A Guide To Creating A Policies and Procedures Manual (Updated For 2014-15 Award Year Requirements)
A Guide To Creating A Policies and Procedures Manual (Updated For 2014-15 Award Year Requirements)
A Guide To Creating A Policies and Procedures Manual (Updated For 2014-15 Award Year Requirements)
Disclaimer: This document has been prepared to provide schools with basic
guidance to develop policies and procedures. However, it should not be assumed
that this document is all-inclusive. For a more complete explanation of specific
program requirements, your school should refer to the applicable statutes,
regulations, and the Federal Student Aid Handbook. It is the schools responsibility
to ensure that all Title IV requirements outlined in the Law and regulations are met.
Table of Contents
Institutional Overview
Section 1:
Administrative Capability
1.1
1.2
1.3
1.4
1.5
1.6
Section 2:
Institutional Eligibility
2.1
2.2
2.3
2.4
Section 3:
General Requirements
Updating Application Information
Admission Policy for Public or Private Nonprofit educational
institution, Proprietary Institution of higher education, and
Postsecondary Vocational Institution
State Authorization
General Provisions
3.1
3.2
3.3
3.4
3.5
3.6
3.7
3.8
3.9
3.10
Section 4:
Certification
Title IV Refunds
Compliance Audits and Audited Financial Statements
Consumer Information
Verification
a. Schools Non participating in the Quality Assurance Program
b. Participating Quality Assurance Schools
Professional Judgment & Dependency Overrides
Misrepresentation
Documentation
Secondary Confirmation
Ability to Benefit
Section 5:
Section 6:
Section 7:
Section 9:
Section 8:
TEACH Grant
9.1
9.2
9.3
9.4
9.5
Eligibility Determination
Counseling
Recalculation of TEACH Grant award amounts
Fiscal Control and fund accounting
Institutional reporting requirements
Appendix A:
Appendix B:
Appendix C:
Icon Definition
Icons are a useful way of designating categories of information.
The following icons have been developed for use with your policies and procedures.
Good Practice
Good Practice suggestion. However, if you commit to a good
practice you must ensure it is followed.
Tip
Suggestions for handling a form or procedures efficiently
Help
Points the reader to helpful information
Policy
Briefly states or refers reader to specific policy
documents available in other offices
Important
A critical piece of information that, if overlooked,
could result in an error
Exception
A way of doing something that is an exception to
the general rule and why it is an exception
Definition
Explain terms
Checklist
A checklist that the user can follow to complete
a task
Example
A specific example of an activity, a document, etc.
New
Highlights something new
Institutional Overview
(Good Practice Suggestion)
An institutional overview provides information specific to your institution that provides colleagues with an
understanding of your financial aid operations.
Name of Institution:
OPE ID:
Suggested information:
1.
2.
Calendar of Activities
Suggested information:
Include a calendar of all financial aid activities. The calendar should include an
explanation of activities for each month of the year. Be sure to include activities that may
involve other offices and list those offices.
Include copies of all application forms used by the school. Some examples of
forms that could be included are: Admissions Applications, FAFSAs, Applications for
institutional scholarships or grants, ISIR Records, Loan Applications, Verification Documents
(Verification Worksheets, etc), SAP Appeals Forms, Professional Judgment Forms, and any
other forms the school uses in determining a students eligibility.
Include an explanation of where to locate Handbooks, Catalogs etc
Section 1
Policy:
Administrative Capability
Regulation: 668.16; 668.34
Purpose:
Scope:
Specifically Address
1.1
1.2
1.3
1.4
1.5
1.6
Responsibilities:
(Identify individuals and/or offices responsible for developing and updating this section)
Definitions:
(Identify acronymns or definitions that will be used in this section)
Part 1.1
1. List the offices involved in approving and Disbursing Title IV Aid. Provide a short
description of each office as indicated (If other offices are involved at your school and
are not listed below, include descriptions of those offices as well):
Admissions Personnel:
Employee job duties and staff functions
Institutional Communication (how the Admissions Office communicates with other
institutional offices)
Federal SEOG
Federal Perkins
Federal Pell
National SMART
ACG
TEACH Grant
FFEL
Direct Loan
Grad PLUS
Other
Other
Other
Other
8. The degree of the office automation used in the administration of Title IV aid:
Suggested information:
Description of the type of software application used by the financial aid office and
business office. Is the system homegrown or an off the shelf product?
