TASFAA 2013 Conference
CASH MANAGEMENT:
START TO FINISH
DANA MINGO
DIRECTOR OF STUDENT
FINANCIAL SERVICES, DALLAS
CHRISTIAN COLLEGE
DECHA REID
DISTRICT DIRECTOR OF AWARDS
MANAGEMENT, DALLAS COUNTY
COMMUNITY COLLEGE DISTRICT
TOPICS FOR DISCUSSION
 Purpose of Cash
 Internal Controls
Management
 G5 System
 Common Origination
& Disbursement
 Communication &
Cooperation
 Financial Aid Office
Functions
 Business (Bursars)
Office Functions
 Disbursement of Title
IV Funds
 Allowable Charges
 Required
Authorizations
 Title IV Credit
Balances
 Reconciliation
Requirements &
Tools
Purpose of Cash Management
 Ensure schools have a solid foundation for administering
Federal Student Aid funds
 Minimize costs related to operating FSA program for schools
and students who receive federal aid funds
 Practices are governed by:
 Generally Accepted Accounting Principles (GAAP)
 Office of Management & Budget (OMB)
 U. S. Department of Treasury
 U.S. Department of Education (ED)
34CFR 668.161
What is the G5 System?
 An electronic delivery system supporting the awarding and payment
administration of federal aid funds
 Part of the Education Central Automated Processing System
(EDCAPS), however G5 is the only module in which schools have
access
 Schools use G5 to request payments, adjust drawdowns, return
unused funds, review cash balances, and payment history for
reconciling awards
 Access is granted through www.G5.gov , as part of a schools Title IV
participation
FSA HB 2013-2014
What is the G5 System?
 Requires schools to set up banking information separate from
the general cash fund
 Schools must also obtain a Data Universal Numbering System
(DUNS), Taxpayer Identification Number (TIN) and grant
number from ED
 Cash may be requested for the following programs:
 Federal Pell Grant
 Federal TEACH Grant
 Federal Supplemental Educational Opportunity Grant
 Federal Work Study
 Federal Perkins Loan
 Federal Direct Loans
Common Origination & Disbursement
(COD)
 The COD system is an electronic solution established
to accommodate the processing of specific Federal
Aid Programs (Pell grants, TEACH grants, Perkins &
Direct Loans)
 The COD process is an integrated system to support
the origination, disbursement and reporting of the
above listed aid programs
Communication & Cooperation
 Why is communication and cooperation important
when setting up a school’s cash management
process?
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Prevent processes contraire to ED’s regulations
Eliminate fiscal errors in awarding, disbursing and
reconciling of awards
Maintains integrity institutions FSA program
Required to continue FSA program participation
Communication & Cooperation
 TIP: Joint Operations Calendar for the
Registrar/Business/Financial Aid/Finance
Departments
Financial Aid Office Functions
 Must confirm student eligibility for said federal aid programs prior
to disbursement
 Must maintain access to the Common Origination and
Disbursement System (COD) with ED
 User will submit Pell Grant, TEACH Grant, and/or Direct Loan
origination and data
 Users have the option to batch records over the Student Aid
Gateway (SAIG) or process individually via the COD website
 Depending approval, schools may draw down of funds from G5, 10
days before the start of the term
Financial Aid Office Functions
 Ensure student eligibility and meets Satisfactory Academic Progress (SAP)
for returning students
 Create comprehensive aid package on behalf of student (generally tracked
via Financial Aid Management System {FAMS: Banner, Datatel,
PeopleSoft, etc})
 Notify student of anticipated financial aid awards & anticipated
disbursements to their account via email or snail mail (TIP: important
to know audience for appropriate delivery method)
 Submit federal aid disbursement records within 15 days via COD for Pell,
Iraq & Afghanistan Service Grant Programs, for awards processed on or
after April 1, 2013
http://ifap.ed.gov/fsahandbook/attachments/1314FSAHbkVol4Ch2.pdf
Business and/or Bursar
Office Functions
 Maintains accounting records to reflect all G5
processing (draw) activities for accurate
reconciliation processes
 Segregate federal funds from the institution’s general
fund bank accounts
 Ensures the federal fund bank account is set up and
named specifically as a federal fund account:
ex. Chase Institution XX Federal Fund Account
Business and/or Bursar
Office Functions
 G5 draw down of funds, no earlier than 10 days before
the start of the academic term
 Disburse federal funds to the respective student account
 Refund credit balances in excess of tuition, fees and other
educational allowances within required timeframe
 Returns any unused funds not disbursed to student
accounts via G5
Internal Control Functions
 Designate an FSA Coordinating Official to monitor & address data
exceptions and/or inconsistencies:
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Develop internal reporting processes
Establish internal reconciliation procedures
TIP: Don’t disburse funds on last day of month to have ‘clean’ month end fund
reconciliation processes
 Internal Control Recommendations from ED:
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Define key roles for departmental functions
Keep documentation of all activity
Maintain collaboration, communication and most importantly cooperation between
offices
Balance all accounts and ledgers
Ensure all G5 drawdowns and refunds have been accounted for
If using an import system for drawdowns reconcile all funds between draw down and
import
Create exception reports to monitor data between the financial aid and business (bursar)
offices
Disbursement of Title IV
Funds & Excess Cash
 Schools must disburse funds within three
business days of receipt of funds under the
advanced payment method
 Some circumstances that may prohibit the
disbursement of federal aid funds:
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Change in a student’s enrollment status
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Failure of student to attend class
