1. Who is Responsible . . . the Financial Aid Office or the Business Office?
U.S. Department of Education 2015 MSURSD Spring/Summer Training
Welcome to the session on Who is Responsible … The Financial Aid Office of the Business Office?
Introduce yourself and any fellow facilitators
Remind the participants of any housekeeping items (e.g., silence or turn off cell phones and remind participants to sign the attendance sheet and complete evaluation form
Explain the evaluation form allows us to measure whether the training session is effective in promoting learning. Participant’s responses will also help us determine whether we need to further refine the session (Only if this is the fist presentation of the day)

2. The Network of Responsibilities
Managing FSA program funds is a school-wide responsibility. FSA program funds are provided to the school, and all offices at a school must work together to ensure successful program management.
The Network of Responsibilities in Managing FSA Funds is a School-wide responsibility. All offices at the Institution must work collaborative to ensure that Title IV Program Funds are managed successfully.

3. The Network of Responsibilities
A school’s FSA program management generally takes place in three functional areas:
the Office of the Chief Executive (CEO, President, or Chancellor, etc.),
the Chief Financial Aid Officer, and
the Chief Business Officer
A school’s FSA program management generally takes place in three functional areas: The Offices of the CEO, FAA and the CFO. Each Institution is different, and make their decisions on the responsibilities of the various offices. However, the President’s office, the Financial Aid office, and the Business office always play key roles in implementing Title IV activities.

4. The Network of Responsibilities
The CEO’s office
Ultimate responsibility for a school’s FSA programs resides with the school’s CEO
Authority and responsibility are delegated to other offices, the leadership and support of the CEO are crucial to successfully administering FSA programs
CEO leadership can foster an environment that promotes an effective and responsive financial aid program that meets institutional goals, students’ needs, and federal requirements
The President or Chancellor’s office has the ultimate authority and responsibility for ensuring that Title IV Funds Regulations are adhered to. The President consequently delegate some of these responsibilities to other key administrators at the institution. The CEO must set the institutional expectation on compliance to promote the effective and responsive financial aid program that meets institutional goals, students’ needs, and federal requirements

5. The Network of Responsibilities
The Financial Aid office
While a school’s Financial Aid Office is usually assigned most of the responsibility for administering FSA programs, its role in the institution’s fiscal operation is a limited one.
In some cases, functions such as loan counseling might be performed by the Business Office instead of the Aid Office.
The Financial Aid Office Responsibilities include the administration of the FSA Programs, which may also include some fiscal responsibilities , though limited. These fiscal responsibilities will be discussed and highlighted through this presentation. In some cases, functions such as loan counseling might be performed by the business office instead of the aid office. It varies from Institution to Institution where some functions are assigned.

6. The Network of Responsibilities
Responsibilities commonly assigned to a school’s Financial Aid office
Advise and counsel students and parents about financial aid
Provide students with consumer information
Develop written policies and procedures
Determine students’ eligibility
Make financial aid awards
Adhere to the principle of separation of functions
Responsibilities commonly assigned to a school’s Financial Aid office includes;
- Advise and counsel students and parents about financial aid
- Provide students with consumer information, as required by federal regulations
- Develop written policies and procedures about the way the school administers FSA programs
- Determine students’ eligibility for financial aid
- Make financial aid awards to students
- Adhere to the principle of separation of functions (no single office or individual may authorize payments and disburse FSA funds to students)

7. The Network of Responsibilities
Coordinate financial aid activities with those of other school offices
Interact with various outside groups, agencies, associations, and individuals
Monitor students’ (SAP)
Maintain school records and student records that document the administration of the financial aid office and provide data for reports
The Financial Aid Office is also responsible for:
- In administering financial aid programs, coordinate financial aid activities with those of other school offices
- Interact with various outside groups, agencies, associations, and individuals about issues concerning the school’s administration of financial aid programs
- Monitor students’ satisfactory academic progress (SAP)
- Maintain school records and student records that document the administration of the financial aid office and provide data for reports

