Providence Christian CollegeNon-Profit

Information on the Federal Program – Department of Education, Student Financial Assistance Cluster, Federal Supplemental Educational Opportunity Grant Program, CFDA 84.007; Federal Work-Study Program, CFDA 84.033; Federal Pell Grant Program, CFDA 84.063; Federal Direct Student Loan Program, CFDA 84.268. Program Year – July 1, 2024 – June 30, 2025 Criteria for Specific Requirement – The Department of Education requires that, for students with a Title IV credit balance, the institution must pay the credit balance to the student or parent borrower (1) within 14 days of the date the balance occurred, or (2) by the end of the loan period or last payment period in the award year for which the funds were awarded, if the institution has obtained a valid authorization to hold the credit balance and is not subject to the reimbursement or heightened cash monitoring payment methods (34 CFR 668.164(h)). Condition –Student account statements did not reflect refund disbursement within timely manner. Questioned Costs – None – nonmonetary finding Context – During our testing, we noted 5 of the 10 disbursements tested paid the credit balance owed to the students after the 14 days period or by the end of the loan period or last payment period in the award year. Cause – In November of 2023, Providence Christian College faced significant institutional turnover. The Financial Aid Director of 15 years left the institution. The appointed successor to the Financial Aid Director then made a decision to leave the institution on December 15th, 2023. This institutional turmoil created upheaval in the department and required the assistance of a consultant. The current provider, Campus Ivy, was not able to provide consulting services and so Providence contracted with FA Solutions to bring stability to the Financial Aid Department. Unfortunately, it seems that some of the processes that were supposed to be maintained were not passed on through the institution. In this specific situation, there was a breakdown in communication and oversight of the refund process. In an attempt to ensure that refunds were paid in a timely manner, the college requests direct deposit information. Sometimes, however, students did not respond in a timely manner and the college did not adequately follow up and/or disburse a check instead. Effect – The College is not in compliance with the Department of Education regulations. Identification as a Repeat Finding – N/A Recommendation – We recommend the College evaluate its procedures and policies around refund disbursement and report accurately and timely.

Information on the Federal Program – Department of Education, Student Financial Assistance Cluster, Federal Supplemental Educational Opportunity Grant Program, CFDA 84.007; Federal Work-Study Program, CFDA 84.033; Federal Pell Grant Program, CFDA 84.063; Federal Direct Student Loan Program, CFDA 84.268. Program Year – July 1, 2024 – June 30, 2025 Criteria for Specific Requirement – The Department of Education requires the college to report the disbursement dates and amount on student ledgers that match the disbursement dates and amount reported to the Common Origination and Disbursement (COD) (34 685.301(a)(2)(iii)). Condition – Disbursement records (Student account statements) did not reflect agreement between disbursement dates (COD), as required. Questioned Costs – None – nonmonetary finding Context – During our testing, we noted 10 of the 10 disbursements tested had incorrect Pell and/or Direct Loan disbursement dates reported to the Common Origination and Disbursement (COD) system. Cause – In November of 2023, Providence Christian College faced significant institutional turnover. The Financial Aid Director of 15 years left the institution. The appointed successor to the Financial Aid Director then made a decision to leave the institution on December 15th, 2023. This institutional turmoil created upheaval in the department and required the assistance of a consultant. The current provider, Campus Ivy, was not able to provide consulting services and so Providence contracted with FA Solutions to bring stability to the Financial Aid Department. In the turnover and transition from employees and third party servicers, there was miscommunication and misunderstanding due to institutional ignorance. We reflected the internal dates of receipt in our SIS when the cash payment was received (typically a day or two after the disbursement date). This is because entries had always been manually created by the former Financial Aid Director and we did not understand that this process would be out of compliance with the way FA Solutions was processing financial aid. Effect – The College is not in compliance with the Department of Education regulations. Identification as a Repeat Finding – N/A Recommendation – We recommend the College evaluate its procedures and policies around reporting Pell and Direct Loan disbursements to COD to ensure that student information is reported accurately and timely.

Information on the Federal Program – Department of Education, Student Financial Assistance Cluster, Federal Pell Grant Program, 84.063; Federal Work-Study Program, 84.033; Federal Supplemental Educational Opportunity Grant Program, 84.007; Federal Direct Student Loan Program. Program Year – July 1, 2024 – June 30, 2025 Criteria or Specific Requirement – Special Tests and Provisions – Return of Title IV Funds – When a recipient of Title IV grant or loan assistance withdraws from an institution during a payment period or period of enrollment in which the recipient began attendance, the institution must determine the amount of Title IV aid earned by the student as of the student’s withdrawal date. If the total amount of Title IV assistance earned by the student is less than the amount that was disbursed to the student or on his or her behalf as of the date of the institution’s determination that the student withdrew, the difference must be returned to the Title IV programs as outlined in this section as soon as possible but no later than 45 days after the date of the institution’s determination that the student withdrew (34 CFR Sections 668.22(a)(1)-(3)). Condition – The return of unearned Title IV aid did not occur within the required timeframe. Questioned Costs – None – nonmonetary finding Context – Out of a sample of 2 students from a population of 11 students who withdrew during the year, unearned Title IV aid was not returned timely for two of the student calculations reviewed. Our sample was not, and was not intended to be, statistically valid. Cause – In November of 2023, Providence Christian College faced significant institutional turnover. The Financial Aid Director of 15 years left the institution. The appointed successor to the Financial Aid Director then made a decision to leave the institution on December 15th, 2023. This institutional turmoil created upheaval in the department and required the assistance of a consultant. The current provider, Campus Ivy, was not able to provide consulting services and so Providence contracted with FA Solutions to bring stability to the Financial Aid Department. In this specific situation, FA Solutions had a manual error that resulted in a miscalculation. Effect – The unearned Title IV aid was ultimately calculated and returned correctly to the Department of Education but was not performed timely. Identification as a Repeat Finding – N/A Recommendation – We recommend the University ensure the process to return Title IV aid is properly followed to allow for the timely return of unearned Title IV aid.

