Trinity Valley Community CollegeHigher Education

Information on the Federal Program: Student Financial Assistance Programs - CFDA 84.063 – Federal Pell Grant Program; CFDA 84.007 – Federal Supplemental Educational Opportunity Grant Program; CFDA 84.268 – Federal Direct Student Loan. United States of Department of Education Compliance Requirements: Special Tests and Provisions – Return of Title IV Funds Type of Finding: Significant deficiency. Criteria: If a recipient of Title IV grant or loan funds withdraws from a school after beginning attendance, the school must perform a Return of Title IV (R2T4) calculation to determine the amount of Title IV assistance earned by the student. Condition: For each student in the sample selection of Title IV students who withdrew, dropped out, or never began attendance during the audit period and for whom a refund calculation was required to be made, we reviewed the applicable student information as well as the completed Return of Title IV Aid Worksheet. Questioned Costs: $3,309 Context:  One student did not have a R2T4 calculation performed despite withdrawing prior to the 60 percent point of the semester. This student received all F's for the semester and the date of last attendance was prior to completing 60% of the semester.  One student had the wrong withdrawal date used in performing the R2T4 calculation. TVCC used 5/9/23 instead of the official withdrawal date of 3/9/2023 as noted on the student’s transcript.  Loans were incorrectly awarded to one student who no longer attended the college. Student withdrew from college 9/12/23 and loan awards were still disbursed to Student on 9/28/23. The financial aid office completed the R2T4 calculation after the check was received from the student. Effect or Potential Effect: Return of Title IV refunds were not properly calculated or performed. Cause: Internal control process failure. Repeat Finding: No Recommendation: The Financial Aid Office should implement an internal control process/procedure to ensure that all students’ that withdraw, drop out, or never began attendance are considered in the R2T4 calculation for possible refund to DOE and ensure that no funds are disbursed after withdrawal date. Views of Responsible Official: We agree with this finding and recommendation. Please see the attached action plan related to this finding in this report.

Finding 2022-001: Information on the Federal Program: CFDA 84.268 ? Federal Direct Student Loan. United States of Department of Education Compliance Requirements: Special Tests and Provisions Type of Finding: Significant deficiency. Criteria: Program requirements state that the institution must notify the student, or parent, in writing of (1) the date and amount of the disbursement; (2) the student?s right, or parent?s right, to cancel all or a portion of that loan or loan disbursement and have the loan proceeds returned to the holder of that loan or the TEACH Grant payments returned to ED; and(3) the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, TEACH Grant, or TEACH Grant disbursement. The notification requirement for loan funds applies only if the funds are disbursed by EFT payment or master check (34 CFR 668.165). Institutions that implement an affirmative confirmation process (as described in 34 CFR 668.165 (a)(6)(i)) must make this notification to the student or parent no earlier than 30 days before, and no later than 30 days after, crediting the student?s account at the institution with Direct Loan or TEACH Grants. Institutions that do not implement an affirmative confirmation process must notify a student no earlier than 30 days before, but no later than seven days after, crediting the student?s account and must give the student 30 days (instead of 14) to cancel all or part of the loan. Condition: For each student in the sample selection of Title IV students who received Direct Loans we reviewed the school?s documentation to ensure a disbursement notification was sent within the required time frame. Questioned Costs: $0 Context: Twenty-six students in the sample selection were identified as not receiving a loan disbursement notification due to a personnel change in the Financial Aid Department. Effect or Potential Effect: Students were not provided information concerning the date and amount of the disbursement, the right to cancel all or a portion of the loan, and the process by which the student or parent must notify the institution that he or she wishes to cancel the loan. Cause: Internal control process failure. Repeat Finding: No Recommendation: The Financial Aid Office should implement an internal control process/procedure to ensure that all students? receiving direct loan awards are receiving a disbursement notification within the required timeframe. Views of Responsible Official: We agree with this finding and recommendation. TVCC Financial Aid Office experienced a change in personnel that caused the email notification not to be sent out to these students. The Financial Aid Office has updated their process for emailing notifications to students. Please see the attached action plan related to this finding in this report.

