Common Audit and Program Review Findings

PASFAA Conference, Harrisburg PA

Common Audit and Program Review Findings

Annmarie Weisman | 10.31.2012

Agenda

• Common Audit and Program Review Findings• Suggestions for Corrective Action• Questions & Answers

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Common Audit Findings

• Return to Title IV (R2T4) • Calculation Errors

• Return(s) Made Late

• Return(s) Not Made

• Pell Overpayment/Underpayment

• Verification Violations

• Overaward-Financial Need Exceeded

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Common Audit Findings

• Enrollment Status Not Verified Before Disbursement

• Improper Certification of Stafford Loan

• Credit Balance Deficiencies

• Satisfactory Academic Progress Errors (SAP)

• Repeat Finding—Failure to Take Corrective Action

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Common Program Review Findings

• Verification Violations • Crime Awareness Requirements Not Met• Credit Balance Deficiencies• R2T4 Calculation Errors• R2T4 Made Late

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Common Program Review Findings

• Entrance/Exit Counseling Deficiencies• Account Records Inadequate/Not Reconciled• Info. in Student Files Missing/Inconsistent• SAP Policy Not Adequately Developed/ Monitored• Pell Overpayment/Underpayment

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Our Focus: Findings on Both Lists and Other Significant Findings

• Verification Violations• R2T4 (Calculation Errors, Made Late, Not Made )

• Pell Grant Over/Underpayments• Credit Balance Deficiencies• SAP• Crime Awareness Requirements Not Met• Repeat Finding – Failure to Take Corrective Action

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Verification Violations

• Verification Worksheet not signed• Untaxed income not verified• Conflicting data on ISIR and verification

documents not resolved• Required corrections not processed

Regulations: 34 C.F.R. §§ 668.51-668.61


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Other Compliance Solutions:• Monitor verification process to ensure procedures

are followed• Perform your own audit of sample files• FSA Assessments: Students

• FSA Verification• Use Verification Worksheet

• School developed or ED worksheet

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R2T4 Calculation Errors

• Incorrect institutional charges for the period• Payment period vs. period of enrollment

• Scheduled breaks not correctly determined• Incorrect # of days counted for the period• Incorrect withdrawal date• Mathematical and/or rounding errors

Regulation: 34 C.F.R. § 668.22(e)

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Other Compliance Solutions:• Pay attention to new regulations; revise procedures

as needed• Perform self-assessment by reviewing a random

sample of student files• FSA Assessments: Managing Funds

• R2T4 module• Use R2T4 Worksheets

• Electronic Web Application• Paper

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• Returns not made timely (45 days)• Inadequate system in place to identify/track

official and unofficial withdrawals • No system in place to track number of days

remaining to return funds• Lack of coordination between offices

Regulation: 34 C.F.R. § 668.22(j)

R2T4 Funds Made Late

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R2T4 Funds Not Made

• Institution unaware that student withdrew• No system in place to verify that R2T4 calculations

(or the return) were made• Lack of communication/coordination between

offices

Regulation: 34 C.F.R. § 668.22


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R2T4 Funds Made Late

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R2T4 Funds Not Made

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R2T4 Made Late/Not Made

Other Compliance Solutions:• Design procedures to ensure timely

communication among offices• Train and assign responsibility to staff for

monitoring the R2T4 process• Perform internal audit by reviewing a random

sample of student files of students who have withdrawn

• Review internal system to track withdrawals

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Other Compliance Solutions:• Periodically review processes/procedures

• Tracking/monitoring deadlines• Timely communication between offices

• Use R2T4 on the Web• FSA Assessment: Managing Funds

• Fiscal Management

R2T4 Funds Made Late?Not Made

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Pell Grant Over/Under Payment

• Adjustments not made for change in enrollment status between terms

• Attendance not documented in all coursework counted in enrollment status• Modules or compressed coursework

• Incorrect information used• Pell formula, EFC, # of weeks/hours

• Inaccurate proration calculation

Regulations: 34 C.F.R. §§ 690.62 and 690.79

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Other Compliance Solutions:• Use correct enrollment status• Use correct Pell Formula/Schedule• Verify that student began attendance in all

coursework• Prorate when needed• Assign responsibility of monitoring to ensure Pell

disbursements are accurate and timely

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Credit Balance Deficiencies

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Other Compliance Solutions:• Develop a process to determine when a credit

balance is created• Develop a system to track number of days remaining

to release funds timely• Understand regulations regarding minor prior year

charges• May create more credit balances if entire program cost is

charged upfront• 2010-11 FSA Handbook, Vol. 4, pp. 4-10 to 4-13

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• No process in place to determine when a credit balance has been created