Information on the Federal Program – Department of Education, Student Financial Assistance Cluster, Federal Pell Grant Program, 84.063; Federal Direct Student Loan Program, 84.268. Program Year – July 1, 2024 – June 30, 2025 Criteria or Specific Requirement – Special Tests and Provisions – Enrollment Reporting – Under the Pell grant and loan programs, colleges must complete and return within 30 days the Enrollment Reporting roster file. 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 web site. Institutions are responsible for timely reporting, whether they report directly or via a third-party servicer. Unless the school expects to complete its next roster within 60 days, the University must notify the lender or the guaranty agency within 30 days, if it discovers that a student who received a loan either did not enroll or ceased to be enrolled on at least a half-time basis. (Pell, 34 CFR Section 690.83(b)(2); Direct Loan, 34 CFR Section 685.309(2)(i)). Condition – Notification of the student status change (graduated, withdrew, less than half-time) did not reach the NSLDS within the required timeframe. Questioned Costs – None – nonmonetary finding Context – Out of a sample of 5 students from a population of 50 students who had changes in status during the year, NSLDS was not provided timely notification for 5 of the student status changes reviewed. Our sample was not, and was not intended to be, statistically valid. Cause – In November of 2023, Providence Christian College faced significant institutional turnover. The Financial Aid Director of 15 years left the institution. The appointed successor to the Financial Aid Director then made a decision to leave the institution on December 15th, 2023. This institutional turmoil created upheaval in the department and required the assistance of a consultant. The current provider, Campus Ivy, was not able to provide consulting services and so Providence contracted with FA Solutions to bring stability to the Financial Aid Department. In this situation, Providence mistakenly assumed that FA Solutions would take over the responsibility of Enrollment Reporting as Campus Ivy had done. It was not until the audit that it was discovered that the FA Solutions contract did not include Enrollment Reporting services. Effect – The status change was ultimately reported correctly to NSLDS but was not performed timely. Identification as a Repeat Finding – N/A Recommendation – We recommend the University ensure the remittance schedule is properly established to allow for timely remittance.

Federal Program – Department of Education, Developing Hispanic-Serving Institutions Program, 84.031S Program Year – July 1, 2023 – June 30, 2024 Criteria or Specific Requirement – Cash Management – The Uniform Guidance and the grant award notification signed by the College for this grant, by reference to the Uniform Guidance, state that the College must minimize the time elapsing between the transfer of funds from the United States Treasury to the College and the utilization or expenditure of those funds. The Uniform Guidance applies to any and all types of federal awards (2 CFR Section 200.305(b)). Condition – The time between the College’s draw-down of funds from the United States Treasury and utilization of those funds was not minimized as stated in the general cash management section of Uniform Guidance. Questioned Costs – None Context – The College drew down $600,000 of the HSI grant during the year ended June 30, 2024, of which $165,484 was not needed immediately (or within a minimum amount of time) for program costs at June 30, 2024. The funds draw-down were used for allowable purposes but time was not minimized between draw-down and use for program purposes. Cause and Effect – The College did not process these funds in accordance with cash management rules under the Uniform Guidance, applicable to these funds with respect to minimizing the time elapsed between the date of the initial transfer and the expenditure or utilization of these grant funds. Identification as a Repeat Finding – No Recommendation – We recommend that the College review its policies and procedures regarding draw-down of non-SFA federal grants to ensure they are in compliance with the cash management rules of the Uniform Guidance. Specifically ensuring the College’s policy minimizes the time between the draw-down and the use of the funds for program purposes. Views of Responsible Officials and Planned Corrective Action – In the first year of the grant award, we retained a consulting group to ensure that our processing and management of the grant complied with all relevant requirements. This was the first time all personnel at the college had dealt with this particular government grant and so guidance was followed by the grant mandated consultants regarding grant drawdowns. The interpretation from our grant mandated consultants was that so long as we did not have excessive drawdowns as defined by the Hispanic Serving Institution Grants manual, we would be in compliance with CFR 200.305(b). Given that guidance, we believed we were in compliance when the decision was made to drawdown grant funds for work that contractors were projected to complete in July. Our grant mandated consultants noted that while we were negotiating the timeline of the work, it was "administratively feasible" to draw funds as the work was to be completed over the summer by the end of July. The schedule ended up getting pushed to the end of August, but funds were anticipated to be drawn within a month of drawdown and they were fully expended by August 31--and payments started going out July 5th to contractors. The combination of the delay in the completion of the contracting work and the wider interpretation of CFR 200.305(b) from our mandated consultants than our auditors are the reason for the non-compliance finding.

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