Tag Archives: financial capability

GAO Report Discusses Accreditors

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A U.S. Government Accountability Office (GAO) report released in December 2014 discussed, among other things, the role and effectiveness of accreditors. The report is particularly valuable as it provides insight into federal expectations for accreditors.

The report identifies 10 areas in which accreditors are required to have standards. The below table illustrates how the Middle States Commission on Higher Education (MSCHE) meets this requirement.

BlogIllustrationAccreditationRequirements

The report also discussed the kind of sanctions that are levied by national and regional accreditors. MSCHE is a regional accreditor.

Sanctions refer to warnings, show cause, probation, and termination of an institution’s accreditation. The GAO found that regional accreditors “were more likely to issue warnings compared to other types of sanctions.” Furthermore, regional accreditors were more likely to issue sanctions to schools that failed to meet academic quality standards than were national accreditors. The report stated:

The reasons cited for terminations and probations varied by type of accreditor. Consistent with our overall analysis of reasons across all types of accreditors, national accreditors more frequently issued sanctions to schools that did not meet accreditors’ financial capability standards, compared to other reasons… In contrast, regional accreditors most frequently issued sanctions to schools that did not meet accreditors’ academic quality capability standards, followed by financial and administrative capability.

Consistent with the practices of regional accreditors cited in the GAO report, MSCHE issued sanctions to 17 schools in 2014. Standards dealing with academic matters were cited for 94% of those institutions. Standards concerning financial capability were noted in 47% of cases and those dealing with administrative capability were cited for 29% of those schools.

Finally, the report found that regional accreditors were more likely to terminate accreditation or issue probation for schools that had higher student loan default rates, lower graduation rates, higher dropout rates, and lower retention rates than were national accreditors. These statistically significant results may suggest that regional accreditors such as MSCHE are better positioned to deal with an increasingly demanding higher education environment in which the public and policy makers are seeking stronger institutional outcomes.