Common Audit and
Program Review Findings
PASFAA Conference, Harrisburg PA
Annmarie Weisman | 10.31.2012
Agenda
Common Audit and Program Review Findings
• Suggestions for Corrective Action
• Questions & Answers
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2
Common Audit Findings
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Return to Title IV (R2T4)
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Calculation Errors
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Return(s) Made Late
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Return(s) Not Made
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Pell Overpayment/Underpayment
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Verification Violations
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Overaward-Financial Need Exceeded
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Common Audit Findings
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Enrollment Status Not Verified Before Disbursement
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Improper Certification of Stafford Loan
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Credit Balance Deficiencies
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Satisfactory Academic Progress Errors (SAP)
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Repeat Finding—Failure to Take Corrective Action
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Common Program Review Findings
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Verification Violations
Crime Awareness Requirements Not Met
Credit Balance Deficiencies
R2T4 Calculation Errors
R2T4 Made Late
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Common Program Review Findings
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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
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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
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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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Verification Violations
Verification Violations
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
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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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R2T4 Calculation Errors
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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R2T4 Funds Made Late
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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)
13
R2T4 Funds Not Made
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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 Calculation Errors
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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R2T4 Funds Made Late?Not Made
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
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Pell Grant Over/Under Payment
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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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Pell Grant Over/Under Payment
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Pell Grant Over/Under Payment
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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Credit Balance Deficiencies
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
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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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Credit Balance Deficiencies
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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)
25
SAP Policy Not Adequately
Developed/Monitored
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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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SAP Policy Not Adequately
Developed/Monitored
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SAP Policy Not Adequately
Developed/Monitored
Other Compliance Solutions:
• Develop adequate SAP policy
• remedial and repeat coursework
• warning/probation periods
• appeal process
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Document each student’s file to reflect eligibility for
disbursements
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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
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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
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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
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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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Crime Awareness Requirements Not Met
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Crime Awareness Requirements Not Met
Other Compliance Solutions:
• Review Handbook for Campus Crime Reporting
http://www.ed.gov/admins/lead/safety/handbook.pdf
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Review HEOA additional requirements
• Emergency response, timely warnings
• Fire safety, missing persons
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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.
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RESOURCES
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FSA Assessments
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Self-assessment tool designed to assist schools in
evaluating their financial aid policies, processes, and
procedures
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Includes assessment modules on Students, Schools,
Managing Funds, and Policies and Procedures
http://www.ifap.ed.gov/qahome/fsaassessment.html
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Help with Title IV Questions
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For Schools & Other Professionals
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Research and Customer Care Center (RCCC)
1-800-433-7327
fsa.customer.support@ed.gov
For Students
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Federal Student Aid Information Center (FSAIC)
1-800-4FED-AID
Contact Information
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For follow-up questions on this session, contact
me at:
Annmarie Weisman, Training Officer
annmarie.weisman@ed.gov
215-656-6456
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To provide feedback to my supervisor, contact:
Jo Ann Borel, Supervisor
joann.borel@ed.gov
281-758-8122
Region III Training Team
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Greg Martin, Training Officer
• gregory.martin@ed.gov
• 215-656-6452
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Craig Rorie, Training Officer
• craig.rorie@ed.gov
• 215-656-5916
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Annmarie Weisman, Training Officer
• annmarie.weisman@ed.gov
• 215-656-6456
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Evaluation
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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