Audit and Program Review

A basic requirement for continuing participation in the Title IV programs is an annual independent audit of the institution’s operations. Audit requirements run throughout the regulations, and are a major tool for the Department of Education’s oversight activities.

Related topics in this Index: Recordkeeping; Cash Management; Financial Standards

Statutory Authority
- U.S. Code, Title 20—Education Chapter 28—Higher Education Resources and Student Assistance Subchapter IV—Student Assistance > Part F—General Provisions Relating to Student Assistance Programs § 1094(c) Program participation agreements [HEA § 487(c)]
- U.S. Code, Title 20—Education Chapter 28—Higher Education Resources and Student Assistance Subchapter IV—Student Assistance > Part G—Program Integrity § 1099c–1 Program review and data [HEA § 498A]
Regulations
- 34 CFR 668.23
ED References
- 2018-19 FSA Handbook, Vol. 2
- 2017-18 FSA Handbook, Vol. 2
NASFAA Publications and Articles
- NASFAA AskRegs Knowledgebase
  Search or browse the Knowledgebase for answers to regulatory and compliance questions submitted by financial aid administrators.
Subtopics
- 90/10 requirement
- Annual audit requirements for institutions
  - Compliance audit
    
    668.23(a)(2)
    
    668.23(b)
    
    2018-19 FSA Handbook, Vol. 2, Ch. 4
    
    2017-18 FSA Handbook, Vol. 2, Ch. 4
  - Financial audit
    
    668.23(d)
    
    2018-19 FSA Handbook, Vol. 2, Ch. 4
    
    2017-18 FSA Handbook, Vol. 2, Ch. 4
- Annual audit requirements for third-party servicers
- Appeal procedures for audit and program review determinations
  - General rules and procedures
    
    Part 668, Subpart H
  - Exclusions
    
    668.111(c)
  - Hearing process and procedures
    
    668.116
    
    668.117
    
    668.118
  - Post-hearing appeal to Secretary
    
    668.119
    
    668.120
    
    668.124
  - Request for review
    
    668.113
- Audit requirements for foreign institutions
  - 668.23(h)
- Authority to examine records and interview personnel
  - 668.24(f)
- Cohort default rate appeal auditor’s opinion
  - 668.213(h)
- Deadlines
  - Payment of liabilities
    
    668.23(g)
  - Penalty for failure to submit timely and properly
    
    668.171(e)
    
    668.174(a)(3)
  - Submission of audit by institutions
    
    668.23(a)(4)
    
    2018-19 FSA Handbook, Vol. 2, Ch. 4
    
    2017-18 FSA Handbook, Vol. 2, Ch. 4
  - Submission of audit by third-party servicers
    
    668.23(c)(3)
    
    GEN-16-15
- Documentation of audit records, work papers, or other audit-related documents
  - 668.23(e)
- eZ-Audit
  - 2018-19 FSA Handbook, Vol. 2, Ch. 4
  - 2017-18 FSA Handbook, Vol. 2, Ch. 4
- Impact of audit disclosures on satisfaction of financial responsibility standards
  See also top list entry for Financial Responsibility of Institutions
  - Audit or program review liabilities exceed certain thresholds
    
    668.174(a)(2)
  - Audit or program review sample shows failure to return unearned Title IV funds timely
    
    668.173(c), (d), (e)
  - Auditor gives adverse, qualified, or disclaimed opinion, or expresses doubt about status as a going concern
    
    668.171(d)(1)
  - Failure to resolve compliance issues
    
    668.174(a)(4)
  - Violation of existing loan agreement
    
    668.171(b)(3)(i)
- Independent auditor (definition)
  - 668.23(a)(1)
- Notification of liability owed by third-party servicer to institutional clients
  - 668.23(f)
- Program reviews
- Record retention in case of audit or program review findings
  - 668.24(e)(3)
- Single Audit Act
  See Types of audits that satisfy annual requirement
- Standards for Audit of Governmental Organizations, Programs, Activities, and Functions (GAO)
  - Appendix A to Subpart B of Part 668
- Standards for Audit of Governmental Organizations, Programs, Activities, and Functions (GAO)—Appendix I
  - Appendix B to Subpart B of Part 668
- Substantiation of completion and placement rates used to qualify short programs as Title IV-eligible
  - 668.8(e)(2)
- Types of audits that satisfy annual requirement
- Waiver of annual audit submission requirement, exemptions, and exclusions

LOG IN

Audit and Program Review

Statutory Authority

Regulations

ED References

NASFAA Publications and Articles

Subtopics

90/10 requirement

Annual audit requirements for institutions

Compliance audit

Financial audit

Annual audit requirements for third-party servicers

Appeal procedures for audit and program review determinations

General rules and procedures

Exclusions

Hearing process and procedures

Post-hearing appeal to Secretary

Request for review

Audit requirements for foreign institutions

Authority to examine records and interview personnel

Cohort default rate appeal auditor’s opinion

Deadlines

Payment of liabilities

Penalty for failure to submit timely and properly

Submission of audit by institutions

Submission of audit by third-party servicers

Documentation of audit records, work papers, or other audit-related documents

eZ-Audit

Impact of audit disclosures on satisfaction of financial responsibility standards

Audit or program review liabilities exceed certain thresholds

Audit or program review sample shows failure to return unearned Title IV funds timely

Auditor gives adverse, qualified, or disclaimed opinion, or expresses doubt about status as a going concern

Failure to resolve compliance issues

Violation of existing loan agreement

Independent auditor (definition)

Notification of liability owed by third-party servicer to institutional clients

Program reviews

Record retention in case of audit or program review findings

Single Audit Act

Standards for Audit of Governmental Organizations, Programs, Activities, and Functions (GAO)

Standards for Audit of Governmental Organizations, Programs, Activities, and Functions (GAO)—Appendix I

Substantiation of completion and placement rates used to qualify short programs as Title IV-eligible

Types of audits that satisfy annual requirement

Waiver of annual audit submission requirement, exemptions, and exclusions