A Report on State of Texas Compliance with Federal Requirements for the Student Financial Assistance Cluster of Federal Programs for the Fiscal Year Ended August 31, 2012
Report Number 13-019
With the exception of certain non-compliance disclosed in this report, the State of Texas complied in all material respects with the federal requirements for the Student Financial Assistance Cluster of federal programs in fiscal year 2012.
As a condition of receiving federal funding, U. S. Office of Management and Budget (OMB) Circular A-133 requires non-federal entities that expend at least $500,000 in federal awards in a fiscal year to obtain annual Single Audits. Those audits test compliance with federal requirements in up to 14 areas that may have a material effect on a federal program at those non-federal entities. Examples of the types of compliance areas include eligibility and reporting. The requirements for 1 of those 14 areas vary by federal program and outline special tests that auditors are required to perform, such as tests of disbursement of funds and the return of unearned Student Financial Assistance Cluster funds to the federal government. The Single Audit for the State of Texas included (1) all high-risk federal programs for which the State expended more than $75,562,558 in federal funds during fiscal year 2012 and (2) other selected federal programs.
From September 1, 2011, through August 31, 2012, the State of Texas expended $50.2 billion in federal funds for federal programs and clusters of federal programs. The State Auditor's Office audited compliance with requirements for the Student Financial Assistance Cluster of federal programs at 11 higher education institutions. Those 11 higher education institutions spent $2,079,872,059 in federal Student Financial Assistance Cluster funds during fiscal year 2012.
Auditors identified 26 Student Financial Assistance Cluster findings at 9 of the 11 higher education institutions audited for the fiscal year ending August 31, 2012. That represented an improvement compared with the audit of the fiscal year ending August 31, 2011, when auditors identified 40 Student Financial Assistance Cluster findings. Additionally, at 2 of the 11 higher education institutions, auditors did not identify any findings related to the Student Financial Assistance Cluster. Those two higher education institutions were the University of Texas at San Antonio and West Texas A&M University.
Two findings auditors identified during the audit of the fiscal year ending August 31, 2012, were classified as material weaknesses and material non-compliance, one finding was classified as a material weakness and non-compliance, and 23 findings were classified as significant deficiencies and non-compliance.
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