Process for how ISIR records are received through FAA Access to CPS online and
how that data is entered into your own computer system.
Process for any automatic systems such as packaging, SAP determinations, budget
construction, reviewing files, requesting verification documents.
If financial aid documents are kept in electronic format, explain process.
Explain how computer systems are backed up.
Last updated May, 2014
Explain security measures in place to protect private information, e.g., the use of
passwords, etc.
Part 1.2
Complete the information below to indicate individuals who are responsible for the Financial
Aid and Fiscal Office as applicable at your institution. You must ensure that there is a
separation of function as outlined in 668.16:
Financial Aid Office
Good Practices
(Good Practice Suggestion)
Providing specific detail of your organizational structure assists in an understanding of how your Title IV aid
operation is structured.
Identify:
Where fiscal records are maintained:
Part 1.3
The policy provides for consistent application of standards to all students within categories of
students, e.g., full-time, part-time, undergraduate, and graduate students, and educational
programs established by the school.
The policy provides that a students academic progress is evaluated at the end of each
payment period if the educational program is either one academic year in length or shorter
than an academic year; or for all other educational programs, at the end of each payment
period or a least annually to correspond with the end of a payment period.
The policy specifies the grade point average (GPA) that a student must achieve at each
evaluation, or if a GPA is not an appropriate qualitative measure, a comparable assessment
measured against a norm.
If a student is enrolled in an educational program of more than two academic years, the policy
specifies that at the end of the second academic year, the student must have a GPA of at
least a C or its equivalent, or have academic standing consistent with the schools
requirements for graduation.
The policy must include a maximum timeframe in which the student must complete his or her
educational program. For an undergraduate program measured in credit hours, the
maximum timeframe cannot be longer than 150 percent of the published length of the
educational program, as measured in credit hours. For an undergraduate program
measured in clock hours, the maximum timeframe cannot be longer than 150 percent of the
published length of the educational program, as measured by the cumulative number of clock
hours the student is required to complete and expressed in calendar time. For a graduate
program, the maximum timeframe must be defined by the school and must be based on the
length of the educational program.
The policy must specify the pace at which a student must progress through his or her
educational program to ensure that the student will complete the program within the
maximum timeframe and must provide for measurement of the students progress at each
evaluation.
The school must calculate the pace at which the student is progressing by dividing the
cumulative number of hours the student has successfully completed by the cumulative
number of hours the student has attempted. In making this calculation, the school is not
required to include remedial courses.
The policy must describe how a students GPA and pace of completion are affected by course
incompletes, withdrawals, or repetitions (see definition of full-time student in 34 CFR
668.2(b)), or transfers of credit from other institutions. Credit hours from another institution
that are accepted toward the students educational program must count as both attempted
and completed hours.
The policy must provide that, at the time of each evaluation, a student who has not achieved
the required GPA, or who is not successfully completing his or her educational program at the
required pace, is no longer eligible to receive assistance under the Title IV, HEA programs
unless: For schools that evaluate SAP at the end of each payment period, the student is
placed on financial aid warning or the student has appealed and has been placed on financial
aid probation. For schools that evaluate SAP annually or less frequently than at the end
of each payment period, the student has appealed and has been placed on financial aid
probation.
If the school places students on financial aid warning, or on financial aid probation, the policy
must describe these statuses and that a student on financial aid warning may continue to
receive assistance under the Title IV, HEA programs for one payment period despite a
determination that the student is not making SAP. Financial Aid Warning Status may be
assigned without an appeal or other action by the student. The policy may also include, for a
student on Financial Aid Probation, that they may receive Title IV, HEA program funds for one
payment period. Further, while a student is on financial aid probation, the school may choose
to require the student to fulfill specific terms and conditions such as taking a reduced course
load or enrolling in specific courses. At the end of one payment period on financial aid
probation, the policy must require that the student meet the schools SAP standards or meet
the requirements of the academic plan developed by the school to qualify for further Title IV,
HEA program funds.
