Houston-Tillotson UniversityHigher Education

2021-001 The University reported minor differences between the FISAP report and the recorded disbursements per the University's accounting system for the FSOG and FWSP programs. Criterion: Compliance Supplement, July 2021, 2 CFR Part 200, Reporting: Compliance Requirement. Effect: The University reports SEOG and FWS disbursements did not agree to the FISAP by minor differences. Cause: Failure of the University to exercise due care in reconciling the FISAP report to the accounting records prior to issuing the FISAP report. Recommendation: Financial Aid Department must perform monthly or quarterly reconciliations and resolve all differences. View of Responsible Officials: Management will adhere to the U.S. DOE guidelines and make the necessary adjustments. There is no questioned costs.

a. Criteria: Unless an institution expects to submit its next enrollment reporting roster file to the Secretary of the U.S. Department of Education within the next 60 days, it must notify the Secretary within 30 days if it discovers that a Federal Perkins Loan, Federal Family Education Loan (FFEL), Direct Subsidized, Direct Unsubsidized, or Direct PLUS Loan has been made to or on behalf of a student who (1) enrolled at that institution but has ceased to be enrolled on at least a half-time basis; (2) has been accepted for enrollment at that institution but failed to enroll on at least a half-time basis for the period for which the loan was intended; or (3) has changed his or her permanent address. The University uses the services of the National Student Clearinghouse (NSC) to report status changes to NSLDS. Under this arrangement, the University reports all students enrolled and their status to NSC. NSC then identifies any changes in status and reports those changes when required to NSLDS. Additionally, NSC completes the roster file on the University?s behalf and communicates status changes to NSLDS, as applicable. Although the University uses the services of NSC, it is still ultimately the University?s responsibility to submit timely, accurate, and complete responses to roster files and to maintain proper documentation. b. Condition: For 1 (33 percent) out of 3 students selected, the University did not report the students? withdrawn status in a timely manner. c. Context: Controls related to the monitoring of new student enrollment were not properly functioning. d. Cause of Condition: To provide reporting to NSLDS in a timely manner, NSC recommends institutions send all transmissions prior to the end of the semester the student experienced a change in status. The University did not submit at least one of its transmissions to NSC until after the subsequent semester. e. Effect of Condition: Not reporting student status changes in a timely manner could affect determinations that guarantors, lenders, and servicers of student loans make related to in-school status, deferments, grace periods, repayment schedules, and the federal government?s payment of interest subsidies. f. Recommendation: We recommend that the University: (1) Establish and implement a process to identify and report unofficially withdrawn students to NSLDS, (2) Report accurate student status changes and effective dates to NSLDS in a timely manner, and (3) Establish and implement a monitoring process to ensure that it reports accurate student status changes to NSLDS in a timely manner. g. Views of Responsible Officials and Planned Corrective Actions: Management concurs with the finding. To address this concern, the Office of Records and Registration will administer routine quality assurance checks to ensure all updates have been properly recorded and submitted. Responsible Official: Wayne Knox, Vice President & Chief Operating Officer h. Auditor's Evaluation: The planned corrective actions adequately address the condition reported.

a. Criteria: Institutions must adhere to Direct Loan limits for both Direct Subsidized Loans and Direct Unsubsidized Loans. The school determines the loan type(s), and the actual loan amount the student is able to receive each academic year, based on financial need. The U.S. Department of Education determines annual loan limits based on student's academic year and whether they are dependent or independent students. The U.S. Department of Education also determines aggregate loan limits for undergraduate and graduate level students. b. Condition: The University did not adhere to the annual loan limit for Direct Subsidized Loans. A first-year undergraduate student may obtain up to $3,500 in Direct Subsidized Loans, regardless of whether a student is determined to be dependent or independent. For one (4%) out of 25 students, the loan limit was exceeded by $1,000. c. Context: Controls related to applying Direct Loan annual limits were not successfully operating. d. Cause of Condition: Due to deficiencies within the University's Office of Student Financial Aid, the University did not properly apply Direct Loan funding thresholds. e. Effect of Condition: Exceeding the Direct Loan limit thresholds can result in an obligation to return funds to the Department of Education or a reduction in available funds to drawdown as a result of overfunding. f. Recommendation: We recommend that the University provide additional training to employees of the Office of Student Financial Aid regarding the annual limits set forth by the U.S. Department of Education in relation to Direct Subsidized Loans and Direct Unsubsidized Loans. Employees applying aid to student accounts should be knowledgeable about the loan limits and how a student's academic year is determined. g. Views of Responsible Officials and Planned Corrective Actions: Management concurs with the finding. To address this concern, the Office of Student Financial Aid will ensure all staff members are properly trained on applying the correct loan amounts. Additionally, the office will deploy a routine quality assurance check to ensure all loan amounts are correct. Subsequent to the discovery of the error, the University administered an internal review of Direct Loan fundings in relation to dependency status and academic year and found the aforementioned finding to be an isolated incident. Responsible Official: Wayne Knox, Vice President & Chief Operating Officer h. Auditor's Evaluation: The planned corrective actions adequately address the condition reported.

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