Direct Loan Funding and Cash Management A-Z

1
Session 42

• Direct Loan Funding and Cash Management A-Z
• George Karayianis
• Tremayne Cobb

2
Session Overview

• Funding Process Overview
• Funding Methods
• Using GAPS
• Hands-On Exercise

3
Funding Process Overview
How do schools get their Money?
4
Funding Delivery Methods
Advanced Funds/School- Initiated Drawdowns
Pushed Cash/System- Initiated Drawdowns
5
Advanced Funds/School-Initiated Drawdowns

• School receives an initial CFL.
• School draws down cash via the GAPS Web site.
• School sends in disbursement records to
  substantiate cash received.
• COD sends CFL increases to GAPS so school can
  continue to drawdown funds as needed.

6
Funding Flow - Advanced Funds
SCHOOL
Batches
GAPS
COD
CFL/authorization
7
Pushed Cash/System-Initiated Drawdowns

• COD initiates drawdown requests and cash is
  deposited in a schools bank account based on
  disbursements accepted and posted by COD.
• Schools must have an accepted origination record
  and MPN on file before an actual disbursement is
  accepted and cash is pushed to a school.

8
Funding Flow - Pushed Cash
SCHOOL
Batches
GAPS
COD
CFL/authorization and drawdown request
9
Ex Funded Disbursement Listing

• Run Date 11/2/06
  US Department of Education Page 1
• Federal Direct Loan Program
• Funded Disbursement Listing Report
•  
• For Loans to be Funded by 11/1/06
• For Academic Year 2006-2007 
• School Georges Hair Salon
  
  School Code G11111
• 13 Maple Pl.
• Washington, DC 20202
•  
• Student Loan ID Disb
  Date Gross Fee Rebate Net
  Amt.
•  
• Sally Mae 233234454S07G11111001 11/2/03
  2,500 -100 38
  2,438
• Jerry Jones 212121233S07G11111001 10/28/03
  2,383 -95 36
  2,324
• Marcy Kay 887890766U07G11111001 11/5/03
  2,000 -80 30
  1,950
•  
  
  --------------------
  Total School Amount 6,712

10
Monitoring Statuses

• Cash Monitoring 1 (HCM1)
• Funding method can be Advanced Funds or Pushed
  Cash
• Cash Monitoring 1 (HCM2) and Reimbursement
• Funding method is Pushed Cash
• Required to have a signed MPN on file and
  accepted origination record before COD will
  accept actual disbursement

11
Cash Management Requirements

• 30-Day Reporting Requirement
• 685.301(d) Direct Loan
• 3-Day Cash Rule
• 668.162(b)
• Monthly Reconciliation
• 685.102(b) Direct Loan

12
Reconciliation and Closeout
13
Direct Loan Reconciliation versus End-of-Year
Closeout

• Monthly Reconciliation
• Compare your records with the Depts to identify
  and resolve outstanding discrepancies.
• Closeout
• Net Accepted and Posted
• Disbursements GAPS net cash
• Ending Cash Balance (ECB) 0

14
COD and GAPS Tools to help reconcile Direct Loans

• COD Funding Web screens
• Reports (COD)
• GAPS

15
School Funding Info Web Screen
School of Outstanding Students Funding
Info   Program Direct Loan Award Year
06-07   Entity ID 44544444 Initial
CFL 56,000 Current CFL 200,000 Availab
le Balance 15,000 Cash gt Net Accepted
Posted Disbursements 0 Net Accepted Posted
Disbursements 185,000 Net Drawdowns 185,0
00 Disbursement To Drawdown Ratio 1.0000
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Cash Activity Screen
School of Outstanding Students Program Direct
Loan Award Year 06-07 Net Draws
30,000 Cash gt Accepted Posted
Disbursements older than 30 days
0 Totals Date of Transaction 10/23/06 Ti
me 135PM Drawdowns 30,000
2,000 Drawdown adjustments 0 Refunds 1,
000 Returns 0 Days for On-time
reporting Payment Control Number
2006102321221 Accepted
Posted Disbursements Applied 20,000 0
Cash gt Accepted Posted Disbursements 10,000
Source System GAPS
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The Department of Educations Grant
Administration and Payment System (GAPS)
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E-Payments Web site(http//e-grants.ed.gov)
19
Logon to GAPS
ed101