Appeal Process:
If the schools policy permits a student to appeal a determination by the school that he or she
is not making SAP, the policy must describe how the student may reestablish his or her
eligibility to receive assistance under the Title IV, HEA Programs; the basis on which a student
may file an appeal: The death of a relative, an injury or illness of the student, or other special
circumstances and information the student must submit regarding why the student failed to
make SAP, and what has changed in the students situation that will allow the student to
demonstrate SAP at the next evaluation.
If the schools policy does not permit a student to appeal a determination by the school that
he or she is not making SAP, the policy must describe how the student may reestablish his or
her eligibility to receive assistance under the Title IV, HEA programs.
Notification:
The schools policy must provide for notification to students of the results of an evaluation that
impacts the students eligibility for Title IV, HEA program funds.
For schools that evaluate SAP at the end of each payment period the policy must specifically
address the following:
If a student is not making SAP according to the schools policy at the end of each payment
period, the schools policy may (for the payment period following the payment period in which
the student did not make SAP) place the student on financial aid warning, and disburse Title
IV HEA program funds to the student; or place the student directly on financial aid probation.
For the payment period following a payment period during which a student was on financial
aid warning, the schools procedures may include placing the student on financial aid
probation and disbursing Title IV HEA program funds to the student if a) the school
evaluates the students progress and determines the student did not make SAP during the
payment period the student was on financial aid warning; b) the student appeals the
determination; and c) the school determines that the student should be able to meet the
schools SAP standards by the end of the subsequent payment period or the school develops
an academic plan for the student that, if followed, will ensure that the student is able to meet
the schools SAP standards by a specific point in time.
The schools policy must not allow a student on financial aid probation for a payment period to
receive Title IV, HEA program funds for the subsequent payment period unless the student
makes SAP or the school determines that the student met the requirements specified by the
school in the academic plan for the student.
For schools that evaluate SAP annually or less frequently than the end of each payment
period, the policy must specifically address the following:
If a student is not making SAP according to the schools policy, the school may place the
student on financial aid probation and may disburse Title IV, HEA program funds to the
student for the subsequent payment period if a) the school evaluates that the student is not
making satisfactory academic progress; b) the student appeals the determination; and c) the
school determines that the student should be able to make satisfactory academic progress
during the subsequent payment period and meet the schools satisfactory academic progress
standards at the end of that payment period, or the school develops an academic plan for the
student that, if followed, will ensure that the student is able to meet the schools satisfactory
academic progress standards by a specific point in time.
The schools policy must not allow a student on financial aid probation for a payment period to
receive Title IV, HEA program funds for the subsequent payment period unless the student
makes SAP or the school determines that the student met the requirements specified by the
school on the academic plan for the student.
List the:
Qualitative component for measuring SAP (must consist of grades with standards that meet
or exceed the requirements of 668.34, work projects completed, or comparable factors that
are measurable against a norm):
Quantitative component (that consists of a maximum timeframe) for which a student must
complete his/her educational program:
Timeframe for an undergraduate program (not to exceed 150% of the published length):
Identify:
When the school checks SAP (must not exceed the lesser of one academic year or
one-half the published length of the educational program):
The process the school uses to ensure consistent application of standards to all students
within categories of students (full-time, part-time, undergraduate, and graduate students, and
educational programs established by the school):
Incompletes:
Withdrawals:
Repeated courses:
Transfer credits:
Provide:
The schedule established by the school that designates the minimum percentage or amount
of work that a student must successfully complete at the end of each increment to complete
his/her educational program within the maximum timeframes:
Procedures for a student to re-establish and document that the student has made SAP:
Include whether the school offers programs in credit hours with terms, clock hours, or
credit hours without terms.
Include the minimum academic year definition for all programs.
Include whether your schools academic year is more than the minimum requirement.
Include whether the school has one definition for all programs. If not, include
an explanation of those programs that need a different definition.
Include whether the payment periods are determined by terms or by hours
and weeks.
Part 1.4
Conflicting Data
Schools must have an adequate system to identify and resolve discrepancies in the
information that the school receives from different sources with respect to a students
application for financial aid under the Title IV, HEA programs. Use the information in
this section to help you develop your procedures for resolving conflicting data.