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TIP: Have “packaging reconciliation process prior to aid
disbursement;” prevents potential Title IV Overpayment)
TIP: Develop census process to confirm enrollment for
disbursement
Change in award eligibility (ie: result of verification process)
Allowable Charges
 Current term/aid year charges for tuition, fees, room, board
and books (If the school contracts with a third party servicer)
 Written authorization from the student for any other
education related charges incurred at the school other than
the above listed is required
 Prior year charges not exceeding $200
 TIP: Develop standard authorization form for
student to sign where circumstances warrant
posting of funds to term outside current aid year,
http://ifap.ed.gov/fsahandbook/attachments/1314F
SAHbkVol4Ch2.pdf
Title IV Credit Balances
 Must be paid to the student and/or parent (PLUS) within 14 days of
disbursement (includes holidays) to the student’s account
 May be issued via check, EFT, or cash; schools may not charge fees when
resolving credit balances
 Not required to issue a refund if the credit balance is less than $1
 May not hold past 14 days unless a signed authorization to hold is on file
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All aid must be released by the end of the loan period for all FSA grant & loan programs
 If issued via check, and the check is not cashed within 240 days, the school
must return the funds to the designated program fund and update
respective student’s record on COD to reflect resulting reduction in the aid
award
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TIP: Develop process inside the 120 day time from where the student is
responsible for the loan fees; benefiting the student and exceeding the federal
requirement
Required Authorizations
 The use of FSA funds to pay charges other than tuition, fees,
and room & board (& books)
 Credit of FWS wages to the student’s account
 Disbursement of FWS wages via Electronic Funds Transfer
(EFT)
 Hold FSA credit balances beyond the 14 day requirement
 REMEMBER: Disbursement of current FSA funds to
prior year charges are not to exceed $200,
http://ifap.ed.gov/fsahandbook/attachments/1314F
SAHbkVol4Ch2.pdf
Reconciliation Requirements
Reconciliation is a joint process where financial aid records
are reviewed to ensure federal funds have been disbursed
appropriately and discrepancies are resolved.
 Schools are required to ensure procedures are in place
 Failure to do so may result in questioning of administrative
capability & impact institution eligibility to participate with FSA
programs
 Two types of reconciliation requirements
 Internal: the school reconciles its record of funds awarded by the Financial Aid
Office to those funds requested, received, disbursed, and returned by the
Business (Bursars) Office
 External: the school reconciles the internal institutional records to that of
grants and loans originated ED via COD
Reconciliation Requirements
 Documented reconciliation procedures required
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Ledgers of G5 account draw activity
Disbursement logs
Direct Loan program requires monthly reconciliation
ED requires all FSA records to be reconciled monthly
 Discrepancy Examples & Required Resolution
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A student’s disbursement data on COD and the school’s record
differs; action required for resolution
A student’s data appears in your school records, however not
reported on COD; action required for resolution
Reconciliation Requirements
 Pell Grant Reconciliation Report from COD: Summary of records processed
for ongoing and year-end reporting
 Pell Grant Electronic Statement of Account (ESOA): Summary school’s CFL
versus net draw down for the year; including the sum of initiated draw downs, direct
payments, adjustments, less refunds and returns
 Pending Disbursement List Report: Report of disbursements not yet funded
per COD (anticipated disbursements received or accepted)
 Pell Grant Year-to Date Record (YTD): Detailed award and disbursement data
on a individual basis or for all students for the institution
REMEMBER: The cash & reporting of Federal Pell, Iraq and Afghanistan
Service Grant disbursements & adjustment deadline is September 30th.
FSA HB 2013-2014 ,Chap 5 Reconciliation, 4-95-96
Tools for Reconciliation:
Direct Loans
 School Account Statement (SAS): Generated monthly via COD delivered via SAIG
(contains ending cash balance); includes the following information:
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Cash Summary
Disbursement Summary by Loan Type
Cash Detail
Disbursement Detail
 Pending Disbursement List: Report details all pending and/or anticipated disbursements
(45 day window into future)
 Actual Disbursement List: Report details actual disbursements from the prior week
(Saturday through Friday)
 Institutional reconciliation reports and procedures (including disbursement
information and student identifying information)
REMEMBER: Final program close-out deadline for 2012-2013 AY is July 31, 2014
and for the 2013-2014 AY is July 31, 2015
FSA HB 2013-2014, Chap 5 Reconciliation, 4-97-100
Tools for Reconciliation:
Campus-Based
 ED Award Letter for SFA Funds
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Federal Perkins Loans
Federal Supplemental Educational Opportunity Grant (FSEOG)
Federal Work Study
 Institutional Disbursement & Reconciliation
Reports
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Federal Perkins & FSEOG Grants
 Institutional Payroll & Reconciliation Reports
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Federal Work Study
Questions & Open Discussion
Resources
 2013-2014 Federal Student Aid Handbook,
Volume 4, Processing Aid & Managing FSA Funds ,
available via the iLibrary:
http://ifap.ed.gov/fsahandbook/attachments/1314F
SAHbkVol4MASTER.pdf
 NASFAA Resources: Compliance Toolkit;
available online via:
http://www.nasfaa.org/compliance/