University of St. Thomas

Special Tests and Provisions – Return of Title IV Funds

Student Financial Assistance Cluster, Assistance Listing Number 84.268 Federal Direct Student Loans, Assistance Listing Number 84.063 Federal Grant Program, Assistance Listing Number 84.007 Federal Supplemental Education Opportunity Grants U.S. Department of Education Program Year 2024–2025

Type of Finding: Other Instance of Noncompliance and Deficiency

Criteria: Management is responsible for compliance with Special Tests and Provisions – Return of Title IV Funds procedures in accordance with the Uniform Guidance. (34 CFR 668.22)

Condition: Federal regulations provide that the University is responsible for properly calculating return of Title IV Funds. The University’s internal control system did not prevent a return from being improperly calculated.

Questioned Costs: One out of the six returns was not calculated properly, resulting in the return being understated by $353. Assistance Listing Number 84.268 Federal Direct Student Loans Context: Out of a population of 54 withdrawn students requiring return of Title IV funds, a sample of six withdrawn students were selected for testing. One out of the six returns was not calculated properly, resulting in the return being understated by $353. Our sampling method was not, and was not intended to be statically valid.

Effect: Failure to properly calculate return of Title IV funds may result in the University disbursing the incorrect amount of returns.

Cause: The University’s processes did not ensure that return of Title IV funds were being calculated properly.

Repeat Finding: 2024-002

Recommendation: We recommend the University evaluate controls around monitoring return of Title IV calcuations, ensuring the amounts and dates utilized in the calculation forms are correct.

Views of Responsible Officials: Management concurs with the finding and recommendation. See further information on the corrective action plan provided by management.

Special Tests and Provisions – Enrollment Reporting

Student Financial Assistance Cluster, Assistance Listing Number 84.268 Federal Direct Student Loans, Assistance Listing Number 84.063 Federal Grant Program U.S. Department of Education Program Year 2023-2024

Type of Finding: Other Instance of Noncompliance and Significant Deficiency

Criteria: Management is responsible for compliance with Special Tests and Provisions – Enrollment Reporting procedures in accordance with the Uniform Guidance. (34 CFR 690.93(b)(2); 34 CFR 682.610; 34 CFR 685.309)

Condition: Federal regulations provide that the University is responsible for notifying the National Student Loan Data System (NSLDS) of enrollment change. NSLDS was not notified, and the University’s internal control system did not prevent or detect that the NSLDS was not notified of change.

Questioned Costs: None

Context: Out of a population of 661 students with enrollment changes, a sample of 25 students were selected for testing. 2 out of the 25 enrollment changes did not get reported to NSLDS. Our sampling method was not, and was not intended to be statically valid.

Effect: The failure to report enrollment changes to NSLDS may result in inaccurate or delayed updates to student loan records.

Cause: The University’s processes did not ensure that enrollment status changes were completed accurately and timely to NSLDS.

Repeat Finding: No

Recommendation: We recommend the University evaluate controls around monitoring enrollment reporting, ensuring NSLDS receives notification of enrollment changes.

Views of Responsible Officials: Management concurs with the finding and recommendation. See further information on the corrective action plan provided by management.

Special Tests and Provisions – Return of Title IV Funds

Student Financial Assistance Cluster, Assistance Listing Number 84.268 Federal Direct Student Loans, Assistance Listing Number 84.063 Federal Grant Program U.S. Department of Education (ED) Program Year 2023-2024

Type of Finding: Other Instance of Noncompliance and Deficiency

Criteria: Management is responsible for compliance with Special Tests and Provisions – Return of Title IV Funds procedures in accordance with the Uniform Guidance. (34 CFR 668.22)

Condition: Federal regulations provide that the University is responsible for returning funds to ED and student accounts within 45 days of the University becoming aware the student has withdrawn, or within 30 days for students that never began attendance. The University’s internal control system did not prevent a late disbursement of return of funds.

Questioned Costs: None

Context: Out of a population of 78 withdrawn students requiring return of Title IV funds, a sample of eight withdrawn students were selected for testing. One out of the eight returns were not returned to ED or the student within the 45-day period. Our sampling method was not, and was not intended to be statically valid.

Effect: The University may not be able to timely detect when return of funds are required for students who withdrew. This could result in late disbursements to ED and the student accounts for Direct Loan and Pell recipients.

Cause: The University’s processes did not ensure return of Title IV funds were completed timely.

Repeat Finding: No

Recommendation: We recommend the University evaluate controls around monitoring return of Title IV funds to determine changes, either on the electronic processes or review processes that should be made to properly capture return of Title IV funds on a timely basis.

Views of Responsible Officials: Management concurs with the finding and recommendation. See further information on the corrective action plan provided by management.