Office Operational Practices

Reconciliation Protocol between Financial Aid and Fiscal Offices

The Pasadena City College (PCC) Federal Program Review was conducted on December 12, 2104 through December 16, 2014 by Department of Education representatives Anna C. Archila and Tracy Simmonds, who reviewed a compliance issue addressing a failure to reconcile Title IV Program accounts in a timely manner.

The PCC Financial Aid Office has established a policy with Fiscal Services Office to ensure that Title IV

programs are reconciled in a timely manner in compliance with federal regulations regarding responsibilities for administering Title IV HEA programs (34 C.F.R. 368.82(a) and (b)).

The cash management regulations establish rules and procedures that a school must follow in requesting and managing FSA program funds. Under the cash management regulations, a school has a fiduciary responsibility to have a system in place to:

 Safeguard FSA funds

 Ensure FSA funds are used only for the purposes intended, and act on the student’s behalf to repay a student’s FSA education loan debt when the school is unable to pay a credit balance directly to the student

 Return to the Department any FSA funds that cannot be used as intended

During the December 2014 Federal Program Review, representatives of the Department of Education identified several areas to be improved. Pursuant to those findings, here is the updated Reconciliation Protocol.

Financial aid staff ensure that the financial aid office meets the Title IV requirements. Reconciliation of Title IV programs beings with the financial aid office generating reports through our financial aid administration

information system Banner. Students' financial aid awards and disbursement records are compared with reports generated from the Department of Education system, Common Origination and Disbursement (COD).

Pasadena City College (PCC) has quality assurance processes in place that document the following:

1. Reporting loan records, disbursements, and adjustments to disbursements correctly to the 2. COD System.

3. Disbursing and retuning loan funds in accordance with regulatory requirements.

4. Disbursing accurate loan amount to the correct student.

5. Completing monthly reconciliation and program year Closeout.

The quality assurance for reconciliation of all Direct Loans is handled by the Financial Aid Office Accounting Staff.

COD provides a School Account Statement (SAS) report (dscldxxop) transmitted the first Saturday of the following month. The report is downloaded via Ed Connect system.

School Account Statement (SAS): A COD generated report that is sent to the PCC Student Aid Internet Gateway Mailbox (SA /G) each month. PCC uses the information from this report to compare with the college's internal records for reconciliation of the Direct Loan Program and Pel1 Grant.

SAS Report Process (dsddxxop):

1. Convert dsddxxop (txt file) into Excel formal.

2. Run a Direct Loan Program disbursement rep011from the Banner Argos Reporting tool.

3. Use MS Access to compare the data from dsddxxop and Banner Direct Loan disbursement report.

4. Resolve discrepancies if needed.

5. Review and save reports each month to show an audit trail of due diligence.

The Financial Aid Accountant requests the pgrcxxop for each month, and it is sent through the SATG Mailbox for PCC. The Pell Reconciliation Report is downloaded via EdConnect system.

Working with the Pell Reconciliation Reports (pgrcxxop):

1. Import Pell Reconciliation Report (pgrcxxop) into Banner and the process to compare data.

2. Work on the output report to resolve any discrepancies.

3. Review and save reports each month to show an audit trail of due diligence.

Reconciliation to Resolve Discrepancy Records

Reconciliation is a process in which financial records are compared and discrepancies resolved. Conducting reconciliation assures PCC is properly exercising its fiduciary responsibilities to safeguard federal funds and ensure appropriate use.

Discrepancy Records

Student record rejection for various reasons:

1. Verification Rejects 2. Eligibility Rejects

3. High School Completion Rejects 4. Multiple Reporting Records (MRR)

5. School records for a n award a mount lesser/greater than the amount shown in the COD system 6. School records do not appear in the COD system.

Resolving Records

1. Financial aid staff will coordinate with other financial aid staff members to resolve these rejects.

a. Certain records can be resolved immediately. Others require interaction with the student.

2. Once the required information is validated, the Financial Aid Office will re-originate the student records to resolve the difference.

Fiscal Office

Most importantly, reconciliation is a shared responsibility between the financial aid office and the fiscal office to perform the periodic reconciliation that is required to make certain that PCC is managing the Federal Student Aid programs as they should be managed. This responsibility involves joint action by the financial aid and the fiscal office to identify discrepancies and to connect those discrepancies in accordance with established

deadlines, and also to ensure the two departments are performing the separation of duties/functions as it relates to cash management.

1. Fiscal ensures that all disbursements and awards posted on the Banner ERP system agrees with the general ledger for each award per year every time there is a financial aid disbursement, typically on a weekly basis.

2. Fiscal requests funds owed to the school based on actual disbursements accepted by the COD system and available for distribution on the GS system.

3. Fiscal ensures that all drawdowns and refunds of cash are accounted for and applied to the connect program year on a weekly basis, or every time a draw down is requested.

