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TABLE OF CONTENTS

[INTRODUCTION 1](#__RefHeading___Toc187823806)

[WHY DO QA PROGRAM SCHOOLS HAVE TO SAMPLE?
1](#__RefHeading___Toc187823807)

[WHAT DO QA PROGRAM SCHOOLS HAVE TO DO? 2](#__RefHeading___Toc187823808)

[CONCLUSION 5](#__RefHeading___Toc187823809)

[]{#__RefHeading___Toc187823806 .anchor}INTRODUCTION

The Quality Assurance (QA) Program of the U.S. Department of Education
(ED) helps schools manage the delivery of Title IV funds at
participating postsecondary schools. In lieu of following federally
prescribed verification of Institutional Student Information Records
(ISIR) for applicants "flagged" by the Central Processing System (CPS),
schools participating in the QA Program are empowered to develop their
*own school* process of verifying the accuracy of ISIR data. The
information on ISIR records reflects student responses on the Free
Application for Federal Student Aid (FAFSA). The ISIR data are used to
calculate the students' expected family contribution (EFC) toward their
postsecondary expenses. The difference between the total price of
attending a specific college or university and a student's EFC
determines his or her eligibility for need-based Federal Student Aid
programs.

The ISIR Analysis Tool (the "Tool") was developed to allow postsecondary
schools to analyze the changes made to ISIR data resulting from
verification in terms of their impact on EFC and Pell Grant eligibility.
By confirming the accuracy of 100 percent of ISIR information supplied
by a random sample of aid applicants and uploading these records into
the Tool schools are able to determine what their verification practices
may be missing.

The QA Program requires participating schools to draw a random sample of
aid applicants who are eligible for need-based aid for the upcoming
award year 2008-09 based on their initial transaction. This document
prepares schools to carry out this exercise with as little disruption to
their regular processing of aid as possible.

We hope that this document will serve as a helpful guide as schools plan
to draw their sample in Spring 2008 and verify all sampled records
according to federal requirements **(in addition to the records that
meet the school's established verification procedures)** prior to
disbursing any Title IV aid.

[]{#__RefHeading___Toc187823807 .anchor}WHY DO QA PROGRAM SCHOOLS HAVE
TO SAMPLE?

Documenting the accuracy of ISIR information for students not normally
selected for verification is the only way schools can find out what
their school verification procedures may be missing. The only way to
ensure the accuracy of every critical ISIR fields used to calculate a
given student's EFC is to verify that ISIR record.

While schools need to examine the accuracy of ISIR data among students
they don't usually verify, they do not have to look at every single aid
applicant. By carefully following the sampling procedures spelled out
below, schools will be able to make valid generalizations, by analyzing
a random sample of relatively few (minimum of 350 records), to their
entire aid population. It is important to follow these rules in order
for the data to be representative of school's aid population.

Schools will collect federal verification documentation from all
students in the random sample. Schools should treat the records drawn
into the sample just as they would if they were not participating in the
QA Program and the CPS selected the records for verification. That is,
verify each ISIR element that affects EFC. Schools will also need to
maintain identifying information so that they will be able upload the
right data into the Tool after completing the verification process. That
is: 1) social security numbers, 2) first two characters of last names,
3) transaction numbers for the initial and paid-on ISIRs, and 4) whether
or not each student in the sample met the school's normal verification
criteria.

**WHY 350?**

In setting the minimum sample size at 350, Federal Student Aid is
attempting to balance the competing desires of collecting enough
information to support meaningful analysis and conclusions while
minimizing the burden of sampling placed on schools. Schools should use
their previous experience in drawing samples to account for attrition.
That is you should include more than 350 records in your initial sample
in order to allow you to collect and analyze data from at least 350 aid
applicants.

Please note schools with fewer than 1,000 aid applicants should set
their sample size to 20 percent of their aid population. Contact your QA
Program regional representative if you have any questions.

[]{#__RefHeading___Toc187823808 .anchor}WHAT DO QA PROGRAM SCHOOLS HAVE
TO DO?

Federal Student Aid requires each school participating in the QA Program
to perform seven activities as part of the sampling process. We would
like to stress that these sampling activities are to be ***in addition
to your institution's normal verification efforts***. Schools
participating in the QA Program are required to follow all of their
normal verification procedures during the alternating years they also
verify a random sample. Table 1 on the following page identifies the
four "extra" steps associated with this sampling process.

