PINAL COUNTY COMMUNITY COLLEGE DISTRICT

The District did not timely return Title IV funds to the U.S. Department of Education, increasing the risk of reduced or terminated future awards Cluster name: Student Financial Assistance Cluster Assistance Listings number(s) and name(s): 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study Program 84.063 Federal Pell Grant Program 84.268 Federal Direct Student Loans Award number(s) and year(s): P007A240134 July 1, 2024 through June 30, 2025 P033A240134 July 1, 2024 through June 30, 2025 P063P242910 July 1, 2024 through June 30, 2025 P268K252910 July 1, 2024 through June 30, 2025 Federal agency: U.S. Department of Education Compliance requirement: Special tests and provisions – return of Title IV funds Questioned costs: None Condition Contrary to federal regulations, the District’s Student Financial Aid Office (Office) did not timely return $1,906 of Student Financial Assistance (SFA) Title IV funds to the U.S. Department of Education (ED) for 3 of 45 students tested who withdrew from the District during the period of enrollment in which the student began attendance. Specifically, the Office did not: Include all required institutional charges recorded in the students’ accounts, such as room and board, when calculating the unearned portion of 2 students’ Pell grant awards, resulting in underpayments to ED for $1,690 and $37. Timely notify 1 student, within 45 days, that they were required to return $179 of unearned Pell grant monies to ED. The District notified the student of the required repayment 607 days late. Effect The District’s failure to timely return Title IV funding and the Office’s lack of controls to comply with federal regulations increases the risk that additional Title IV funds could be returned past the 45-day requirement and increases the risk that ED could reduce or terminate future awards of Title IV funds for noncompliance. There were no questioned costs because, after we informed the District of the underpayments, they submitted $1,690 and $216 to ED on June 6, 2026 and July 15, 2026, respectively. The returns were submitted between 363 and 607 days late. Cause The Office’s policies and procedures did not require a second employee to review and approve the return of Title IV funds calculations to verify that the proper amounts were remitted from both the District and the student. In addition, according to Office management, they did not have the appropriate staffing to complete the secondary reviews. Criteria Federal regulations require the return of Title IV funds when a recipient of Title IV grant or loan assistance withdraws from the District during a payment period or period of enrollment in which the recipient began attendance. Specifically, the District must determine the amount of Title IV aid the student earned as of the student’s withdrawal date. If the total amount of Title IV assistance the student earned is less than the amount that was disbursed to the student or on their behalf as of the date of the institution’s determination that the student withdrew, the difference must be returned to the Title IV programs no later than 45 days after the date the District determined that the student withdrew (34 Code of Federal Regulations [CFR] §668.22[a–j]). In addition, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal programs are being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303). Recommendations to the District Improve policies and procedures to require an independent employee to review and approve the return of Title IV funds calculations to verify that the proper amounts were remitted from both the District and the student. Perform timely return of Title IV funds calculations for all students who received Title IV funds and subsequently withdrew from the District, ensuring that all institutional charges are included. Notify students who received student financial assistance and subsequently withdrew from the District of any unearned Title IV funds they are required to repay no later than 45 days after the District’s determination that the student withdrew. Initiate returns of the institution’s and student’s portion of Title IV funds to ED no later than 45 days after the date of the District’s determination that the student withdrew. This finding is similar to prior-year finding 2024-001 and was initially reported in fiscal year 2021. Views of responsible officials District management concurs with this finding. The District’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials regarding these recommendations. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy.