Finding 2022-002: Information on the Federal Program: CFDA 84.268 ? Federal Direct Student Loan. United States of Department of Education. Compliance Requirements: Special Tests and Provisions Type of Finding: Significant deficiency. Criteria: Program requirements state that the institution may not disburse or deliver the first installment of Direct Loans to first-year undergraduates who are first time borrowers until 30 days after the student?s first day of classes (34 CFR 668.164(i)(2)). Condition: For each student in the sample selection receiving direct loans, we reviewed the school?s documentation to determine if the student was a first-year undergraduates who are first time borrowers to determine is the institution disburse the first installment of direct loans until 30 days after the first day of class. Questioned Costs: $0 Context: We identified one student who was not coded as first-year undergraduate who was a first-time borrower in the Colleague System when he should have. This incorrect coding caused the student to receive their first installment of direct loans before the 30 days required time frame. Effect or Potential Effect: Early distribution to first-year undergraduates who are first time borrowers students who are subject to the 30-day delayed disbursement requirement Cause: Internal control process failure. Repeat Finding: No. Recommendation: TVCC should develop and institute a sustainable internal control system for appropriate identification of first-year undergraduates who are first time borrowers. Views of Responsible Official: We agree with this finding and recommendation. The student identified in this finding did not attend in the fall and when switching over to a spring summer loan the student was coded incorrectly. The TVCC Financial Aid Office has updated our process in packaging students, that start in the spring term and did not attend in the fall, to include reviewing those students manually. Please see the attached action plan related to this finding in this report.

Finding 2021-001: Information on the Federal Program: Student Financial Assistance Programs - CFDA 84.063 ? Federal Pell Grant Program; CFDA 84.007 ? Federal Supplemental Educational Opportunity Grant Program; CFDA 84.268 ? Federal Direct Student Loan. United States of Department of Education. Compliance Requirements: Student Eligibility- General Type of Finding: Significant deficiency. Criteria: A student is eligible to receive Title IV assistance if the student meets all of the eligibility requirements set forth by 34 CFR section 668.32. Condition: For each student in the sample selection of Title IV students who received aid we reviewed their eligibility criteria requirements. Questioned Costs: $3,173 Context: We identified one student who was found to have not maintained satisfactory academic progress in their course of study according to the institution's published standards of satisfactory academic progress and still received aid. Per the institution's SAP policy, a Students on Financial Aid Suspension due to exceeding the exceeding the maximum time frame, can regain eligibility for aid if a student?s submits a successful appeal. This student had no appeal on file. Effect or Potential Effect: Title IV aid was awarded to an ineligible student. Cause: TVCC failed to check this students SAP records in the old ERP system prior to awarding this student aid in the new Colleague system. The financial aid office was also not aware that all student data was not imported from the old ERP system until the end of the semester for this student. Repeat Finding: No Recommendation: The Financial Aid Office should implement an internal control process/procedure to ensure that all students? records are checked in AS400 prior to awarding aid. Views of Responsible Official: We agree with this finding and recommendation. Please see attached action plan related to this finding in the report.

Finding 2021-002: Information on the Federal Program: CFDA 84.268 ? Federal Direct Student Loan. United States of Department of Education. Compliance Requirements: Special Tests and Provisions ? Student Loan Repayments Type of Finding: Significant deficiency. Criteria: Program requirements state that the institution must exercise due care and diligence in the collection of loans. This due diligence includes a requirement to conduct exit counseling for direct loan student borrowers who are graduating, leaving school, or dropping below half-time enrollment. The exit counseling must be in person, by audiovisual presentation, or by interactive electronic means. If a student borrower withdraws from school without the school's prior knowledge or fails to complete the exit counseling as required, exit counseling must be completed, within 30 days after the school learns that the student borrower has withdrawn from school or failed to complete the exit counseling as required, be provided either through interactive electronic means, by mailing written counseling materials to the student borrower at the student borrower's last known address, or by sending written counseling materials to an email address provided by the student borrower that is not an email address associated with the school sending the counseling materials. Condition: For each student in the sample selection receiving direct loans, we reviewed the school?s documentation to determine if the student was sent the required exit counseling materials. Questioned Costs: $0 Context: We identified one student in the sample selection that was not sent the required exit counseling due to a lack of documentation Effect or Potential Effect: Students were not provided information concerning the repayment of federal student loans that were made available during exit counseling. Cause: Lack of documentation. Repeat Finding: Repeat finding. Recommendation: TVCC should develop and institute a sustainable internal control system for appropriate documentation retention and identification of errors. Views of Responsible Official: We agree with this finding and recommendation. Please see the attached action plan related to this finding in the report.