8. The Network of Responsibilities
Keep current on changes in laws and regulations to ensure that the school remains in compliance
Assist in reporting program expenditures
Manage and report on activities that involve financial aid funds
Calculate the return of Title IV funds and,
If it applies, authorize post-withdrawal disbursements to students
The Financial Aid Office personnel must further ensure that it;
- Keep current on changes in laws and regulations to ensure that the school remains in compliance
- Assist in reporting program expenditures
- Manage and report on activities that involve financial aid funds
- Calculate the return of Title IV funds and, if it applies, authorize post-withdrawal disbursements to students

9. The Network of Responsibilities
Assist in reconciling loan records
Reconcile student financial aid data provided to the business office to ensure;
all payments have been made,
return of FSA funds have been accounted for, and
expenditures have been reported
Have a procedure to report any changes to ED about the school’s current eligibility status
Responsibilities include:
- Assist in reconciling loan records (for schools in the Direct Loan Program)
- Reconcile student financial aid data provided to the business office to ensure all payments have been made, return of FSA funds have been accounted for, and expenditures have been reported
- Have a procedure to report any changes to ED about the school’s current eligibility status (for example, change in ownership, address, name, officials, third-party servicers, etc.)

10. The Network of Responsibilities
Perform (limited) fiscal operations, such as:
authorizing payment of FSA funds to student
authorizing return of Title IV funds to program accounts and post-withdrawal disbursements to students
notifying a student who owes an overpayment
notifying ED of the overpayment
coordinating submission of FISAP
The Financial Aid Office may also be responsible for the following:
- Perform (limited) fiscal operations, such as:
- authorizing payment of FSA funds to student
- authorizing return of Title IV funds to program accounts and post-withdrawal disbursements to students
notifying a student who owes an overpayment
notifying ED of the overpayment
coordinating submission of FISAP

11. The Network of Responsibilities
The Business Office
Most FSA related fiscal operations are handled by a school’s Business Office.
May also be known as the fiscal office, finance office, comptroller’s office, bursar’s office, treasurer’s office, or student accounts office.
The Business Office Responsibilities:
Most FSA related fiscal operations are handled by a school’s business office.
This office may also be known as the fiscal office, finance office, comptroller’s office, bursar’s office, treasurer’s office, or student accounts office.

12. The Network of Responsibilities
The Business Office provides critical services to the school in managing both federal and nonfederal financial aid programs.
Administering the accounting, recordkeeping, and reporting functions related to the school’s use of federal and other funds.
Strong internal controls and sound business and financial management practices are keys to the success of these operations and delivering funds to students.
The Business Office provides critical services to the school in managing both federal and nonfederal financial aid programs.
Administering the accounting, recordkeeping, and reporting functions related to the school’s use of federal and other funds requires many detailed, complex systems.
Strong internal controls and sound business and financial management practices are keys to the success of these operations and delivering funds to students

13. The Network of Responsibilities
Assist in reconciling loan records
Reconcile student financial aid data provided to the business office to ensure;
all payments have been made,
return of FSA funds have been accounted for, and
expenditures have been reported
Have a procedure to report any changes to ED about the school’s current eligibility status
Responsibilities include:
- Assist in reconciling loan records (for schools in the Direct Loan Program)
- Reconcile student financial aid data provided to the business office to ensure all payments have been made, return of FSA funds have been accounted for, and expenditures have been reported
- Have a procedure to report any changes to ED about the school’s current eligibility status (for example, change in ownership, address, name, officials, third-party servicers, etc.)

