Diane Stemper - Nebraska Association of Student Financial Aid
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Transcript Diane Stemper - Nebraska Association of Student Financial Aid
NeASFAA Fall Training
How to Survive a Title IV Audit
or Program Review
Diane Stemper
Executive Director
Enrollment Services
Student Financial Aid
The Ohio State University
Agenda
Federal Program Review and Audits
What are they?
Why?
Preparation
While audit is occurring - expectations
Completion of audit and findings
Next steps
Enrollment Services
What are Program Reviews and Title IV
Audits?
Why do we have to endure a U.S. Department of Education
Program Review?
Authority for Program Reviews is defined by Congress to
ED to ensure necessary oversight of Title IV institutional
participants
Section 498A (administrative capability & financial
responsibility)
“Why?”
Purpose is to evaluate compliance, identify
liabilities/risks, and enhance institutional
administrative capabilities
Ensure the efficient and effective use of taxpayer
dollars in support of American education
Identify financial aid compliance risks and financial
liability
Make conclusions and recommendations
Determine corrective action
Types of Audits
•Public & Non-Profit Institutions:
A-133
Due within 9 months of the
fiscal year end (FYE) date
(-More requirements, more
time)
•For-Profit Institutions:
SFA Audit Guide
Due within 6 months of the
fiscal year end (FYE) date
Schools must arrange for regular independent audits
that include the operation of the FSA programs.
Types of Audits and Reviews
Focused
Full Scope
Program Review Triggers
High cohort default rate
Significant changes in Direct Loan or Pell volume
Late refunds
Deficiencies reported by state licensing or accrediting agencies
Financial responsibility standards
High withdrawal rates
Significant audit findings
Repeat findings or recurrent problems
Significant risk of noncompliance with administrative capability
Complaints from students or adverse publicity
Institutions that haven’t had a review in a number of years
Frequent change in financial aid leadership
ED’s Goals
Identify any institutional weakness(es)
Frame required actions to strengthen institutional
compliance
Quantify harm of noncompliance
Administrative action to protect students and
taxpayers
Institutional Goals
Understand and ensure compliance with Program
Review requirements
Respond as quickly and accurately as possible to the
multiple data requests prior to the on-site visit
Remain professional throughout the site visit and at
all times (email, phone, etc.)
Manage the Program Review and follow-up to
mitigate liabilities and administrative action
Positives of a Program Review
Increase visibility of our complex financial aid world
(one campus even received additional staff after their
Review)
Raise awareness of Federal Title IV compliance as a
campus-wide responsibility
Learn what you are doing right!
Assess and make focused
improvements/enhancements
Mitigate liabilities and administrative actions
You’ve Been Selected
You’ve Received a Letter
Don’t Panic
Remember that auditors and reviewers are financial
partners
Read the letter carefully
Contact the reviewer
Notify senior campus officials immediately
Discuss with staff
Provide overview of what to expect
Program Review Timeline
2-4 weeks advanced notice (but sometimes very
short notice, especially in cases of serious
complaints or adverse media)
Typically 1 week on-campus
Written report 1-6 months later
School response due in 30 days
Final Determination Letter (or, in cases of few or no
findings, an expedited Determination Letter)
Appeal process
PREPARATION
Institutional Responsibility
President’s
Office
Bursar
Financial
Aid
Admissions
Registrar
“Point”
Person
3rd Party
Servicers
How to Prepare
Read the 2009 ED Program Review Guide
http://www.ifap.ed.gov/programrevguide/2009Progra
mReviewGuide.html
Review the sample file and policy review checklists
Review and prepare for sample student/staff
interview questions
Obtain outside help if needed
Rally the Resources
Identify key staff to compile required documents –
share the responsibility
Pull files
Conduct individual interviews as needed
Resolve issues
Prepare to provide copies of entire student records
(FA files, admission applications, student records,
academic transcripts, student account files, R2T4
calculations/payments, etc.)
Internal Reviews
Locate a Program Participation Agreement (PPA)
and Eligibility and Certification Approval Report
(ECAR)
Review prior audits
Standard of Administrative Capability (34 CFR
668.16)
Corrective Action Plan (CAP) should have
indicated corrective steps taken
What procedures are in place?
Make sure prior deficiencies are addressed!
