This AskRegs Knowledgebase Q&A was updated on April 1, 2021 to reference the March 8, 2021 Higher Education Emergency Relief Fund (HEERF) Grant Program Auditing Requirements letter and the March 31, 2021 Guide for Compliance Attestation Engagements of Proprietary Schools Expending Higher Education Emergency Relief Fund Grants.
Unless specifically stated otherwise, the following guidance applies to HEERF I student grants under the Coronavirus Aid, Relief, and Economic Security Act (CARES Act), HEERF II student grants under the 2021 Coronavirus Response and Relief Supplemental Appropriations Act (CRRSAA, Section 314 of the Consolidated Appropriations Act, 2021), and HEERF III funds under the American Rescue Plan Act of 2021 (ARP).
Yes. Audit requirements related to HEERF grants are outlined in the HEERF Grant Program Auditing Requirements letter dated March 8, 2021, which covers three categories (excerpted below):
Single Audits of Public and Private Nonprofit Institutions
Any non-Federal entity, including private nonprofit and public institutions, that expends $750,000 or more during the non-Federal entity’s fiscal year in Federal awards, including student financial assistance under Title IV of the Higher Education Act of 1965, as amended (Title IV) and HEERF, must have a single audit conducted in accordance with 2 CFR part 200 Subpart F-Audit Requirements.
A non-Federal entity that expends less than $750,000 in Federal awards during the non-Federal entity’s fiscal year is exempt from Federal single audit requirements for that year, except as noted in 2 CFR § 200.503, but records must be available for review or audit by appropriate officials of the Federal agency, pass-through entity, and Government Accountability Office (GAO).
See the HEERF Grant Program Auditing Requirements letter for more details on what must be audited, the audit submission requirements, and submission deadlines.
Compliance Audits of Proprietary Institutions
Any proprietary institution that either (1) expended $500,000 or more in HEERF grant funds during an institution’s fiscal year, or (2) was on Federal Student Aid’s (FSA’s) Heightened Cash Monitoring (HCM) 1 or 2 lists in an institution’s fiscal year in which it expended any HEERF grant funds must submit a compliance audit covering the institution’s administration of the entire HEERF grant program to the Department.3 The HEERF compliance audit must be conducted in accordance with Government Auditing Standards, issued by the Comptroller General of the United States, and the applicable audit guide developed by the OIG.
A proprietary institution that expended less than $500,000 in HEERF grant funds during an institution’s fiscal year and is not otherwise on HCM 1 or HCM 2 list during an institution’s fiscal year in which it expended any HEERF grant funds is exempt from this HEERF compliance audit requirement for that year, but the grant records must remain available for review or audit by authorized officials of the Department.
For additional details, see the HEERF Grant Program Auditing Requirements letter and the Guide for Compliance Attestation Engagements of Proprietary Schools Expending Higher Education Emergency Relief Fund Grants.
General Requirements and Information – All HEERF Grantees
In the 2020 Compliance Supplement Addendum and the HEERF Audit Guide, we ask auditors to confirm that the institution was both timely and accurate in posting its (1) Section 18004(a)(1) Student Aid Portion Quarterly Public Reporting (assistance listing 84.425E) and (2) Sections 18004(a)(1) Institutional Portion, (a)(2), and (a)(3) Quarterly Public Reporting (assistance listings 84.425F, 84.425J, 84.425K, 84.425L, 84.425M, 84.425N, as applicable) reports.
The Department understands that this information may be unique and challenging to audit, particularly because auditors are asked to verify information posted on a webpage which may not be accessible during audit fieldwork. For these public reporting requirements, the Department will accept as evidence of compliance, contemporarily produced emails, webmaster logs, or other relevant documentation establishing a good-faith indication that the institution posted the required information at approximately the timelines established by our public reporting requirements.
Additional Historical Information: The U.S. Department of Education's (ED’s) Office of Inspector General (OIG) outlined in its Coronavirus Relief Oversight Plan the steps it will take to ensure that CARES Act funds are properly allocated by ED and that states and colleges appropriately spend their portion of the funding. See the Oversight Plan and NASFAA's Today's News article, ED’s Internal Watchdog Releases Plan to Oversee Billions in COVID-19 Relief Funding.
As we receive additional information, we will update this AskRegs Q&A.
See ED's Proprietary Schools, Foreign Schools, and Third-Party Servicer Audits website for future updates.
AskRegs Q&As represent NASFAA's understanding of regulatory and compliance issues. They are FOR INTERNAL USE ONLY. While NASFAA believes AskRegs Q&As are accurate and factual, they have not been reviewed or approved by the U.S. Department of Education (ED). If you should need written confirmation of AskRegs information for audit or program review purposes, please contact your ED School Participation Division. NASFAA shall not be liable for technical or editorial errors or omissions contained herein; nor for incidental or consequential damages resulting from the furnishing, performance, or use of this material.