Oklahoma Wesleyan University

FINDING 2024-001 – Notification of Loan Disbursements Federal Agency: U.S. Department of Education; Office of Federal Student Aid Pass through Entity: Not applicable Program Name: Federal Direct Student Loan Program ALN and Program Expenditures: 84.268 ($5,702,366) Award Number: P268K242030 Federal Award Year: July 1, 2023 to June 30, 2024 Questioned Costs: N/A Condition Found: The University could not provide documentation that the required loan disbursement notifications were made to the student at the time disbursement for the forty-one students who received Federal Direct Student Loans in our sample. This represented the entire population of students who received Federal Direct Student Loans in our sample. Criteria: Since the University uses active acceptance, the University is required to report to the students in writing the anticipated date and amount of the disbursement, the student’s or parents’ right to cancel all or a part of the loan and have the loan proceeds returned to the Department of Education, and procedures and deadlines by which the student or parent must notify the institution that want to cancel the loan no earlier than thirty days before the disbursement is made or thirty days after. Cause: As part of the change to a new Financial Aid Management Software, the University was not made aware that Loan Disbursement Notifications were not automatically sent at the time of disbursement. This was the case with the prior software system. As such, the University was unaware that Loan Disbursement Notifications were not sent to students when disbursing loans during the award year. Possible Asserted Effect: The students were not aware of the option to cancel a Federal Direct Loan disbursement and the procedures and deadlines for canceling the loan disbursement. Repeat Finding: There was not a similar finding in the prior year. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: The University discovered the software error in July 2024. The software error has been corrected. Loan disbursement notifications are automatically being sent to students for the Fall 2024 disbursements. We recommend continually checking the software systems to verify the loan disbursement notifications are being sent. Documentation of the notifications should be kept on file. Management Response: Management agrees with the auditors’ finding and their recommendation. The Financial Aid Office discovered the error in July 2024 before the audit began. Up to that point, the Financial Aid Office believed the software was automatically sending loan disbursement notification emails. The Financial Aid Office worked with the information technology staff to correct the software error. Loan disbursement notification emails are being sent timely as of August 2024.

FINDING 2024-001 – Notification of Loan Disbursements Program Name: Federal Direct Student Loan Program ALN and Program Expenditures: 84.268 ($5,702,366) Award Number: P268K242030 Federal Award Year: July 1, 2023 to June 30, 2024 Questioned Costs: N/A Condition Found: The University could not provide documentation that the required loan disbursement notifications were made to the student at the time disbursement for the forty-one students who received Federal Direct Student Loans in our sample. This represented the entire population of students who received Federal Direct Student Loans in our sample. Corrective Action Plan: Management agrees with the auditors’ finding and their recommendation. The Financial Aid Office discovered the error in July 2024 before the audit began. Up to that point, the Financial Aid Office believed the software was automatically sending loan disbursement notification emails. The Financial Aid Office worked with the information technology staff to correct the software error. Loan disbursement notification emails are being sent timely as of August 2024. Anticipated Completion Date: The corrective action was completed in August 2024. Contact Person Shala LaTorraca, Director of Financial Aid 918-335-6260

Federal Agency: U.S. Department of Education; Office of Federal Student Aid Pass through Entity: Not applicable Program Name: Federal Direct Student Loan Program and Federal Work Study Program ALN and Program Expenditures: 84.268 ($6,424,016) and 84.033 ($ 138,030) Award Number: P268K232030 and P033A223400 Federal Award Year: July 1, 2022 to June 30, 2023 Questioned Costs: $1,145 (ALN 84.033) Condition Found: Need-based Title IV financial aid exceeded students’ eligibility for four of the sixty students in our sample. Criteria: Need-based Title IV financial aid is limited to a student’s cost of attendance less their expected family contribution and other Non-title IV financial aid received. Cause: Need-based Title IV financial aid was not limited to the calculation listed in the criteria section. Possible Asserted Effect: The effect for each student was as follows: The first student received $2,000 of subsidized federal direct loans that the student was ineligible to receive. The second student received $382 of subsidized federal direct loans that the student was ineligible to receive. The third student received $1,649 of subsidized federal direct loans that the student was ineligible to receive. The fourth student received $1,145 of federal work study that the student was ineligible to receive. Repeat Finding: There was not a similar finding in the prior year. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: The recommendation for each student is as follows: For the first student, $2,000 of subsidized federal direct loans should be reallocated to unsubsidized federal direct loans. For the second student, $382 of subsidized federal direct loans should be reallocated to unsubsidized federal direct loans. For the third student, $1,649 of subsidized federal direct loans should be reallocated to unsubsidized federal direct loans. For the fourth student, $1,145 of federal work study funds should be returned to the Department of Education. The funds should be replaced with institutional funds. Management Response: The Financial Aid Director recalculated the “need” for each student in question. The Financial Aid Director agreed with the auditor’s calculations. The following corrections were made on August 8, 2023: For the first student, $2,000 of subsidized federal direct loans were reallocated to unsubsidized federal direct loans. For the second student, $382 of subsidized federal direct loans were reallocated to unsubsidized federal direct loans. For the third student, $1,649 of subsidized federal direct loans were reallocated to unsubsidized federal direct loans. For the fourth student, $1,145 of federal work study funds were returned to the Department of Education. The student had already worked for the University and earned the funds in question. He was treated as a regular employee of the University and paid with institutional funds instead of federal work study funds.