4. Fiscal requests a reconciliation on a monthly basis from the financial aid office itemizing differences between COD, GS available funds, and what has been recorded as awarded disbursed on a

cumulative basis on the BANNER financial aid system and the General Ledger. Typically the difference is in timing resolved within the next disbursement date. The fiscal office will then draw clown the remaining balance on the next disbursement cycle, typically a week later.

5. Return all refunds of cash if GS shows a negative balance. If there is a negative balance on an award Fiscal creates a requisition to return the funds within two weeks.

Every week after the financial aid awards are posted to the student accounts (LancerPoint), fiscal runs an automated process that produces a refund check to students. This file is sent electronically to Los Angeles County, Department of Education who processes the checks. The checks are then sent back to the fiscal office for signature, stuffing, and mailing the refund checks to the students. All refund checks are mailed to the students, and are not available for pick up in person.

In addition, the report stated that Pasadena City College should have an electronic financial aid distribution system. The financial aid office is in discussions with multiple vendors regarding an electronic distribution system. Our primary concern is the impact on, and benefit to, the students. Therefore, we are currently working with various vendors to ascertain terms of cost to the student, ease of access, and other factors that might affect students who receive financial aid.

Processing of Stale/Cancellation Checks

1. The financial aid and fiscal offices need to process stale/cancellation checks every two weeks. This is critical to balancing the cash drawdowns from G5.

a. The stale/cancellation checks are identified through a fiscal office process.

b. A list is generated for the financial aid office identifying stale/cancellation checks.

c. Once financial aid identifies the issues, it is then sent back to the fiscal office to update the Banner student account. The Banner process is to "zero" out the amount in the student account.

d. Stale dated checks or the cancellation of checks, reduces the disbursed amount of financial aid on the student account. The fiscal office ensures that this amount reconciles to the Banner general ledger accounts and the amounts are either returned to the D.O.E. or offset against any awards/disbursement for the same award year.

Satisfactory Academic Progress Appeal Committee

Students have the right to appeal for financial aid Satisfactory Academic Progress (SAP) or unit cap

disqualification. If a student loses eligibility for financial aid as a result of not meeting SAP or going over the unit cap, a student is given the opportunity to complete a Petition for Reinstatement of Financial Aid.

To be eligible to receive federal and state financial aid, a student must be maintaining progress toward a specific degree (AA/AS), certificate of achievement, or transfer program.

What is Satisfactory Academic Progress (SAP)?

HEA Sec. 484(c), 34 CFR 668.16(e), 34 CFR 668.32(f), & 34 CFR 668.34 Maintaining SAP with Pasadena City College (PCC) means a student must:

1. Meet the minimum cumulative Grade Point Average standard of 2.0 or higher,

2. Meet the "PACE" requirement by completing at least 67% of the units a student attempts.

3. Complete their educational program within the maximum timeframe (90 units).

NOTE: Coursework from all other colleges, universities, and trade schools are counted toward the student’s Satisfactory Academic Progress review.

Appeal: A process by which a student who is not meeting SAP standards petitions the school for reconsideration of his eligibility for FSA funds.

Financial aid warning: A status a school assigns to a student who is failing to make satisfactory academic progress. The school reinstates eligibility for aid for one payment period and may do so without a student appeal. This status may only be used by schools that check SAP at the end of each payment period and it is also

only for students who were making SAP in the prior payment period they were enrolled in or who were in the first payment period of their program.

Financial aid probation: The status a school assigns to a student who is failing to make satisfactory academic progress and who successfully appeals. Eligibility for aid may be reinstated for one payment period.

Maximum timeframe: For an undergraduate program measured in credit hours, a period no longer than 150 percent of the published length of the program. Depending on the outcome of the Appeal Committee decision, eligibility for aid may be reinstated for the length of the program or one payment period.

How does PCC calculate the Grades and pace of completion (Qualitative)?

Grades

Students enrolled in a program of more than two academic years must have a GPA of at least a “C” or its equivalent or must have an academic standing consistent with school’s graduation requirements.

Pace of Completion

Calculate the pace at which a student is progressing by dividing the total number of hours the student has successfully completed by the end of the payment period.

How does PCC calculate the maximum timeframe or “unit cap”(Quantitative)?

Federal regulations require that a student complete their academic programs within 150% of the standard time frame for their program.

 At PCC, we use 60 units as the standard AA/AS degree or transfer program multiply 150% equals 90 attempted units as the maximum time frame or "unit cap". For the Certificate programs, the unit cap is based on 150% of the total units required to complete the certificate (example: the unit cap for an 18 unit certificate is 27 units.)

 All units are counted even if they did not receive student financial aid for those units and even if the units do not count for unit credit toward graduation. Once they reach the unit cap for their program, they are ineligible to receive student financial aid.

 The calculation of attempted units includes all coursework completed at PCC as well as all other course- work completed at other institutions.

 If they have an AA/AS, or higher degree, they have reached the maximum time frame.