Audit of the Berkshire Community College Objectives, Scope, and Methodology

An overview of the purpose and process of auditing the Berkshire Community College

Overview

In accordance with Section 12 of Chapter 11 of the Massachusetts General Laws, the Office of the State Auditor has conducted a performance audit of certain activities of Berkshire Community College (BCC) for the period March 1, 2020 through June 30, 2021.

We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Below is a list of our audit objectives, indicating each question we intended our audit to answer; the conclusion we reached regarding each objective; and, if applicable, where each objective is discussed in the audit findings.

Objective	Conclusion
Did BCC administer the student portion of funding under Section 18004(a)(1) of the Coronavirus Aid, Relief, and Economic Security (CARES) Act, Section 314(a)(1) of the Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA), and Section 2003(a)(1) of the American Rescue Plan (ARP) Act in accordance with the United States Department of Education’s (US DOE’s) Higher Education Emergency Relief Fund (HEERF) Frequently Asked Questions (FAQ) Rollup Document, Higher Education Emergency Relief Fund (HEERF) II Public and Private Nonprofit Institution (a)(1) Programs ([Catalog of Federal Domestic Assistance, or CFDA] 84.425E and 84.425F) Frequently Asked Questions, and Higher Education Emergency Relief Fund III Frequently Asked Questions and its own distribution method?	Yes
Did BCC administer the institutional portion of funding under Section 18004(a)(1) of the CARES Act and Section 314(a)(1) of the CRRSAA in accordance with US DOE’s Higher Education Emergency Relief Fund (HEERF) Frequently Asked Questions (FAQ) Rollup Document and Higher Education Emergency Relief Fund (HEERF) II Public and Private Nonprofit Institution (a)(1) Programs (CFDA 84.425E and 84.425F) Frequently Asked Questions?	No; see Findings 1 and 2
Did BCC calculate lost revenue3 that it recovered in accordance with Questions 3, 9, and 10 of US DOE’s Higher Education Emergency Relief Fund (HEERF I, II, and III) Lost Revenue Frequently Asked Questions?	Yes
Did BCC provide the student portion of Governor’s Emergency Education Relief (GEER) funding to eligible students in accordance with Attachment A of the interdepartmental service agreement (ISA) between the Massachusetts Executive Office of Education (EOE) and the Massachusetts Department of Higher Education (MDHE), and did it provide the institutional portion of GEER funding in accordance with Attachment A of its own ISA with MDHE?	No; see Finding 1
Did BCC update its internal control plan (ICP) to address the effect of the 2019 coronavirus (COVID-19) pandemic in accordance with the Office of the Comptroller of the Commonwealth’s “COVID-19 Pandemic Response Internal Controls Guidance,” dated September 30, 2020?	Yes
Did all BCC Administration and Finance Division and Student Financial Services Office employees who had access to COVID-19 funding complete required cybersecurity awareness training in accordance with Sections 6.2.3 and 6.2.4 of the Executive Office of Technology Services and Security’s (EOTSS’s) Information Security Risk Management Standard IS.010?	No; see Finding 3

 

To achieve our objectives, we gained an understanding of the internal controls we determined to be relevant to the objectives by reviewing BCC’s policies and procedures, as well as conducting inquires with BCC’s staff members and management. We evaluated the design and implementation of the internal controls related to approvals of BCC’s Higher Education Emergency Relief Fund (HEERF) I and HEERF II institutional-portion disbursements.

To test the effectiveness of internal controls related to the approval of CARES Act and CRRSAA institutional-portion disbursements, we selected a random sample of 11 of 594 CARES Act and CRRSAA institutional-portion disbursements that occurred during our audit period. We inspected emails or purchase orders for these 11 disbursements for evidence of approval from BCC’s chief financial officer or another member of the executive council before the disbursement of funding.

In addition, we performed the following procedures to address the objectives.

