Transcript De-dc-md asfaa Conference How to Prepare for an AudiT 11/9

DE-DC-MD CONFERENCE
HOW TO PREPARE FOR AN AUDIT
11/9/2011
Dawn Y. Mosisa, Director, University Financial Aid Compliance
Johns Hopkins University
How to Prepare for An Audit or Program
Review?
Perspective is critical
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Manage the audit/review process carefully
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Ensure your office is in good shape
•
Types of Audits and Reviews
Annual Audit
•
General Assessment Reviews
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Focused Reviews
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Who performs Audits & Reviews?
Independent Auditors
•The U.S. Department of Education
•Office of the Inspector General (OIG)
•Others
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Do They Speak To Each Other?
Independent Auditors
•The Dept of Education
•Other Agencies
•Coordinated onsite reviews
•
What is the Typical Focus of an
Audit/Program Review?
Annual Audit
•General Assessment Program Review
•Focused Program Review
•Recertification
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What are Some Possible Triggers
for a Program Review?
High CDR
•Deficiencies reported by state, accrediting, or other agency
•Significant changes in Pell or Loan volume
•Late refunds
•High withdrawal rates
•Significant Audit Findings
•Repeat Findings or recurrent problems
•Complaints from students or adverse publicity
•Haven’t had a review in a number of years
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Timing for an Audit or Review?
Typically you work with your auditors to identify
a mutually agreeable timeframe.
•
The Department of Education generally
provides 2-4 weeks notice for a general
assessment program review.
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Factors That Could Result In Short
Notice For a Review
Complaints from law enforcement agencies
•Serious, credible complaints from students
•OIG complaints
•Negative reports from state or accrediting
agencies
•Adverse articles in the media
•Information from employees (current or prior)
•Possible fraud and abuse
•
Common Audit Findings
R2T4 calculation errors
•Pell overpayment / underpayment
•Late return of TIV funds
•Verification errors
•Overawards
•R2T4 not made
•Enrollment status not verified prior to disbursement
•Improper certification of loans
•Credit balances not refunded in a timely manner
•Ineligible students – not meeting SAP
•Repeat finding – failure to take corrective action
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Common Program Review Findings
Verification errors
•Crime Awareness requirements not met
•Credit balances not refunded in timely manner
•R2T4 calculation errors
•R2T4 done late
•Entrance/exit counseling deficiencies
•Account Records inadequate / not reconciled
•Missing/inconsistent information in files
•SAP policy not adequately developed and/or monitored
•Pell overpayment / underpayment
•Enrollment report (SSCR) issues
•Repeat findings or failure to take corrective action
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What is on both lists?
Verification errors
•R2T4 calculation errors
•R2T4 performed late
•Pell Grant underpayment / overpayment
•Credit balances not refunded in timely manner
•SAP issues
•Repeat finding / failure to take corrective action
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What Should You Know About the
Audit Process?
Involves more than just the financial aid office
•More than student eligibility and the
management of Title IV funds
•Institutional compliance with TIV laws
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Who Is Your Auditor / Reviewer?
What is the level of knowledge of your
auditor/reviewer?
•Do you think it is better to have a more
knowledgeble auditor? Or less?
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Snapshot of the Typical Audit
Letter
•Request for Information
•Onsite Visit
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•
•
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Entrance Interview
Audit / Review is conducted
Exit Interview – usually with preliminary findings
Initial Letter of Findings
•Institutional Response with Corrective Action Plans
(CAP) as appropriate
•Final Report of Findings
•
During the Onsite Visit…..
Be calm!
•Listen and understand what is being asked
•Be cooperative, responsive, and honest
•Be direct in your responses and to the point
•Do not answer the “unasked” question
•Say you don’t know if you don’t know (find out the answer)
•Document what was said, and any outcome or action items
•Ask for requests in writing, or confirm in writing for clarity
•Keep copies of anything you provide to them
•
How Do You Prepare for An
Upcoming Onsite Audit / Review?
Who is conducting the audit / review?
•What is their focus and how were you selected?
•What type of information will they request and will you
be able to easily provide it?
•Are your student files organized and by AY?
•Who should you involve? Notify leadership and
relevant offices, including IT.
•Select a “point person” for the auditor/reviewer to work
with.
•Designate a quiet work area for your auditor.
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What Documents Are Typically
Requested?
Policy and Procedure Manual
•Cost of Attendance Budgets
•SAP Policy
•Pell and Loan account information
•R2T4 Policy and process
•List of enrolled students, and withdrawals
•ISIRs and student files
•Access to documents/SIS
•SSCR documentation
•Other
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How to Prepare for Audits and
General Assessment Reviews
Ongoing due diligence
•Ensure previous audit findings are corrected
•Ensure new laws and regulations are implemented
•Have safety nets in place in your operations
•Don’t ignore repeat questions/issues raised by students &
staff - they could indicate a weak area or gap
•Ensure your staff is properly trained ongoingly
•Meet regularly with your staff
•Ensure your student files are organized, and that actions and
decisions are documented
•Keep your P&P updated
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What Else?
Internal Audits
•Mock Program Review by outside consultant
•NASFAA Self-Evaluation Guide
•Program Review Guide for Institutions on IFAP
•FSA Assessments on IFAP
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What is FSA Assessments?
On IFAP under Tools
•Developed in collaboration with FA
Professionals
•Purpose is to help schools with compliance and
with making improvements
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What Does FSA Assessments Offer?
It has 3 main topic areas, with several sections under each,
and several specific topics/sub-sections under each section.
These main topic areas are:
Students
•School
•Campus-based
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There’s an FAQ page with guidance on how to navigate
and begin using!
FSA Assessments - “Students”
The “Students” main topic includes 3 sections:
Student Eligibility
•Satisfactory Academic Progress
•Verification
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FSA Assessments - “School”
The “School” main topic area includes 7 sections:
Guide to create a P&P
•Automation
•Consumer Information
•Default Prevention and Management
•Fiscal Management
•Institutional Eligibility
•R2T4
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FSA Assessments – “Campus-based”
The“Campus-based” main topic includes 3
sections:
FSEOG
•FWS
•Perkins
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FSA Assessments Chart
Provides guidance on which sections and/or
activities to complete based on your current situation,
such as:
Deficient Audit
•Recertification
•Fiscal Reconciliation
•Program Review Deficiencies
•No Action or Deficiencies
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2 Assessments per AY is recommended
FSA Assessments –
Student – Student Eligibility
15 sub-sections – with 3 activities
Student eligibility
Citizenship
Academic Qualification
SAP
FA History
Valid SSN
Selective Service
ACG/SMART
Drug-related offenses
TEACH Grant
Telecommunications
Study Abroad
Financial Need
Verification
Regular Student in Eligible Program
FSA Assessments –
School – Institutional Eligibility
9 sub-sections – with 5 activities
Recertification
PPA
Gainful Employment
Consumer Information
Financial Responsibility
Preferred Lender Lists
Accred/State Approval
Written Arrangements
Program Eligibility/AY Requirements
In Summary
No Surprises
•Know the scope, perspective, and reason for the
audit/review
•An institutional review
•Select a “point person”
•Be organized
•Always be professional, responsive, and direct
•Document
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Good Luck!!!
Questions???