Review of Financial Activities of the Colegio Cesar Chavez

In response to a congressional request, GAO reviewed the financial status of Colegio Cesar Chavez, a coeducational, nondenominational college which offers programs leading to a bachelor's degree, to determine whether Federal grants are being spent in accordance with grant provisions. GAO provided information concerning: (1) the source and amount of Federal funds the Colegio has received since 1973; (2) whether the Colegio has spent these funds in accordance with grant provisions and has appropriately accounted for the funds; (3) whether the Colegio reported accurate enrollment information, to the extent that Federal moneys were based on enrollment; (4) the status of the Colegio's liability for properties acquired from the Department of Housing and Urban Development and an assessment of the condition and use of the property; and (5) the extent to which accreditation or lack of accreditation will affect the Colegio's eligibility to receive funds under several sources.

The Colegio spent $656,745 that it had received under discretionary grant programs since its establishment in 1973. GAO was able to determine that expenditures in excess of a half million dollars were made in accordance with the provisions of the grants. However, GAO could not provide adequate financial records and supporting documentation to account for the remaining expenditures and, therefore, GAO could not reach an opinion on the propriety of these expenditures. In addition to the funds expended under the discretionary programs, the Colegio was responsible for administering Federal student financial aid funds totaling $560,665. GAO questioned the propriety of expenditures totaling $9,204. The Colegio lost its accreditation candidacy status which made it ineligible to receive funding under several Federal educational programs. With regard to its liability to the Department of Housing and Urban Development, the Colegio was current in its payments through October 1981.