Rocky Mountain CollegeHigher Education

Finding No. 2025-001: Untimely Reporting of Student Enrollment Status to the National Student Loan Data System Assistance Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.063, 84.0384, 84.268, 84.379 Federal Agency: U.S. Department of Education Type of Finding: Significant Deficiency and Noncompliance Category of Finding: Special Tests and Provisions: Enrollment Reporting Known Questioned Costs: $-0- Likely Questioned Costs: $-0- Criteria According to 34 CFR §685.309(b), institutions must report changes in student enrollment status to the National Student Loan Data System (NSLDS) within 30 days of the change or include the change in response to the next scheduled Enrollment Reporting roster file within 60 days. Condition During compliance testing of 14 student records, it was found that 3 students—representing approximately 21% of the sample—were not reported to NSLDS in a timely manner, exceeding the required reporting deadlines. Cause The untimely reporting resulted from a lapse in internal controls over the enrollment reporting process, possibly due to oversight or insufficient monitoring of reporting schedules. Effect Failure to report enrollment status changes promptly can lead to incorrect deferment or repayment statuses for student borrowers, potentially affecting their financial obligations and the federal government's ability to manage the student loan portfolio effectively. Repeat Finding This is a repeat finding to No. 2024-002. Recommendation We recommend that the College review and enhance its procedures for monitoring and reporting enrollment status changes. This could involve implementing automated alerts, providing additional staff training, or establishing more robust internal checks to ensure adherence to reporting deadlines. Management’s Response Management concurs with this finding. See Management’s Response and Corrective Action plan.

Finding No. 2025-002: Inadequate Timing of Return of Student Funds Assistance Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.063, 84.0384, 84.268, 84.379 Federal Agency: U.S. Department of Education Type of Finding: Significant Deficiency and Noncompliance Category of Finding: Eligibility Known Questioned Costs: $350 Likely Questioned Costs: $350 Criteria According to 34 CFR §668.164(h), institutions must pay the credit balance directly to the student or parent as soon as possible but no later than 14 days after: 1) the first day of class of a payment period if the credit balance occurred on or before that day, or 2) the balance occurred if that was after the first day of class. Condition During our compliance testing of 85 student files, we discovered that 6 files—representing approximately 6% of the sample—had funds that were not appropriately returned in a timely manner. There were 5 files who were not refunded within the 14 day time period and 1 file who was charged a soccer fee when they did not end up playing soccer. Cause The untimely refunds of student accounts resulted from a lapse in internal controls over the student account refund process, possibly due to oversight or insufficient monitoring of student accounts within the Jenzabar software. Effect Failure to refund student accounts timely can lead to incorrect federal expenditures or funding of student accounts, potentially affecting the College’s receipt of federal funding. Repeat Finding This is not a repeat finding. Recommendation We recommend that the College review and enhance its procedures for monitoring and funding student accounts. This could involve implementing automated alerts, providing additional staff training, or establishing more robust internal checks to ensure adherence to refund requirements. Management’s Response Management concurs with this finding. See Management’s Response and Corrective Action plan.

Finding No. 2025-003: Inadequate Calculation of Return of Title IV Funds Assistance Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.063, 84.0384, 84.268, 84.379 Federal Agency: U.S. Department of Education Type of Finding: Significant Deficiency and Noncompliance Category of Finding: Special Tests and Provisions: Return of Title IV Funds Known Questioned Costs: $57 Likely Questioned Costs: $57 Criteria Per 34 CFR §668.22(a)(3), percentages related to the calculation of the Return of Title IV Funds are calculated to four decimal places, and rounded to three decimal places. The third decimal place is rounded up if the fourth decimal place is five or above. Condition During our compliance testing of Return of Title IV funds over 21 students, we discovered that the College was utilizing two decimal places rather than three decimal places as required by the Federal Student Aid Handbook. This impacted 13 students in the Spring 2025 semester, amounting to $57 of funds that should have been returned. Cause The miscalculation of return of funds appears to be due to inadequate internal controls over Federal Student Aid Handbook requirements, resulting in utilizing a different amount than what was required. Effect Without utilizing the appropriate decimal places, the College may be misusing federal funding by not calculating the appropriate amount to be returned. Repeat Finding This is not a repeat finding. Recommendation We recommend that the College strengthen its controls over ensuring the Federal Student Aid Handbook is being monitored for appropriate requirements. Management’s Response Management concurs with this finding. See Management’s Response and Corrective Action plan.

