---
kind: "section"
citation: "34 C.F.R. § 685.309"
title: "34"
number: "685.309"
heading: "Administrative and fiscal control and fund accounting requirements for schools participating in the Direct Loan Program."
url: "https://uscodex.org/cfr/34/685.309"
---

# §685.309. Administrative and fiscal control and fund accounting requirements for schools participating in the Direct Loan Program.

- (a) **General.** A participating school must—
  - (1) Establish and maintain proper administrative and fiscal procedures and all necessary records as set forth in this part and in [34 CFR part 668](/cfr/34/part668.md); and
  - (2) **Submit all reports required by this part and 34 CFR part 668 to the Secretary.**
- (b) **Enrollment reporting process.**
  - (1) Upon receipt of an enrollment report from the Secretary, a school must update all information included in the report and return the report to the Secretary—
    - (i) In the manner and format prescribed by the Secretary; and
    - (ii) **Within the timeframe prescribed by the Secretary.**
  - (2) Unless it expects to submit its next updated enrollment report to the Secretary within the next 60 days, a school must notify the Secretary within 30 days after the date the school discovers that—
    - (i) A loan under title IV of the Act was made to or on behalf of a student who was enrolled or accepted for enrollment at the school, and the student has ceased to be enrolled on at least a half-time basis or failed to enroll on at least a half-time basis for the period for which the loan was intended; or
    - (ii) A student who is enrolled at the school and who received a loan under title IV of the Act has changed his or her permanent address.
- (c) **Record retention requirements.** An institution must follow the record retention and examination requirements in this part and in [34 CFR 668.24](/cfr/34/668.24.md).
- (d) **Accounting requirements.** A school must follow accounting requirements in [34 CFR 668.24(b)](/cfr/34/668.24.md?p=b).
- (e) **Direct Loan Program bank account.** Schools must follow the procedures for maintaining funds established in [34 CFR 668.163](/cfr/34/668.163.md).
- (f) **Division of functions.** Schools must follow the procedures for division of functions in [34 CFR 668.16(c)](/cfr/34/668.16.md?p=c).
- (g) **Limit on use of funds.** Funds received by a school under this part may be used only to make Direct Loans to eligible borrowers and may not be used or hypothecated for any other purpose.

## Notes

### Amendments

[59 FR 61690, Dec. 1, 1994, as amended at 60 FR 33345, June 28, 1995; 61 FR 60493, Nov. 27, 1996; 61 FR 60610, Nov. 29, 1996; 78 FR 65841, Nov. 1, 2013]

### Authority

Authority: 20 U.S.C. 1087a—1087j. Subpart A also issued under U.S.C. 1087e(a). Subpart B also issued under U.S.C 1078, 1078-3, 1087(e), 1087e(a)(2), 1087e(a), 1087e(a)(3), 1087e(b), 1087e(d), 1087e(d)(1), 1087e(f), 1087e(g), 1087(m)(1)(A), 1091(a), 1092(d)(1), 1098e(a)(2), 1098e(a)(3), 1098h(a)(2). Subpart C also issued under U.S.C 1087a.

### Source

Source: 59 FR 61690, Dec. 1, 1994, unless otherwise noted.

### Amendments

[59 FR 61690, Dec. 1, 1994, as amended at 60 FR 33345, June 28, 1995; 61 FR 60493, Nov. 27, 1996; 61 FR 60610, Nov. 29, 1996; 78 FR 65841, Nov. 1, 2013]