The District did not accurately report required student information to the federal agency, risking students not being asked to repay financial assistance Cluster name: Student Financial Assistance Cluster Assistance Listings number(s) and name(s): 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study Program 84.063 Federal Pell Grant Program 84.268 Federal Direct Student Loans Award number(s) and year(s): P007A240134 July 1, 2024 through June 30, 2025 P033A240134 July 1, 2024 through June 30, 2025 P063P242910 July 1, 2024 through June 30, 2025 P268K252910 July 1, 2024 through June 30, 2025 Federal agency: U.S. Department of Education Compliance requirement: Special tests and provisions – enrollment reporting Questioned costs: None Condition Contrary to federal regulations, the District’s Financial Aid Office (Office) did not accurately report student enrollment status changes to the National Student Loan Data System (NSLDS) as required. Specifically, the Office reported incorrect dates for students’ enrollment changes for 5 of the 63 students we tested participating in the Federal Pell Grant (Pell) or Federal Direct Student Loans (Direct Loans) programs. Effect The District’s students may not be asked to repay student financial assistance grants and loans if or when required if the NSLDS does not accurately reflect students’ enrollment status. Also, the District is at risk that student enrollment status changes may be reported inaccurately for additional students attending the summer session.

Cause Office management reported that they do not have formal policies and procedures for reviewing and verifying that student enrollment status changes are submitted accurately to NSLDS. Criteria Federal regulations require reporting to the NSLDS all applicable students’ enrollment statuses and any enrollment status changes for the Pell and Direct Loans programs within 60 days of the students’ change. Student enrollment status changes include reductions or increase in attendance levels, withdrawals, graduations, or approved leaves of absence (34 Code of Federal Regulations [CFR] §§685.309[b][2] and 690.83[b][2]). Further, federal guidelines require establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal programs are being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303). Recommendations to the District Develop and implement policies and procedures for enrollment reporting to: Report accurate student enrollment statuses and changes within 60 days of the change to the NSLDS for all students receiving Pell and Direct Loans. Review, verify, and correct as necessary the student-enrollment status data compiled from system-generated reports prior to submitting it to NSLDS. Designate an individual to verify that student enrollment status changes recorded on its student information system and reported to NSLDS are accurate. Views of responsible officials District management concurs with this finding. The District’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials regarding these recommendations. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy.

The District did not disburse federal financial assistance owed to 34 students within the required 14-day time frame Cluster name: Student Financial Assistance Cluster Assistance Listings number(s) and name(s): 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study Program 84.063 Federal Pell Grant Program 84.268 Federal Direct Student Loans Award number(s) and year(s): P007A240134 July 1, 2024 through June 30, 2025 P033A240134 July 1, 2024 through June 30, 2025 P063P242910 July 1, 2024 through June 30, 2025 P268K252910 July 1, 2024 through June 30, 2025 Federal agency: U.S. Department of Education Compliance requirement: Special tests and provisions – disbursements to or on behalf of students Questioned costs: None Condition Contrary to federal regulations, the District’s Student Financial Aid Office (Office) did not disburse Student Financial Assistance (SFA) credit balances to students or their parents within 14 days after applying the Title IV grant and loan awards to the student’s accounts. Specifically, during October 2024, the Office failed to timely disburse $39,014 in SFA credit balance funds owed to 34 students. The Office held the students’ SFA credit balances 1 to 3 days longer than the allowed 14 days after the awards were posted to the students’ accounts. Effect The Office’s lack of controls to monitor compliance with federal regulations increases the risk that students will not receive their SFA credit balances timely to help pay for additional college expenses. Further, continued District noncompliance administering its federal programs could enforce escalated penalties over its cash-monitoring requirements, which would require additional supporting records and longer periods of time for reimbursement to the District. Cause According to Office management, the late SFA credit balance payments were caused by a student information system generated reporting error for the period October 9, 2024 through October 23, 2024. Office management reported that they identified the report was incomplete but were unable to determine why the report did not capture all the required credit balances. The Office subsequently developed a new report to capture the complete population of undisbursed credit balances. However, because of the revised report’s timing, 34 students’ SFA credit balances were disbursed late. Criteria Federal regulation requires the Office to apply each student’s SFA awards to the student’s account to satisfy tuition and fees owed to the District. Any excess SFA awards results in a credit balance on the student’s account. When this occurs, the Office is required to disburse any remaining SFA award monies directly to the student or parent as soon as possible, but no later than 14 days after the award has been posted to the student’s account. If the credit balance occurred before the first day of class of that payment period, then disbursement to the student or parent would be required no later than 14 days after the first day of class of the payment period (34 Code of Federal Regulations [CFR] §668.164[h]). In addition, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal programs are being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303). Recommendations to the District Disburse all SFA credit balances to students or their parents within 14 days after applying the Title IV grant and loan awards to the students’ accounts. If the credit balance occurred before the first day of class of that payment period, then disbursement to the student or parent would be required no later than 14 days after the first day of class of the payment period. Verify that student information system-generated reports used to monitor credit balances accurately capture the complete population of student information, award dates, and credit balances to ensure that all impacted students receive final payment of SFA credit balances within the required 14-day time frame. Views of responsible officials District management concurs with this finding. The District’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials regarding these recommendations. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy.