Tools of the Trade
FSA Handbook
ISIR Guide
Dear Colleague Letters
Federal Registers
Code of Federal Regulations
FSA Assessment Tool
NASFAA Standards of Excellence
Review
NASFAA Self-Evaluation Guide
The Blue Book
Preparation for Audit
Review operational practices
Review and update policy and procedures
documents for packaging
Conduct training sessions on regulatory changes,
ongoing reminders and compliance information
Requested Documents Include:
Policies and Procedures Manual
Sample FSA forms
Cost of Attendance Budgets
Pell Electronic Statement of Account (ESOA)
Information
Return to Title IV (R2T4) worksheets
Documentation of cash requests/refunds/returns
Default management plan, if required
FISAP
Satisfactory Academic Program and refund policies
Requested Documents Include:
ISIRs
Latest accreditation status
Third party servicer contracts
Administrative software utilized
Program Participation Agreement (PPA) and
Eligibility and Certification Approval Report (ECAR)
Financial statements for past two years
Campus security report
Catalog
Consumer information
Specific Prep Items
Chart of accounts/funds information
Control/process memos
List of trainings and in-services for staff
Policies for notifying ED and NSLDS of student status
change
Reciprocity students
Cost of Attendance (COA) budgets
Compensation plans
Recruiting policies
Satisfactory Academic Progress & Academic progress
Consortium or other program agreements MOAs
Program Review and Audit: Helpful Hints
Provide single point of contact
Ask for requests in writing or confirm understanding
in writing for clarity
Keep copies of everything provided: you will look at
the stuff again
Provide a comfortable place for reviewers to work
Respond promptly to requests
Do not answer the “unasked” question
Challenge findings
Managing the Visit
Give the Program Reviewers space, but be available
and check in periodically to see if anything is needed
Keep detailed notes of all questions, follow-ups,
documents provided
Track open items and resolutions
If possible, have your staff review COD and NSLDS
records of student sample group before the visit (or
as soon as you receive the list)
Entrance Interview
President/Chancellor
Vice President(s)/Provost
Directors of key departments (Bursar, Admissions,
Comptroller, Chief Fiscal Officer(s), Internal Audit)
Entrance Interview Overview
Welcome and introductions
Program Reviewers will explain to the group:
The purpose of the Review
The scope of the Review
The Timeframe, including the date/time of the Exit
Interview (typically with the same invitees)
Clarify the campus operating parameters (hours of access to
campus personnel) for Program Reviewers
Clarify who Program Reviewers will need to meet with
Remain professional, courteous and cautious responding only
to what is requested (and prepare others accordingly)
Exit Interview
Advise campus colleague attendees of any
preliminary issues you may be aware of before the
Exit Interview
Ask a campus colleague to take detailed notes
Ask for regulatory citations for any issues you may
question
Prepare your own list of questions for the Program
Reviewers
Discuss any findings or unresolved issues
appropriately – it is ok to ask questions (but don’t be
confrontational)
50 Ways to Survive a Federal Title IV Program
Advise legal counsel of the visit in case they are needed
Do everything you can to maximize the success of the review – do not feel
bad about asking staff or key responders to reschedule/postpone leave or
appointments to accommodate the review – this is important stuff
You will need help – ask for it and keep asking until you get it!
Trust that you know things
Remember that no one knows everything, especially immediately from
memory
Stress that everyone involved should keep notes on all conversations of
substance
Ease tension for financial aid staff and other core responders by meeting to
discuss the review
Listen more, talk less
DON’T ANSWER QUESTIONS THAT ARE NOT ASKED
50 Ways to Survive a Federal Title IV Program
Be sure you understand any questions before trying to answer
An honest answer to any question is all that is needed– however, do
not answer when you don’t know (no guessing!) or unnecessarily
expand an answer – it’s okay to say “I’d like to get back to you on
that”
Ask questions; respectfully disagree – a reviewer may not be an
expert in every area of financial aid (like systems)
Keep organized; if you have the option, use an “assistant”
Don’t treat reviewers like the enemy; be cautious but professional
Establish a congenial working relationship with the reviewers
Assume there will be findings
50 Ways to Survive a Federal Title IV Program
When discussing findings, ask questions if you are unclear – you can
state “do not concur”
You will have a good sense of what will be shared at the exit interview
- prepare those who will attend no matter how negative the findings –
it is much better to hear it from you first than in a group setting with
the reviewers
During review ask for regulatory/statutory citations and make sure
you understand how they apply to the findings
Make sure you keep all reviewed materials together to ensure you
know what reviewers saw at the time of the review
Completion of Audit
Understand findings so corrective action can occur
Write responses in timely fashion, involve other units
Potential items:
Inaccurate/untimely reporting of enrollment status
Attendance first day (distance vs. non-distance)
Withdrawal date
Earn and unearned “F” grade
Grade level information, notification of
Full-time/part-time documented
Degree progress
Course repeat rules enforced
Frequent Audit Findings
Auditor opinion cited in audit (qualified or adverse)
Verification violations
Pell over/under payments
Student Credit Balance deficiencies
Student confirmation report filed late/not filed/not
retained for five years/inaccurate
Return of Title IV late, calculation errors
Entrance/Exit Counseling
Repeat finding – failure to take corrective action
Student Status – inaccurate/untimely reporting
Most Frequent Program Review Findings
Verification
Crime awareness reporting
Return of Title IV late, calculation errors
Entrance/Exit Counseling
SAP
Student Credit Balance deficiencies
Missing or inconsistent information in student files
Pell over/under payments
Ineligible Pell disbursement
Most Frequent Program Review Findings
Consumer information deficiencies
Improper dependency overrides
Lack of administrative capabilities
Improper Certification of Student Loans
Repeat finding – failure to take corrective action
Student Status – inaccurate/untimely reporting
Some additional recent findings:
FWS students paid for time they were scheduled for class
Documenting Pell recipients’ initial attendance and/or
documenting dropping a class and reducing Pell
accordingly
Findings on Both Lists
Return of Title IV late, calculation errors
Entrance/Exit Counseling deficiencies
Verification violations
Pell Grant over/underpayments
Student Credit Balance deficiencies
Repeat finding – failure to take corrective action
Student Status – inaccurate/untimely reporting
Next Steps
Create priority list for implementation of correcting
findings
Create an implementation timeline
Review frequently
Online Resources
Top 10 Audit and Program Review
Findings: http://www.nasfaa.org/Main/orig/2012/Top_10_Audit_and_Program_R
eview_Findings.aspx
Compliance Resources for Financial Aid
Professionals: http://www.nasfaa.org/compliance/
Program Review Guide for Institutions
2009:
http://ifap.ed.gov/programrevguide/attachments/2009ProgramR
eviewGuide.pdf
Successfully Managing a Program Review (again, much of today’s slide deck
came from this NASFAA presentation):
http://www.nasfaa.org/EntrancePDF.aspx?id=2595
FSA Handbook, Volume 2, Chapter 9, “Program Reviews, Sanctions &
Closeout” http://ifap.ed.gov/fsahandbook/attachments/1112FSAHbkVol2Ch9.pd
f
Moving Forward – OSU QA Model
Compliance
Quality
Assurance
Training
Questions?
Thank you!
Diane Stemper
[email protected]