CARES Act, CRRSAA, and ARP Act Student Portion

To determine whether BCC administered the student portion of CARES Act, CRRSAA, and ARP Act funding in accordance with US DOE’s Higher Education Emergency Relief Fund (HEERF) Frequently Asked Questions (FAQ) Rollup Document, Higher Education Emergency Relief Fund (HEERF) II Public and Private Nonprofit Institution (a)(1) Programs (CFDA 84.425E and 84.425F) Frequently Asked Questions, and Higher Education Emergency Relief Fund III Frequently Asked Questions, as well as its own distribution method, we divided our population of 1,569 student grants into three categories: CARES Act technology grant;⁴ CRRSAA emergency grant;⁵ and CARES Act, CRRSAA, and ARP Act additional student assistance grants distributed during our audit period. For each category, we conducted the following procedures:

• To determine whether BCC administered the student portion of the CARES Act technology grant in accordance with US DOE’s Higher Education Emergency Relief Fund (HEERF) Frequently Asked Questions (FAQ) Rollup Document, we selected a random, nonstatistical sample of 50 student grants from a population of 640. We verified that each student in our sample had completed a 2019–2020 Free Application for Federal Student Aid (FAFSA); was enrolled in at least one on-campus course on March 13, 2020; and had maintained satisfactory academic progress. To determine whether the payment method was allowable, we verified that payments to students were made by a method approved by US DOE (i.e., checks, electronic transfers, debit cards, or payment apps that adhere to US DOE’s requirements for paying credit balances to students).
• To determine whether BCC administered the student portion of the CRRSAA emergency grant in accordance with US DOE’s Higher Education Emergency Relief Fund (HEERF) II Public and Private Nonprofit Institution (a)(1) Programs (CFDA 84.425E and 84.425F) Frequently Asked Questions, we selected a random, nonstatistical sample of 50 student grants from a population of 620. We verified that each student in our sample had completed a 2020–2021 FAFSA, was enrolled in at least one three-credit spring 2021 course, and had maintained satisfactory academic progress. To determine whether the payment method was allowable, we verified that payments to students were made by a method approved by US DOE.
• To determine whether BCC administered student requests for additional assistance from CARES Act, CRRSAA, and ARP Act funding in accordance with US DOE’s Higher Education Emergency Relief Fund (HEERF) Frequently Asked Questions (FAQ) Rollup Document, Higher Education Emergency Relief Fund (HEERF) II Public and Private Nonprofit Institution (a)(1) Programs (CFDA 84.425E and 84.425F) Frequently Asked Questions, and Higher Education Emergency Relief Fund III Frequently Asked Questions, as well as its own method for calculating each distribution amount, we selected a random, nonstatistical sample of 40 student grants from a population of 309. We verified that each student had submitted an online request for additional assistance, that the additional assistance was related to COVID-19, and that the student had provided supporting documentation. We requested copies of the corresponding schedule for each source of funding (CARES Act, CRRSAA, or ARP Act funding) to verify that the student met the following enrollment requirements:
• If a student received a grant from CARES Act funding, we verified that they had completed a 2019–2020 FAFSA; were enrolled in at least one on-campus course on March 13, 2020; and had maintained satisfactory academic progress.
• If a student received a grant from CRRSAA funding, we verified that they had completed a 2020–2021 FAFSA, were enrolled in at least one three-credit course for the spring 2021 semester, and had maintained satisfactory academic progress.
• If a student received a grant from ARP Act funding, we verified that they were enrolled on or after March 13, 2020. To determine whether the payment method was allowable, we verified that payments to students were made by a method approved by US DOE, and we recalculated each payment amount for accuracy.

CARES Act and CRRSAA Institutional Portion

To determine whether BCC administered the institutional portion of CARES Act and CRRSAA funding in accordance with US DOE’s Higher Education Emergency Relief Fund (HEERF) Frequently Asked Questions (FAQ) Rollup Document and Higher Education Emergency Relief Fund (HEERF) II Public and Private Nonprofit Institution (a)(1) Programs (CFDA 84.425E and 84.425F) Frequently Asked Questions, we selected a random, nonstatistical sample of 50 institutional transactions from our population of 593. For each sampled transaction, we inspected purchase orders, vouchers, invoices or bills, emails, payment vouchers, and/or receipts to determine the reason for the transaction, whether the transaction was related to the disruption of campus operations due to COVID-19, whether the documentation adequately supported the need for each item or service, and whether the transaction was allowable.