Applicants selected for verification If the school has reason to believe that
any information on the application used to calculate the EFC is discrepant or
inaccurate (or if any supporting documentation is discrepant or inaccurate), you
must require the applicant to provide adequate documentation to resolve the
conflict.
Applicants not selected for verification the school must resolve conflicting
information regardless of whether or not the applicant was selected for verification.
The financial aid office must review all tax returns provided to the school even if
they were not requested. All C Codes on the ISIR must be reviewed and resolved
by the financial aid office.
Other applicant information received by the school The school must have an
adequate internal system to identify conflicting information that it may have
regardless of the source. The office lead for each office is required to provide
information that could impact the financial aid status of each student applicant e.g.
(Admissions Office: High School Diploma, Fiscal Office: Report outside awards,
Graduate Aid Office: Report outside awards, Registrar: Report changes in
enrollment, FWS Office: Report FWS earning in a calendar year, NSLDS: Review
financial aid history, (e.g. review aid received from prior colleges attended).
In addition, the following charts provide examples of conflicting data to assist you in the development
of your own procedures.
The charts below are available by selecting the link:
http://ifap.ed.gov/qadocs/FSAVeriModule/activity1verif.doc
Good practices vs. what is required
Chart A provides examples of issues that are considered Conflicting Data.
Although the chart is designed to be extensive, it is not to be construed as an allinclusive list. The chart is provided for information only and has been developed
to help you review your policies and procedures.
(Important) A critical piece of information that, if overlooked, could result in an error.
Chart B provides examples of issues not considered Conflicting Data, but would
be a good practice to consider. The chart is provided for information only and has
been developed to help you review your policies and procedures.
(Good Practice Suggestion)
A student is not selected for verification, the tax return or IRS transcript is on
file and information conflicts with items on the FAFSA.
1040 shows parent single head of household and the FAFSA/ISIR shows the
same person as married.
Parent or student report on their FAFSA and signed a verification worksheet
that they will not file an IRS 1040. You have reason to believe that they would
have been required to file a U.S. Income Tax Return, as the amount of
reported income is greater than or equal to the minimum amount required to
file as indicated in the instructions provided on the 1040.
Statements or information that suggest that the copy of the Income Tax
Return you received is not the return actually filed with the IRS.
School receives Profile from CSS. Student reports a specific amount in
untaxed income; FAFSA reports a different amount (If the school receives the
CSS Profile, it must ensure that information contained there does not conflict
with other documents received by the school).
Veterans Affairs (VA) benefits verified by the certifying official in the
Registrars Office dont match the FAFSA. (To resolve conflict, can rely on
certifying official).
Admissions information received impacts student eligibility (i.e., student
accepted into a non degree program, student received scholarship from high
school, etc.)
The Student Academic Progress or Enrollment Status on file in the Financial
Aid Office doesnt agree with the information from the Registrars Office.
This is a good practice. However, if you choose to include these examples, you
must follow them consistently.
(Good Practice Suggestion)
Chart B: Examples of issues not considered Conflicting Data, but would be a good practice to
consider for review
Assets reported on the FAFSA are $0 or low but significant interest and
dividend income or capital gains are reported on the U.S. Income
Tax Return.
$0 income reported with no explanation as to how the student/parent/family
can live on $0 income (Your institution may want to consider developing an
expense vs. resource form to review $0 to low income reporting for the
Calendar Year JanuaryDecember).
Address reported by student/parent (i.e., if parents are divorced and the
address on the students tax return does not match the address of the
custodial parents tax return). Or the address doesnt match the state of
residence as listed on the FAFSA. (Your institution may want to consider
obtaining a written explanation to determine residency).
If the student or parents reported business/farm net worth but didnt file a
schedule C or Form 1120 or just didnt supply it to the school (Your institution
may want to consider requesting additional documentation from the student
or parent).
Box 14 information from W-2 (Determine if the dollars represented are
untaxed income not previously reported).
Always have the ability to ask for whatever information you need any time
that you think there is a problem.
Identify person(s) responsible for coordinating both Federal and non-federal aid at
your institution.
