Finding Text
2023‐002 U.S. Department of Education
Student Financial Aid Cluster
Reporting – Common Origination and Disbursement (COD) System
Significant Deficiency in Internal Control over Compliance
Criteria:
Institutions submit Direct Loan, Pell Grant, TEACH Grant, and IASG origination records and
disbursement records to the COD system. Origination records can be sent well in advance of any
disbursements, as early as the institution chooses to submit them for any student the institution
reasonably believes will be eligible for a payment.
The acknowledgments identify the processing status of each record: Rejected, Accepted with
Corrections, or Accepted. In testing the origination and disbursement data, the auditor should
be most concerned with the data ED has categorized as accepted or accepted with corrections.
Institutions must report student disbursement data within 15 calendar days after the institution
makes a disbursement or becomes aware of the need to make an adjustment to previously
reported student disbursement data or expected student disbursement data. Institutions may
do this by reporting once every 15 calendar days, bi‐weekly or weekly, or may set up their own
system to ensure that changes are reported in a timely manner.
Condition: The disbursement date recorded by the COD for financial aid and the disbursement to student
by the District was greater than the allowable period of 15 calendar days for one item.
Questioned
Costs: None
Effect: Untimely reporting of student enrollment status does not allow the Department of Education to
properly track and monitor students, including initiation of the loan repayment process.
Cause: The delay in actual disbursement is believed to be contributed to the District reviewing the costs
of the Aviation Program before the disbursements was made. However, the person over the
department when this disbursement was made is currently no longer employed by the District
and the reason for the delayed disbursement cannot be clarified and records do not appear to
be retained for this item. Repeat finding
From Prior Year:
No
Context: Out of the 40 sample of students tested for COD reporting, 1 student was beyond the required
15 calendar days. Non‐statistical sampling was used.
Recommendation:
We recommend that management update their control processes to ensure that the proper
COD reporting and proper retention of files in the event of subsequent updates from the original
transfer date.
Views of Responsible Officials:
We agree with the finding.