Single Audit Report Fiscal Year Ended June 30, 2012 - State ...

State of GeorgiaFederal Awards Findings and Questioned CostsFor the Fiscal Year Ended June 30, 2012Enrolled in the College, the Pell Grant Program, the Federal Work-Study Program and the FederalSupplemental Educational Opportunity Grant Program that did not reconcile to the accounting records.Cause:Effect:This deficiency was a result of management's failure to adequately reconcile information submitted onthe FISAP with activity recorded in the accounting records.Information submitted to the U. S. Department of Education was not accurate and was not supportedby the accounting records.Recommendation: The College should implement policy and procedures to ensure that all reports submitted to the U. S.Department of Education are accurately completed and supported by the accounting records. TheCollege should also contact the U. S. Department of Education regarding the resolution of this finding.Finding Control Number: FA-571-12-02SPECIAL TESTS AND PROVISIONSInadequate Control Procedures over Unofficial WithdrawalsU. S. Department of EducationStudent Financial Assistance Cluster ProgramCondition:Criteria:Questioned Cost:Information:The College did not have adequate internal control procedures in place to identify students whounofficially withdraw during an academic semester.34 CFR 668.22 provides requirements over the treatment of Title IV funds when a student withdraws.The College is required to determine the amount of Title IV grant that the student earned as of thestudent's withdrawal date when a recipient of a Title IV grant withdraws from an institution during apayment period or period of enrollment in which the recipient began attendance. A refund must bereturned to Title IV programs when the total amount of Title IV grant that the student earned is lessthan the amount of Title IV grant that was disbursed to the student as of the withdrawal date.Questioned costs of $16,736 were identified for students who received student financial assistance inexcess of the amount earned as of the determined withdrawal date. The College performed proceduresto estimate likely questioned costs of $897,366. Auditor performed procedures to ensure the College'sestimate was reasonable.A sample of twenty-five financial assistance files was selected to determine if financial assistance wasproperly calculated and disbursed to students. This sample revealed six students that unofficiallywithdrew from the College.This matter was brought to the attention of the College. The College was asked to determine thenumber of students and the amount of the refunds related to the unofficial withdrawals.The College determined that 4,243 students earning less than 60% of Title IV aid disbursedunofficially withdrew during the period under review. The likely estimated refunds related to theseunofficial withdrawals were $897,366.As of the end of fieldwork, the College was in the process of performing the required refundcalculations and refunding Title IV aid to the U. S. Department of Education.Cause:Effect:This deficiency occurred because the College's management did not have procedures in place toidentify unofficial withdrawals that received Title IV funds.The College did not properly calculate a refund for students who unofficially withdrew. UnearnedTitle IV funds are not being returned as required.121