This is the seventh in a series of 10 blog posts related to the Top 10 Audit Findings of the U.S. Department of Education.
One of the top 10 audit findings, according to the U.S. Department of Education, includes student credit balance deficiencies. Indicated causes include:
- Credit balances not released to students within 14 days,
- No process in place to determine when a credit balance has been created,
- Non-compliant authorization to hold Title IV credit balances, and
- Credit balances not released by the end of loan period or award year.
Credit balances can occur in many ways and may be the result of payments from not only Title IV program funds, but also personal funds, private loans, and institutional grants. Also, as you are aware, credit balances may be related to and affected by changes in a student's enrollment status that might affect federal or other aid eligibility. Technically, a Title IV credit balance typically occurs whenever your school credits Title IV program funds to a student’s account and the total amount of those funds exceeds the student’s allowable charges.