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OIG: Office of Inspector General
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Lenders and Lender Servicer Audits

Prior to July 1, 2010, eligible lenders could make loans under the Federal Family Education Loan (FFEL) Program. These lenders may continue to hold FFEL Program loans until they are repaid or a claim is paid on the loan. All FFEL Program lenders that hold more than $5 million in FFEL Program loans and school lenders that hold any amount of FFEL Program loans are required to submit annual compliance audits (34 C.F.R. §§ 682.305(c)(1) and 682.601).

Lenders frequently engage lender servicers to administer certain aspects of the lender’s FFEL
Program functions. Servicers that enter into contracts to administer any aspect of a participating lender’s FFEL Program are required to submit annual audited financial statements (34 C.F.R §668.23(d)(5)) and annual compliance audits (34 C.F.R. §682.416(e)).

Audits of lenders and lender servicers that are not governmental entities or nonprofit organization must be performed in accordance with the appropriate audit guide developed by the OIG.

Current Lender Audit Guide:
Guide for Compliance Attestation Engagements of Lenders Holding Federal Family Education Loan Program Loans (September 2020) [Transmittal Letter] [Guide]

  • **NEW** Dear CPA Letter CPA-21-04: Lender Federal Family Education Loan Program Compliance Engagement Example Practitioner’s Reports Reflecting Changes for SSAE Nos. 19 and 21 (Issued October 26, 2021) [PDF]

To satisfy the lender compliance audit requirement, this Guide requires an examination-level attestation engagement (Standard Engagement), an agreed-upon procedures engagement (Alternative Engagement), or a combination of both (Combined Engagement), depending on whether the lender functions are carried out in whole or in part by a lender servicer(s).

Current Lender Servicer Audit Guide:
Guide for Financial Statement Audits and Compliance Attestation Engagements of Lender Servicers Administering Federal Family Education Loan Program Loans (September 2020) [Transmittal Letter] [Guide]

  • **NEW** Dear CPA Letter CPA-21-07: Lender Servicer Federal Family Education Loan Program Compliance Engagement Example Practitioner’s Reports Reflecting Changes for SSAE No. 21 (Issued October 26, 2021) [PDF]

Along with a financial statement audit, this Guide requires an examination-level attestation engagement to satisfy the lender servicer compliance audit requirement.

For copies of superseded audit guides, send a request to OIGNon-FederalAudit@ed.gov.

The following resources are available to assist auditors that perform lender or lender servicer audits:

Non-Federal Audit Main page



   
Last Modified: 11/04/2021