Finding 2021-003: Information on the Federal Program: Student Financial Assistance Programs - CFDA 84.063 ? Federal Pell Grant Program; CFDA 84.268 ? Federal Direct Student Loan. United States of Department of Education. Compliance Requirements: Special Tests and Provisions ? Enrollment Reporting Type of Finding: Significant Deficiency. Criteria: Institutions must complete and return within fifteen days the Enrollment Reporting roster file [formerly the Student Status Confirmation Report (SSCR)] placed in their Student Aid Internet Gateway (SAIG) mailboxes sent by the Department of Education via NSLDS. The institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every sixty days. Once received, 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. Condition: We reviewed, evaluated, and documented procedures for updating student status. We determined if the school is meeting reporting requirements by having the school access the NSLDS website and create the SCHER1. The dates on the roster file are compared to verify that the school returned the roster files within fifteen days. We tested the accuracy and timeliness of the enrollment data certification by selecting a sample of students from the institution?s records and compared the data to the NSLDS Enrollment Detail. Questioned Costs: $0 Context: We identified one students in the sample that had an incorrect enrollment reporting status reported to the NSLDS. Effect or Potential Effect: A student?s enrollment status determines eligibility for in-school status, deferment, and grace periods. Enrollment reporting in a timely and accurate manner is critical for effective management of programs. Cause: Colleague report programming error. Repeat Finding: No Recommendation: Develop a process or procedure that regularly reviews the SCHER1 report uploaded to the NSLDS website for accuracy. Views of Responsible Official: We agree with this finding and recommendation. Please see the attached action plan related to this finding in the report.

Information on the Federal Program: Student Financial Assistance Programs - CFDA 84.063 ? Federal Pell Grant Program; CFDA 84.007 ? Federal Supplemental Educational Opportunity Grant Program; CFDA 84.268 ? Federal Direct Student Loan. United States of Department of Education. Compliance Requirements: Special Tests and Provisions ? Return of Title IV Funds. Type of Finding: Significant deficiency. Criteria: If a recipient of Title IV grant or loan funds withdraws from a school after beginning attendance, the school must perform a Return of Title IV (R2T4) calculation to determine the amount of Title IV assistance earned by the student. Condition: For each student in the sample selection of Title IV students who withdrew, dropped out, or never began attendance during the audit period and for whom a refund calculation was required to be made, we reviewed the applicable student information as well as the completed Return of Title IV Aid Worksheet. Questioned Costs: $321 Context: ? One student did not have a R2T4 calculation performed despite withdrawing prior to the 60 percent point of the semester. ? One student did not have their award amount updated in the Colleague System as a result of the R2T4 calculation Effect or Potential Effect: Return of Title IV refunds were not properly calculated, performed or returned to the Department of Education. Cause: The financial Aid Office has to complete R2T4 calculations by hand for summer sessions due to limitations of the new ERP system Colleague. During the beginning, the FAO was unaware that the system was incapable of calculating returns for modules in the system and had to go back and begin manually calculating them upon notification of withdrawal from the Advising office. Additionally, once the calculations are complete, the award amount has to be updated to reflect the related adjustments. Repeat Finding: Repeat finding. Recommendation: The Financial Aid Office should implement an internal control process/procedure to ensure that all students that take courses during the summer terms are considered in the R2T4 calculation for possible refund to DOE while also confirming that awards are updated accordingly. Views of Responsible Official: We agree with this finding and recommendation. The college entered into an agreement in 11/2017 for the purchase and implementation of a new ERP system to resolve the issues mentioned in this finding. The college?s Financial Aid office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. The system implementation was ongoing at the time. This was our first experience having to do this process manually in the summer. This will be corrected and costs will be submitted to the Department of Education. Please see the attached action plan related to the findings in this report.

Information on the Federal Program: CFDA 84.268 ? Federal Direct Student Loan. United States of Department of Education. Compliance Requirements: Special Tests and Provisions ? Student Loan Repayments Type of Finding: Significant deficiency. Criteria: Program requirements state that the institution must exercise due care and diligence in the collection of loans. This due diligence includes a requirement to conduct exit counseling for direct loan student borrowers who are graduating, leaving school, or dropping below half-time enrollment. The exit counseling must be in person, by audiovisual presentation, or by interactive electronic means. If a student borrower withdraws from school without the school's prior knowledge or fails to complete the exit counseling as required, exit counseling must be completed, within 30 days after the school learns that the student borrower has withdrawn from school or failed to complete the exit counseling as required, be provided either through interactive electronic means, by mailing written counseling materials to the student borrower at the student borrower's last known address, or by sending written counseling materials to an email address provided by the student borrower that is not an email address associated with the school sending the counseling materials. Condition: For each student in the sample selection receiving direct loans, we reviewed the school?s documentation to determine if the student was sent the required exit counseling materials. Questioned Costs: $0 Context: We identified three students in the sample selection that were not sent the required exit counseling due to a lack of documentation Effect or Potential Effect: Students were not provided information concerning the repayment of federal student loans that were made available during exit counseling. Cause: Internal control process failure and an issue with the former ERP system. Repeat Finding: Repeat finding. Recommendation: TVCC should develop and institute a sustainable internal control system for appropriate documentation retention and identification of errors. Views of Responsible Official: We agree with this finding and recommendation. The college entered into an agreement in 11/2017 for the purchase and implementation of a new ERP system to resolve the issues mentioned in this finding. The college?s Financial Aid office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. The process of implementation was ongoing and the new documentation and policies were not fully in place. They are now in place to resolve this issue, and we are working towards implementing a trackable process within Colleague. Please see the attached action plan related to the findings in this report.

