TOP 10 PROGRAM REVIEW FINDINGS OF 2018

Higher Ed Executives Financial Aid Consultants

TOP 10 PROGRAM REVIEW FINDINGS OF 2018

One of the functions of the U.S. Department of Education is to oversee the Federal Student Aid programs to ensure they are administered correctly and that institutions are meeting the FSA requirements for institutional eligibility, financial responsibility, and administrative capability.

School Participation Divisions review information about each title iv approved school from a variety of sources including accrediting agencies, state licensing boards and agencies, student complaints and of course, financial and compliance audits.

This information is evaluated by ED and FSA to assess potential risk to the FSA programs and if necessary, act to investigate a school. One of the ways ED does this is by conducting program reviews at schools that exhibit certain indications of problems or pose a potentially significant risk of failing to comply with the rules and regulations governing title iv participation.

Knowing what to watch out for can help you avoid compliance problems.

These findings represent data ED reported based on findings from Program Review audits and compliance examinations reports conducted by FSA and published in the last twelve months for fiscal year 2018.

  1. NSLDS Roster Reporting – Inaccurate/Untimely Reporting
  2. Crime Awareness Requirements Not Met
  3. Return of Title IV (R2T4) Calculation Errors
  4. Drug Abuse Prevention Requirements Not Met
  5. Student Credit Balance Deficiencies
  6. Consumer Information Requirements Not Met
  7. Verification Violations
  8. Entrance/Exit Counseling Deficiencies
  9. Inaccurate Recordkeeping
  10. Satisfactory Academic Progress Policy Not Adequately Developed/Monitored

Findings like these are preventable.

Higher Ed Executives provides colleges and universities with objective and confidential assessments that can help you uncover unknown compliance problems and improve title iv administrative and operational procedures and processes.

Our comprehensive assessments cover the full spectrum of FSA requirements for institutional eligibility, financial responsibility, and administrative capability.

Call us today for a free no obligation consultation and to find out how our assessments can work for you.

Call 203-836-4806

FSA IS PLANNING MULTIPLE SYSTEM OUTAGES DURING NOVEMBER

ICYMI – NOVEMBER SYSTEM OUTAGES

Throughout the first few weeks of November, there will be several planned outages impacting the availability of Federal Student Aid Systems. During these outages, government systems will be unavailable which could impact students applying for aid as well as schools’ ability to award, disburse and draw down title iv funds.

FSA ID SYSTEM OUTAGE – November 3-4, 2018 

From 11 p.m. Eastern time (ET) on Saturday, November 3, 2018, until 11 a.m. ET on Sunday, November 4, 2018, users will be unable to access functionality that requires an FSA ID on the websites and systems listed below. Users attempting to access an impacted website or system during this outage period will receive an error message informing them that the page cannot be found or that the site is unavailable due to maintenance.

  • Borrower Defense to Loan Repayment (customers may submit applications at StudentAid.gov/borrower-defense during the outage but will be unable to sign in with an FSA ID)
  • gov (users of the myStudentAid mobile app will also be unable to sign in with an FSA ID)
  • Federal Student Aid Feedback System (customers may submit feedback directly at feedback.studentaid.ed.gov during the outage but will be unable to sign in with an FSA ID)
  • FSA ID
  • National Student Loan Data System (NSLDS®) Student Access
  • gov My Federal Student Aid functionality
  • gov, including the Teacher Cancellation Low Income (TCLI) Directory (until Noon ET on Sunday, November 4, 2018)

G5 SYSTEM OUTAGE – November 10-19, 2018

All day Saturday, November 10, 2018 through 6 a.m. Eastern time (ET) on Monday, November 19, 2018, the G5 website will not be available. Schools will not be able to draw down or return funds during this period for the following Title IV Programs:

  • Campus-Based Programs
  • Federal Pell Grant (Pell Grant)
  • Iraq and Afghanistan Service Grant
  • Teacher Education Assistance for College and Higher Education Grant (TEACH Grant)
  • William D. Ford Federal Direct Loan (Direct Loan)

COD SYSTEM OUTAGE – November 10 – 19, 2018

All day Saturday, November 10, 2018 through 6 a.m. ET on Monday, November 19, 2018, the Common Origination and Disbursement (COD) System will accept Pell Grant, Iraq and Afghanistan Service Grant, TEACH Grant, and Direct Loan records. However, after 10 a.m. ET on Friday, November 9, 2018, Current Funding Level (CFL) changes (as a result of actual disbursements) and funding will not be processed by G5 until November 19, 2018.