The Financial Aid Director recalculated the “need” for each student in question. The Financial Aid Director agreed with the auditor’s calculations. The following corrections were made on August 8, 2023: For the first student, $2,000 of subsidized federal direct loans were reallocated to unsubsidized federal direct loans. For the second student, $382 of subsidized federal direct loans were reallocated to unsubsidized federal direct loans. For the third student, $1,649 of subsidized federal direct loans were reallocated to unsubsidized federal direct loans. For the fourth student, $1,145 of federal work study funds were returned to the Department of Education. The student had already worked for the University and earned the funds in question. He was treated as a regular employee of the University and paid with institutional funds instead of federal work study funds. Anticipated Completion Date: The corrective action was completed on August 8, 2023. Contact Person Shala LaTorraca, Director of Financial Aid 918-335-6260

FINDING 2022-002 ? Federal Direct Loan Exit Interview Federal Agency: U.S. Department of Education; Office of Federal Student Aid Pass through Entity: Not applicable Program Name: Federal Direct Student Loan Program ALN and Program Expenditures: 84.268 ($6,877,168) Award Number: P268K222030 Federal Award Year: July 1, 2021 to June 30, 2022 Questioned Costs: $-0- Condition Found: A Federal Direct Loan exit interview was not completed by nor were instructions sent to the student on how to complete an exit interview when the student graduated from the University. This omission occurred for one of the sixty students in our sample. Criteria: Federal Direct Loan recipients must receive exit interview counseling. If in-person counseling is not completed, the University may mail written counseling materials to the student?s last known address. Cause: Federal Direct Loan exit counseling was not provided when the student withdrew from the University at the end of the spring semester. This was an oversight on the part of the financial aid office staff. Possible Asserted Effect: The student was not aware of his or her responsibilities related to the Federal Direct Loan program, including repayment options and when repayment on the loan begins. Repeat Finding: There was a similar finding in the prior year related to sending a TEACH Grant exit interview. See prior year Finding 2021-002. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: Federal Direct Loan exit interview information should be sent to the student in question. Procedures should be improved to ensure that Federal Direct exit interviews are completed or information is sent to a student when a student ceases attendance at the University. Management Response: Federal Direct Loan exit interview information was sent to the student in question on August 3, 2022. Procedures will be improved to ensure Federal Direct Loan exit interviews are completed or information is sent to students when they cease enrollment at the University.

FINDING 2022-002 ? Federal Direct Loan Exit Interview Condition Found: A Federal Direct Loan exit interview was not completed by nor were instructions sent to the student on how to complete an exit interview when the student graduated from the University. This omission occurred for one of the sixty students in our sample. Corrective Action Plan: Federal Direct Loan exit interview information was sent to the student in question on August 3, 2022. Procedures will be improved to ensure Federal Direct Loan exit interviews are completed or information is sent to students when they cease enrollment at the University. Anticipated Completion Date: The corrective action was completed on August 3, 2022. Contact Person Tirzah Knight, Director of Financial Aid 918-335-6252

2021-002

FINDING 2022-003 ? Subsidized Loan Allocation Federal Agency: U.S. Department of Education; Office of Federal Student Aid Pass through Entity: Not applicable Program Name: Federal Direct Student Loan Program ALN and Program Expenditures: 84.268 ($6,877,168) Award Number: P268K222030 Federal Award Year: July 1, 2021 to June 30, 2022 Questioned Costs: $-0- Condition Found: The amount of Subsidized and Unsubsidized Federal Direct Loans awarded was incorrect for one of the fifty-four students in our sample that received Federal Direct Loans. Criteria: The annual subsidized Federal Direct Loan limit is $3,500 for freshmen, $4,500 for sophomores, and $5,500 for juniors and seniors. Cause: The student in question declined to participate in the Federal Work Study program. When this occurred, unsubsidized loans were awarded later to the student without reviewing the student?s remaining subsidized loan eligibility. Possible Asserted Effect: The student was eligible for an additional $1,407 of subsidized federal direct loans. However, the student received a $1,407 unsubsidized loan. Repeat Finding: There was not a similar finding the prior year. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: $1,407 of unsubsidized loan funds should be reclassified to subsidized loans. Procedures should be improved to ensure that subsidized loan eligibility is reviewed before awarding unsubsidized loans. Management Response: The Financial Aid Director updated reallocated $1,407 of unsubsidized loan funds as subsidized loan funds on August 3, 2022. Procedures will be improved to ensure that subsidized loan eligibility is reviewed before awarding unsubsidized loans.