Information on the Federal Program: Student Financial Assistance Programs - CFDA 84.063 ? Federal Pell Grant Program; CFDA 84.268 ? Federal Direct Student Loan. United States of Department of Education. Compliance Requirements: Special Tests and Provisions ? Enrollment Reporting Type of Finding: Significant Deficiency. Criteria: Institutions must complete and return within fifteen days the Enrollment Reporting roster file [formerly the Student Status Confirmation Report (SSCR)] placed in their Student Aid Internet Gateway (SAIG) mailboxes sent by the Department of Education via NSLDS. The institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every sixty days. Once received, 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. Condition: We reviewed, evaluated, and documented procedures for updating student status. We determined if the school is meeting reporting requirements by having the school access the NSLDS website and create the SCHER1. The dates on the roster file are compared to verify that the school returned the roster files within fifteen days. We tested the accuracy and timeliness of the enrollment data certification by selecting a sample of students from the institution?s records and compared the data to the NSLDS Enrollment Detail. Questioned Costs: $0 Context: Trinity Valley Community College was unable to provide Enrollment Reporting roster files and other needed information in a timely manner. Effect or Potential Effect: A student?s enrollment status determines eligibility for in-school status, deferment, and grace periods. Enrollment reporting in a timely and accurate manner is critical for effective management of programs. Cause: Internal control process failure and lack of training. Repeat Finding: Repeat Finding. Recommendation: Review the current assignment and qualifications of individuals responsible for direct loan reconciliation to ensure they have the appropriate skills to perform their assigned duties. Ensure that those individuals have been appropriately trained, and possess the proper understanding of both the controls they are performing and the transactions that they are responsible for recording. Consider the need for cross-training of employees in various grant accounting functions. Consider developing written procedures that can be easily disseminated to employees to aid in cross-functional training. Views of Responsible Official: We agree with this finding and recommendation. The college entered into an agreement in 11/2017 for the purchase and implementation of a new ERP system to resolve the issues mentioned in this finding. The college?s Financial Aid office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. The process of implementation was ongoing and the new documentation and policies were not fully in place. They are now in place to resolve this issue. Please see the attached action plan related to the findings in this report.

Criteria: Program requirements (34 CFR 668.22(i)) state that the institution must return Title IV funds to the programs from which the student received aid during the period of enrollment in a prescribed order. Condition: For each student in the sample selection of Title IV students who withdrew, dropped out, or never began attendance during the audit perform and for whom a refund calculation was required to be made, we reviewed the applicable student information as well as the completed Return of Title IV Aid Worksheet. Questioned Costs: $608 Context: One student in the sample selection returned amounts associated with the Pell program rather than Federal Direct Loans. Effect or Potential Effect: Funds were incorrectly refunded to the wrong program. Cause: Trinity Valley Community College?s Financial Aid department attaches a document at the end of the completed Return of Title IV Aid Worksheet titled `Return of Title IV Fund Calculation Memo.? This document offers a breakdown of aid to return to the Department of Education for the purpose of the Business Office to process the refund. However, this internal memo contained the incorrect Title IV program sequence for refunding. This was later discovered by the Financial Aid department, and corrected. However, the student identified in our sample was overlooked for correction. Repeat Finding: Not a repeat finding. Recommendation: The Financial Aid Office should implement an internal control process/procedure to better implement the return of Title IV funds. Views of Responsible Official: We agree with this finding and recommendation. The college entered into an agreement in 11/2017 for the purchase and implementation of a new ERP system to resolve the issues mentioned in this finding. The college?s Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan related to the findings in this report.

