Submitting OIG:
Report Description:
We found that the Department did not comply with the Improper Payments Elimination and Recovery Act because its FY 2015 improper payment rate did not meet the reduction target for the William D. Ford Federal Direct Loan (Direct Loan) program. The Department established an FY 2015 reduction target of 1.49 percent for the Direct Loan program; however the improper payment rate for the program was
2.63 percent after the Department recalculated this rate to correct for the formula execution errors we identified during our audit. Similar to our previous IPERA audits, we found that the Department’s improper payment methodologies for the Federal Pell Grant and Direct Loan
programs were flawed, as its estimation methodologies did not include all program reviews that could identify improper payments. We also found the estimation methodology for the Pell program excluded sources of improper payments, such as the Free Application for Federal Student Aid/Internal Revenue Service Data Statistical Study, and fraud. Further, the estimation methodologies did not include all improper payments from ineligible programs or locations identified in program reviews. In addition, we found that Department’s reported improper payment estimates for both the Pell Grant and Direct Loan programs were inaccurate and unreliable because spreadsheet formulas used in the calculations were incorrect and the calculations deviated from the Office of Management and Budget-approved methodologies.
Date Issued:
Tuesday, May 10, 2016
Agency Reviewed / Investigated:
Submitting OIG-Specific Report Number:
A03Q0001
Component, if applicable:
Office of Chief Financial Officer
Location(s):
Agency-Wide
Type of Report:
Audit
Questioned Costs:
$0
Funds for Better Use:
$0
Number of Recommendations:
9
Report updated under NDAA 5274:
No
View Document:
Attachment | Size |
---|---|
FY16A03Q0001040424v100SECURED.pdf | 1.2 MB |
Additional Details Link: