CHAPTER 32
FINANCIAL AID – CAMPUS/LOCAL/NONGOVERNMENTAL
1.0 OVERVIEW AND DEFINITIONS:
Sections 1.1 and 1.2 are directly from the Financial Aid website. For the most up-to-date
information, please visit the Financial Aid Programs website. This chapter will focus on
Financial Aid funded by the campus, for local agencies or any other non-governmental entity.
1.1 Introduction
Financial aid programs provide support for students to help meet the costs of obtaining a college
education. Funding for financial aid programs is provided by the federal government, state
governments, colleges and schools, and a variety of other public and private sources. There are
two main categories of aid, differentiated primarily by the basis upon which they are awarded:

Achievement-based aid is awarded to students who have a special characteristic, skill,
talent, or ability. Typically achievement-based aid is in the form of scholarships.

Need-based aid is provided to students who demonstrate financial need. Most financial
aid, particularly public-funded aid, is awarded on the basis of financial need determined
through the application process and in accordance with a prescribed federal formula.
Financial aid is available in four basic types of programs.

Scholarships are "gift aid" which do not have to be repaid. Scholarships typically include
criteria such as academic performance or special talents.

Grants are "gift aid" and generally do not include criteria other than financial need.

Work-study is a "self-help" program in the form of part-time employment during the
student's college career.

Loans are a form of "self-help" since they represent borrowed money that must to be paid
back over a period of time, typically after the student leaves school.
Student Lending – Code of Conduct
Each CSU campus abides by a Code of Conduct that addresses its relationship with providers of
educational loans. Click here to see the Code of Conduct.
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1.2 Aid Programs Administered by the California State University
The CSU maintains efforts to ensure educational opportunity for all students. In addition to the
significant state subsidy provided to all students who enroll at the CSU, reflected by its low fee
structure, the CSU also dedicates a significant amount of its revenues to need-based grants each
year.

State University Grant (SUG) - provides need-based awards to cover a portion of the
state tuition fee for eligible undergraduate, graduate, and post-baccalaureate students who
are California residents or are otherwise determined as eligible. Systemwide, the priority
is to award a SUG at least equal to the amount of the state tuition fee to eligible students
who apply for financial aid by March 2nd, who have an expected family contribution
(EFC) of $4,000 or less, and who are not receiving a Cal Grant or other award designated
to cover fees. Funding for this program is limited. Students must re-apply for
consideration every year. SUG awards are limited based on the number of units a student
has earned and the published length of their academic program. For more complete
information, review the financial aid web site(s) of the individual campuses.

Educational Opportunity Program (EOP) Grant - provides assistance to economically
and educationally disadvantaged undergraduates. Recipients must be California residents
who are admitted to a CSU campus through the Educational Opportunity Program.
EOP students may receive a grant, based on need, of up to $2,000 per year.
1.3 Aid Programs Administered by CSU Campuses

Scholarships - The availability and application procedures for institutional scholarships
vary among the campuses.

