Summary: This letter will provide you additional information regarding the new Recipient Financial Management System (RFMS). RFMS is designed to report and request funds for the Federal Pell Grant Program. The second step in the new RFMS process is the submission of the disbursement record.
SUMMARY: This letter will provide you additional information regarding the new Recipient Financial Management System (RFMS). RFMS is designed to report and request funds for the Federal Pell Grant Program. The second step in the new RFMS process is the submission of the disbursement record.
This letter, the fourth in the series, provides information concerning the new RFMS disbursement record and process. To more fully understand the content of this letter, we recommend that you first read ANN-98-8 (announcing the new 1999-2000 Recipient Financial Management System), P-98-4 (Action Letter #2 describing the new 1999-2000 Recipient Financial Management System , and P-99-3 (Action Letter #6 describing the origination record). These letters can be found on the Departments Information for Financial Aid Professionals (IFAP) web site, www.ifap.ed.gov under the description Bookshelf under Pell Grant Process. Please consider the material in this letter as advance information, as it may change while we develop and test the system.
What is the purpose of the disbursement record?
Purpose: Disbursement records are used to report student Pell Grant disbursement data to the Department. They also determine the amount of Federal Pell Grant funding available to your institution.
The RFMS adjusts your authorization by the amount that total accepted disbursements exceed your current authorization level.
For instance, if your initial authorization amount established by the Department is $100,000 and you report disbursements totaling $101,000, your authorization will increase by $1,000.
You will receive updated Electronic Statements of Account (ESOA) for each adjustment to your authorization.
What are the types of disbursement records?
There are two types of disbursement records.
· Regular disbursement record - a simple Electronic Data Interchange (EDI) compliant record. It
contains (1) origination ID, (2) disbursement reference number, (3) debit/credit indicator flag, (4) disbursement amount, and (5) disbursement date.
· Special disbursement record - a record that includes regular disbursement and additional payment-period-specific data.
How do I know which disbursement record to use?
If your institution is advance funded or in the Just-In-Time Pilot, you should use the regular disbursement record.
If your institution has been placed on either the reimbursement or cash monitoring payment methods by the Department or your institution ceases to participate in the Federal Pell Grant program at some point during the award year, you are required to use the special disbursement record.
However, anyone may use the special disbursement record. For example, you may wish to change the enrollment status for a student for only one specific payment period.
How does the disbursement process work?
Process: You prepare and submit a disbursement record to RFMS for each disbursement made to a recipient, using EDExpress or your own software. Each student disbursement record must have a unique reference number. In assigning these numbers, we recommend you start with number one (01) for a student and use consecutive numbers for each additional disbursement transaction you submit to the Department for that student.
· Receives and edits the disbursement record against accepted origination records.
· Rejects a disbursement record when no origination record match is found.
· Rejects, or adjusts downward, a disbursement record when the disbursement exceeds the
accepted origination record annual award or 100% of the student's scheduled award across all institutions has been exceeded.
· Sends you an acknowledgment after it processes your disbursement record. This disbursement
acknowledgment record contains (1) the record acceptance status (accepted, corrected, or rejected), (2) the data values accepted by RFMS during processing, and (3) comment codes to indicate the reason for warning messages, corrections made to data, or rejection of the record.
· Sends you acknowledgment records that contain a Year-to-Date disbursement amount for the student. These acknowledgments provide you with an accurate and timely status of your accepted Federal Pell Grant disbursements. With this information, you will be able to reconcile your disbursement records with the Department.
· Processes origination records before disbursement records if you submit both records at the same time.
When will RFMS accept disbursement records?
· After June 25, 1999 when the disbursement feature becomes operational in RFMS; and
· with or after an origination record; and
· 30 days before or after the disbursement date.
Do I report cents in RFMS disbursement records?
Yes, as part of the Departments modernization effort, dollars and cents are used in the disbursement amount field. You must be able to create and receive records that contain two digits for cents. However, unlike the origination record, RFMS will accept the cents values sent in disbursement records.
For example, if you submit a disbursement amount of $1,562.50, RFMS will accept $1,562.50 as the disbursement amount. We will not fill the cents positions with zeros in the disbursement record.
When and how do I correct disbursement records?
You are required to submit student disbursement data within 30 days of making a payment or becoming aware of the need to make an adjustment.
You do not correct disbursement records. You submit disbursement records with either a "P" (for positive) or a "N" (for negative) in the Debit/Credit Indicator field to adjust the total amount of disbursements previously accepted for the student. The reporting of disbursements is transaction based. RFMS does not change previously accepted disbursement data.
For example: The RFMS has accepted a disbursement of $700.00 for a recipient, and subsequently, a change to the student's eligibility results in a reduction in the amount of that disbursement. You should NOT submit a replacement disbursement record for $400.00. Instead, you report a negative (N) disbursement for the amount of reduction ($300.00) as a new disbursement.
Disbursement 1: Amount = $700.00, Debit/Credit Indicator = P, Full Time award
Disbursement 2: Amount = $300.00, Debit/Credit Indicator = N, Half Time award
How does the new RFMS improve the Potential Overaward Project (POP)?
We feel that reporting each disbursement amount just before the disbursement will significantly reduce the potential for overpaying recipients. POP processing will be addressed in the next RFMS Action Letter.
How can I find out more about business rules and edits?
We have provided, as an enclosure, a copy of the business rules and edit messages that RFMS uses to process disbursement records.
To provide you assistance in submitting disbursement records and the most error free process as possible, we have incorporated many of the RFMS edits into the Pell Module of the 1999-2000 EDExpress software.
Will more information on RFMS be available?
Future letters describing additional RFMS processes will include:
· the uses of the Multiple Reporting Record and the Potential Overaward Project (POP); and
· updates to information previously provided, if needed.
We look forward to providing you improved services through the implementation of the new RFMS, and thank you for your continued support of the Federal Pell Grant Program.
Chief Operating Officer
Office of Student Financial Assistance