The U.S. Department of Education, Office of Inspector General has published its new Guide for Financial Statement Audits and Compliance Attestation Engagements of Lender Servicers Administering Federal Family Education Loan Program Loans (Guide). This Guide supersedes the January 2011edition of the Audit Guide, Lender Servicer Financial Statement Audit and Compliance Attestation Guide for Lender Servicers that Service Federal Family Education Loan Program Loans. The Guide is effective for fiscal years ending on or after June 30, 2021. Early implementation is permitted.
A servicer that contracts with a lender to administer any aspect of the lender’s programs must at least annually have an audit of its financial statements (34 C.F.R. § 668.23(d)(4)) and a compliance audit of the servicer’s administration of the FFEL program loan portfolio (34 C.F.R. § 682.416(e)). A servicer is required to have a compliance audit unless (1) the servicer contracts with only one lender, and (2) the audit of that lender’s FFEL programs involves every aspect of the servicer’s administration of those FFEL programs (34 C.F.R. § 682.416(e)(1)).
The guidance and requirements in this Guide apply to the financial statement audits and compliance attestation engagements of all lender servicers, except those servicers that are exempt under 34 C.F.R. § 682.416(e)(1), as described above, and those servicers that are State, local, or nonprofit organizations subject to single audits in accordance with Subpart F—Audit Requirements of Title 2 of the C.F.R., Chapter II, Part 200 Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, provided that the single audit covers the portfolios of the lenders the servicer has contracted with.
If you are a lender servicer subject to audit in accordance with this Guide, please ensure that your auditor is using this Guide for audits of fiscal years ending on or after June 30, 2021. The Guide and the related transmittal letter are available on the OIG Non-Federal Audit website at https://www2.ed.gov/about/offices/list/oig/nonfed/lender.html.
Questions pertaining to this Guide may be directed to the Office of Inspector General’s Non‑Federal Audit Team via email to OIGNon-FederalAudit@ed.gov.