Southwestern Oklahoma State UniversityHigher Education

Federal Program – Student Financial Assistance Cluster – Assistance Listing Numbers 84.007, Federal Supplemental Education Opportunity Grants and 84.268, Federal Direct Student Loans – U.S. Department of Education Program Year 2024–2025 Criteria or Specific Requirement – Cash Management – 34 CFR §668 Subpart K Condition – The University maintained $163,740 of excess cash for the Federal Supplemental Educational Opportunity Grants and Federal Direct Student Loans programs for approximately two months (July 25, 2024 through September 19, 2024), which exceeds the seven-day excess cash tolerance window outlined in 34 CFR §668.166. Questioned Costs – N/A Context – Out of a population of 23 cash drawdowns during fiscal year 2025, three were selected for testing. One of these drawdowns was not compliant with the cash management requirements. Our sample was not, and was not intended to be, statistically valid. Effect – The University did not appropriately return excess cash to the U.S. Department of Education and, therefore, was out of compliance with excess cash compliance requirements. Cause – The University did not have appropriate controls in place to ensure compliance with relevant requirements. Identification as a Repeat Finding – N/A Recommendation – The University should ensure the design and appropriate operating effectiveness of controls surrounding cash management compliance to ensure that all cash drawdowns are made and distributed to students in accordance with the relevant compliance requirements. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. See attached corrective action plan.

Federal Program – Student Financial Assistance Cluster – Assistance Listing Numbers 84.063, Federal Pell Grant Program and 84.268, Federal Direct Student Loans – U.S. Department of Education Program Year 2024–2025 Criteria or Specific Requirement – Special Tests and Provisions – NSLDS Reporting – 34 CFR §690.83 and 34 CFR §685.309 Condition – One student status change was not reported timely, and inaccurate program-level record data was reported for four students. Questioned Costs – N/A Context – Out of a population of 2,595 students with status changes during the Fall and Spring semesters of the 2025 aid year, 25 were selected for testing. Of those students, one had a status change that was not reported timely, and four had program-level record data that was not appropriately reported. Our sample was not, and was not intended to be, statistically valid. Effect – The University reported inaccurate information or failed to report changes within the required time frame and, as such, the U.S. Department of Education was not provided accurate and timely information. Cause – The University did not have appropriate controls in place to ensure timely and accurate reporting. Identification as a Repeat Finding – See 2024-003 Recommendation – The University should ensure the design and appropriate operating effectiveness of controls surrounding enrollment reporting to ensure that all status changes are reported timely and that all program-level record data is reported accurately. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. See attached corrective action plan.

Federal Program – Student Financial Assistance Cluster – Assistance Listing Numbers 84.063, Federal Pell Grant Program and 84.268, Federal Direct Student Loans – U.S. Department of Education Program Year 2024–2025 Criteria or Specific Requirement – Special Tests and Provisions – Return of Title IV Funds – 34 CFR §668.22 Condition – The incorrect number of days for spring break was used in the Spring 2025 Return of Title IV calculations, causing amounts due back to the U.S. Department of Education to not be properly identified and returned. Questioned Costs – $125.30 – $48.02 for 84.063, Federal Pell Grant Program and $77.28 for 84.268, Federal Direct Student Loans Context – Out of a population of 118 students who withdrew during fiscal year 2025, 13 were selected for testing. Of the 13 tested, two were identified to have errors in their Return of Title IV calculations, which were caused by the inappropriate number of days used for spring break. Management further investigated the impact on other students who withdrew in Spring 2025 and an additional nine students were identified as being impacted by this error. Effect – The University allowed students to maintain a total of $125.30 of Title IV funds that should have been returned to the U.S. Department of Education. Cause – The University did not have appropriate controls in place to ensure the accuracy of disbursements and Return of Title IV calculations. Identification as a Repeat Finding – N/A Recommendation – The University should ensure the design and appropriate operating effectiveness of controls surrounding Return of Title IV Funds to ensure that all returns of funds are appropriately calculated and processed. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. See attached corrective action plan.

Federal Program – Student Financial Assistance Cluster – Assistance Listing Number 84.268, Federal Direct Student Loans – U.S. Department of Education Program Year 2024–2025 Criteria or Specific Requirement – Eligibility – 34 CFR §668.34 Condition – One student who received a Direct Unsubsidized Loan for the Spring 2025 semester did not meet the maximum timeframe element of the satisfactory academic progress requirements as of the beginning of that semester. Questioned Costs – $2,919 Context – Out of a population of 2,868 students who received Pell and/or Direct Loans in fiscal year 2025, 25 students were selected for testing. Of the 25 students tested, one was identified as not meeting the maximum timeframe satisfactory academic progress requirement and, therefore, was ineligible to receive the funding received for the Spring 2025 term. Our sample was not, and was not intended to be, statistically valid. Effect – The University disbursed $2,919 of Title IV funds to a student who was not eligible for this funding. Cause – The University did not have appropriate controls in place to ensure satisfactory academic progress requirements were properly met prior to disbursing funding to students. Identification as a Repeat Finding – N/A Recommendation – The University should ensure the design and appropriate operating effectiveness of controls surrounding the review of satisfactory academic progress prior to the disbursement of funds to students. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. See attached corrective action plan.