TABLE 1: Seven Required Steps of Sampling

+----+----------------------------------------------------+-----------+
| St | Sample Year Only Activities                        | Every     |
| ep |                                                    | Year      |
|    |                                                    | A         |
|    |                                                    | ctivities |
+----+----------------------------------------------------+-----------+
| 1  | Complete Sampling Plan Worksheet available at      |           |
|    | <http://ifap.ed.gov                                |           |
|    | /qadocs/ToolsforSchools/0809SamplingWorksheet.doc> |           |
+----+----------------------------------------------------+-----------+
| 2  | Randomly select a sufficient number of records to  |           |
|    | allow you to verify at least 350 non duplicate     |           |
|    | student ISIR records from your aid applicant       |           |
|    | population that demonstrate financial need, i.e.,  |           |
|    | Initial EFC minus the cost of attendance is        |           |
|    | greater than zero.                                 |           |
+----+----------------------------------------------------+-----------+
| 3  | Require each student drawn into the sample to      |           |
|    | complete the applicable federal verification       |           |
|    | worksheet by placing a hold on their aid           |           |
|    | disbursement until they comply.                    |           |
+----+----------------------------------------------------+-----------+
| 4  | Submit ALL changes stemming from the sample        |           |
|    | verification process that exceed Federal tolerance |           |
|    | through the central processor. Keep track of       |           |
|    | transaction number of corrected ISIRs.             |           |
+----+----------------------------------------------------+-----------+
| 5  |                                                    | Update    |
|    |                                                    | and set   |
|    |                                                    | school    |
|    |                                                    | ver       |
|    |                                                    | ification |
|    |                                                    | flags in  |
|    |                                                    | the Tool. |
+----+----------------------------------------------------+-----------+
| 6  |                                                    | Analyze   |
|    |                                                    | changes   |
|    |                                                    | to ISIR   |
|    |                                                    | in        |
|    |                                                    | formation |
|    |                                                    | within    |
|    |                                                    | your      |
|    |                                                    | sample    |
|    |                                                    | with the  |
|    |                                                    | ISIR      |
|    |                                                    |           |
|    |                                                    | Analysis  |
|    |                                                    | Tool.     |
+----+----------------------------------------------------+-----------+
| 7  |                                                    | Document  |
|    |                                                    | and apply |
|    |                                                    | the       |
|    |                                                    | results   |
|    |                                                    | of your   |
|    |                                                    | analysis  |
|    |                                                    | in        |
|    |                                                    | improving |
|    |                                                    | your      |
|    |                                                    | inst      |
|    |                                                    | itutional |
|    |                                                    | ver       |
|    |                                                    | ification |
|    |                                                    | pr        |
|    |                                                    | ocedures. |
+----+----------------------------------------------------+-----------+

We expand on each of these steps below.

## 

## Sampling Plan Worksheet

Before schools embark on the 2008-09 sampling process, it is essential
to plan for each of the following activities. Federal Student Aid
understands that schools will need flexibility in terms of timing the
sample of their financial aid applications, but it is important that
each school have a schedule.

## Sample a Minimum of 350 Applicants with Financial Need Randomly

We are requiring every school to analyze a sample of at least 350 of
their aid applicants who are eligible for need-based aid. Schools may
decide to sample more, but they must place a hold on aid disbursements
to all students sampled until they complete a federal verification
worksheet. There are multiple software packages, for example, SPSS, SAS,
Excel, and even some aid processing systems, with the capacity to draw a
random sample.

Schools may choose to sample ISIR records as soon as they begin
receiving them from the CPS in early January, or wait until some point
later in the process. There are benefits to either strategy. Below we
discuss issues for schools to consider as they are deciding on the
timing of their sample.

Sampling from the very beginning lets schools avoid having to ask
students who were previously subjected to school verification for any
additional information. Multiple requests for confirmatory information
have the potential of exasperating students and their parents. Sampling
from the start will also allow (force) schools to integrate the sampling
exercise into their normal operations and spread the work across the
spring and summer. This type of integration may make it easier for
schools to manage the work associated with the sample. Depending upon
the system the school uses to process aid, it might be quite easy or
nearly impossible for schools to integrate the sample into their normal
operations. Integrating the sample would be analogous to adding a
randomly generated verification flag to an existing institutional
verification system.

Conversely, waiting to sample will allow schools to remove more of the
applicants who will not be attending their school from the sampling
pool. As the spring progresses, schools will be increasingly able to
identify applicants who will attend their school in the fall. Schools
will make offers of admissions to a subset of applicants. A subset of
these admitted students will choose to accept admission at a given
school. Waiting until the final roster of students is clearer minimizes
the proportion of sampled ISIRs that will drop out of the population
because they do not receive aid at the school drawing the sample.

When deciding when to start their sample, schools should consider when
they begin and what documentation they collect during their normal
school verification process. There is, of course, no risk of having to
make a second request for information from a previously verified student
until institutional verification actually begins. Furthermore, schools
that collect all the information requested by the federal verification
worksheets from all the students who meet their verification criteria
will have no need to re-contact previously verified students who are
subsequently drawn into the sample. When either of these two situations
applies, we encourage schools to wait to begin their sample in order to
allow the initial sampling frame to include a greater proportion of
applicants who will actually receive aid.

If waiting is not practical, schools should increase the sample size
well beyond the minimum of 350 to account for an expected level of
attrition. For example, if only half of the students from whom a
particular school received an ISIR file from last year ended up
attending in the fall, then a school might want to double their sample
size to 700. This would help ensure that the school would have
sufficient data to analyze in the fall after matriculation decisions
work themselves out.

