U.S. Department of Education’s Compliance with Improper Payment Reporting Requirements for FY 2020

The objectives of our audit were to: 1. Review the payment integrity section of the fiscal year (FY) 2020 Agency Financial Report (AFR) to determine whether the U.S. Department of Education (Department) is in compliance with the Payment Integrity Information Act of 2019 (PIIA). 2. Evaluate the Department’s (a) risk assessment methodology, (b) improper payment rate estimates, (c) sampling and estimation plans, (d) corrective action plans, and (e) efforts to prevent and reduce improper payments.The Department did not comply with the PIIA because it did not meet two of the six compliance requirements, as described in Finding 1. Specifically, the Department did not demonstrate improvement in reducing improper payments in the William D. Ford Federal Direct Loan (Direct Loan) program. In addition, the Department reported improper payment rates that exceed 10 percent for the Temporary Emergency Impact Aid for Displaced Students (Emergency Impact Aid) and Immediate Aid to Restart School Operations (Restart) programs.