The District failed to report complete and accurate information to the U.S. Department of Education (ED) on its Fiscal Operations Report and Application to Participate (FISAP) Cluster name: Student Financial Assistance Cluster Assistance Listings number(s) and name(s): 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study Program 84.063 Federal Pell Grant Program 84.268 Federal Direct Student Loans Award number(s) and year(s): P007A240134 July 1, 2024 through June 30, 2025 P033A240134 July 1, 2024 through June 30, 2025 P063P242910 July 1, 2024 through June 30, 2025 P268K252910 July 1, 2024 through June 30, 2025 Federal agency: U.S. Department of Education Compliance requirement: Reporting Questioned costs: Not applicable Condition Contrary to federal regulations, we found the District failed to report complete and accurate information to the U.S. Department of Education (ED) on the Fiscal Operations Report and Application to Participate (FISAP) for award year July 1, 2024 through June 30, 2025, and application award year July 1, 2026 through June 30, 2027. Specifically, the Student Financial Aid Office (Office) reported the wrong student data for the Pell Grant Program (Pell), Federal Work-Study Program (FWS), and Federal Supplemental Education Opportunity Grants Program (FSEOG) included in Part II, Section F, and Part VI, Section A, of the District’s FISAP. In addition, the District reported student data from fiscal year 2024 instead of fiscal year 2025 for all line items in these 2 sections of the FISAP. In addition, the District understated the amounts reported in the FISAP Section E, Lines 22 and 23, for tuition and fees revenues and the Pell grant awarded by $6,104,147 and $128,244, respectively. Effect Failure to report accurate and complete data in its FISAP puts the District’s campus-based programs, which include the FWS and FSEOG programs, at risk and may impact the District’s ability to receive funding for these programs from ED. If the District’s funding is reduced or eliminated, students lose the opportunity to receive federal grants and work-study opportunities. Cause Office management reported that they did not have policies and procedures over the FISAP reporting process. As a result, management used incorrect data to compile the FISAP report, and a second employee did not review or detect the sections with errors to ensure the reported data was compiled in accordance with the FISAP report directions and agreed to the supporting schedules. Criteria Each year, the District is required to submit a Fiscal Operations Report to the ED and ensure that the information reported is accurate (34 Code of Federal Regulations [CFR] §§675.19[b][3] and 676.19[b][3]). In addition, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal programs are being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303). Recommendations to the District Develop and implement policies and procedures for compiling the FISAP report to include the following: Step-by-step instructions on where to obtain the required data to ensure accurate information is included in the FISAP report in accordance with the report’s directions. Require an independent review and approval of the report by a knowledgeable employee prior to its submission to ED. Contact ED to revise and resubmit an accurate FISAP report that covers both the award year July 1, 2024 through June 30, 2025, and the District’s application for award year July 1, 2026 through June 30, 2027. Views of responsible officials District management concurs with this finding. The District’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials regarding these recommendations. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy.

Federal Agency: U.S. Department of Education Cluster Name: Student Financial Assistance Cluster Federal Program Name: Federal Supplemental Educational Opportunity Grants; Federal Pell Grant Program; Federal Direct Student Loans; Federal Work Study Program Assistance Listing Number: 84.007, 84.033, 84.063, 84.268 Federal Award Identification Number and Year: P007A240134; P033A240134; P063P242910;P268K242910 - 2024 Award Period: July 01, 2023 - June 30, 2024 Compliance Requirement: Special tests and provisions Type of Finding: Significant Deficiency in Internal Control over Compliance, Other Matters. Criteria or specific requirement: Once a student's withdrawal date is determined, a school needs to calculate the percentage of the payment period or period of enrollment completed. Institutionally scheduled breaks of five or more consecutive days are excluded from the return of Title IV calculation as periods of nonattendance and, therefore, do not affect the calculation of the amount of Federal Student Aid earned (34 CFR 668.22(f)(2)(i)). Condition: During our testing, it was noted the College's process did not ensure scheduled breaks were properly factored into the R2T4 calculations for both the Fall 2023 and Spring 2024 term. Questioned costs: $109.45. Context: The College did not correctly factor in scheduled breaks to 12 of the 17 students tested for Fall 2023 and 18 of the 18 students tested for Spring 2024. The College did not include the 5 day break for Thanksgiving for the Fall 2023 Semester and used 6 days of scheduled spring break instead of the entire spring break of 9 days in the Spring 2024 calculations. Cause: Management did not have a process in place to exclude the correct amount of days in the scheduled breaks of 5 days or more. Effect: The College did not complete an accurate calculation as defined by Federal regulations. Repeat Finding: Yes- 2023-001. Recommendation: We recommend the College review the R2T4 requirements and implement procedures to ensure scheduled breaks are properly factored into the R2T4 calculations. Views of responsible officials: There is no disagreement with the audit finding, see District's corrective action plan.

Cluster name: Student Financial Assistance Cluster Assistance Listings numbers and names: 84.007 Federal Supplemental Educational Opportunity Grants 84.033 Federal Work-Study Program 84.063 Federal Pell Grant Program 84.268 Federal Direct Student Loans Award numbers and year: P007A220134, P033A220134, P063P222910, and P268K232910; July 1, 2022, through June 30, 2023 Federal agency: U.S. Department of Education Compliance requirement: Special tests and provisions Questioned costs: $8

Condition—Contrary to federal regulations and District policies and procedures, the District did not correctly calculate $8 of returns of student financial assistance monies it reported in the federal agency’s Common Origination and Disbursement (COD) system. Specifically, for 1 of 40 students tested, the District used incorrect credit hours when calculating the refund amount it recorded in the COD, resulting in the student being owed a refund of $8. In addition, for 2 of 40 students tested, the District did not timely calculate, report, and return student financial assistance monies owed to the student or the federal government within the required 45 days after the student’s withdrawal from classes, as the District returned these students’ monies 4 days and 17 days late.

Effect—Because of the District’s inaccurate calculation in the COD system, a student was owed a refund of $8 from the District. Further, the District increases the risk that they may not collect monies from the student that are due back to the federal government or may not refund monies it owes to students by not calculating, reporting, and returning student financial assistance monies within the required time frame.

Cause—District management reported it intended to strengthen its policies and procedures to require an independent review of the calculation, but, because of program management turnover, it was unable to prioritize these revisions. Further, District management reported that it did not have sufficient staffing available to calculate, report, and process returns of student financial assistance monies within the required 45 days.

Criteria—Federal regulations and District policies and procedures require the District to accurately calculate, report, and return federal student financial assistance to the federal grantor no later than 45 days after the date of the District’s determination that the student withdrew (34 Code of Federal Regulations [CFR] §§668.22 and 668.173). Also, federal regulation requires establishing and maintaining effective internal control over federal awards that provides reasonable assurance that federal programs are being managed in compliance with all applicable laws, regulations, and award terms (2 CFR §200.303).

Recommendations—The District should allocate staffing and improve its policies and procedures to:

1. Accurately calculate, report, and return student financial assistance monies to the federal government or the student within the required 45 days. 2. Require an independent review of the return of student financial assistance monies calculations prior to their submission to the COD.

The District’s corrective action plan at the end of this report includes the views and planned corrective action of its responsible officials. We are not required to audit and have not audited these responses and planned corrective actions and therefore provide no assurances as to their accuracy.

This finding is similar to prior-year finding 2022-102 and was initially reported in fiscal year 2021.