Schools do not need to have a complete list of aid applicants
demonstrating financial need before beginning sampling. However, schools
do need to have a realistic estimate for the eventual total number of
applicants if they want to sequentially build their sample by taking
multiple random "mini-samples" as they receive ISIR records through out
the course of the spring and summer of 2008. The number of need-based
aid recipients a school had last year is generally an excellent estimate
of this year's total. If schools build their sample in this fashion,
they must sample the same percentage of cases in each draw and ensure
that each student is exposed to the risk of sampling only once.

Regardless of when schools decide to begin sampling they should strive
to complete their sample no later than the end of June. Schools need to
leave enough time to verify ISIR information from selected students
before disbursing aid in the fall. If admission and acceptance data will
not be available by June, or if the information will be extremely
sketchy at this point in time, there is no added value waiting for it.

Finally, we remind schools to keep track of identifying information and
whether or not each applicant in the sample would have been subjected to
their normal institutional verification process. Schools will use this
information to identify the right records to upload and to set the
School Verification Flag within the Tool.

## Verify Before Disbursing Aid

Ideally, schools will confirm the information called for by the
applicable (dependent or independent) federal verification worksheet for
any student selected into the sample prior to disbursing aid to that
student. Federal Student Aid strongly encourages schools to do this
prior to disbursing aid to these students. Failing to complete the
verification process by the time classes start in the fall will not
create "statistical problems," but may result in adjustments to aid
awards after initial disbursements have been made. Schools are advised
to schedule at least eight weeks to contact sampled students, collect
completed federal verification worksheets, and resolve any discrepancies
with existing ISIR data. Schools may, however, make an initial aid
disbursement prior to completing verification (following interim
disbursement regulations in §668.58). Schools that do not complete
verification prior to disbursement face potential institutional
liability for any over-award(s) of aid discovered that cannot be
collected from the aid recipient(s).

Schools are not required to verify applicants who decide to attend
another school, decide to forego college, or decide to attend your
school without federal financial assistance. Therefore, the number of
applicants that will supply data for analysis will be smaller than the
number originally sampled.

## Submit Changes to the CPS

Schools may apply the same \$400 tolerance level used in federal
verification when submitting changes to ISIR data detected during the
sample, but are required to submit changes even if changes in excess of
this tolerance level do not affect the student's Pell eligibility. This
tolerance applies to "Total Income" that is the result of adding
adjusted gross income and untaxed income together and then subtracting
federal taxes paid. If the difference in the results of this calculation
using initial compared to confirmed information is \$400 or less,
schools do not have to submit the new data through the CPS. This will
allow schools to exclude changes to ISIR data that are unlikely to
affect aid eligibility. However, all changes to the number of family
members in college and household size need to be submitted.

Keep track of the ISIR transaction number containing the correct
information for later uploading into the Tool. If a review of federal
verification worksheets reveals no need to correct information, the
"corrected" paid on transaction number is the same as the initial ISIR
transaction number.

## Upload Data and Apply Institutional Verification Profiles

One reason Federal Student Aid is requiring schools to verify a sample
is to support meaningful analysis at the Title IV program level, and to
support ongoing initiatives to reduce improper payments in the Pell
Grant Program.

As a result, Federal Student Aid requires that schools upload ISIR data
and identify records in the sample that met your institutional
verification criteria by setting the School Verification Flag within the
Student Listing prior to the data collection effort. A training session
on how to upload ISIR records is available on the QA Program website at
the following URL
(<http://ifap.ed.gov/qadocs/ToolsforSchools/FlatFileUpload.ppt>).

## 

## Analyze the Data

The Tool, which schools will use to analyze their sample data, includes
standard reports and filtering capabilities as well as ad hoc reports
including "shared reports" authored by Federal Student Aid staff.

Federal Student Aid estimates that a thorough analysis with the Tool
will take at least a week or two of staff time. Schools should strive to
identify a specific window of time during late October through mid-
December 2008 when staff member(s) can devote time to this analysis.
Schedule analysis to allow enough time to implement quality improvements
for the subsequent award year.

## Apply the Results of Your Analysis

The purpose of analyzing changes with the Tool is to make improvements
in your institution's verification practices. Schools should explicitly
plan for how they will apply the results of their analysis to the
verification procedures they will use in 2009-10 or 2010-11. During this
process schools should document and be ready to share the rationale for
the enhancements they employ with their QA Program representative.
Schools should also continue to work collaboratively with Federal
Student Aid to improve the ability of the Tool to produce the types of
analysis that support improvements in verification.

[]{#__RefHeading___Toc187823809 .anchor}CONCLUSION

In this document we summarized the steps that schools must take to
select and verify a random sample of Title IV applicants for the 2008-09
award year. We remind Quality Assurance Program schools that they are
required to select a random sample of applicants every other year. It is
important that schools follow the steps outlined in this sampling guide
to ensure that samples are truly random and reflect the underling
applicant populations. The data collected from these samples will help
schools determine the effectiveness of current verification practices.
Schools will be able to apply this insight in making ongoing
improvements in their school verification procedures.