14. The Network of Responsibilities
Responsibilities commonly assigned to a school’s Business Office
Coordinate activities and cooperate with the Financial Aid Office in:
projecting cash needs
processing cancellations and institutional refunds
obtaining authorization to pay FSA funds
being aware of the changes in FSA laws and regulation
submitting accurate and timely reports
reconciling Title IV Funds
The Responsibilities commonly assigned to a school’s business office include;
Coordinate activities and cooperate with the financial aid office in:
-projecting cash needed to cover disbursements
-processing cancellations and institutional refunds
-obtaining authorization to pay FSA funds
-being aware of the changes in FSA laws and regulation
-submitting accurate and timely reports
-reconciling records to ensure that financial aid adjustments are properly recorded

15. The Network of Responsibilities
Maintain a system of internal controls that includes adequate checks and balances
Ensure that the functions of authorizing and disbursing FSA funds remain separate
Maintain records consistent with Generally Accepted Accounting Principles (GAAP), and government auditing standards
Maintain records to ensure a clear audit trail
Draw down and return FSA funds to program accounts
The Business Office;
-Maintain a system of internal controls that includes adequate checks and balances
-Ensure that the functions of authorizing and disbursing FSA funds remain separate
-Maintain records consistent with Generally Accepted Accounting Principles (GAAP), and government auditing standards
-Maintain records to ensure a clear audit trail
-Draw down and return FSA funds to program accounts – Adhere to the 3-day disbursement rule to prevent excess cash.

16. The Network of Responsibilities
Disburse funds to eligible students from FSA program accounts
Maintain a system of student accounts that records charges, credits, and amounts due
Collect Federal Perkins Loans1
Calculate the return of Title IV funds, and
If it applies, authorize post-withdrawal disbursements to students2
Establish and implement the institution’s refund policy (if required by the school’s accrediting or state agency)2
1. At some schools, a separate student loan office collects these loans.
2. At some schools, the financial aid office performs this function.
The Business Office;
- Disburse funds to eligible students from FSA program accounts
- Maintain a system of student accounts that records charges, credits, and amounts due
- Collect Federal Perkins Loans1
- Calculate the return of Title IV funds, and if it applies, authorize post-withdrawal disbursements to students2
- Establish and implement the institution’s refund policy (if required by the school’s accrediting or state agency)2

17. The Network of Responsibilities
Process return of Title IV funds
Assist in reporting FSA expenditures to the Department in a timely manner
Reconcile accounts, including:
reconciling cash between school records and bank
reconciling federal funds between bank statements and federally reported balances
Internal reconciliation of Business Office disbursement records with the Financial Aid Office authorized records
The Business Office;
Process return of Title IV funds
Assist in reporting FSA expenditures to the Department in a timely manner
Reconcile accounts, including:
reconciling cash between school records and bank
reconciling federal funds between bank statements and federally reported balances
Internal reconciliation of Business Office disbursement records with the Financial Aid Office authorized records

18. The Network of Responsibilities
Assist in completing FISAP
Maintain a cash management system
Provide general stewardship for federal funds
Prepare for and participate in FSA program reviews and audits
Before making a first disbursement of Direct Loan or Perkins Loan funds, confirm that new borrowers have completed entrance counseling(2)
2. At some schools, the financial aid office performs this function.
The Business Office also;
Assist in completing applications, fiscal reports for federal funds, and FISAP
Maintain a cash management system to meet disbursement requirements and federal laws and regulations
Provide general stewardship for federal funds, including maintaining bank accounts and investments as appropriate
Prepare for and participate in FSA program reviews and audits
Before making a first disbursement of Direct Loan or Perkins Loan funds, confirm that new borrowers have completed entrance counseling2
2. At some schools, the financial aid office performs this function.

19. The Separation of Functions
Separation of Duties,
To accomplish separation of duties,
Duties are divided among different individuals to reduce the risk of error or inappropriate action
In general, responsibility for related transactions should be divided among employees so that one employee’s work serves as a check on the work of other employees.
When assuring that Institutions adhere to Separation of Duties;
Make sure your institution has sound separation of duties measures in place;
In general, responsibility for related transactions should be divided among employees so that one employee’s work serves as a check on the work of other employees.
When duties are separated, there must be collusion between employees for assets to be stolen and the theft disguised in the accounting records.

