Finding Text
Federal Program Information: Student Financial Assistance Cluster: Federal Direct Loan Program (Assistance Listing #84.268) Criteria or Specific Requirement:N. Special Tests and Provisions – Award notification: Federal regulation 34 CFR 668.165 states if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of (i) The anticipated date and amount of the disbursement; (ii) The student's or parent's right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement, (3)(i) No earlier than 30 days before, and no later than 30 days after, crediting the student's ledger account at the institution, if the institution obtains affirmative confirmation from the student. Condition: The University did not send an award disbursement notification to the student borrower within the required timeframe. Cause: Administrative oversight. Effect or Possible Effect: The University was not in compliance with required federal guidelines. Questioned Costs: None. Context: Award Disbursement Notification: For 1 of 25 direct loan disbursements tested, the university did not provided timely notification to the student of (1) the date and amount of the disbursement; (2) the student's/parent's right to cancel; and (3)the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel. Identification of Repeat Finding: No. Recommendation: The University should implement procedures to ensure that award notifications are reported in a timely manner. Views of Responsible Officials: Incident Response and Process Impact Assessment: •Develop a standard protocol for identifying and reviewing business processes that may be impactedduring or after a data security event. •Document any suspended or delayed processes duringan incident and report to IT and follow-up. • Conduct a post-incident reconciliation of all financial aid transactions (disbursements, notifications, adjustments) to ensure completeness and compliance. • Collaborate with IT to include critical Student Account processes in the business continuity and recovery plan, ensuring prioritized restoration after any system outage or data event.