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2025 Compliance Finding Updates: Common Findings Corner for Institutions

The Department of Education’s latest Top 10 Findings highlight a continued focus on key areas of compliance and operations within educational institutions. These findings show recurring issues across institutions that emphasize the need for ongoing attention and improvement in these areas. Though this was the first reporting cycle since the release of the 2023 Guide for Financial Statement Audits of Proprietary Schools and Compliance Attestation Examination Engagements of Proprietary Schools and Third-Party Servicers Administering Title IV Programs, the Department’s list still features many of the same findings from prior audit guidance.

Top 10 Domestic School Audit Findings by Number of Findings

  1. Student Status – Inaccurate/Untimely Reporting
  2. Repeat Finding – Failure to Take Corrective Action
  3. Return to Title IV (R2T4) Calculation Errors
  4. R2T4 Funds Made Late
  5. Student Credit Balance Deficiencies
  6. Qualified Auditor’s Opinion Cited in Audit
  7. CARES Act – Higher Education Emergency Relief Fund (HEERF) Non-Compliance
  8. Inaccurate Disbursement Dates/Amounts Reported to the Centralized Origination and Disbursement (COD)
  9. Entrance/Exit Counseling Deficiencies
  10. Pell – Overpayment/Underpayment

Top 10 Domestic School Program Review Findings by Number of Findings

  1. Student Status – Inaccurate/Untimely Reporting
  2. R2T4 Calculation Errors
  3. Student Credit Balance Deficiencies
  4. Inaccurate Record Keeping
  5. Entrance/Exit Counseling Deficiencies
  6. Lack of Administrative Capability
  7. Satisfactory Academic Progress Policy not Adequately Developed/Monitored
  8. Pell – Overpayment/Underpayment
  9. Credit/Clock Hour Conversion Improper
  10. Inaccurate Disbursement Dates/Amounts Reported to COD

Several trends can be seen when comparing these findings to those of previous years. For instance, the issue of Student Status – Inaccurate/Late Reporting has consistently been a top finding. Meeting this requirement remains a challenge for many institutions despite efforts to address this problem.

Similarly, R2T4 Calculation Errors and Student Credit Balance Deficiencies are recurring findings from the past several years. While financial management within educational institutions is complex, institutions should implement proactive training and enhanced oversight to prevent challenges related to financial calculations.

Other findings cited for recurring years include R2T4 Funds Made Late and Entrance/Exit Counseling Deficiencies. Institutions should provide more robust, effective counseling programs to support students in determining and paying refunds associated with the R2T4 refund processes.

Institutions must prioritize investing in improvements to their administrative processes, especially in areas that make the Department’s list on an annual basis. Training opportunities and resources can be found on the Department’s website for further assistance.

Key Takeaways

The Department of Education’s Top 10 Findings for 2023 highlight compliance findings that have posed challenges to institutions for many years. Attention must be paid to these areas, as should establishing improvements as necessary. Key areas, such as student status reporting, R2T4 process, student loan counseling, and accuracy of disbursement dates/amounts reported to COD, continue to lead the Department’s list.

Due to the complexity of the requirements, we expect to see incomplete Gramm-Leach Bliley Act (GLBA) policies make these listings in the near future. Chances are, since this update was required as of June 9, 2023, we will most likely see this finding become more prevalent during the next round of top 10 findings once released by the Department.

Please contact the Title IV team at Sikich to learn more about avoiding these challenges and remaining compliant.

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