All actual disbursements with a disbursement date from November 10th through November 16th must be received, and subsequently accepted, by the COD System no later than 10 a.m. ET on Friday, November 9, 2018, in order to generate the appropriate funding level increase prior to the outage. Disbursements submitted by the deadline but not subsequently accepted, disbursements submitted after the deadline, and disbursements with a disbursement date after November 16th will be processed and funded after G5 re-opens.

Note: Generally, schools that submit records by the 10 a.m. ET deadline on November 9th will be able to draw those funds after 2 p.m. ET on Friday, November 9th.

IRS DRT SYSTEM OUTAGE – November 11-12, 2018

The IRS DRT will be unavailable on Sunday, November 11, 2018 and Monday, November 12, 2018 from 8 a.m. to 6 p.m. ET each day as the IRS completes critical system upgrades. During these outage periods, actions can be completed on fafsa.gov, using the myStudentAid mobile app, and on StudentLoans.gov. However, if an action requires entry of federal tax information, the tax information will need to be provided manually. Applicants may wish to complete the application after the outage is over.

In the event the IRS is unable to complete its upgrades during the outage periods described above, an additional outage will be scheduled for the weekend of November 17-18, 2018. Monitor the Information for Financial Aid Professionals (IFAP) website for an Electronic Announcement that will provide details about this additional IRS DRT outage, if needed.

EZ-AUDIT INSTRUCTIONS FOR INSTITUTIONS SUBJECT TO ASU 2016-14

In August 2016, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) 2016-14, Presentation of Financial Statements of Not-for-Profit Entities. ASU 2016-14 reduced the number of classes of net assets from three to two; Net Assets Without Donor Restrictions, and Net Assets with Donor Restrictions. ASU 2016-14 also requires the presentation of expenses in both natural and functional classifications.
ASU 2016-14 is effective for fiscal years beginning after December 15, 2017, with early adoption permitted. The Department’s eZ-Audit system has not been updated to reflect these changes yet. Recently Federal Student Aid offered interim guidance for early implementers to ensure data is properly loaded into the financial statement templates.

FUNDAMENTALS OF FEDERAL STUDENT AID ADMINISTRATION WORKSHOPS

Federal Student Aid just announced the Fundamentals of Federal Student Aid Administration training workshops schedule for November 2018 through September 2019. These four and a half day, in-person workshops are conducted at ten different locations around the country throughout the year at one of the Department of Education’s regional training facilities.

If a school undergoes a change in ownership or control, or if your school is applying for Title IV participation for the first time, the school’s chief financial aid administrator and its chief administrator (typically school President, CEO or another high-level school official designated by the President or CEO) must attend training. For new schools, attendance at this workshop is required to complete your institution’s certification and is one of the prerequisites for coming off “provisional status”, which usually occurs 12-24 months after your school is initially approved for Title IV funding. When your school applies for recertification, the Department will check to make sure that both required people have attended the workshop, and for the appropriate number of days. The Department may also request that you send a copy of the certificate that you received, to prove your attendance. If your school is undergoing a Change of Ownership, you must also attend this workshop within 12 months.

Anyone who plans to attend must also complete online prerequisite courses for FSA Coach Fundamentals which is approximately 20-30 hours to complete. After passing the course, participants will be sent a link to register for the in-person session.

Participants who wish to register for and attend a Fundamentals of Federal Student Aid Administration workshop must first successfully complete an online, prerequisite course titled FSA Coach Fundamentals (formerly known as Introduction to Federal Student Aid). The online course may take 20 to 30 hours to complete, so please plan accordingly. Together, these two courses comprise the Fundamentals Training Series.

FSA is offering two workshops that are exclusively for schools with clock-hour programs. These clock-hour-only workshops are scheduled for May 6-10, 2019 in Dallas, Texas and May 13-17, 2019 in Washington, DC. Only schools with clock-hour programs will be allowed to attend these workshops. Clock-hour schools may, however, enroll in any workshop that is listed in this announcement and are not limited to the two listed above. All workshops cover material applicable to clock-hour schools.

For more information including the 2018-2019 schedule of trainings, a brief Q&A, and information about registering check out this electronic announcement from FSA.