20. The Separation of Functions
The functions must be performed by;
individuals who are not members of the same family,
who do not together exercise substantial control over the school, and
who are organizationally independent.
If a school performs these functions via computer,
no one person may have the ability to change data that affect both the authorization and disbursement of FSA funds.
Your Institution want to put measures and people in place to avoid the possibility of misuse, fraud, abuse or any forms of collusion. The functions of authorizing payments and disbursing funds must be performed by;
individuals who are not members of the same family,
who do not together exercise substantial control over the school, and
who are organizationally independent.
Special care must be taken when the functions of authorizing and disbursements are computerized;
If a school performs these functions via computer,
no one person may have the ability to change data that affect both the authorization and disbursement of FSA funds.

21. Fiduciary Responsibility
Schools have a responsibility to:
Safeguard FSA funds
Ensure FSA funds are used for intended purposes
Maintain records of the eligibility of each Title IV aid recipient and the amount and date of each posting or return of aid
Return funds on student’s behalf to loan programs
Return to ED funds that cannot be used as intended
These Fiduciary Responsibilities are joint responsibilities off the Fiscal Office and Financial Aid Office.

22. Title IV Processing Systems
COD (Common Origination & Disbursement)
Direct Loans
TEACH Grants
Pell Grants
IASG (Iraq Afghanistan Service Grant)
eCB (electronic Campus Based)
SEOG (Supplemental Economic Opportunity Grants)
FWS (Federal Work-Study)
We use COD (Common Origination & Disbursement) for process the different programs: Direct Loans, TEACH Grants, Pell Grants, IASG (Iraq Afghanistan Service Grants), eCB (electronic Campus Based), SEOG (Supplemental Economic Opportunity Grants) and FWS (Federal Work-Study).

23. Drawing Funds Authorization/CFL vs. Available funds
Authorization refers to the total amount of aid made available to date for the entire award year for that award- may include funds already drawn
Available funds refer to the authorization minus funds already drawn
Funds may only be drawn based on immediate need, i.e. what will be disbursed or has already been disbursed
The Department of Education Authorizes Initial Current Funding Levels to the Institutions. The Authorized amount minus the funds previously drawn is the Institution’s Available funds. Schools must determine the amount of funds it needs by the amount they anticipate disbursing immediately upon withdrawal (within three days). The financial Aid office provides the Business Office with the amount of funds they are authorizing, and the Business Office is responsible for withdrawing, disbursing and returning any undisbursed funds to the Program.

24. Cash Management
15 day reporting requirement for disbursements and disbursement adjustments
Federal Register published July 11, 2014
An institution must submit Pell Grant, Iraq and Afghanistan Service Grant, Direct Loan, and TEACH Grant disbursement records, as applicable, no later than 15 days after making the disbursement or becoming aware of the need to adjust a student's previously reported disbursement
34 CFR (a), “Title IV funds are disbursed on the date that the institution: (a) Credits those funds to a student's account in the institution's general ledger or any sub ledger of the general ledger, or (b) pays those funds to a student directly. Title IV funds are disbursed even if an institution uses its own funds in advance of receiving program funds from the Secretary”
The cash monitoring payment method is similar to the reimbursement payment method, but less onerous. As with the reimbursement payment method, under the cash monitoring payment method a school must make disbursements to eligible students and parents before it may request or receive funds for those disbursements from the Department.

25. Title IV Excess Cash
Schools must disburse Title IV funds to a student within 3 business days of receiving the funds in its federal funds bank account
Title IV funds that are not disbursed before this deadline are Title IV excess cash and must be returned immediately
In some cases, funds may be held
additional 7 calendar days
Blue Book volume 5 page 24
Schools may NOT hold additional funds
while reconciling accounts
The Department of Education (the Department) considers excess cash to be any amount of Title IV funds (other than Federal Perkins Loan Program funds) that a school does not disburse to students or parents by the end of the third business day after the date the school: (1) received the funds from the Department, or (2) deposited or transferred to its federal account previously disbursed Title IV funds received from the Department. In some circumstances, cash may be held for up to an additional 7 calendar days if a school meets the excess cash tolerance and can disburse the aid to students within that time frame. In no circumstance should cash balances remain beyond the additional 7-day period.
See 34 CFR for the federal regulations that govern requesting funds for the Title IV programs and 34 CFR for the excess cash regulations. The Business Office is primarily responsible for these cash management functions.

