Compliance Findings & Solutions, Part 3 of 3

By Sherri Savasta

In our previous blogs, we provided solutions offered by Global Consulting to assist institutions with 10 common compliance results from an audit or a Department of Education program review. In this blog today, we will cover the final four.

Since 1996, Global Financial Aid Services has provided consulting support in resolving compliance findings. Our team members bring years of experience to our solutions and familiarity with all aid delivery options for all size institutions.

Below are some of the most recently released audit determinations and department program review findings, and following are details about how Global Consulting can lend valuable assistance to your financial aid team for the remaining findings of 7-10. Consulting solutions for findings 1-6 can be found in earlier blogs on October 17 and 28.

Common fiscal year 2023 audit determinations and Department of Education program review findings include:

1. Student Status Reporting is Inaccurate or Untimely

2. R2T4 Calculation Errors

3. R2T4 Funds Made Late

4. Entrance/Exit Counseling Deficiencies

5. Lack of Administrative Capabilities

6. Consumer Information Requirements Not Met

7. Verification or C-Flag Violations

8. Crime Awareness Requirements Not Met

9. Clock to Credit Hour Conversion

10. Awarding/Disbursement Errors

Financial aid administrators can download a complete list of final audit determinations and the department’s final program review findings for fiscal year 2023 here.

7. Verification or C-Flag Violations

Finding Detail – If a student’s FAFSA application data is selected for verification, an institution must require the applicant to verify the information reported on the FAFSA. For each FAFSA application selected for verification, the Department of Education specifies the specific information that the applicant must verify. Findings may include:

• Inaccurate verification of selected applicants
• Verification documentation missing or incomplete
• Interim disbursement rules not followed
• Missing verification policies

Additionally, a C-Code or C-Flag on a student’s FAFSA indicates that there is a conflict in the information provided, which may require further review, collection of additional documentation from the student or clarification by the institution for resolution.

Global Offering – Global can complete required reconstruction(s), provide training and develop compliant policies and procedures.

8. Crime Awareness Requirements Not Met

Finding Detail – The Clery Act requires institutions participating in federal student aid programs to compile and disclose campus crime statistics (through the publication of an Annual Security Report) and to develop and implement campus safety and crime prevention policies, procedures and programs. The Clery Act also requires institutions to issue crime and safety alerts to keep campus communities informed about serious crimes, emergencies and other dangerous conditions. The Violence Against Women Reauthorization Act of 2013 amended the Clery Act to require schools to provide enhanced information about accommodations and protective measures that are available to survivors of sexual violence. Institutions are also required to disclose statistics for incidents of major crimes against persons and property reported during the three most recent calendar years. The Clery Act also requires the separate disclosure of hate crimes, arrests and disciplinary referrals for violations of drug, liquor and weapons laws, and for the VAWA offenses of dating violence, domestic violence and stalking.

Global Offering – Global can evaluate the deficiencies and develop policy, procedures or training to improve the areas lacking.

9. Clock- to Credit-Hour Conversion

Finding Detail – Institutions that offer undergraduate non-degree education programs that do not fully transfer into a year program offered by the college in credit hours must use the clock-hour to credit-hour conversion formula to determine Title IV program eligibility. The formula determines if each non-degree program includes the minimum number of credit hours needed to qualify as an eligible Title IV program. The institution must apply the conversion formula to each course in the program, and then add these hours to determine the total number of credit for the entire program.

Global Offering – Global can conduct an evaluation of the conversion and correct anything that’s incorrect, which can include full award reconstructions as required.

10. Awarding/Disbursement Errors

Finding Detail – Pell is the fund source where the most awarding/disbursement errors occur.  It can also occur in conjunction with student loans and campus-based aid programs. For brevity, we will outline Pell errors here. A Pell Grant overpayment or underpayment can occur in several ways. A Pell overaward exists when the student’s Pell award exceeds his or her eligibility. A Pell underaward is the opposite—the student did not obtain the maximum Pell award that he or she was eligible to receive. An overaward becomes an overpayment when the overawarded funds are disbursed to the student before the institution can correct the issue. A Pell grant disbursed incorrectly or to an ineligible student is an overpayment. Likewise, a Pell underaward becomes an underpayment when the lesser amount was disbursed. Common causes for this finding include:

• Incorrect Pell grant formula used
• Inaccurate calculations, including prorating awards and using the incorrect fraction (weeks vs. credit/clock hours) in Formula 4
• Change in enrollment intensity
• Incorrect post-withdrawal disbursement

Global Offering – Global can conduct an evaluation of awarding/disbursement practices and correct anything that’s incorrect, which can include full award reconstructions as required.

For assistance, contact Sherri Savasta at (228) 523-1072, ssavasta@globalfas.com or https://globalfas.com/contact.

Sherri Savasta is Global’s Director of Consulting. She has been with Global since 2006, bringing in-depth experience to financial aid processing solutions.