20
Select Payment Requests from Main Menu
Main Menu   School of Outstanding Students 100
Student Way Bookville, AZ 22222     Please select
one of the following options  
Payment Requests
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Select Create Direct Loan Payment Requests from
Payment Requests Menu
Create Payment Requests
Modify Payment Requests
View Payment Requests
Adjust Drawdown Amounts
View Authorization History
Create Direct Loan Payment Requests
Modify Direct Loan Payment Requests
View Direct Loan Payment Requests
Adjust Direct Loan Drawdown Amounts
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Enter Payment Amount
Return to Payment Requests Menu
You have to save your work
202
Exit
Direct Loan Payment Requests (Create)
Payee DUNS 111111111 Pay by ACH Deposit Date (MM/DD/YYYY 10/19/2006
Sort ? Document No. ? School ? Recipient Reference School of Outstanding Students 100 Student Way Bookville, AZ 22222
Document Number School Year Recipient Reference Last Date to Draw Funds Request Amt
P268k059999 School of Outstanding Students 2005 ABC1 7/31/2006
P268k069999 School of Outstanding Students 2006 ABC2 7/31/2007
P268k079999 School of Outstanding Students 2007 ABC3 7/31/2008
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Electronic Refunds
Main Menu    School of Outstanding Students 100
Student Way Bookville, AZ 22222     Please select
one of the following options  
Refunds
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Check refunds to open awards and initiate
refunds
Refunds Menu School of Outstanding Students 100
Student Way Bookville, AZ 22222   Please select
one of the following options  
X
Initiate Refunds
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Awards and net draws will be displayed
Refunds to Open Awards Please note --- your
session will be timed out after 10 minutes of
inactivity. Any button click will reset the
inactivity timer. DUNS Number 111111111
PR Award Number Net Draws Refund Amount Account Name
P268k059999 23,000 School Refund Account A

P268k069999 18,000 School Refund Account A

P268k079999 3,000 School Refund Account A

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Enter the amount(s) to be refunded
Refunds to Open Awards Please note --- your
session will be timed out after 10 minutes of
inactivity. Any button click will reset the
inactivity timer. DUNS Number 111111111
PR Award Number Net Draws Refund Amount Account Name
P268k059999 23,000 School Refund Account A

P268k069999 18,000 School Refund Account A

P268k079999 3,000 School Refund Account A

100.00
Continue
Cancel
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Refund Confirmation
Refunds to Open Awards Confirmation DUNS Number
111111111
First
Previous
P268k059999 P268k079999
Next
Last

P268k079999 3,000 1,293 School Refund Account A 20061018R01000
PR Award Net Draws Refund Amt
Account Name
Confirmation Number

Comments
Grand
Total
1,293
Settlement Date
10/20/2006
NOTE It will take
two days before refund is posted to GAPS
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Drawdown Adjustments

• Cant move more than has been drawn
• Net adjustment must equal zero
• Do not use adjustments as a substitute for
  returning excess cash
• Do not use adjustments to close out a year or
  bring your schools cash balance to zero