Criteria: Program requirements (34 CFR 668.22) require nonfederal entities to determine the amount of Title IV aid earned by a student when they withdraw. When a student completes greater than 60 percent of a term, they are considered to have fully earned their aid. If a student completes less than 60 percent of the term, the nonfederal entity is required to return a portion of the aid to the Department of Education based on various criteria discussed. Additionally, 34 CFR 668.22(j) and 668.173(b)(1) require an institution to return amounts of unearned Title IV aid as soon as possible, but no later than 45 days after the date of the institution?s determination that the student withdrew. Condition: For each student in the sample selection of Title IV students who withdrew, dropped out, or never began attendance during the audit period and for whom a refund calculation was required to be made, we reviewed disbursement and accounting records to verify that returned Title IV funds were applied to programs within 45 days of the institution becoming aware that the student had withdrawn. Questioned Costs: $0 Context: Every student in our sample of Return of Title IV refunds were not returned to the Department of Education within 45 days of withdrawal determination. All Return of Title IV calculations were done at the end of each semester and not the date of withdrawal determination. Effect or Potential Effect: Return of Title IV refunds were not returned within the required timeframe and are thus considered late for compliance purposes. Cause: The Financial Aid Office experienced turnover of personnel. During this period of time, only one individual in the Financial Aid Office had knowledge on how to complete the Return of Title IV process. Additionally, the current ERP software being utilized requires significant manual intervention to produce relevant data. Repeat Finding: Not a repeat finding. Recommendation: Review the current assignment and qualifications of individuals responsible for refunds to ensure they have the appropriate skills to perform their assigned duties. Ensure that those individuals have been appropriately trained, and possess the proper understanding of both the controls they are performing and the transactions that they are responsible for recording. Consider the need for cross-training of employees in various Financial Aid functions. Consider developing written procedures that can be easily disseminated to employees to aid in cross-functional training. Additionally, the institution should implement an ERP system that reduces the need for manual intervention. Views of Responsible Official: We agree with this finding and recommendation. The college entered into an agreement in 11/2017 for the purchase and implementation of a new ERP system to resolve the issues mentioned in this finding. The college Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan related to the findings in this report.

Criteria: The Federal Code of Regulations 34 CFR 668.22(a)(5) states that if the total amount of Title IV grant or loan assistance, or both, that the student earned is greater than the total amount of Title IV grant or loan assistance, or both, that was disbursed to the student as of the date of the institution?s determination that the student withdrew, the difference between these amounts must be treated as a post-withdrawal disbursement. Condition: For each student in the sample selection of Title IV students who withdrew, dropped out, or never began attendance during the audit perform and for whom a refund calculation was required to be made, we reviewed the applicable student information as well as the completed Return of Title IV Aid Worksheet. Questioned Costs: $0 Context: For testing, there was no reasonable way to determine if a student qualified for a post-withdrawal disbursement due to the fact that relevant information involving the amounts that could have been disbursed could not be determined or obtained. Effect or Potential Effect: Post-withdrawal disbursements could potentially be misstated. Cause: The existing student information ERP software did not show an audit trail of changes made to records as well as who changed them. Additionally, documentation of changes was not appropriately retained. Repeat Finding: Not a repeat finding. Recommendation: The institution should implement an ERP system that should be able to show an audit trail of changes made to records as well as who changed them. TVCC should develop and institute a sustainable internal control system for appropriate documentation retention. Views of Responsible Official: We agree with this finding and recommendation. The college entered into an agreement in 11/2017 for the purchase and implementation of a new ERP system to resolve the issues mentioned in this finding. The college Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan related to the findings in this report.