Federal Program – Student Financial Assistance Cluster – Assistance Listing Number 84.063 – U.S. Department of Education Program Year 2024–2025 Criteria or Specific Requirement – Eligibility – 34 CFR §690, Subpart F Condition – Five students received a Pell Grant who were not eligible to receive this funding, and two students did not receive a Pell Grant or the full amount of Pell Grant funding they were eligible to receive during the 2024–2025 academic year. Questioned Costs – $3,996 Context – Out of a population of 2,868 students who received Pell and/or Direct Loans in fiscal year 2025, 25 students were selected for testing. Of the 25 students tested, two were identified as not having received the full amount of Pell funding for which they were eligible. In addition, in testing return of Title IV funds, one student was noted to have received more Pell funding than they were eligible for, and upon further review, management identified an additional four students who received Pell funding who should not have. Our sample was not, and was not intended to be, statistically valid. Effect – The University disbursed $3,996 of Title IV funds to students who were not eligible for this funding, and two students did not receive the full amount of funding for which they were eligible. Cause – The University did not have appropriate controls in place to ensure Pell calculations were accurate prior to disbursing funding to students. Identification as a Repeat Finding – N/A Recommendation – The University should ensure the design and appropriate operating effectiveness of controls surrounding the review of Pell calculations prior to the disbursement of funds to students. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. See attached corrective action plan.

Federal Program – Student Financial Assistance Cluster – Assistance Listing Numbers 84.063, 84.007, 84.033, and 84.268 – U.S. Department of Education Program Year 2023-2024 Criteria or Specific Requirement – Gramm-Leach-Bliley Act (GLBA) – Student Information Security – 16 CFR §314 Condition – The University’s written information security program did not adequately include three of the six required minimum elements.Questioned Costs – N/A Context – Out of the six elements that are required to be included in the written information security program, all six were tested. Of these elements, three were not adequately included in the written program. Effect – The University failed to include the minimum elements in its written information security program to meet GLBA requirements, as agreed to within its Program Participation Agreement with the Department of Education (ED). This could potentially result in the failure to secure student financial aid information. Cause – The University did not have appropriate controls in place to ensure compliance with relevant requirements. Identification as a Repeat Finding, if Applicable – N/A Recommendation – The University should ensure the design and appropriate operating effectiveness of controls surrounding GLBA compliance to ensure that all required elements are included in the information security program. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the finding. Policies are being reviewed and approved to add the documentation and testing that was not covered in previous policies.

Federal Program – Student Financial Assistance Cluster – Assistance Listing Numbers 84.063 and 84.268 – U.S. Department of Education Program Year 2023-2024 Criteria or Specific Requirement – Special Tests and Provision – Enrollment Reporting – 34 CFR §690.83 and 34 CFR §685.309 Condition – Three address changes and one student status change were not reported timely and one student had incorrect enrollment information. Questioned Costs – N/A Context – Out of a population of 1,393 students with status changes during the Spring and Fall semesters of the 2024 aid year, 25 were selected for testing. Of those students, three had status or address changes during the period that were not reported timely, and one had both an address change that was not reported timely and the incorrect CIP code reported. Our sample was not, and was not intended to be, statistically valid. Effect – The University reported inaccurate information or failed to report changes within the required time frame and, as such, ED was not provided accurate and timely information. Cause – The University did not have appropriate controls in place to ensure timely and accurate reporting. Identification as a Repeat Finding, if Applicable – N/A Recommendation – The University should ensure the design and appropriate operating effectiveness of controls surrounding enrollment reporting to ensure that all status and address changes are reported timely and that all enrollment information is reported accurately. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the findings and has put the following in place. The Registrar will report enrollment changes during the summer semesters. The Registrar will also send the Director of Student Financial Services notifications when enrollment changes are submitted through the National Student Clearinghouse.

Federal Program – Student Financial Assistance Cluster – Assistance Listing Numbers 84.063, 84.007 and 84.268 – U.S. Department of Education Program Year 2023-2024 Criteria or Specific Requirement – 2 CFR 200.516(a), Paragraph 13.39(e) – Known or Likely Fraud Affecting a Federal Award Condition – Financial aid funds were provided to six fraudulent student accounts; the issue was identified by the school and reported to the U.S. Department of Education. Questioned Costs – $54,112 Context – During a review of the awards population for fiscal year 2024, the University identified six accounts that had duplicate contact and bank information. After further investigation, these accounts were determined to be fraudulently created. In total, $54,112 in funds were paid out. The school worked with the U.S. Department of Education’s CyberIncident Division to inform the Department of the fraudulent activity. Effect – The University allowed refunds to be made from financial aid awarded to fraudulent student accounts resulting in questioned costs. Cause – The University had detective rather than preventative controls in place regarding distributions of financial aid funds to repeating accounts or individuals. Identification as a Repeat Finding, if Applicable – N/A Recommendation – The University should implement procedures to identify duplicate contact and bank information across student accounts automatically or a process to check for duplicates prior to financial aid distribution. Views of Responsible Officials and Planned Corrective Actions – Management agrees with the findings and has put the following in place. The Bursar will work with ITS to perform a scan of all students’ accounts for duplicate contact and banking information. If duplicates are found, students will be notified and accounts frozen until students are identified. This will be critical before refund checks are dispersed to students every semester. The amount of $54,112 will be paid back with the next draw down before February 28, 2025.