SAVE SYSTEM GLITCHES ON THIRD STEP VERIFICATION

After some new SAVE system users began receiving “No Records Found” messages when submitting Third Step Verification Requests through the recently launched DHS System, FSA is asking schools that are receiving this message to temporarily stop processing third-step cases and stop sending DHS numbers to application processing to generate new DHS verification numbers. According to FSA, the Department of Homeland Security which runs the SAVE site has identified the problem and is working on implementing a solution. The fix is expected to be rolled out by the middle of July.

In the meantime, schools should follow the steps contained in this electronic announcement to receive an updated ISIR from CPS. These procedures are like those provided during the transition to the DHS SAVE system.

DELAY OF STATE AUTHORIZATION RULES FOR DISTANCE EDUCATION PROVIDERS

State Authorization Reciprocity Agreement

The Department of Education announced it will delay the effective dates of the controversial state authorization rules that were passed at the end of the Obama administration and set to go into effect on July 1, 2018. The rules, initially introduced in 2010, have been postponed before, and this time the Department expects to delay the effective date until July 1, 2020. The delay will allow the Department to take up the issue in another round of negotiated rulemaking sessions and rewrite the rules.

The regulations mainly delineate State authorization requirements for postsecondary distance education that must be met for participation in the Title IV aid programs. Under the state authorization regulations, online programs were required to obtain approval in each state where they enrolled students. As a result, colleges and universities were left with few options; forced to either seek approval from each state individually unless they were lucky enough to be based in a state with a “State Authorization Reciprocity Agreement” in place, or forgo enrolling students living in states where they weren’t approved. Public comments on the delay are open until June 11, 2018.

OVERTIME WAGE CHANGES

Higher Ed Executives Consulting Firm

The Department of Labor is undertaking rulemaking to revise regulations which govern the exemption of executive, administrative, and professional employees from the FLSA’s minimum wage and overtime pay requirements after Obama era regulations were struck down by a federal district court in 2016. Before the court blocked the rule, Institutions of Higher Education were poised to begin expanding overtime to their employees and despite being blocked, there were lots of lingering questions about which employees were eligible for overtime pay and which weren’t.

Under the Fair Labor Standards Act (FLSA) Higher Education employees such as faculty, administrators and other “white-collar” employees must meet unique requirements to be classified as exempt from federal overtime pay rules.

The FLSA requires that a non-exempt employee receive minimum wages for his or her work, as well as overtime wages whenever he or she works more than 40 hours in a workweek. Section 13(a)(1) of the FLSA, however, exempts certain employees who perform bona fide executive, administrative, professional, and outside sales duties from minimum wage and overtime requirements. These exemptions are often called the “white collar” exemptions.

To qualify for a white-collar exemption, an employee must generally satisfy three tests:

  1. The employee must be paid on a salary basis that is not subject to reduction based on the quality or quantity of work (the “salary basis test”), rather than, for example, on an hourly basis;
  2. The employee must receive a salary at a rate not less than $455* per week (the “salary level test”); and
  3. The employee’s primary duty must involve the kind of work associated with the exempt status sought, such as executive, administrative, or professional work (the “duties test”).

If you’re thinking this list is awfully broad, you’re not alone. It’s reasonable to assume based on this that these rules could apply to everyone from teachers and coaches to financial aid and admissions personnel. And let’s not forget student employees like graduate teaching assistants, research assistants, and student residential assistants, they’re covered here too.

Recently the U.S. Department of Labor Wage and Hour Division released Fact Sheet #17S: Higher Education Institutions and Overtime Pay Under the Fair Labor Standard Act. This fact sheet breaks it all down for you so that you can see which jobs are exempt and there are a few changes to note:

Exemptions for Common Higher Education Jobs

  • Teachers and Faculty including those who teach online or remotely
  • Coaches (excluding recruiters)
  • Professional Employees (Teachers and Learned Professionals)
  • Administrative Employees (Financial Aid, Admissions, Registrar etc.)
  • Executive Employees

Student Employees (Graduate Teaching Assistants, Research Assistants, Student Residential Assistants)

UPDATED SINGLE AUDIT SUBMISSION REQUIREMENTS FOR 2018

If your school has been a Single Audit filer, ED recently provided an update to the submission requirements for 2018 that you’ll want to pay attention to. Last year, the Department required Single Audit filers to submit an audit annually and, in the event that the Student Financial Assistance Cluster, which includes the Title IV programs, was not audited as a major program because it was identified as a low-risk program, filers were instructed to contact their School Participation Division to report the low-risk determination.