Criteria: If a recipient of Title IV grant or loan funds withdraws from a school after beginning attendance, the school must perform a Return of Title IV (R2T4) calculation to determine the amount of Title IV assistance earned by the student. Condition: For each student in the sample selection of Title IV students who withdrew, dropped out, or never began attendance during the audit period and for whom a refund calculation was required to be made, we reviewed the applicable student information as well as the completed Return of Title IV Aid Worksheet. Questioned Costs: $0 Context: ? All Return of Title IV calculations were done with the incorrect total days for the semester. It was determined that Trinity Valley Community College was improperly not including the final day in their calculations. ? One student did not have a R2T4 calculation performed despite withdrawing prior to the 60 percent point of the semester. ? One student had a R2T4 calculation performed when it was unnecessary. TVCC performed the R2T4 calculation due to calculating the student as if he unofficially withdrew due to receiving an `F?. However, the student received an `A? for the other class he was enrolled in during the semester. Per the Financial Aid Handbook, pg. 5-60, if one instructor reports that the student attended through the end of the period, then the student is not a withdrawal. ? One student had the wrong withdrawal date used in performing the R2T4 calculation. TVCC used 3/7/19 instead of the official withdrawal date of 3/13/19, as noted on the student?s transcript. Effect or Potential Effect: Return of Title IV refunds were not properly calculated or performed. Cause: The Financial Aid Office experienced turnover of personnel. During this period of time, only one individual in the Financial Aid Office had knowledge on how to complete the Return of Title IV process. Additionally, the current ERP software being utilized requires significant manual intervention to produce relevant data. Repeat Finding: Not a repeat finding. Recommendation: Review the current assignment and qualifications of individuals responsible for refunds to ensure they have the appropriate skills to perform their assigned duties. Ensure that those individuals have been appropriately trained, and possess the proper understanding of both the controls they are performing and the transactions that they are responsible for recording. Consider the need for cross-training of employees in various Financial Aid functions. Consider developing written procedures that can be easily disseminated to employees to aid in cross-functional training. Additionally, the institution should implement an ERP system that reduces the need for manual intervention. Views of Responsible Official: We agree with this finding and recommendation. The college entered into an agreement in 11/2017 for the purchase and implementation of a new ERP system to resolve the issues mentioned in this finding. The college?s Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan related to the findings in this report.

Criteria: Program requirements state that the institution must notify the student, or parent, in writing of (1) the date and amount of the disbursement; (2) the student?s right, or parent?s right, to cancel all or a portion of that loan or loan disbursement and have the loan proceeds returned to the holder of that loan and (3) the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel the loan. Institutions that implement an affirmation confirmation process must make this notification to the student or parent no earlier than 30 days before, and no later than 30 days after, crediting the student?s account at the institution with Direct Loan funds. Condition: For each student in the sample selection receiving loans, we reviewed the school?s documentation to determine if the student or parent were sent the required disbursement notification and the date of notification was sent to determine if it was sent within the required timeframe. Questioned Costs: $0 Context: We were unable to determine if ten students in the sample selection were sent the required disbursement notification due to a lack of documentation. Effect or Potential Effect: Student were not notified of their rights to cancel loan funding. It was noted that due to the corruption of the EDExpress software, six students in the sample selection had incorrect disbursement amounts entered into the Common Origination and Disbursement (COD) system since the Financial Aid department had to manually enter awards. Cause: The Financial Aid Office was not able to obtain these letters due to a malfunction with the Federal Student Aid software, EDExpress, which was utilized for loan packaging. Repeat Finding: Not a repeat finding. Recommendation: The institution should implement an ERP system that should be able to show an audit trail of changes made to records as well as who changed them. TVCC should develop and institute a sustainable internal control system for appropriate documentation retention. Views of Responsible Official: We agree with this finding and recommendation. The college entered into an agreement in 11/2017 for the purchase and implementation of a new ERP system to resolve the issues mentioned in this finding. The college?s Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan related to the findings in this report.

Criteria: Program requirements state that the institution must exercise due care and diligence in the collection of loans. This due diligence includes a requirement to conduct exit counseling for direct loan student borrowers who are graduating, leaving school, or dropping below half-time enrollment. The exit counseling must be in person, by audiovisual presentation, or by interactive electronic means. If a student borrower withdraws from school without the school's prior knowledge or fails to complete the exit counseling as required, exit counseling must be completed, within 30 days after the school learns that the student borrower has withdrawn from school or failed to complete the exit counseling as required, be provided either through interactive electronic means, by mailing written counseling materials to the student borrower at the student borrower's last known address, or by sending written counseling materials to an email address provided by the student borrower that is not an email address associated with the school sending the counseling materials. Additionally, program requirements state specify requirements for students that are in their first year of undergraduate study and are a first-time borrower; the institution may not disburse the first installment of the direct loan until thirty calendar days after the program of study begins. Condition: For each student in the sample selection receiving direct loans, we reviewed the school?s documentation to determine if the student was sent the required exit counseling materials. We also viewed disbursement timing to ensure that students that are considered a first time student, first time borrower were properly delayed. Questioned Costs: $0 Context: We were unable to determine if ten students in the sample selection were sent the required exit counseling due to a lack of documentation. We identified one student in the sample selection that was disbursed the first installment of the direct loan before the thirty day requirement despite identifying as a first time student, first time borrower. Effect or Potential Effect: Students were not provided information concerning the repayment of federal student loans that were made available during exit counseling. Additionally, the timing of disbursements are out of compliance. Cause: Internal control process failure and an issue with the current ERP system. Repeat Finding: Not a repeat finding. Recommendation: The institution should implement an ERP system that removes the need for manually identifying and notifying students of exit counseling as well as properly identifying first time student, first time borrowers. TVCC should develop and institute a sustainable internal control system for appropriate documentation retention. Views of Responsible Official: We agree with this finding and recommendation. The college entered into an agreement in 11/2017 for the purchase and implementation of a new ERP system to resolve the issues mentioned in this finding. The college?s Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan related to the findings in this report.