Provide procedure as to how Federal and non-Federal aid is identified and processed
through the financial aid office.
Provide procedure to identify and resolve discrepancies in the information that the
institution receives from different sources with respect to a students application for
Title IV aid.
Identify all student aid applications, need analysis documents, Statements of Registration
Status, and eligibility notification documents presented by or on behalf of each aid applicant.
Provide a description of all documents, including any copies of State and Federal income tax
returns that are normally collected.
Include a description of how the institution verifies information received from the student or
other sources.
Include procedures concerning the coordination of any other information normally available to
the institution regarding a students citizenship, previous educational experience (NSLDS),
documentation of the students social security number, or other factors relating to the
students eligibility for Title IV Aid (e.g. coordinating outside aid received by various offices on
campus).
Include procedures to refer to the Office of the Inspector General of the Department of
Education for investigation any credible information indicating that an applicant for Title IV
may have engaged in fraud or other criminal conduct.
Include any credible information indicating that any employee, third-party servicer, or other
agent of the school , who acts in a capacity involving the administration of Title IV, HEA
programs, or the receipt of funds under those programs may have engaged in fraud,
misrepresentation, conversion or breach of fiduciary responsibility or other illegal conduct
involving the Title IV, HEA programs.
Additional fiscal requirements are found throughout most sections of this manual. The fiscal
requirements here are also part of the fiscal requirements in Sections 4-11 of this manual. You
may choose to repeat the information contained in this section (in sections 4-11) or you can
refer to this section as appropriate. However, you must still include the specific information
required in addition to this general fiscal information as applicable in each section.
Maintaining records required under the individual Title IV HEA program regulations.
Specifically,
Fiscal reports and financial statements
Identify the process used to obtain information for required fiscal reports and financial statements.
Include bank account and internal ledger reconciliation procedures.
Develop and follow procedures for record retention and examinations as outlined in 34 CFR
668.24. Use the following information to ensure your procedures are adequately developed:
Record retention and examinations 34 CFR 668.24 (b)
Your schools procedures must include the following:
Program records 34 CFR 668.24(a)
Your school must establish and maintain, on a current basis, any application for Title
IV, HEA program funds and program records that document:
Your schools eligibility to participate in the title IV, HEA programs
The eligibility of its educational program for title IV, HA program funds
Your schools administration of the title IV, HEA programs in accordance with
all applicable requirements
Your schools financial responsibility
Information included in any application for title IV, HEA program funds
Your schools disbursement and delivery of title IV, HEA program funds
Describe the schools procedures to ensure compliance with the Program records
requirements:
parents bank account, or return the funds to the appropriate title IV, HEA
program
Initiating an EFT to a bank account designated by the student or parent; or
Dispensing cash for which the school obtains a signed receipt from the student or
parent
For purposes of this requirement bank account means an account insured by the
Federal Deposit Insurance Corporation (FDIC) or the National Credit Union Share
Insurance Fund (NCUSIF). This account may be a checking, saving, or similar account
that underlies a stored-value card or other transaction device
Your school may establish a policy requiring its students to provide bank account
information or open an account at a bank of their choosing as long as this policy does not
delay the disbursement of title IV, HEA program funds to students. Consequently, if a
student does not comply with the schools policy, the school must nevertheless disburse
the funds to the student using a method described in 34 CFR 668.164(c) in accordance
with any timeframes required under 34 CFR Part 668, Subpart K. In cases where the
school opens a bank account on behalf of a student or parent, establishes a process the
student or parent must follow to open a bank account, or similarly assists the student or
parent in opening a bank account, the school must:
Obtain in writing affirmative consent form the student or parent to open that
account
Before the account is opened, inform the student or parent of the terms and
conditions associated with accepting and using the account
Not make any claims against funds in the account without the written permission
of the student or parent, except for correcting an error in transferring the funds in
accordance with banking protocols
Ensure that the student or parent does not incur any cost in opening the account
or initially receiving any type of debit card, stored-value card, other type of