Other Aid Programs - The availability of other aid programs varies among institutions.
Several CSU campuses have small institutional long-term loan programs and a number of
them currently participate in the state Work-Study Program.
For questions regarding the above sections, campuses should first contact their campus Financial
Aid Office for assistance.
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2.0 FUND SPECIFICS:
2.1 FIDUCIARY – PRIVATE PURPOSE FUNDS
Financial Aid Funds
2.1.1 CSU Fund 423, Forgivable Loan/Doctoral Incentive Program: Used to record the loans,
support and operating costs related to the California Doctoral Incentive Program (CDIP).
Authority: EC 89721(b) and established via Grantor Agreement.
2.1.2 CSU Fund 431, TF-Campus Scholarships and Grants-Restricted: Used as a campus
scholarship/grant fund. This fund is used for miscellaneous non-federal scholarships and grants.
Authority: EC 89721(b) and established via Financial Aid Regulations.
2.1.3 CSU Fund 433, Campus Students Loans Trust: Used to record campus-administered
student loan funds that are not required to be accounted for elsewhere. Funding is provided from
contributions, repayments of previous loans, and interest income. Examples include short-term
and emergency loan funds.
Authority: EC 89721(b) and established via Financial Aid Regulations.
2.1.4 CSU Fund 434, Campus Student Long Term Loans: Used to record campusadministered student long-term loans that are not required to be accounted for elsewhere.
Funding is provided from contributions, repayments of previous loans, and interest income.
Authority: EC 89721(b) and established via Financial Aid Regulations.
2.1.5 CSU Fund 435, Miscellaneous Financial Aid – Unrestricted: This campus fund is used
to record financial aid activity funded by unrestricted sources.
Authority: EC 89721(b) and established via Financial Aid Regulations.
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2.2 FIDUCIARY – AGENCY FUNDS
Financial Aid Funds
2.2.1 CSU Fund 436, Miscellaneous Financial Aid and Other Agency: Used to record funds
held by the campus on behalf of another agency and, as such, transactions generally occur only
in balance sheet accounts. When a campus receives scholarship monies in which the scholarship
recipients have been determined by another agency, the campus is acting as their agent. This
fund should not be used for Federal Direct Loans (which are accounted for in CSU fund 410,
Federal Direct Student Loans).
Authority: EC 89721(b) and established via Financial Aid Regulations.
3.0 FUND MANAGEMENT AND ACCOUNTING PRACTICES:
3.1 FIRMS Edit Table
During the FIRMS data validation process, campus data will be checked to verify that only
financial aid object codes are being used in the funds referenced in this chapter. See Chapter 3,
FIRMS, for further information about the Legal Edits Table, which validates combinations of
CSU fund and object code.
3.2 Recording SUG and EOP in the General Ledger
SUG and EOP cash will remain in the CSU Operating Fund (CSU fund 485) and will be
expensed directly from this fund as disbursed to students. Unique object codes are to be used to
record SUG and EOP expenditures to differentiate these from other activity in the CSU
Operating Fund, making them easily identifiable for CSU budgetary reporting to the state and to
allow for proper classification of SUG and EOP amounts for GAAP reporting purposes.
Campuses should use FIRMS object code 609001, State Educational Opportunity Program
Grant, and 609002, State University Grant, in CSU fund 485 for direct expensing of EOP and
SUG disbursed to students. The Student Financial system should be set up with the appropriate
item types so that these object codes and CSU fund 485 are used to record the financial aid
disbursements. Item types are codes used in the Oracle Student Financials module to define all
of the unique actions seen in student accounts such as Tuition Deposits, Financial Aid Payments,
Waivers, Application Fees, Interest charges, and Refunds. Item types are mapped to general
ledger accounts and thus determine how student account information is transferred to the General
Ledger.
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Special Note for SUG and EOP:
For campuses that treat summer as a trailer term, the unspent financial aid should be accrued in the
legal books to properly account for the entire amount awarded to students. A trailer term is a term
that follows the Spring term, but which does not go into the next academic year. If financial aid
has been granted, but was not used by a student for the previous Fall or Spring terms, it can be
used in a trailer term. In addition, a year-end fund balance designation entry to FIRMS object code
304021, Fund Balance Designated for Financial Aid, is required for these amounts, and an explanation
will need to accompany the annual carryforward report to the Systemwide Budget Office. (See
Chapter 14, CSU Operating Fund, Section 5.1 and 5.2, for further information concerning the
carryforward report.)
Please also see Chapter 14, CSU Operating Fund, Section 3.7, Guidelines for Financial Aid
Funded from Student Fees, for further details related to SUG and EOP.
3.3 Recording Other Financial Aid Programs Funded From Student Fees
There are two other primary financial aid programs at the campus that are recorded in CSU fund
485: the Graduate Business Professional Fee (GBPF) and the financial aid set-aside for doctoral
programs.
3.3.1 Graduate Business Professional Fee (GBPF)
Campuses are directed to set aside 25% to 33% of GBPF as a provision for financial aid. For
tracking and reconciliation purposes, a separate campus fund should be established within CSU
fund 485 for the provision. The unexpended balance at year end should be reported using the
FIRMS object code 304021, Fund Balance Designated for Financial Aid, to avoid inflating
unexpended balances in CSU fund 485 that are available for general operations. There is no
expense FIRMS object code for GBPF since GBPF is a funding source rather than a separate
financial aid program and the financial aid disbursements from GBPF are made through existing
financial aid programs.
If the set-aside is higher than the financial aid need for a particular academic year, the balance of
the GBPF remaining after the set-aside can be recorded in the campus main operating fund.
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3.3.2 Financial Aid Set-Aside for Doctoral Programs:
The following doctoral programs exist within the CSU:



Doctor of Education (Ed.D.)
Doctor of Physical Therapy (D.P.T.)
Doctor of Nursing Practice (D.N.P.)
Fees charged to doctoral students are not considered a state tuition fee and are, therefore,
ineligible for the SUG. The doctoral program set-aside, however, functions in much the same
way as the SUG. The campus projects the tuition revenues to be collected annually, applies the
appropriate set-aside percentage and then uses those funds to make the doctoral financial aid
awards.
The doctoral program, in consultation with other departments as appropriate, determines the
annual amount of the doctoral set-aside, in accordance with the Trustee resolution. The set-aside
percentages are as follows:
EdD 10% - Per EO 1054
DNP 20% - Per resolution RFIN 07-11-08
DPT 33.3% - Per resolution RFIN 07-11-09
Please also see Chapter 14, CSU Operating Fund, Section 3.5, Guidelines for Financial Aid
Funded from Student Fees, for further details related to the recording of these programs in CSU
fund 485.
3.4 Specific Considerations for CSU Fund 431, TF-Campus Scholarships and GrantsRestricted
Each campus should analyze the monies in this fund to determine whether they should be treated
as restricted or unrestricted. The funds should be restricted if the restriction as to the use of funds
is imposed by the grantor, contributor or by law. For example, if a grantor indicates that the
funds may only be used for scholarships, the funds received are deemed to be restricted. The
funds are considered unrestricted if there is no externally imposed restriction on use.
If the grantor selects the student recipients of a scholarship or grant, the scholarship or grant
should be classified as an agency transaction since the campus is only serving as an agent to the
grantor. If the campus has the ability to select the recipient student, or has the ability to redirect
the grant or scholarship, the campus should record the revenue and related expense as part of
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restricted net position. The revenue should be recorded to the appropriate 503XXX financial aid
FIRMS object code. The scholarship expense object code, 609005, Other Student
Scholarships/Grants, should be used when issuing the scholarship to the recipient.
3.5 Specific Considerations for CSU Fund 436, Miscellaneous Financial Aid and Other
Agency
When a campus receives scholarship monies for which the scholarship recipients have been
determined by another agency, the campus is acting as their agent. Therefore, monies recorded in
CSU fund 436 should be recorded in the FIRMS liability object code 206700, Depository
Accounts–Noncurrent, or 206701, Depository Accounts-Current. Upon issuing the scholarship,
campuses are to offset this same liability account. No revenue or expenses are to be recorded in
conjunction with these types of transactions. This fund should not be used for Federal Direct
Loans (which are accounted for in CSU fund 410). See Chapter 30, Financial Aid - Federal, for
further details regarding CSU fund 410.
Scholarship funds received from the California State University Foundation for the CSU Trustee
Awards are also considered agency transactions and should be recorded in CSU fund 436.
Though campus financial aid departments nominate eligible candidates, the CSU Foundation
selects the student recipients of a scholarship. Therefore, the campus is only serving as an agent
to the grantor. The campus should record the money to FIRMS object code 206701, Depository
Accounts-Current.
The accounting described above will allow the entries to be easily eliminated for purposes of
GAAP reporting.
3.6 Specific Considerations for Scholarship Awards
In some cases, grants received will include a provision for student scholarships. The overriding
purpose of the grant is not to provide financial aid, and so the accounting for the grant is done in
CSU fund 465, Grants and Contracts. The funds for scholarships are a very small portion of the
monies received under the grant. The scholarship funds provided may be for students of the
campus receiving the grant and/or for students at other CSU campuses. When scholarship funds
are given by the grantee campus to another CSU campus it is necessary to eliminate the resultant
duplication of revenue and expense entries. The necessity for elimination depends on whether
the receiving campus is an active participant in the transaction or is simply an agent for the
grantee campus. The distinction is discussed further below and in the examples provided in this
section.
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The recipients of the scholarships may be determined by the grant, by the campus administering
the grant or by the campus issuing the scholarship funds. When a campus disburses monies in
which the scholarship recipient has been determined by the grant, the campus is acting as their
agent. Therefore, monies recorded in CSU fund 431 should be recorded in FIRMS liability object
code, 206701, Depository Accounts-Current. Upon issuance of the scholarship, this same
liability account is to be charged. No revenue or expenses are to be recorded in conjunction with
these types of transactions.
If the campus has the ability to select the recipient student, or has the ability to redirect the grant
or scholarship, the campus should record the revenue and related expense as part of restricted net
position.