• Credit balances not released to students within required 14-day timeframe

• Credit balances held without student authorizations

Regulation: 34 C.F.R. § 668.164 (e)

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SAP Policy Not Adequately Developed/Monitored

• Missing required components• Qualitative, quantitative, completion rate, maximum timeframe, probation, appeals

• Policy not at least as strict as for non-Title IV recipients• Standards inconsistently applied• Aid disbursed to students not making SAP

Regulation: 34 C.F.R. § 668.16(e)

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Other Compliance Solutions:• Develop adequate SAP policy

• remedial and repeat coursework• warning/probation periods• appeal process

• Document each student’s file to reflect eligibility for disbursements

• 34 C.F.R. 668.34 consolidated all SAP regulations - published Nov. 1, 2010


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Repeat Finding-Failure to Take Corrective Action• Same finding(s) in subsequent audit(s)

• School failed to adequately develop, implement, and/or monitor procedures to ensure Corrective Action Plan (CAP) was followed

• Problem identified too late to avoid repeat finding

• New issue but same finding title

Regulations: 34 C.F.R. §§ 668.16 and 668.174

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Repeat Finding-Failure to Take Corrective Action

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Repeat Finding-Failure to Take Corrective Action• Review results of CAP

• Is it working?• Are changes needed to improve process?

• Develop specific procedures for CAP action items• Assign responsible person/office to ensure CAP is

implemented/monitored• Conduct student file reviews• FSA Assessments

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Crime Awareness Requirements Not Met

• Policies and procedures regarding campus security not adequately developed

• Annual report not published and/or distributed annually to current students/staff by the required deadline

• Failure to develop a system to track and/or log all required categories of crimes

Regulations: 34 C.F.R. §§ 668.41 and 668.46(c)(1)

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Other Compliance Solutions:• Review Handbook for Campus Crime Reporting

http://www.ed.gov/admins/lead/safety/handbook.pdf

• Review HEOA additional requirements• Emergency response, timely warnings • Fire safety, missing persons

• Review Information Required to be Disclosed Under the Higher Education Act: Suggestions for Dissemination

http://nces.ed.gov/pubs2010/2010831rev.pdf


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Suggestions for a Strong CAP

Include adequate detail.

Sample CAP: We trained all staff on proper verification procedures.

Better CAP: The DFA developed a checklist to use when completing verification. All FAO staff attended a two hour training session on verification in March 2011. The DFA will review five files where verification was done by each FAO each quarter.

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Suggestions for a Strong CAP

Provide a strong solution.

Sample CAP: This finding was the result of staff oversight. Staff will be more careful in the future.

Better CAP: The DFA will run a weekly report each Monday to identify withdrawals from the prior week. All FAO staff will review the report for the addition of their assigned students. The DFA will also run a report of students who withdrew more than 30 days ago, but with no R2T4 calculation.

RESOURCES

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• Self-assessment tool designed to assist schools in evaluating their financial aid policies, processes, and procedures

• Includes assessment modules on Students, Schools, Managing Funds, and Policies and Procedures

http://www.ifap.ed.gov/qahome/fsaassessment.html

FSA Assessments

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Help with Title IV QuestionsHelp with Title IV Questions

• For Schools & Other Professionals

• Research and Customer Care Center (RCCC)• 1-800-433-7327• [email protected]

• For Students

• Federal Student Aid Information Center (FSAIC)• 1-800-4FED-AID

Contact InformationContact Information

• For follow-up questions on this session, contact me at:

Annmarie Weisman, Training [email protected]

• To provide feedback to my supervisor, contact:Jo Ann Borel, [email protected]

Region III Training Team

• Greg Martin, Training Officer• [email protected]• 215-656-6452

• Craig Rorie, Training Officer• [email protected]• 215-656-5916

• Annmarie Weisman, Training Officer• [email protected]• 215-656-6456

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EvaluationEvaluation

Your attention is appreciated at today’s session!

To provide feedback to me and my supervisor, please complete an evaluation form.

Thank you!!!

QUESTIONS?

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Common Audit and Program Review Findings

Documents