FINDING 2022-003 ? Subsidized Loan Allocation Condition Found: The amount of Subsidized and Unsubsidized Federal Direct Loans awarded was incorrect for one of the fifty-four students in our sample that received Federal Direct Loans. Corrective Action Plan: The Financial Aid Director updated reallocated $1,407 of unsubsidized loan funds as subsidized loan funds on August 3, 2022. Procedures will be improved to ensure that subsidized loan eligibility is reviewed before awarding unsubsidized loans. Anticipated Completion Date: The corrective action was completed on August 3, 2022. Contact Person Tirzah Knight, Director of Financial Aid 918-335-6252

FINDING 2021-002 ? TEACH Exit Interview Federal Agency: U.S. Department of Education; Office of Federal Student Aid Pass through Entity: Not applicable Program Name: TEACH Grant CFDA# and Program Expenditures: 84.379 ($60,248) Award Number: P379T212030 Federal Award Year: July 1, 2020 to June 30, 2021 Questioned Costs: $-0- Condition Found: A TEACH Grant exit interview was not completed by nor were instructions sent to the student on how to complete an exit interview when the student graduated from the University. This omission occurred for one of the sixty students in our sample. Criteria: TEACH grant recipients must receive exit interview counseling. If in-person counseling is not completed, the University may mail written counseling materials to the student?s last known address. Cause: Federal Direct Loan exit counseling was provided, but the financial aid office did not offer TEACH grant exit counseling to the student. This was just an oversite on the part of the financial aid office staff. Possible Asserted Effect: The student was not aware of their responsibilities related to the TEACH Grant program, including what situations would cause the grant to revert to an unsubsidized Federal Direct Loan. Repeat Finding: There was not a similar finding in the prior year. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: TEACH Grant exit interview information should be sent to the student in question. Procedures should be improved to ensure that TEACH Grant exit interviews are completed or information is sent to a student when a student ceases attendance at the University. Management Response: TEACH Grant exit interview information was sent to the student in question in August 2021. Procedures will be improved to ensure TEACH Grant exit interviews are completed or information is sent to a student when they cease enrollment at the University.

FINDING 2021-002 ? TEACH Grant Exit Interview Condition Found: A TEACH Grant exit interview was not completed by nor were instructions sent to the student on how to complete an exit interview when the student graduated from the University. This omission occurred for one of the sixty students in our sample. Corrective Action Plan: TEACH Grant exit interview information was sent to the student in question in August 2021. Procedures will be improved to ensure TEACH Grant exit interviews are completed or information is sent to a student when they cease enrollment at the University. Anticipated Completion Date: The corrective action was completed in August 2021. Contact Person Tirzah Knight, Director of Financial Aid 918-335-6252

FINDING 2020-002 ? R2T4 Calculation Federal Agency: U.S. Department of Education; Office of Federal Student Aid Pass through Entity: Not applicable Program Name: Federal Pell Grant Program CFDA# and Program Expenditures: 84.063 ($1,629,263) Award Number: P063P192030 Federal Award Year: July 1, 2019 to June 30, 2020 Questioned Costs: $583 (84.063 Federal Pell Grant Program, net) Condition Found: A student was administratively withdrawn from the University and the required R2T4 was not completed. This occurred for one of the sixty students in our sample. Criteria: A R2T4 calculation is required when a student withdrawals from all courses during an enrollment period. Cause: The student was administratively withdrawn from the University due to academic integrity issues. This information was not provided to the student financial aid office. Possible Asserted Effect: An R2T4 was not completed to determine if the student was eligible for the full amount of federal financial aid disbursed. $583 of Federal Pell Grant funds is due to the Department of Education. Repeat Finding: See Finding 2019-001 for a similar finding in the prior year. Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: The Student Financial Director should complete the R2T4 calculation for the student in question. Based on the R2T4 calculation, the student received $583 of Federal Pell Grant funds that the student was ineligible to receive. $583 should be returned to the Department of Education. Management Response: The Student Financial Aid Director confirmed the date of the withdrawal with the registrar?s office and completed the R2T4 calculation. $583 of Federal Pell Grant funds was due to the Department of Education. The funds were returned on August 10, 2020.

