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() Summary: Subject: Direct Loan Quality Assurance Requirement

Publication Date: May 2002

Bulletin ID: DLB-02-14

Summary: Subject: Direct Loan Quality Assurance Requirement

May 2002


Subject: Direct Loan Quality Assurance Requirement

Dear Partner,

We would like to remind all Direct Loan schools of the requirement to implement a quality assurance system within their financial aid office operations {34 CFR 685.300(b)(9)}. This quality assurance requirement is in place to help schools review their processes and develop a system to promote program integrity and to ensure accurate student award records.

While neither the regulations nor FSA require that a yearly report be filed with the Department of Education, a clearly documented quality assurance system must be in place at your school. Additionally, you must review this system on a regular basis. Recently, this has become a key review point for auditors and program reviewers and it has been raised as a weak issue at some Direct Loan schools. There are several tools available to help schools fulfill this requirement.

These tools can include one or more of the following:

· FSA Assessments

· Additionally, the Management Enhancement form can be used to document any weakness and corrective actions taken to improve the weakness.

· List Reports in EDExpress and the Disbursement Measurement Tool in DL Tools V2.0

· NASFAA Self-Assessment

· Institutional-designed Assessment or any comparable quality assurance methodology or analysis

Regardless of the method you choose, it is important to have a clearly documented quality assurance system and supporting information that the system is being used.

Note: The FSA Assessments originated with FSA's Title IV Quality Assurance Program. However, FSA has offered these redesigned, web-based tools to all schools since their release in the fall of 2001. They can help a school improve and maintain compliance in a number of processes critical to the management and integrity of the programs. They are linked to the regulations and handbooks, and are available from the website - under "tools for schools".

If you have any questions about this bulletin, please contact COD School Relations Center at 1-800-848-0978. Thank you for your ongoing partnership in the Direct Loan Program.


Jane Holman
Acting Director, Title IV Delivery
Schools Channel