Lost Revenue

To determine whether lost revenue recovered by BCC was calculated in accordance with US DOE’s Higher Education Emergency Relief Fund (HEERF I, II, and III) Lost Revenue Frequently Asked Questions, we reperformed BCC’s calculation of lost revenue recovered, for accuracy, and analyzed the method used to determine the recovery amount.

GEER Funding

To determine whether BCC administered the student portion of GEER funding in accordance with Attachment A of the ISA between EOE and MDHE, and the institutional portion of GEER funding in accordance with Attachment A of BCC’s ISA with MDHE, we split the total population of 96 transactions into 65 institutional transactions and 31 summarized student transactions. The 31 summarized student transactions consisted of 133 individual GEER Fund student grants.

• To determine whether BCC administered the institutional portion of GEER funding in accordance with the ISAs, we selected a random, nonstatistical sample of 20 institutional transactions from the population of 65. We inspected purchase orders, vouchers, emails, invoices/bills, and/or receipts to determine whether each expense was incurred between March 1, 2020 and December 31, 2020; what was the purpose of each one; whether each transaction was related to the disruption of campus operations due to COVID-19; whether funding was used for staff members, student services, or building services; and whether each transaction was allowable.
• To determine whether BCC administered the student portion of GEER funding in accordance with Attachment A of the ISA between EOE and MDHE, we selected a random, nonstatistical sample of 35 student transactions from a population of 133. For each student transaction, we determined whether the student was a Massachusetts resident, was enrolled in a degree or certificate program, had completed a FAFSA, had maintained satisfactory academic progress, and had not earned a baccalaureate or professional degree. Additionally, we determined whether each transaction was related to COVID-19; whether the funding disbursed was for education expenses, childcare, healthcare, technology expenses, transportation, or personal expenses; and that the funding granted did not exceed $1,000.

ICP

To determine whether BCC updated its ICP to address the effects of COVID-19, as required by the Office of the Comptroller of the Commonwealth’s “COVID-19 Pandemic Response Internal Controls Guidance,” we received and reviewed Internal Control Questionnaires (ICQs) from fiscal years 2020 and 2021, BCC’s ICP from before March 2020, and BCC’s ICP from June 2020. We also compared the ICQs for fiscal years 2020 and 2021 to the ICPs to determine whether BCC performed a risk assessment related to COVID-19.

Cybersecurity Awareness Training

To determine whether all 31 BCC Administration and Finance Division and Student Financial Services Office employees who had access to COVID-19 funding during our audit period completed annual refresher or new hire cybersecurity awareness training in accordance with EOTSS’s Information Security Risk Management Standard IS.010, we obtained and inspected certificates of completion of cybersecurity awareness training for these 31 employees.

When nonstatistical sampling was used, we could not project the results to the entire population.

Data Reliability Assessment

To determine the reliability of the data from Colleague, we interviewed knowledgeable officials about the datasets for institutional and student transactions and system users. We tested BCC’s access and security management controls for this system.

We tested both CARES Act and GEER Fund student grant lists for missing and duplicate records and for records outside the audit period; we also traced grants from both lists to each student’s application and reconciled the student grant list with the summarized transaction totals from the general ledger.

To determine the reliability of both CARES Act and GEER Fund institutional transaction lists, we reconciled the lists to the account balances and their respective revenue accounts from the general ledger.

To determine the reliability of the Colleague system user list, we compared it to the list of employees provided by BCC officials.

As a result of these procedures, we determined that the institutional and student transaction data and the user lists were sufficiently reliable for the purpose of our audit. However, we did identify a number of information technology general control issues we believe warrant BCC’s attention; we have disclosed them in the “Other Matters” section of this report.

3.    According to US DOE’s Higher Education Emergency Relief Fund (HEERF I, II, and III) Lost Revenue Frequently Asked Questions, “Lost revenue refers to those revenues an institution of higher education . . . otherwise expected but were reduced or eliminated as a result of the novel coronavirus 2019 (COVID-19) pandemic.”

4.    CARES Act technology grants were awarded to students to help cover costs associated with converting to online learning.

5.    CRRSAA emergency grants were awarded to students to help cover the costs of remote learning, such as food, technology, Internet service, and utilities.

Date published:	August 30, 2022