VALLEY GRANDE INSTITUTE FOR ACADEMIC STUDIESNon-Profit

"Findings ? Financial Statement Audit Finding 2022-001 Accrual accounting records and material adjustments Condition: It was noted that the Company did not maintain accounting records on full accrual basis in accordance with GAAP. Criteria: The Company is responsible for maintaining accounting records in accordance with GAAP for financial reporting. Cause: The Company accounting records were not adjusted at year end to reflect accurate account balances. Recommendation: The Company should keep accounting records on a full accrual basis in accordance with GAAP. Views of Responsible Officials: We will review our policies and procedures and monitor out activities to make sure we maintain the necessary requirements current. "

Findings ? Financial Statement Audit Finding 2021-001 Accrual accounting records and material adjustments Condition: It was noted that the Company did not maintain accounting records on full accrual basis in accordance with GAAP. Criteria: The Company is responsible for maintaining accounting records in accordance with GAAP for financial reporting. Cause: The Company accounting records were not adjusted at year end to reflect accurate account balances. Recommendation: The Company should keep accounting records on a full accrual basis in accordance with GAAP. Views of Responsible Officials: We will review our policies and procedures and monitor out activities to make sure we maintain the necessary requirements current.

Finding 2020-002 U.S. Department of Education Federal Direct Loan Program, CFDA 84.268 NSLDS Reporting Condition: The Institution did not accurately or timely update NSLDS for forty-eight out of sixty students tested. Specifically, eight student effective dates were incorrect, nine student effective dates were incorrect and reported late, three student effective dates and statuses were incorrect and reported late, twenty-six student statuses were not reported timely, and NSLDS was not updated for two students. Criteria: Institutions are required to accurately notify NSLDS within 60 days of a student?s change in enrollment status. Cause: These instances of noncompliance were due to changes in staff and the Institution?s lack of following their policies and procedures as required for performing procedures for NSLDS reporting. Effect: An institution?s failure to notify NSLDS of student status changes in an accurate and timely manner causes a loss to the government in interest income and/or special allowance expense. Recommendation The Institution should update the status and effective dates of the above-mentioned student. The Institution should review and revise its procedures to ensure that NSLDS is promptly notified, and statuses are accurate when borrowers cease to be enrolled on at least a half-time basis.

Finding 2020-003 U.S. Department of Education Federal Direct Loan Program, CFDA 84.268 Late Refunds Condition: The Institution failed to make refunds within the required time period, as specified by regulation for one of five students tested requiring refunds. Criteria: An institution must pay a refund that is due to a Title IV program within 45 days after the date of the student?s withdrawal. Cause: These instances of noncompliance were due to changes in staff and the Institution not following its policies and procedures for the return of funds. Effect: The improper retention of Title IV funds results in an institution receiving funds to which it is not entitled and causes increased expense to the U.S. Department of Education. Recommendation The Institution should review and revise its procedures for paying refunds within the required time frames.

Finding 2020-004 U.S. Department of Education Federal Direct Loan Program, CFDA 84.268 Credit Balances Cause: The Institution failed to pay credit balances within the required time frame or to obtain the proper authorization to retain credit balances for one out of four students tested requiring credit balances. Criteria As a fiduciary for the benefit of the guaranty agency, the Secretary and the student, the school may hold any additional Title IV funds in order to assist the student in managing his/her Title IV funds for the remainder of the academic year if the student makes this request in writing. A student has the right to rescind this authorization at any time and request that credit balance funds be disbursed. Cause: This instance of noncompliance was due to an oversight. Effect: An institution?s improper retention of student credit balances results in students being deprived of Title IV assistance needed for living expenses and other indirect educational costs. Recommendation The Institution should pay credit balances owed to the above students. The Institution should review and/or revise its procedures to identify students with credit balances and obtain the proper authorization to retain the balance or disburse to students in a timely manner.

