44 FY 2021 AGENCY FINANCIAL REPORT | U.S. DEPARTMENT OF EDUCATION

FINANCIAL SECTION | 

Message From the Chief Financial Officer

I am pleased to present our fiscal year (FY) 2021 Agency 

Financial Report (AFR) for the Department of Education 

(Department). Throughout FY 2021, the Department 

has remained committed to our stated mission to 

“promote student achievement and preparation for global 

competitiveness by fostering educational excellence and 

ensuring equal access.”

Congress established the Department as a Cabinetlevel agency in 1980. Today, the Department supports 

programs that touch every area and level of education. The 

Department’s early learning, elementary, and secondary 

education programs annually serve more than 17,000 

school districts and more than 56 million students 

attending more than 98,000 public and 32,000 private 

schools. Department programs also provide grant, loan, 

and work-study assistance to more than 10 million 

postsecondary students at more than 5,600 institutions 

of higher education.

The Department is responsible for administering 

education programs authorized and funded by Congress 

and signed into law by the President. This responsibility 

involves developing regulations and policy guidance 

regarding program operations, determining how program 

funds are awarded to recipients consistent with statutory 

requirements, and ensuring programs are operated 

fairly and conform to statutes and laws prohibiting 

discrimination in federally funded activities. The 

Department also collects data and conducts research on 

education to help focus attention on education issues of 

national importance.

While remaining in a maximum telework posture for 

the past year, the Department’s innovative and dedicated 

workforce achieved several accomplishments during 

FY 2021:

• In FY 2020 and FY 2021, Congress passed multiple 

COVID-19 relief bills that provided the Department 

with over $280 billion of supplemental funding for 

educational purposes. With this influx of funds, the 

Department successfully managed payment integrity 

risk by implementing strong internal controls that 

reduce the risk of improper payments while also 

implementing management flexibilities to temporarily 

reduce regulatory burdens on grantees adversely 

impacted by the pandemic.

• The Department established the Office of Enterprise 

Data Analytics and Risk Management, which merges 

enterprise risk management and operational internal 

controls activities and aims to provide leadership with 

actionable insights powered by data analytics.

• In March 2021, the Federal Student Aid (FSA) 

launched the FSA Partner Connect website, 

fsapartners.ed.gov to help streamline the Next 

Generation Federal Student Aid (Next Gen FSA) 

experience for partners.

• For the 20th consecutive year, we received an 

unmodified (clean) audit opinion on our financial 

statements from our independent auditor. A clean 

opinion confirms that our financial statements are 

presented fairly, in all material respects, and conform 

with generally accepted accounting principles. 

The internal control report identified one repeat 

material weakness, “Controls over the Reliability 

of Underlying Data Used in Credit Reform Reestimates Need Improvement.” The Department 

developed and implemented a corrective action plan 

to begin addressing deficiencies identified as part 

of this particular weakness in FY 2021 and remains 
FY 2021 AGENCY FINANCIAL REPORT | U.S. DEPARTMENT OF EDUCATION 45

committed to continually evaluating current internal 

controls for improvement opportunities in FY 2022 

and beyond.

• We received external validation of our sustained efforts

to produce user-friendly, transparent financial reporting

by earning the Department’s 17th award of the

Association of Government Accountants’ Certificate

of Excellence in Accountability Reporting, as well

as a special award for the Innovative Presentation of

A Matter of Wide Public Interest. Federal financial

reports must pass a rigorous independent review

against a comprehensive set of standards to earn this

prestigious recognition, which is the highest award

bestowed for federal financial reporting.

I am proud of the work the Department has accomplished 

over the past fiscal year, though challenges still lie ahead. 

Student loan payment relief during the COVID-19 

pandemic was extended through January 31, 2022. This 

measure included suspending loan payments and halting 

collections on defaulted loans. These actions have largely 

insulated federal student loan performance from economic 

disruption caused by the COVID-19 pandemic, while at 

the same time reducing the amount of loan repayments 

being remitted to the Department. This final extension 

will give students and borrowers the time they need to 

plan for restart and ensure a smooth pathway back to 

repayment. The Department is working with students 

and borrowers and providing guidance and information 

about how to plan for payment restart as the end of the

pause approaches.

The Department’s achievements illustrate the remarkable 

effort and dedication of our employees and partners. We 

will continue to serve as accountable and committed 

stewards supporting the Department’s mission on behalf 

of the public while enhancing our financial management 

capabilities.

Denise Carter

Delegated the authority to perform the functions and duties of 

the position of Chief Financial Officer

November 19, 2021