According to the 2005 National Center for Education Statistics, there are approximately 2,474 public and private 4-year institutions and 1,666 2-year institutions in the United States with enrollments of 10,999,420 and 6,488,055, respectively for a total of 17,487,475 enrollees. The statistics reveal that the industry of higher education is pervasive, relevant, and in great demand in an ever changing society. Many of the institutions of higher education, like any other business concern, rely on sound leadership, governance, and a properly structured infrastructure. In recent years, many businesses have failed due to a combination of poor governance, inadequate leadership, poorly designed operational, marketing, financial and technological and communication systems and the lack of integrity and competency. The original business model for colonial colleges was patterned after the English Oxford and Cambridge University systems with Harvard establishing the first prototype for the now thousands of colleges and universities in America. However, the pattern and model must change to adequately and proficiently deal with the challenges of the business in this twenty-first century.
The level of expertise needed to assess, evaluate, and provide meaningful feedback and information to management and to the board of trustees and directors is of utmost importance. We, at Clausell & Associates, P.C., have many years of experience in providing this service. This is especially true for those institutions and their students who rely on federal financial assistance. Our experience and expertise are unique because we have years of understanding, auditing and practicing the dynamics of the U.S. Department of Education laws and regulations (e.g. Title IV Programs). Specific understanding and working experience is needed for each major area of federal financial aid as enumerated below:
1. Federal Pell Grant
2. Federal Supplemental Educational Opportunity Grant (FSEOG)
3. Academic Competitiveness Grant (ACG)
4. National Science and Mathematics Access to Retain Talent Grant (National SMART Grant)
5. Federal Work-Study (FWS)
6. Federal Perkins Loan
7. Subsidized Direct or FFEL Stafford Loan
8. Unsubsidized Direct or FFEL Stafford Loan
9. Direct or FFEL Plus Loan
For further details and discussion of federal financial aid programs visit www.FederalStudentAid.ed.gov.
Not only do we have a working knowledge of the aforementioned financial aid areas, we provide training of institutional staff, management, and trustees in the understanding of such programs. We also can assist in establishing accounting, compliance, and operational procedures to create a sound and low risk business environment.
We have also teamed up with an affiliated group, The Institute of Student Financial Aid and Administrative Services, Inc. (a 501(c)(3) organization), in establishing a credential based approach in training financial aid advisors and staff in implementing and understanding the administration of financial aid and the many compliance requirements of each program. We have provided representation for our clients when issues arose with the various federal program reviews and the Office of Inspector General in matters of compliance, sanctions and disciplinary actions.
Another area of concern of many institutions of higher education is in research and development. Execution, deliverables, internal and external reporting, and grant accounting are critical in a successful research and development department. We have many years of experience in auditing and providing guidance in grant accounting requirements. We have assisted our clients in maximizing indirect costs through the development of indirect cost recovery plans and other cost procedures and plans. The tax treatment of scholarships, stipends and other financial aid resources must also be properly structured and understood.
Other areas of concern that must be understood by the board members and management is that provided under the Committee of Sponsoring Organizations of the Treadway Commission (COSO).
In 1985, COSO was formed to help model internal controls to prevent and or reduce fraudulent financial reporting and to provide guidance for management to implement five critical areas of internal controls as explained below:
The industry of higher education, like any other major sector in the economy, requires specific skills to evaluate and determine if each entity is operating in a safe and efficient environment. We offer those unique skills and knowledge to our clients. We would like to meet you and discuss your needs and requirements as you face the ever changing dynamics of your institution of higher education.