26. Adjusting Funds Adjusting of funds not allowed in G5 for Campus-Based
Adjust via the FISAP
Adjustments and corrections can be made for up to 5 years
Contact the eCB help desk for assistance
G5 adjustment of funds for Pell, Direct Loans, or TEACH
Only allowed to correct either a draw or return of funds to the incorrect award year or program
Should be made as soon as possible
NEVER allowed for reconciliation
For Campus Cased Funds, the Institution should keep a record of all CB Fund activities during the year, to include disbursements, transfers, etc. and account for these activities on its annual FISAP Report. Schools use G5 to make adjustments to Pell, DL, and the TEACH Grant programs as follows;
Only allowed to correct either a draw or return of funds to the incorrect award year or program
Should be made as soon as possible
NEVER allowed for reconciliation

27. How to Refund Funds All programs - ELECTRONICALLY via G5
FSA Handbook, Volume 4 Chapter 4
Blue Book, Volume 5 Chapter 5
Paper checks will no longer be accepted for Direct Loans after December 31, 2014
All programs - ELECTRONICALLY via G5
FSA Handbook, Volume 4 Chapter 4
Blue Book, Volume 5 Chapter 5
Paper checks will no longer be accepted for Direct Loans after December 31, 2014
Note the school’s DUNS # and award number (i.e., P063P14####) on the front of the check
U. S. Department of Education, PO Box , St. Louis, Missouri,

28. How to Refund Funds
If exceptional circumstances require your school to refund Grant funds via paper check
Make check payable to U.S. Department of Education
Use a separate check for each award/year
Note the school’s DUNS # and award number (i.e., P063P14####) on the front of the check
U. S. Department of Education, PO Box , St. Louis, Missouri,
If exceptional circumstances require your school to refund Grant funds via paper check
Make check payable to U.S. Department of Education
Use a separate check for each award/year
Note the school’s DUNS # and award number (i.e., P063P14####) on the front of the check
U. S. Department of Education, PO Box , St. Louis, Missouri,

29. Reconciliation Requirements
Monthly reconciliation REQUIRED for Direct Loans, TEACH, FWS, and SEOG
Regular reconciliation recommended for all programs
Why?
Identifies issues with meeting other cash management and disbursement reporting requirements
Demonstrates administrative capability
Reconciliation is required on a monthly and annual basis. Annual reconciliation is referred to as Program Year Closeout and must be completed by the established deadline for each year. By implementing and executing a monthly reconciliation process, your school should be able to close out earlier than each Program Year Closeout deadline. Think of monthly and annual reconciliation as balancing your own personal checkbook; if you resolve discrepancies as they occur each month, you will have a balanced checkbook at the end of the year.
Your school will need to determine who will perform the reconciliation function at your school, on what basis the parties involved will communicate with each other, and which systems will be used for the reconciliation process. This planning is essential as it must be a coordinated effort between those with financial aid responsibilities and those with business office responsibilities. The Department provides report and software resources to assist your school in this effort.

30. Reporting Requirements
Schools are required to report data to the U.S. Department of Education (ED) as a condition of administering Federal Student Aid.
Reporting is a school-wide responsibility although some duties may be business office or financial aid office functions specific.
There is overlap between information schools disclose to the public and information they report to the ED.
All offices must work together to ensure timely and accurate reporting for each academic year.
As a condition of administering Federal Student Aid, schools are required to report certain data to the Department of Education. It is not the sole responsibility of the financial aid office but a campus wide responsibility. All offices must work together to report accurate information to the Department of Education or other entities in a timely fashion.