FINDING 2020-002 ? R2T4 Calculation Condition Found: A student was administratively withdrawn from the University and the required R2T4 was not completed. This occurred for one of the sixty students in our sample. Corrective Action Plan: The Student Financial Aid Director confirmed the date of the withdrawal with the registrar?s office and completed the R2T4 calculation. $583 of Federal Pell Grant funds was due to the Department of Education. The funds were returned on August 10, 2020. Anticipated Completion Date: The corrective action was completed on August 10, 2020. Contact Person Kandi Molder, Executive Director of Registration and Financial Aid 918-335-6237

2019-001

FINDING 2019-001 ? R2T4 Calculation Federal Agency: U.S. Department of Education; Office of Federal Student Aid Pass through Entity: Not applicable Program Name: Federal Direct Student Loan Program CFDA# and Program Expenditures: 84.268 ($10,215,711) Award Number: P268K192030 Federal Award Year: July 1, 2018 to June 30, 2019 Questioned Costs: $134 (84.268 Unsubsidized Direct Loan Funds, net) Condition Found: The incorrect number of days in the semester and the number of days completed by a student were used in the R2T4 calculations for four students covering two different sample sets. Calculation errors were found for two of the twenty-five students in R2T4 testing sample and two of the forty students in the compliance testing sample. As a result of the R2T4 calculation errors, the amount of aid returned to the Department of Education was incorrect for the four students. Criteria: The number of days in the semester is calculated by counting the number of days in the semester less any breaks of four or more days. Cause: Three students were enrolled in the nontraditional degree program which is structured in modules. The students were enrolled in multiple modules with differing beginning and ending dates. This made it difficult to calculate the number of days in the semester and the number of days the students completed. The fourth student was a traditional student and considered an unofficial withdrawal. The financial aid office was unaware the student left the University. Possible Asserted Effect: The number of days in the semester and the number of days completed by the students used in the R2T4 calculations were incorrect. When the correct number of days are used, the following changes should be made: ? Student 1 ? The University returned $494 of Unsubsidized Federal Direct Loans that the student was actually eligible to receive. ? Student 2 ? The University returned $42 of Unsubsidized Federal Direct Loans that the student was actually eligible to receive. ? Student 3 ? The University returned $156 of Unsubsidized Federal Direct Loans that the student was actually eligible to receive. ? Student 4 ? $826 of Unsubsidized Federal Direct Loans should be returned to the Department of Education. This represents the amount of aid the student was not eligible to receive. A net amount of $134 is due to the Department of Education. Repeat Finding: A similar finding was reported in the prior year as Finding 2018-006 Statistical Sampling: The sample was not intended to be, and was not, a statistically valid sample. Recommendation: The Student Financial Director should determine the correct number of days in the semester and the number of days completed by the students in question. The R2T4s should be recalculated. The following corrections should be made: ? Student 1 ? An additional $494 of Unsubsidized Federal Direct Loans should be awarded to the student in question. ? Student 2 ? An additional $42 of Unsubsidized Federal Direct Loans should be awarded to the student in question. ? Student 3 ? An additional $156 of Unsubsidized Federal Direct Loans should be awarded to the student in question. ? Student 4 ? $826 of Unsubsidized Federal Direct Loans should be returned to the Department of Education. Management Response: The Student Financial Aid Director manually recalculated the number of days in the semester and the number of days completed by the students in question. The R2T4s were recalculated. The following corrective action was completed in September 2019: ? Student 1 ?$494 of Institutional aid was awarded in the student in question. ? Student 2 ?$42 of Institutional aid was awarded in the student in question. ? Student 3 ?$156 of Institutional aid was awarded in the student in question. ? Student 4 ?$826 of Unsubsidized Federal Direct Loans was returned to the Department of Education.

CORRECTIVE ACTION PLAN Year Ended June 30, 2019 FINDING 2019-001 ? R2T4 Calculation Condition Found: The incorrect number of days in the semester and the number of days completed by a student were used in the R2T4 calculations for four students covering two different sample sets. Calculation errors were found for two of the twenty-five students in R2T4 testing sample and two of the forty students in the compliance testing sample. As a result of the R2T4 calculation errors, the amount of aid returned to the Department of Education was incorrect for the four students. Corrective Action Plan: The Student Financial Aid Director manually recalculated the number of days in the semester and the number of days completed by the students in question. The R2T4?s were recalculated. The following corrective action was completed in September 2019: ? Student 1 ?$494 of Institutional aid was awarded in the student in question. ? Student 2 ?$42 of Institutional aid was awarded in the student in question. ? Student 3 ?$156 of Institutional aid was awarded in the student in question. ? Student 4 ?$826 of Unsubsidized Federal Direct Loans was returned to the Department of Education. Anticipated Completion Date: The corrective action was completed in September 2019. Contact Person Kandi Molder, Executive Director of Registration and Financial Aid 918-335-6237

2018-006

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2017-002

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2017-004

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2017-005

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2017-003

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2017-001

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2016-003

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2016-004

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2016-002

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2015-005

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2015-002

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