Finding No. 2024‐001: Missing Original Promissory Note in Perkins Loan File Assistance Title: Student Financial Assistance Cluster – Federal Perkins Loan Program Assistance Listing Number: 84.038 Federal Agency: U.S. Department of Education Type of Finding: Significant Deficiency and Noncompliance Category of Finding: Special Tests and Provisions: Perkins Loan Recordkeeping and Retention Known Questioned Costs: $‐0‐ Likely Questioned Costs: $‐0‐ Criteria Per 34 CFR §674.19(e), institutions participating in the Federal Perkins Loan Program are required to maintain accurate and complete records for each borrower, including the original signed promissory note. Condition During our compliance testing of 25 Perkins Loan files, we discovered that one file—representing approximately 4% of the sample—was missing the original promissory note. The loan in question had an original amount of $600, with an unpaid balance of $459 as of June 30, 2024. Cause The missing promissory note appears to be due to inadequate internal controls over document retention procedures, resulting in the oversight or misplacement of critical loan documentation. Effect Without the original promissory note, the College may be unable to enforce repayment of the loan, potentially resulting in financial loss to the Perkins Loan Program and noncompliance with federal regulations. Repeat Finding This is not a repeat finding. Recommendation We recommend that the College strengthen its document retention policies and procedures to ensure that all original promissory notes are properly maintained in the loan files. This may include implementing a tracking system for loan documentation and conducting periodic audits of loan files to verify the presence of required documents. Management’s Response Management concurs with this finding. See Management’s Response and Corrective Action plan.

Assistance Title: Student Financial Assistance Cluster Assistance Listing Number: 84.007, 84.063, 84.0384, 84.268, 84.379 Federal Agency: U.S. Department of Education Type of Finding: Significant Deficiency and Noncompliance Category of Finding: Special Tests and Provisions: Enrollment Reporting Known Questioned Costs: $‐0‐ Likely Questioned Costs: $‐0‐ Criteria According to 34 CFR §685.309(b), institutions must report changes in student enrollment status to the National Student Loan Data System (NSLDS) within 30 days of the change or include the change in response to the next scheduled Enrollment Reporting roster file within 60 days. Condition During compliance testing of 14 student records, it was found that 1 student—representing approximately 7% of the sample—was not reported to NSLDS in a timely manner, exceeding the required reporting deadlines. Cause The untimely reporting resulted from a lapse in internal controls over the enrollment reporting process, possibly due to oversight or insufficient monitoring of reporting schedules. Effect Failure to report enrollment status changes promptly can lead to incorrect deferment or repayment statuses for student borrowers, potentially affecting their financial obligations and the federal government's ability to manage the student loan portfolio effectively. Repeat Finding This is not a repeat finding. Recommendation We recommend that the College review and enhance its procedures for monitoring and reporting enrollment status changes. This could involve implementing automated alerts, providing additional staff training, or establishing more robust internal checks to ensure adherence to reporting deadlines. Management’s Response Management concurs with this finding. See Management’s Response and Corrective Action plan.

Assistance Title: Education Stabilization Fund Assistance Listing Number: 84.425E and 84.425F Federal Agency: Department of Education Type of Finding: Significant Deficiency and Noncompliance Category of Finding: Allowable Costs and Activities Allowed Known Questioned Costs: $864 Likely Questioned Costs: Up to $3,000 Criteria: Under 2 CFR 200.403(g), costs must be adequately documented to be allowable under Federal awards. Condition: We tested a sample of sixty expenditures charged to the Education Stabilization Fund and identified two instances of noncompliance and deficiencies in internal control. For one student who received a student award under the Higher Education Emergency Relief Fund (HEERF), there was an absence of clarity regarding approved and unapproved expenditures, along with inadequate itemized receipts. Additionally, for one student who received a student award under HEERF, there was no completed application or supporting documentation to support the award. Cause: Lack of robust review process to ensure that all expenditures have detailed, appropriate supporting documentation. Effect: Unallowable costs could be incurred with Federal funds, subjecting the College to potential penalties and claw backs. Recommendation: We recommend that procedures be strengthened to ensure adequate documentation of expenses charged to Federal awards. Management’s Response: Management concurs with this finding. See Management’s Response and Corrective Action plan.

Assistance Title: Education Stabilization Fund Assistance Listing Number: 84.425E and 84.425F Federal Agency: Department of Education Type of Finding: Significant Deficiency and Noncompliance Category of Finding: Reporting Known Questioned Costs: None Likely Questioned Costs: None Criteria: In accordance with the Federal award terms, the Quarterly Budget and Expenditure reports are required to be made publicly available by the 10th day of the month following the calendar quarter. Condition: The report for the calendar quarter ended December 31, 2022 was made publicly available on January 11, 2023, one day late. Although not made publicly available on January 10, 2023, the quarterly report was submitted timely to the Department of Education on January 10, 2023. Cause: Lack of robust controls in adhering to certain reporting deadlines. Effect: Submission of public reporting late could result in reputational damage and regulatory actions. Recommendation: We recommend that procedures be strengthened to ensure the College adheres to reporting deadlines. Management’s Response: Management concurs with this finding. See Management’s Response and Corrective Action plan.