Updated Audit Requirements for 2018

Public and non-profit entities with institutions participating in the Title IV programs that submit a Single Audit that does not include the Student Financial Assistance Cluster as a major program will no longer be required to notify their respective School Participation Division of the low-risk assessments.

According to 2 C.F.R. § 200.518(a), under a Single Audit, an auditor must use a risk-based approach to determine which Federal programs are major programs. Part of the major program determination requirements at 2 C.F.R. § 200.518 require an auditor to identify larger Federal programs (Type A programs) which are low-risk. If a Type A program is identified as low-risk, it is not required to be audited as a major program, unless necessary to comply with the percentage of coverage rule. For a Type A program to be considered low-risk, it must, among other requirements, have been audited as a major program in at least one of the two most recent audit periods.

Institutions must still submit (via the Department’s eZ-Audit system) their complete Single Audit each year by the due date regardless of whether the Student Financial Assistance Cluster was audited as a major program.

The impact on year three testing requirements (after two years of low risk assessments) for fiscal year 2019 audits and beyond is still under review.

You can read the full electronic announcement from Federal Student Aid here.

TIME TO UPDATE YOUR DUNS NUMBER

It’s time to update your school’s DUNS number in the Government’s SAM system. All schools must complete the registration renewal and confirmation of their Data Universal Numbering System (DUNS) number annually. The G5 website uses a school’s DUNS number to verify grantees in the System for Award Management (SAM) Web site before it will allow you to draw funds, so it’s important to keep your DUNS number active and renew before the deadline each year. Here’s a heads up – If you don’t update your DUNS, you’ll log into G5 one day and it won’t work. And then you’ll have to wait a few weeks to get it all fixed back up before you can disburse again. Not fun.

To prevent delays in the receipt of Title IV program funds, schools should be sure to complete their annual confirmation of their DUNS number with the SAM Web site as soon as possible. A 60-day and 30-day reminder e-mail will be sent to the Point of Contact (POC) and alternate POC for your school prior to your school’s renewal deadline, but if you don’t renew in time, you could get access to G5 shut down until you do. It can take as long as 14-30 days to have access restored.

To complete the annual confirmation, a school should go to the SAM Web site and search for each DUNS number associated with programs for which the school expects to receive funds from the Department of Education (the Department). The URL for the SAM Web site is https://www.sam.gov.

For more information about the annual DUNS number registration renewal, click here: https://ifap.ed.gov/eannouncements/031418ReminderAnnlDUNSNumberRegistRenewalwithSystemAwardMgmtDatabase.html

TOP TEN FSA PROGRAM REVIEW FINDINGS

Financial Aid Program Review Consultant

We’ve got this year’s top ten FSA Program Review Findings to help you start the year off right.

Knowing what to watch out for can help you avoid compliance problems. These findings represent data ED reported based on findings from institution’s Program Review audits and compliance examinations during the most recently completed fiscal year (2017).

50% of the top program review findings last year were related to consumer information violations.

1. NSLDS Roster Reporting – Inaccurate/Untimely Reporting
2. Crime Awareness Requirements Not Met
3. Return of Title IV (R2T4) Calculation Errors
4. Verification Violations
5. Drug Abuse Prevention Requirements Not Met
6. Entrance/Exit Counseling Deficiencies
7. Consumer Information Requirements Not Met
8. Student Credit Balance Deficiencies
9. Inaccurate Recordkeeping
10. Satisfactory Academic Progress Policy Not Adequately Developed/Monitored

Findings like the ones on this list are preventable and if you’ve already been cited for non-compliance, corrective action can be made.

Higher Ed Executives provides colleges and universities with objective and confidential assessments that can help you uncover unknown compliance problems, and improve Title IV administrative and operational procedures and processes.

Our comprehensive assessments cover the full spectrum of Title IV Program Participation Requirements and Program Administration including:

  • Standards of Administrative Capability
  • Packaging, Awarding and Disbursing FSA Funds
  • Fiscal and Administrative Controls
  • Institutional Eligibility
  • Consumer Information and Student-Right-To-Know
Call us today for a free no obligation consultation and to find out how our assessments can work for you.
Call 203-836-4806