automated teller machine (ATM) card, or similar transaction device that is used to
access the funds in that account
Ensure that the student has convenient access to a branch office of the bank or
an ATM of the bank in which the account was opened (or an ATM of another
bank), so that the student does not incur any cost in making cash withdrawals
from that office or these ATMs. This branch office or these ATMs must be located
on the schools campus, in institutionally-owned or operated facilities, or,
consistent with the meaning of the term Public Property as defined in 34 CFR
668.46(a), immediately adjacent to and accessible from the campus
Ensure that the debit, stored-value or ATM card, or other device can be widely
used, e.g., the school may not limit the use of the card or device to particular
vendors; and
Not market or portray the account, card, or device as a credit card or credit
instrument, or subsequently convert the account card, or device to a credit card
or instrument
Describe the schools procedures to when a payment is made directly to a student:
The school may not make a late disbursement of a Direct Loan if the student was a
first-year, first-time borrower unless the student completed the first 30 days of his or
her program of study. This limitation does not apply if the school is exempt from the
30-day delayed disbursement requirements under 34 CFR 685.303(b)(4)(i)(A), (B), or
(C)
The school may not make a late disbursement of any title IV, HEA program
assistance unless it received a valid SAR or a valid ISIR for the student by the
deadline date established by the Secretary in a notice published in the Federal
Register
Describe the schools procedures for late disbursements:
Returning funds 34 CFR 668.164(h):
Notwithstanding any State law (such as a law that allows funds to escheat to the
State), the school must return to the Secretary and title IV, HEA program funds,
except FWS program funds, that it attempts to disburse directly to a student or parent
but the student or parent does not receive or negotiate those funds. For FWS
program funds, the school is required to return only the Federal portion of the payroll
disbursement
If the school attempts to disburse the funds by check and the check is not cashed,
the school must return the funds no later than 240 days after the date it issued that
check
If a check is returned to the school, or an EFT is rejected, the school may make
additional attempts to disburse the funds, provided that those attempts are made not
later than 45 days after the funds were returned or rejected. In cases where the
school does not make another attempt, the funds must be returned before the end of
this 45 day period; and no later than the 240 day period described in 34 CFR
668.164(h)(2), the school must cease any additional disbursement attempts and
immediately return those funds
Provisions for books and supplies
The school must provide a way for a Federal Pell Grant eligible student to obtain or
purchase, by the seventh day of a payment period, the books and supplies required
for the payment period if, 10 days before the beginning of the payment period:
The school could disburse the title IV, HEA program funds for which the
student is eligible; and presuming the funds were disbursed, the student
would have a credit balance under 34 CFR 668.164(e)
The amount the school provided to the Federal Pell Grant eligible student to obtain or
purchase books and supplies is the lesser of the presumed credit balance or the
amount needed by the student, as determined by the school
The school must have a policy under which a Federal Pell Grant eligible student may
opt out of the way the school provides for the student to obtain or purchase books
and supplies
If a Federal Pell Grant eligible student uses the way provided by the school to obtain
or purchase books and supplies, the student is considered to have authorized the
use of title IV, HEA funds and the school does not need to obtain a written
authorization under 34 CFR 668.164(d)(1)(iv) and 34 CFR 668.165(b)
Describe the schools procedures for returning funds when a student or parent does
not receive or negotiate those funds:
Help
The Fiscal Year-End reconciliation worksheet is designed as a comprehensive exercise for all
programs for year-end reconciliation. It is also important for schools to ensure that they
reconcile all accounts on a monthly basis. Monthly reconciliation also makes year-end
reconciliation an easier process. There are separate worksheets for each program.
Instructions are included with each worksheet.
These forms can be accessed from the Fiscal Management Assessment
http://ifap.ed.gov/qahome/qaassessments/fiscalmanagement.html
Or, select any specific worksheet listed below:
Fiscal Year-End Reconciliation Worksheet
Federal Pell Grant Monthly Reconciliation
TEACH Grant Monthly Reconciliation
FWS Monthly Reconciliation
Federal Perkins Monthly Reconciliation
FSEOG Monthly Reconciliation
Direct Loan Monthly Reconciliation
Part 1.6
The following topics need to be addressed for Financial Aid counseling of students:
Identify the sources and the amount of each type of aid awarded.
Make available the rights and responsibilities of the student with the
respect to enrollment at the institution and receipt of financial aid.