, for students paid on an hourly basis, a time record showing the hours each student worked in clock time sequence, or the total hours worked per day (34 CFR 675.19). Condition/Context: Under the University?s established payroll policies regarding entry and approval of a student worker?s time, the following process should be followed for each pay period: 1) The student worker enters his time into the University time entry system each day as he clocks in and out; 2) The student officially submits his time for approval in the time entry system; 3) The supervisor reviews and approves the student?s submitted time; and 4) The payroll department processes the approved time and issues the student?s paycheck. In our testing of students receiving aid under Federal Work Study, we found that this process was not being followed for many of the timesheets selected in our testing. For 4 of the 5 students selected in our testing, we determined that one or both of the following circumstances occurred: 1) The student keyed his time in, but it was not officially submitted for approval to the supervisor (and thus was never approved); however, the payroll department still processed the student?s time, and the student was paid for the time entered. 2) The student did submit his time to the supervisor for approval, but the supervisor did not approve the student?s time; however, the payroll department still processed the student?s time, and the student was paid for the time entered. Our samples were not, and were not intended to be, statistically valid. Cause: Although the payroll department sends out automatic email reminders to both students and supervisors to review and/or approve timesheets, students and supervisors sometimes do not act on the reminders. In each of these cases noted above, the payroll timesheet clerk did not follow up with the student and/or supervisor to ensure they reviewed and submitted the timesheet as required. The payroll department submitted the timesheet for payment without student and/or supervisor confirmation.Effect: Student workers were paid for time that was never approved by a supervisor. This could potentially lead to a student entering time that they did not work and being paid for time not worked. The Student Financial Aid Department did review payroll reports consistently throughout the year to ensure that no student was paid more than the amount of FWS funds originally awarded. Questioned Costs: $1,172 Recommendation: The University should implement policies and procedures to ensure student workers cannot be paid without supervisory approval of their timesheets. Views of Responsible Officials: It was confirmed that there were timesheets that were not reviewed and submitted by the student and/or the supervisor. Although all time punches are done electronically and cannot be altered by the student, it is still the responsibility of the student and the supervisor to confirm that the time entered is correct. The following corrective action plan has been put in place to ensure that all timesheets are reviewed and submitted by the student and the supervisor for all pay periods. Corrective Action Plan for Approval of Time Sheets The payroll department will continue to send out automatic email reminders to review and submit time. This will continue to be required by both the student and the supervisor. In addition to this process, the following steps will be taken to ensure that all time sheets are reviewed and submitted by student and supervisor. 1) The payroll timesheet clerk will send a list of FWS students to all work supervisors with instructions regarding the review and submission of timesheets by both the student and the supervisor. 2) All time is submitted electronically so students cannot alter their own time. They must submit a request for adjustments to time based on a missed punch. Only the supervisor or his representative is authorized to make these entries. 3) At the end of each pay period following the automatic reminders regarding review and submission, the payroll timesheet clerk will confirm that FWS students and their supervisors have reviewed and submitted their time sheets. If they have not, the timesheet clerk will contact the student and/or supervisor requesting that they review and submit as required. Because there is a two-week delay between submission of timesheets and actual pay dates, there should be ample time for this follow-up and submission to occur before actual payroll is processed for that pay period. 4) At the time the payroll is processed but before FWS funds are drawn down, the Financial Aid Administrator responsible for FWS will confirm with the payroll timesheet clerk that all FWS timesheets have been reviewed and submitted by both the student and the supervisor for that pay period.