29
Select Payment Requests from Main Menu
Main Menu    School of Outstanding Students 100
Student Way Bookville, AZ 22222     Please select
one of the following options  
Payment Requests
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Select Adjust Direct Loan Drawdown Amounts
Create Payment Requests
Modify Payment Requests
View Payment Requests
Adjust Drawdown Amounts
View Authorization History
Create Direct Loan Payment Requests
Modify Direct Loan Payment Requests
View Direct Loan Payment Requests
Adjust Direct Loan Drawdown Amounts
Adjust Direct Loan Drawdown Amounts
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Adjustments between years and/or
campuses
Return to Payment Requests Menu
Select New Payee
Exit
Direct Loan Drawdown Adjustments
Payee DUNS 111111111 School of Outstanding Students Bookville, AZ 22222
School Academic Year Net Draws Adjustments
School of Outstanding Students - Boston 2006 3,000
School of Outstanding Students - Boston 2007 5,000
School of Outstanding Students - Dallas 2006 4,000
School of Outstanding Students - Dallas 2007 10,000
Total 22,000 0.00
OK
Cancel
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Enter the amounts to be adjusted and click OK
Return to Payment Requests Menu
Select New Payee
Exit
Direct Loan Drawdown Adjustments
Payee DUNS 111111111 School of Outstanding Students Bookville, AZ 22222
School Academic Year Net Draws Adjustments
School of Outstanding Students - Boston 2006 3,000 (500)
School of Outstanding Students - Boston 2007 5,000 1,000
School of Outstanding Students - Dallas 2006 4,000 700
School of Outstanding Students - Dallas 2007 10,000 (1.200)
Total 22,000 0.00
OK
Cancel
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Adjustment Confirmation
Return to Payment Requests Menu
Select New Payee
Exit
Direct Loan Drawdown Adjustments
Payee DUNS 111111111 School of Outstanding Students Bookville, AZ 22222
School Academic Year Net Draws Adjustments
School of Outstanding Students - Boston 2006 2,500
School of Outstanding Students - Boston 2007 6,000
School of Outstanding Students - Dallas 2006 4,700
School of Outstanding Students - Dallas 2007 8,800
Total 22,000 0.00
The drawdown amounts have been adjusted
34
GAPS Reports
Main Menu   School of Outstanding Students 100
Student Way Bookville, AZ 22222     Please select
one of the following options  
Reports
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Select Activity Report
Reports Menu
Activity Report
Refund Report
Award Balances Report
Activity Report
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Activity Report - Selection Screen
Return to Payment Requests Menu
Select New Payee
Exit
Activity Report (Select)
Payee DUNS 111111111
Payee Name School of Outstanding Students
Award(s) Status ? Any ? Open ? Closed
Period From Through
PR Award Number
Select
37
Activity Report - Cumulative Summary
Payee DUNS 111111111
Payee Name School of Outstanding Students
Payee Address 100 Student Way Bookville, AZ 22222
Cumulative Summary Table From October 2002 Through October 2006
Row ID PR Award Number A Cumulative Draws B Cumulative Refunds C Cumulative Returns DNet Adjustments E (A-B-CD) Net Drawdowns
P268k059999 6,000 1,000 0 (500) 4.500
P268k069999 7,000 0 0 500 7,500
P268k079999 4,000 600 0 0 3,400
1
2
3
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Activity Report - Record Detail
Payee DUNS 111111111
Payee Name School of Outstanding Students
Payee Address 100 Student Way Bookville, AZ 22222
DETAIL TABLE
Transactions
PR Award Number
P268k079999
Date Drawdowns Refunds Returns Adjustments
10/16/2006 (500)
9/1/2006 2,000
8/18/2006 1,300
7/4/2006 700
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GAPS Access

• Full Access
• View Access
• Limit 5 user IDs of each access per school
• Download form from e-payment web site
• Fax completed form to GAPS
• (202-205-0729)

40
GAPS Helpdesk

• 1-888-336-8930
• Helpdesk hours of operation are 8 a.m.
• to 6 p.m., EST, Monday through Friday.

41
Other Direct Loan Sessions

• Session 40 Hands On Tour of DL Tools
• Session 41 Best Practices in Using DL LSDA
• Session 43 Best Practices for Processing DL at
  Your School
• Session 44 Direct Loans A Z
• Session 45 Direct Loans How to Get Started
• Session 46 Whats New in Direct Loans Grad PLUS
  and other HERA Related Changes
• Session 47 Direct Loan Reconciliation and
  Closeout
• Session 48 Direct Loan Reports Reference
  Materials-Tools of the Trade
• Session 49 How Direct Loan Servicing is Improving
  the Financial Aid Experience for You and Your
  Students