Criteria: The Federal Code of Regulations 34 CFR 685.300(b)(5) states that a school that participates in the Direct Loan Program is required monthly to reconcile cash (funds it received from the G5 System to pay its students) with disbursements (actual disbursement records) it submitted to the Common Origination and Disbursement (COD) system. Each month, the COD provides institutions with a School Account Statement (SAS) data file that is required to be reconciled to financial records. Condition: We requested documentation of the SAS to ascertain that reconciliations are being performed and to determine whether dates and amounts of disbursements to borrowers recorded were supported by the institution?s records on individual borrowers. Questioned Costs: $0 Context: It was determined that no monthly reconciliations were performed during the period under audit. Effect or Potential Effect: Direct loan financial data and reporting could be inaccurate. Cause: An effective internal control environment is evidenced by documented procedures with strong ongoing communications between key departments where employees implement and maintain those internal control activities. The lack of implemented procedures for monthly and year-end processes creates a deficiency to prepare accurate and timely financial reports and federal compliance. As noted in the Federal Student Aid Handbook, pg. 4-114, the direct loan reconciliation is a team effort by the business and financial aid offices. Since both have information that is needed to reconcile, cooperation between these two departments is essential for successful reconciliation. Additionally, the current ERP software being utilized requires significant manual intervention to produce relevant data, which consumes the majority of the time available for employees. Repeat Finding: Not a repeat finding. Recommendation: Review the current assignment and qualifications of individuals responsible for direct loan reconciliation to ensure they have the appropriate skills to perform their assigned duties. Ensure that those individuals have been appropriately trained, and possess the proper understanding of both the controls they are performing and the transactions that they are responsible for recording. Consider the need for cross-training of employees in various grant accounting functions. Consider developing written procedures that can be easily disseminated to employees to aid in cross-functional training. Views of Responsible Official: We agree with this finding and recommendation. Colleague implementation will significantly enhance and greatly assist staff in accomplishing this objective. Colleague will enable TVCC to use the software itself as an internal control tool that will significantly enhance the college?s ability to perform more thorough, accurate and timely reconciliations between the TVCC financial aid, the TVCC general ledger, and the Texas Higher Education Coordinating Board, Texas Comptroller and U.S. Department of Education. The college Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan.

Criteria: An institution shall require each applicant whose application is selected by the Department of Education to verify the information required for the Verification Tracking Group to which the applicant is assigned. Condition: For each student in the sampling of applications that were selected by the Department of Education for verification, we reviewed the student aid files for those applications to ascertain that the institution (1) obtained acceptable documentation to verify the information required for the Verification Tracking Group to which the applicant is assigned; (2) matched information on the documentation to the student aid application; (3) if necessary, submitted data corrections to the central processor and recalculated awards and (4) whether the institution correctly coded the student?s verification status in the Common Origination and Disbursement (COD) system. Questioned Costs: $0 Context: One student in the sample selection that was selected for verification had no documentation of a high school transcript. Effect or Potential Effect: Failing to follow procedures in place over verification can lead to noncompliance due to error or fraud over the student verification process. Cause: The Financial Aid Office experienced turnover of personnel, which resulted in the department failing to request this transcript. Repeat Finding: Not a repeat finding. Recommendation: Review the current assignment and qualifications of individuals responsible for financial aid functions to ensure they have the appropriate skills to perform their assigned duties. Ensure that those individuals have been appropriately trained, and possess the proper understanding of both the controls they are performing and the transactions that they are responsible for recording. Consider the need for cross-training of employees in various Financial Aid functions. Consider developing written procedures that can be easily disseminated to employees to aid in cross-functional training. Views of Responsible Official: We agree with this finding and recommendation. The college?s Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system.

