Surviving a Program Review

1. Surviving a Program Review • Intro of Audit History at LTU • Internal, External, State CB, VA, Program Review • Not an expert - don’t play one on TV • Not providing secrets how to fool an auditor, a recent survivor, that’s all • LTU still waiting for final report from Denver Case Management Team

2. Presentation Scope • Who (Internal, External/Independent, State, Guaranty Agency, DOE, VA, Institutional Partners, etc.) • What (FA records only? – Not) • Where (Onsite, Offsite, Electronic) • When (When they say) • How (As painless as possible)

3. Who • Internal Auditors • External/Independent Auditors • A-133 • State • Campus Based • State Programs • Loan Programs • Title IV Program Review • Schools with 25% cohort default rate higher priority • Highest 25% of defaulted loan volume school higher priority

4. Who (Program Review) • Higher priority schools • 25% cohort default rate higher priority • Highest 25% of defaulted loan volume schools • Schools with high fluctuation in Stafford loans or Pell Grant • Schools reported by state agency or accrediting agency • School with high drop out rates • School determined to pose significant risk of failing to comply with administrative capability or financial responsibility

5. Who’s Involved at Institution • Institutional Partners • Registrar • Business Office • VP of Finance • Controller • Student Accounting • Accounts Payable • Career Services • IT Staff • Associate Provost Enrollment Mgt (FA Director Reports To) • Admissions Director • President • Campus Safety • Marketing Staff

6. What • List was provided of all T4 recipients for last 3 years not including current year • Catalog • Program Participation Agreement • Third Party Servicer Agreements • A-133 and copy of independent audit • FISAP • Campus Based Statement of Accounts • Policy & Procedures (provide what you have) • Admissions and Registration/Transcript Data • Campus Security Report • See handout (request from reviewer)

7. What To Expect from Program Review • Written Notice • Entrance Interview and Explanation to Campus Attendees • Extensive Review and Requests • Exit Interview • Provide Follow Up Information • Written Report Within Approx. 60 Days • Appeal Final Audit Determination Letter (FADL) or Final Program Review Determination Letter (FPRD)

8. Where • You know they’re watching • Case Management Team is watching your electronic activity and independent audits • Pre-review activity in Denver • Onsite for actual review • Seems to be a big push for Program Reviews in Michigan • LTU had State CB, Merit, TIP audit offsite (2004) • Had to ship student data and reports (transcripts, ISIRs, Award Package Worksheet, Employment Records, etc.)

9. When • Be ready at all times • Could be unannounced - written request for review is required but could be provided when arrive to school • I received call from Denver Case Management Team on November 16th • Week of December 12th Program Review • Needed data file of unduplicated T4 recipients by December 2nd • Called all necessary campus partners together for prep (& pep) meeting immediately • Updated policy & procedure documentation immediately • Provided everything on checklist in neat format to the “Resource” room day before review

10. How (We Prepared) • Updated web and printed materials • Consumer information • Policy & procedures • Labeled and organized requested materials in binders, logically categorized • Printed student data from information system on request (not much advanced notice the first day of the review)

11. Discussion & Examples • Sample Letter to President Announcing Program Review and List of Requested Items • Program Review Guide • http://www.ifap.ed.gov/IFAPWebApp/currentIposGuidancePag.jsp • Sample Institutional Responsibility Guide • NASFAA Self Evaluation Guide • http://www.nasfaa.org/publications/2005/selfeval21.asp (for members)

12. Discussion & Examples • Additional References • IFAP • SFA Handbook • Section on Administrative Capability is very important • 25% of annual refund amount may be required as a Letter of Credit • Federal Registers • Compilation of Federal Regulations • NASFAA Encyclopedia

13. Recommendations • Be honest and forthright • Be prepared (know FSA Handbook in & out) • Provide and organize all requested material • Be polite and hospitable • Provide a comfortable setting • But don’t cross the line (don’t offer food or drink) • Be responsive • Make sure staff within and without OFA are available • If you get a request, provide response with 24 hours • Your program reviewers have jobs too, and they are reviewed for their results, the more successful you make them, the better they will treat you.

14. Recommendations (continued) • Start preparing now • LTU is developing a semi-annual self evaluation process • See reference material mentioned earlier • Work with NASFAA Peer Evaluation Process • Review all consumer information and requirements • We reviewed print and web material prior to review • Every day, every decision should be made with the idea that the results of that decision could end up in the hands of an auditor for review • Stress this to staff (internal and external to OFA) • Keep files neat and orderly (no chance to organize upon request) • Be prepared to print student data from Information System (FA, Registration, Admissions, Student Accounting, etc.) • Really pay attention to R2T4 and SAP • Communicate extensively with departments outside of OFA

15. Recommendations (continued) • Make sure other departments appreciate why they do the things they do (withdrawal notification, update Clearinghouse, Campus Security Report, etc.) • Ask the auditor for “best practice” advice • They are there to help as well • Advice may be vague, but it shows a willingness to improve • Challenge external auditor finding because these findings can end up on A-133 which is reviewed by Case Management Team Member (Institutional Review Specialist)

16. Recommendations • Example of a challenge at LTU • Independent auditor found that our enrollment status changes were not getting to NSLDS within 30 days. • Found that as long as we are on a schedule of updates every 60 days, the ad hoc reporting requirement of 30 days is not in effect • Was challenged on BBAY and offering additional loan funds for Summer (3rd semester)