The following examples demonstrate the journal entries to be prepared on a legal basis for the
alternative relationships between the grantee and the campus disbursing the scholarship funds:
Scenario 1 – Campus A receives a grant and sends Campus B a scholarship award from the
grant. Campus B determines which students receive the scholarship.
Campus A
Dr. CSU fund 465, FIRMS object code 101100 – Short Term Investments/Cash (SWIFT)
Cr. CSU fund 465, FIRMS object code 503XXX [financial aid revenue object
codes]
To record receipt of the grant.
Campus A
Dr. CSU fund 465, FIRMS object code 624101, SP Interagency Scholarships (w/F&A)
Cr. CSU fund 465, FIRMS object code101100 – Cash/Short-Term Investments
(SWIFT)
To issue the scholarship funds to Campus B.
Note: Campus A employs a special FIRMS object code when recording the scholarship expense
(624101). It is important for campuses to use this object code when recording transactions like
this since it allows the Chancellor’s Office to identify them for purposes of recording a GAAP
elimination.
Campus B
Dr. CSU fund 431, FIRMS object code101100, Cash/Short-Term Investments (SWIFT)
Cr. CSU fund 431, FIRMS object code 503302, Local Financial Aid Grants,
Noncapital
To record scholarship funds transferred by Campus A.
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Campus B
Dr. CSU fund 431, FIRMS object code 609005, Other Student Scholarships/Grants
Cr. CSU fund 431, FIRMS object code101100, Cash/Short-Term Investments
(SWIFT)
To record issuance of scholarship to a student designated by Campus B.
Note: Campus A will need to provide information to the Chancellor’s Office about these
transactions so the duplicate revenue and expense can be eliminated for GAAP reporting
purposes. Campus A will need to notify the Chancellor’s Office of the amount it recorded in
revenue and expense for these scholarships, confirm the fund and object codes used, and identify
the receiving campus.
Scenario 2 – Campus A receives a grant and sends Campus B the funds to issue the scholarships
on their behalf. Campus A determines the recipients, therefore, campus B will record an agency
transaction.
Campus A
Dr. CSU fund 465, FIRMS object code 101100, Cash/Short-Term Investments (SWIFT)
Cr. CSU fund 465, FIRMS object code 503XXX [financial aid revenue object
codes]
To record receipt of the grant.
Campus A
Dr. CSU fund 465, FIRMS object code 624001 or 624002, SP Scholarships
Cr. CSU fund 465, FIRMS object code 101100, Cash/Short-Term Investments
(SWIFT)
To record issue of funds to Campus B for payment of scholarship to specified student.
Note: Do not use FIRMS object code 624101, SP Interagency Scholarships (w/F&A), as this is
only used in when both the issuing and receiving campuses record the scholarship revenues and
an elimination is required in GAAP.
Campus B
Dr. CSU fund 436, FIRMS object code101100, Cash/Short-Term Investments (SWIFT)
Cr. CSU fund 436, FIRMS object code 206701, Depository Current
To record receipt of the scholarship funds on behalf of Campus A.
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Campus B
Dr. CSU fund 436, FIRMS object code 206701, Depository Current
Cr. CSU fund 436, FIRMS object code 101100, Cash/Short-Term Investments
(SWIFT)
To record issuance of the scholarship to a student specified by Campus A.
3.7 Graduate Equity Fellowship
The recording of the Graduate Equity Fellowship depends on the funding source for the
fellowship. If it is funded from student fee revenues in CSU fund 485, as seems most likely, then
financial aid expenses for the program should be recorded in CSU fund 485 using FIRMS object
code 609004, State Graduate Fellowship. Campuses may create a separate PeopleSoft account
that maps to FIRMS object code 609004 to track fellowship expenses separately from other state
graduate fellowship programs, if any.
4.0 REPORTING REQUIREMENTS:
None
5.0 FUND BALANCE:
FIRMS object code 304021, Designated for Financial Aid, was created only for campuses that
treat summer as a trailer term for financial aid purposes. Therefore, campuses should typically
accrue on their legal books any unspent amounts that have been awarded for the summer term. In
cases where 100% of the SUG or EOP amounts for a year have not been spent or properly
accrued for award to a student, a designated reserve should be recorded for those amounts within
CSU fund 485 and an explanation should be provided in the annual carryforward report to the
Systemwide Budget Office.
There are no equity accounts for financial aid and student loan funds, and for financial aid funds
held on behalf of others (agency funds); therefore, there is no fund balance at the end of the
fiscal year in these funds.
6.0 GAAP IMPACT:
There is a need for GAAP entries for tuition discounting (see GAAP Manual Chapter 4.11 for further
information) and any adjustment for summer term trailer accruals (see GAAP Manual Chapter 4.13
for further information).
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7.0 RESOURCES:
Financial Aid Programs
GAAP Manual
Legal Edits Table
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FINANCIAL AID – CAMPUS/LOCAL/NONGOVERNMENTAL
REVISION CONTROL
Document Title:
CHAPTER 32 – FINANCIAL AID – CAMPUS/LOCAL/NONGOBERNMENTAL
Contributor:
Kristina Randig
Reviewer:
Dean Kulju/Wendy Ortega
CO Owner:
Roberta McNiel
Issuance Date:
May 29, 2014
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