Criteria: ED Form 646-1, Fiscal Operations Report and Application to Participate (FISAP) is submitted annually to receive funds for the campus-based programs. The school uses the Fiscal Operations Report portion to report its expenditures in the previous award year and the Application to Participate portion to apply for the following year. A school must keep financial records that reflect all campus-based program transactions and must keep all records supporting the school?s application for campus-based funds. Condition: For the most recently submitted FISAP report, which would be the June 30, 2019 report that was due October 1, 2019, traced key line items to supporting documentation and relevant financial information. Questioned Costs: $0 Context: Certain key items such as Pell, FSEOG, and FWS did not agree to financial records. Effect or Potential Effect: Incorrect amounts were reported on the FISAP. Cause: There was no reconciliation or review of relevant financial data to Financial Aid information or reporting. Repeat Finding: Not a repeat finding. Recommendation: There needs to be a review process in place for the FISAP submission to reduce the likelihood of errors in the completion of this form. Consider the need for cross-training of employees in various Financial Aid functions. Consider developing written procedures that can be easily disseminated to employees to aid in cross-functional training. Views of Responsible Official: We agree with this finding and recommendation. Colleague will enable TVCC to use the software itself as an internal control tool that will significantly enhance the college?s ability to perform more thorough, accurate and reconciliation between financial aid and financial records. The college?s Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan.

Criteria: The Federal Code of Regulations 34 CFR 675.18 states that institutions must use at least seven percent of the sum of its initial and supplemental Federal Workstudy (FWS) allocations for an award year to compensate students employed in community service activities. In meeting this requirement, at least one or more of the school?s FWS students must be employed as a reading tutor for children in a reading tutoring project or performing family literacy activities in a family literacy project. Condition: We requested FWS documentation and detail, including the breakdown of wages paid to students. Questioned Costs: $6,233 Context: It was determined that no community service wages were paid to students during the period under audit. A school may request a waiver of the community service and tutor requirements; the request must be submitted electronically before the annual deadline using the Common Origination and Disbursement (COD) website. TVCC did not request a waiver. Effect or Potential Effect: If a school fails to meet the community service requirements or to request a waiver, the school may be required to return FWS federal funds in an amount that represents the difference between the amount a school should have spent for community service and the amount actually spent. The school may also be subject to a Limitation, Suspension, and Termination proceeding, through which the school may be denied future participation in the FWS program or fined. Cause: Internal control process failure and lack of training. Repeat Finding: Not a repeat finding. Recommendation: Review the current assignment and qualifications of individuals responsible for direct loan reconciliation to ensure they have the appropriate skills to perform their assigned duties. Ensure that those individuals have been appropriately trained, and possess the proper understanding of both the controls they are performing and the transactions that they are responsible for recording. Consider the need for cross-training of employees in various grant accounting functions. Consider developing written procedures that can be easily disseminated to employees to aid in cross-functional training. Views of Responsible Official: We agree with this finding and recommendation. The college?s Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan.

Criteria: Institutions must complete and return within fifteen days the Enrollment Reporting roster file [formerly the Student Status Confirmation Report (SSCR)] placed in their Student Aid Internet Gateway (SAIG) mailboxes sent by the Department of Education via NSLDS. The institution determines how often it receives the Enrollment Reporting roster file with the default set at a minimum of every sixty days. Once received, 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. Condition: We reviewed, evaluated, and documented procedures for updating student status. We determined if the school is meeting reporting requirements by having the school access the NSLDS website and create the SCHER1. The dates on the roster file are compared to verify that the school returned the roster files within fifteen days. We tested the accuracy and timeliness of the enrollment data certification by selecting a sample of students from the institution?s records and compared the data to the NSLDS Enrollment Detail. Questioned Costs: $0 Context: Trinity Valley Community College was unable to provide Enrollment Reporting roster files and other needed information in a timely manner. Effect or Potential Effect: A student?s enrollment status determines eligibility for in-school status, deferment, and grace periods. Enrollment reporting in a timely and accurate manner is critical for effective management of programs. Cause: Internal control process failure and lack of training. Repeat Finding: Not a repeat finding. Recommendation: Review the current assignment and qualifications of individuals responsible for direct loan reconciliation to ensure they have the appropriate skills to perform their assigned duties. Ensure that those individuals have been appropriately trained, and possess the proper understanding of both the controls they are performing and the transactions that they are responsible for recording. Consider the need for cross-training of employees in various grant accounting functions. Consider developing written procedures that can be easily disseminated to employees to aid in cross-functional training. Views of Responsible Official: We agree with this finding and recommendation. The college?s Financial Aid Office is in the process of developing and implementing new written policy and procedures that line up with all Department of Education rules and regulations and the new ERP system. Please see the attached action plan.

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