Pacific Oaks Education Corporation

Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster, Federal Direct Student Loans Assistance Listing Number: 84.268 Award Year: June 1, 2020 ? May 31, 2021 Program Expenditures: $25,120,603 Questioned Costs: None Criteria: Per 34 CFR 685.309(b)(2), a School is required to notify the lender 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. The School has 30 days to notify the lender if the next scheduled roster reporting date is within 30 days of the date of determination of a status change. Condition: One student?s enrollment status change was not properly reported within the required timeframe. Cause: One student?s enrollment status change was not reported timely. The College?s internal controls failed to detect the error. Effect: Noncompliance with federal regulations could result in the loss of future federal financial aid funding. In addition, not reporting enrollment status changes within the required timeframe can impact an individual student?s loan deferment and repayment schedule. Questioned Costs: None Context: One of 49 students tested from a population of 666 students with enrollment status changes was not reported in the required timeframe. Repeat finding: Yes, 2020-001 Recommendation: The College should enhance their internal controls related to student enrollment status changes. The College should implement procedures to ensure the registrar?s office uploads withdrawal dates timely and communicates with the student aid office so the student aid office can report the changes to the lender in a timely manner. Management?s response: Management agrees with this finding. Please see corrective action plan attached.

Identifying Number: 2021-001 Finding: During performance of special tests and provisions, 1 out of 49 students tested for enrollment status changes was not reported in the required timeframe. Per 34 CFR 685.309(b)(2), a School is required to notify the lender 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. The School has 30 days to notify the lender if the next scheduled roster reporting date is within 30 days of the date of determination of a status change. Corrective Action Taken or Planned: The Financial Aid Specialist team will partner with the institutional Registrar and Academic Records and Compliance team to emphasize the significance of timely processing of rejected forms to eliminate impacting the timeliness of enrollment reporting in November, 2021. This measure will ensure enrollment changes are reported within the required timeframe. The person responsible for the completion of the corrective action plan is Tonya Henry, Vice President of Student Finance, and can be reached at (312) 488.6057 or thenry@tcsedsystem.edu.

2020-001

Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster, Federal Supplemental Educational Opportunity Grants, Federal Pell Grant Program, Federal Direct Student Loans Assistance Listing Number: 84.007, 84.063, 84.268 Award Year: June 1, 2020 ? May 31, 2021 Program Expenditures: $26,689,847 Questioned Costs: None Criteria: Per 34 CFR 668.22(j)(1), a School is required to return the amount of title IV funds for which it is responsible under 34 CFR 668.22(g) as soon as possible but no later than 45 days after the date of the institution?s determination that the student withdrew as defined in 34 CFR 668.22(l)(3). Condition: Two students? refunds for return of title IV funds were not properly returned within the required timeframe. Cause: Two students? refunds for return of title IV funds were not returned timely. The College?s internal controls failed to detect the errors. Effect: Noncompliance with federal regulations could result in the loss of future federal financial aid funding. In addition, not returning refunds that are required to be returned the Department of Education could result in additional interest owed to the Department. Questioned Costs: None Context: Two of 40 students tested from a population of 324 students that required a return of title IV funds calculation did not have refunds returned within the required timeframe. Repeat finding: No Recommendation: The College should enhance their internal controls related to return of title IV funds. The College should implement procedures to ensure the financial aid office performs the calculations of return of title IV funds timely so that refunds are returned timely to the Department. Management?s response: Management agrees with this finding. Please see corrective action plan attached.

Identifying Number: 2021-002 Finding: During performance of special tests and provisions, 2 out of 40 students tested for Return of Title IV funds did not have funds returned within the required timeframe. Per 34 CFR 668.22(j)(1), a School is required to return the amount of title IV funds for which it is responsible under 34 CFR 668.22(g) as soon as possible but no later than 45 days after the date of the institution?s determination that the student withdrew as defined in 34 CFR 668.22(l)(3). Corrective Action Taken or Planned: The Financial Aid Specialist team will partner with the institutional Registrar and Academic Records and Compliance team to emphasize the significance of timely processing of rejected forms to eliminate impacting the timely return of funds in November, 2021. This measure will ensure refunds are returned within the required timeframe. The person responsible for the completion of the corrective action plan is Tonya Henry, Vice President of Student Finance, and can be reached at (312) 488.6057 or thenry@tcsedsystem.edu.

Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster, Federal Pell Grant Program, Federal Direct Student Loans Assistance Listing Number: 84.063, 84.268 Award Year: June 1, 2020 ? May 31, 2021 Program Expenditures: $26,623,539 Questioned Costs: None Criteria: Per 34 CFR 668.164(h), a Title IV, HEAD credit balance must be paid directly to the student or parent as soon as possible, but no later than: (I) fourteen days after the balance occurred if the credit balance occurred after the first day of class or (II) fourteen days after the first day of class of a payment period of the credit balance occurred on or before the first day of class of that payment period. Condition: One student?s credit balance was not properly paid to the student within the required timeframe. Cause: One student?s credit balance was not paid to the student timely. The College?s internal controls failed to detect the error. Effect: Noncompliance with federal regulations could result in the loss of future federal financial aid funding. In addition, not timely returning credit balances to students within the required timeframe can impact students? ability for costs associated with their education. Questioned Costs: None Context: One out of 40 students tested from a population of 1,555 students that received student financial aid funding did not have their credit balance paid within the required timeframe. Repeat finding: No Recommendation: The College should enhance their internal controls related to paying credit balances to students or parents The College should implement procedures to ensure credit balances are reviewed timely and are properly disbursed to the student or parent. Management?s response: Management agrees with this finding. Please see corrective action plan attached.

