Posted Date:June 30, 2016
|Author:||Sue O'Flaherty, Service Director, Program Management, Federal Student Aid|
Subject: Additional 2014-2015 Direct Loan Program Year Closeout Information
Over the past few months, we have provided information about 2014-2015 Direct Loan Program Year closeout (see the February 5, 2016 Electronic Announcement and the May 5, 2016 Electronic Announcement). This announcement supplements the previous guidance.
As a reminder, to be considered successfully closed out, the school must—
- Reconcile to an Ending Cash Balance of $0 and Total Net Unbooked Disbursements of $0, as reflected on your monthly School Account Statement (SAS) Report and in your school’s internal records; and
- Complete the Balance Confirmation form on the Common Origination and Disbursement (COD) Web site. The Balance Confirmation form can be completed after the school has reconciled to a $0 balance and has received a Zero Balance Letter, which is sent to the school via e-mail (default format) or paper (if email address is invalid/unavailable). Once the letter is received, the school should log in to the COD Web site, click the Balance Confirmation link from the School options menu on the left-hand side of the page, and follow the instructions on the Balance Confirmation screen.
When is the closeout deadline?
The closeout deadline to submit records is 8:00 P.M. (ET) on Friday, July 29, 2016. The COD System subsequently must accept all records submitted by the closeout deadline to be included in the school's final Ending Cash Balance for 2014-2015. Any 2014-2015 batches or records received after the closeout deadline will be rejected and returned to the school.
Though the closeout deadline is July 29, 2016, cash management, disbursement/adjustment reporting, and monthly reconciliation requirements supersede the closeout deadline. A school should be able to reconcile to a zero balance and close out within a month or two of its final 2014-2015 actual disbursements.
Prior to program year close out, schools should ensure that fields related to Subsidized Usage Limit Applies (SULA), such as academic year dates, loan period dates, loan and/or disbursement amounts, etc., are updated appropriately.
What if a school does not successfully close out by the deadline?
Any school that has not successfully closed out by the closeout deadline and has a positive Ending Cash Balance will be sent a Final Demand Letter requesting the return of the outstanding balance as a refund of cash. If the outstanding balance is not paid by the deadline noted in the letter, a receivable will be established, and the school will be billed accordingly.
Any school that has not successfully closed out by the closeout deadline and has a negative Ending Cash Balance will be sent a Negative Balance Letter requesting the resolution of the outstanding balance.
Exceptions to these letter processes may be made for a school with processing periods that extend beyond the July 29, 2016 closeout deadline. Once the closeout deadline has occurred, a school can request Extended Processing for closed Direct Loan award years via the COD Web site. Consistent with the Grant programs, Direct Loan users will complete this action by using the Request Post Deadline/Extended Processing link under the School menu. Requests will be approved on a case-by-case basis. A school will receive notification of approved requests via a Reopen/Extended Processing e-mail to the Financial Aid Administrator and President.
If a school has any concerns about meeting the closeout deadline, contact COD School Relations prior to the deadline for further assistance.
When is the deadline for drawdowns and/or drawdown adjustments?
Drawdowns and/or drawdown adjustments must also be requested/completed by the processing deadline of 8:00 P.M. (ET) on Friday, July 29, 2016.
As a reminder, effective January 1, 2015, all refunds for Direct Loan must be returned via G5. Refunds of Cash sent via G5 can take 7-9 days to process and post to the COD System. A school should consider its timing when submitting Refunds of Cash in order for these types of transactions to be reflected in its Ending Cash Balance prior to the deadline.
The G5 Web site will not be available from 9:00 P.M. (ET) on Tuesday, July 19, 2016 through 6:00 A.M. (ET) on Tuesday, July 26, 2016. Schools will not be able to draw down or return funds during this period. A school should consider the impact that the outage period may have on your school’s closeout process.
How will a school learn its final balance?
In early August 2016, we will produce a final 2014-2015 SAS Report and send it to all schools. A school will receive this SAS Report even if it is at a zero balance or has previously closed out for this program year. If a school has not completed reconciliation to a zero balance prior to the deadline, it is important that its reconciliation be completed using this final SAS Report. This SAS Report will serve as a final record of the school's official Ending Cash Balance for 2014-2015 and should be kept as part of your reconciliation documentation.
We appreciate your cooperation as we work to close out the 2014-2015 Direct Loan Program Year. If you have questions about this announcement or need assistance with closeout, contact the COD School Relations Center at 800/848-0978. You may also e-mail CODSupport@ed.gov.