Common Findings During Title IV Audits
1. Enrollment Reporting
Is your school timely notifying the Department of Education (DOE) of changes in student status? Are you ensuring the accuracy of those statuses? Do you know who to report, what to report, when to report, or why to report? Do you know what to provide your auditors? So many questions…but so little time!
When to Report
For schools participating in the Pell grant and loan programs, Enrollment Reporting roster files are received in your Student Aid Internet Gateway (SAIG) mailboxes. At a minimum, schools are required to certify enrollment for all students who are included on your roster at least every 60 days. However, the school can determine how often it receives the Enrollment Reporting roster file, if it wishes to update the student statuses sooner. Responses to the Enrollment Reporting roster file are due within 15 days of the date the Department sent the file.
The National Student Loan Data System (NSLDS) processes the roster file and returns an acknowledgment/error file that contains a count of accepted records and any error records. It is very important that schools report enrollment data consistently and accurately to the DOE using NSLDS.
The Department monitors school reporting and informs schools of their delinquency when responding to their roster or if the schools are not reporting program level data at an acceptable level. Any errors must be corrected and submitted within 10 days of receiving the file. If the acknowledgment/error file does not indicate any errors, it serves as proof that the submitted file was received and processed by NSLDS and should be kept for audit purposes. Even if the school uses a servicer for updating NSLDS, the school is responsible for the accuracy and timely reporting of the student information in NSLDS.
What is Reported?
The Enrollment Reporting Summary Report (also known as SCHER1 in NSLDS) provides the history of submissions that shows:
- the dates the roster files were sent and returned,
- the number of errors,
- date and number of online updates,
- and the number of letters sent for overdue Enrollment Reporting rosters.
Your auditors will use this report to determine if the school returned the Enrollment Reporting roster file to the Department within 15 days of receipt. Since this activity is basically required bi-monthly, it is easy to overlook; a lot of schools rely heavily on their automated systems or software and third party servicers. Avoid the common mistake of untimely enrollment reporting findings by setting reminders or being diligent with the roster updates. You may be asking, “How do I provide the SCHER1 report”? Your Sikich auditor can help! They will be able to provide you with detailed instructions.
Obviously, accuracy of the statuses is very important as well. Your auditors are required to test the accuracy of the NSLDS Enrollment Timelines for each student sampled to the institutional data provided in the students academic and financial aid files. Many of these errors are caught during audit time, but can be easily prevented. Most frequently noted mistakes are enrollment statuses along with their effective dates, more specifically, for those students that graduate or drop from the program. Be sure to precisely enter in the effective dates for the statuses of the students you are reporting. You should already be keeping tabs on those students that graduate or drop. Yet, it’s important to note that you do not leave the door open for any conflicting documentation on those effective dates. You can do so by ensuring that all the dates match the information stored in the students’ files, like their academic transcript, enrollment agreement or Return to Title IV refund calculation. Remember, reporting of graduated statuses is critical to the protection of a student’s interest subsidy and initiation of repayment periods.
The Department provides plenty of resources to assist with enrollment reporting, but a good starting point would be to review the NSLDS Enrollment Reporting Guide.
Findings in this area can be easily avoidable. With the proper procedures and staff training, meeting these reporting deadlines and ensuring accuracy of the submissions should keep your school well in compliance.
2. Validating High School Diplomas
High school diploma mills seem to be multiplying and can be a challenge to identify. With final regulations published on October 29, 2010, institutions were given the task to develop their own procedures to evaluate the validity of high school diplomas. An institution is required to validate a high school diploma if the institution or the Department of Education (DOE) has reason to believe the diploma is invalid.
Keep in mind that the Department does give institutions the final authority to validate high school diplomas. It does not plan to have an appeal process or to intervene in reasonable judgements of school administrators.
However, the process of developing adequate procedures to validate diplomas has been a daunting task for many institutions. This is because evaluating diplomas can require a great deal of professional judgment and many school administrators struggle with making final determinations.
Clarification Provided by the Department of Education
The good news is that on July 23, 2019, the DOE provided additional guidance on validating high school completion in an electronic announcement. This announcement established a two-part test that institutions can add to their procedures.
The institution’s procedures will be in compliance if it establishes and follows a process to evaluate the validity of a student’s high completion that includes:
- Receiving documentation directly from the secondary school that confirms the validity of the student’s diploma; and
- Confirming or receiving documentation from the relevant department or agency in the state in which the secondary school is located that the secondary school is recognized as a provider of secondary school education.
While the above is a great addition to procedures, it is worth to note that this will not always apply to students who completed high school at a secondary school that is not required to be recognized by the relevant department or agency in the state that the school is located. In these cases, the Department encourages institutions to consider alternative procedures.
Common Signs of Diploma Mill
As quick refresher, keep an eye for below indicators of a diploma mill:
- Charges a flat fee for the diploma
- Offers the diploma in a short period of time
- No phone number, address, or e-mail information is available
- Program sounds too good to be true
- Requires little or no course work, and no interaction with teachers or staff
- “Fast track” or “life experience” diplomas offered with no course work
(2016, June 8). Program Integrity Questions and Answers. Retrieved from https://www2.ed.gov/policy/highered/reg/hearulemaking/2009/hsdiploma.html
(2019, July 23). IFAP. Retrieved from https://ifap.ed.gov/eannouncements/072319CheckValidityofStudentsHighSchCompletion.html