Identifying Number: 2021-003 Finding: During performance of special tests and provisions, one student?s credit balance was not paid to the student timely. Per 34 CFR 668.164(h), a Title IV, HEAD credit balance must be paid directly to the student or parent as soon as possible, but no later than: (I) fourteen days after the balance occurred if the credit balance occurred after the first day of class or (II) fourteen days after the first day of class of a payment period of the credit balance occurred on or before the first day of class of that payment period. Corrective Action Taken or Planned: In May, 2021, the Student Accounts department implemented auto-scheduling of stipends and collaborated with the Treasury department to establish check-printing procedures that ensure the timely distribution of credit balances to eligible students. This measure will prevent credit balances from being issued to students greater than the maximum time period allowed. The person responsible for the completion of the corrective action plan is Tonya Henry, Vice President of Student Finance, and can be reached at (312) 488.6057 or thenry@tcsedsystem.edu.

Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster, Federal Direct Student Loans CFDA Number: 84.268 Award Year: June 1, 2020 ? May 31, 2021 Program Expenditures: $25,120,603 Questioned Costs: $704 Criteria: Per 34 CFR 685.203(e)(2), an independent undergraduate?s aggregate award amount of Direct Unsubsidized Loans, Unsubsidized Federal Stafford Loans and Federal Subsidized Loans may not exceed $57,500. Condition: One student was awarded Federal Direct Student Loans that exceeded the student?s aggregate loan limit. Cause: One student was awarded Federal Direct Student Loans that exceeded the student?s aggregate loan limit. The College?s internal controls failed to detect the error. Effect: Noncompliance with federal regulations could result in the loss of future federal financial aid funding. In addition, awarding aid in excess in award limits will require the institution to refund the Department for these funds. Questioned Costs: $704 Context: One out of 40 students tested from a population of 1,555 students that received student financial aid funding was awarded in excess of the aggregate loan limit for Federal Direct Student Loans. Repeat finding: No Recommendation: The College should enhance their internal controls related to determining eligibility for Federal Direct Student Loans. The College should implement procedures to ensure the financial aid office determines the proper eligibility for student financial aid funding. Management?s response: Management agrees with this finding. Please see corrective action plan attached.

Identifying Number: 2021-004 Finding: During performance of special tests and provisions, one student was awarded Federal Direct Student Loans that exceeded the student?s aggregate loan limit. Per 34 CFR 685.203(e)(2), an independent undergraduate?s aggregate award amount of Direct Unsubsidized Loans, Unsubsidized Federal Stafford Loans and Federal Subsidized Loans may not exceed $57,500. Corrective Action Taken or Planned: A refresher training will be conducted and documented with the Financial Aid Advising team in October, 2021 to highlight the proper review of prior student aid award years and the National Student Loan Database System (NSLDS) history report. The person responsible for the completion of the corrective action plan is Tonya Henry, Vice President of Student Finance, and can be reached at (312) 488.6057 or thenry@tcsedsystem.edu.

Federal Agency: U.S. Department of Education Program Name: Student Financial Assistance Cluster, Federal Direct Student Loans CFDA Number: 84.268 Award Year: June 1, 2019 ? May 31, 2020 Program Expenditures: $22,816,359 Questioned Costs: None Criteria: Per 34 CFR 685.309(b)(2), a School is required to notify the lender 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. The School has 30 days to notify the lender if the next scheduled roster reporting date is within 30 days of the date of determination of a status change. Condition: One student?s enrollment status change was not properly reported within the required timeframe. Cause: One student?s enrollment status change was not reported timely. The College?s internal controls failed to detect the error. Effect: Noncompliance with federal regulations could result in the loss of future federal financial aid funding. In addition, not reporting enrollment status changes within the required timeframe can impact an individual student?s loan deferment and repayment schedule. Questioned Costs: None Context: One of 46 students tested from a population of 617 students with enrollment status changes was not reported in the required timeframe. Repeat finding: No Recommendation: The College should enhance their internal controls related to student enrollment status changes. The College should implement procedures to ensure the registrar?s office uploads withdrawal dates timely and communicates with the student aid office so the student aid office can report the changes to the lender in a timely manner. Management?s response: Management agrees with this finding. Please see corrective action plan attached.

Identifying Number: 2020-001 Finding: During performance of eligibility testing, 1 student tested for enrollment status change was not reported in the required timeframe. Per 34 CFR 685.309(b)(2), a School is required to notify the lender 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. The School has 30 days to notify the lender if the next scheduled roster reporting date is within 30 days of the date of determination of a status change. Corrective Action Taken or Planned: From August 17, 2020 through September 2, 2020, the Academic Records & Compliance (ARC) team conducted a two-week training for Registrar staff to cover Registrar overview, multiple CampusVue functions (registration, pulling transcripts, status changes, attendance, SAP, degree conferral, holds and reports) and Academic Portal functionality. Additionally, beginning in February, 2020, the ARC team modified its procedures to include the review of a registered-not-active report prior to the monthly Clearinghouse report to identify any students who may have an active status without any registration. These measures will help ensure that students are accurately coded by status and subsequently reported to the Clearinghouse in a timely manner. The person responsible for the completion of the corrective action plan is Tonya Henry, Vice President of Student Finance, and can be reached at (312) 488.6057 or thenry@tcsedsystem.edu.