Findings ? Major Federal Award Programs Audit Finding 2019-003 U.S. Department of Education Federal Direct Loan Program, CFDA 84.268 NSLDS Reporting Condition: The Institute did not accurately or timely update NSLDS for fourteen out of sixty students tested. Specifically, three student effective dates were incorrect and reported late, four student statues were not reported and seven student statuses were not reported timely. Criteria: Institutions are required to accurately notify NSLDS within 60 days of a student?s change in enrollment status. Cause: These instances of noncompliance were due to changes in staff and the Institute?s lack of following their policies and procedures as required for performing procedures for NSLDS reporting. Effect: An institution?s failure to notify NSLDS of student status changes in an accurate and timely manner causes a loss to the government in interest income and/or special allowance expense. Recommendation The Institute should update the status and effective dates of the above-mentioned student. The Institution should review and revise its procedures to ensure that NSLDS is promptly notified, and statuses are accurate when borrowers cease to be enrolled on at least a half-time basis. View of Responsible Officials: Management concurs with the finding. See Management?s Corrective Action Plan.

Findings ? Major Federal Award Programs Audit (Continued) Finding 2019-004 U.S. Department of Education Federal Direct Loan Program, CFDA 84.268 Exit Counseling Condition: The Institute did not timely perform the required Federal Direct Loan (FDL) exit counseling for twenty-one out of fifty-five students tested requiring exit counseling. Criteria: An in-person or on-line exit counseling session is required with each FDL borrower shortly before the student ceases enrollment on at least a half-time basis in order to emphasize the obligation and consequences of default. General information such as repayment options, consolidation, and debt management strategies must also be provided to the borrower. If the borrower withdraws/graduates without an institution?s prior knowledge and did not perform the exit counseling session, the institution must notify the borrower within 30 days after learning the borrower has withdrawn/graduated of their obligation. Institutions must document, in each student?s file, that the exit counseling or notification has been completed. Cause: These instances of noncompliance were due to changes in staff and the Institute?s lack of following their policies and procedures as required for performing exit counseling. Effect: An institute?s failure to provide exit loan counseling increases the possibility of a student defaulting on his or her loan. FDLs that go into default status create increased expense for the U.S. Department of Education. Recommendation The Institute must perform the required exit loan counseling for the above-mentioned student. In addition, the Institute should review and revise its procedures for performing exit counseling for all FDL recipients upon withdrawal/graduation. View of Responsible Officials: Management concurs with the finding. See Management?s Corrective Action Plan.

Finding 2019-005 U.S. Department of Education Federal Direct Loan Program, CFDA 84.268 Notice of Right to Cancel Condition: The Institute did not notify seventeen students of their right to cancel when a FDL disbursement was credited to his/her account. Criteria: Institutions are required to notify students and/or parents when FDL loan funds are credited to the student?s account. This notification must be sent no earlier than 30 days before and not later than 30 days after crediting the student?s account. Cause: These instances of noncompliance were due to changes in staff and the Institution?s lack of following their policies and procedures as required for performing Notice of Right to Cancel. Effect: An institution?s failure to notify the student and/or parent enables them to request a cancellation within 14 days as required. Recommendation The Institute should review and revise its procedures to ensure that student?s and or parents receive notice of right to cancel in a timely manner. View of Responsible Officials: Management concurs with the finding. See Management?s Corrective Action Plan.

Finding 2019-006 U.S. Department of Education Federal Direct Loan Program, CFDA 84.268 Failure to Maintain Student Records Condition: The Institute was unable to provide the requested student records needed to test the applicable compliance requirements for four students of 64 files selected for testing, resulting in an error rate of 6.25%. These four students received Title IV funds totaling $29,584. The Institute disbursed Title IV funds to 317 unduplicated students during the audit period. Criteria: To continue participation in any Title IV, HEQA program, an institution must demonstrate that it is capable of adequately administering the program under standards established by the Secretary. The Secretary considers an institution to have that administrative capability if it establishes and maintains student and financial records. Cause: This instance of noncompliance was due to the Institute?s failure to maintain adequate records to support the disbursements of Title IV funds. Effect: An institution?s impaired administrative capability may cause the Institution to disburse Title IV funds to ineligible students which deprives other eligible, needy students of the aid and creates a financial burden for the U.S Department of Education. Recommendation The Institute should review and revise its policies and procedures for maintaining student and financial records. All funds disbursed to the four students should be refunded to the appropriate Title IV programs. View of Responsible Officials: Management concurs with the finding. See Management?s Corrective Action Plan.

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