31. Why is Timely Reporting Important?
Timely and accurate reporting is important to:
Maintain compliance with Federal Regulations.
Penalties for non-compliance may include fines and suspension from participation in Title IV Programs.
Assure quality of information to the public.
Data and product information is reported and available as good consumer information to the public.
Why is it important to provide information in a timely fashion? To maintain compliance with Federal Regulation, schools must adhere to the reporting requirements of ED. There are steep penalties for non compliance which may include fines and suspension from Title IV Programs. Timely information is also important to guarantee the public is receiving quality information.

32. FA Office-Reporting Responsibilities
Provide data reports to maintain student and school records to document the administration of financial aid.
Report FSA Program expenditures to ED.
Notify students who owe overpayments as a result of withdrawal from school. Report any overpayments to ED.
Devise procedures to report any school eligibility status changes to ED.
Coordinate submission of FISAP to ED to report financial aid from previous year and application for continued participation in FSA.
Provide students with consumer information about financial aid.
Listed on this slide are some of the major reporting responsibilities of the financial aid office. This is not an exhaustive list.
Provide data reports to maintain student and school records to document the administration of financial aid. Provide both internal and external reports.
Report Federal Student Aid Program expenditures to ED. Maintain accurate records to report these changes.
Notify students who owe overpayments as a result of withdrawal from school. Report any overpayments to ED.
Devise procedures to report any school eligibility status changes to ED. (closing of school, adding new programs, etc.)
Coordinate submission of FISAP to ED to report financial aid from previous year and application for continued participation in FSA.
Provide all students with consumer information about financial aid. Provide information on the web and in other venues.

33. Business Office Reporting Responsibilities
Assist in reporting FSA expenditures to ED in a timely fashion.
Ensure that Federal Perkins Loan funds are administered properly from promissory note to repayment and reporting to NSDLS.
Assist in completing applications, fiscal reports for financial aid, and the FISAP.
This list provides some of the Business Office’s reporting requirement. Again, it is not an exhaustive list but highlights the business office's main functions.
Assist in reporting FSA expenditures to ED in a timely fashion. As is evident, the business and financial aid office share some reporting responsibilities.
Ensure that Federal Perkins Loan funds are administered properly from promissory note to repayment and reporting to NSDLS.
Assist in completing applications, fiscal reports for financial aid, and the FISAP. These are mainly fiscal reports which is a business office function.

34. The Laws & Regulations
34 CFR 668, Subpart K - Financial management systems
34 CFR (c)(1) - Checks and balances
34 CFR (a) Checks and balances
34 CFR (a) Checks and balances
34 CFR (a) Checks and balances
34 CFR (c)(2) - Separating of functions
The Laws and Regulations regarding the Responsibilities of the Institution, the CEO, CFO and the FAA are found in the Higher Education Amendment and Federal Registers, and highlighted and/or further explained throughout the Code of Federal Regulations and the FSA Handbook. Specific regulations regarding the Financial Management Systems requirements, Checks and Separation of Functions can be viewed in the specific CFR cites as listed.

35. Cash Management Guides/Resources
G5 Help Desk
Phone: / 8:00 a.m. - 6:00 p.m. (ET)  
eCampus Based Help Desk
Phone: /8:00 a.m. - 8:00 p.m. (ET)
COD Help Desk / 8:00 a.m. - 8:00 p.m. (ET)
Grant Programs: / Direct Loan Program:
Foreign Schools:
G5, eCampus Based and COD Help Desk’s phone numbers and addresses are provided here for your questions and inquiries.

36. Cash Management Guides/Resources
FSA Handbook - Volume IV
Other Resources include…….

37. Summary In Conclusion;
- Managing FSA Funds is a school-wide responsibility.
- FSA program funds are provided to the school, and
All offices at a school must work together to ensure successful program management
Other Institutional offices are involved in implementing Title IV requirements as well ( to include Registrar, Academics, IT, Security, Admissions, and many others), however, the Primary responsibility rests with the CEO, CFO, and the FAD.
In Conclusion, , the Primary responsibility for management and implementing of Title IV requirements rests with the CEO, CFO, and the FAD.

38. QUESTIONS?
Questions????????????????????