The Division III Financial Aid Audit Model was developed to ensure that Division III institutions are in compliance with the Division III Philosophy of awarding no athletically related financial aid to any student. As a legislative requirement, member institutions must award aid on a consistent basis pursuant to NCAA Bylaw 15.4.1 Consistent Financial Aid Package:

1. A member institution shall not consider athletics ability as a criterion in the formulation of the financial aid package;
2. The financial aid procedures used for a student-athlete are the same as the existing official financial aid policies of the institution;
3. The financial aid package for a particular student-athlete cannot be clearly distinguishable from the general pattern of all financial aid for all recipients at the institution; and
4. The percentage of the total dollar value of institutionally administered grants awarded to student-athletes shall be closely equivalent to the percentage of student-athletes within the student body. A differential is defensible if it can be demonstrated that the average need of the student-athletes at the institution is equivalently greater than the average need of other students.

The audit methodology was developed in conjunction with the Division III Financial Aid Compliance Checklist that has been incorporated into the Division III Institutional Self-Study Guide (ISSG). Many of the recommended policies and procedures from the checklist are required to be included in the institution’s NCAA audit report.

The audit report is required to contain the following statistical information:

• Number of students who attended the institution during the prior year.
• Number of students who received financial aid and participated in intercollegiate athletics.
• Average amount and type of financial aid provided to students who attended the institution during the prior year.
• Average amount and type of financial aid provided to students who attended the institution during the prior year and participated in intercollegiate athletics.
• Average need of students who attended the institution during the prior year.
• Average need of students who attended the institution during the prior year and participated in intercollegiate athletics.
• Percentage variation, if any, between the average amount of financial aid provided to students who attended the institution during the prior year and who participated in intercollegiate athletics and students who attended the institution during the prior year generally.

To determine whether an institution is in compliance with NCAA Bylaw 15.4.1 an outside auditor will annually randomly select 10 % of the institution’s student-athlete population to be compared with the non-student-athlete the student population generally for auditing purposes. The auditor may use student files that were selected during the institution’s Federal Financial Audit in order to reduce the costs associated with developing and selecting an entirely new population. If additional files are necessary to meet the percentage, the auditor will randomly select additional files.

In order for an institution to be considered to be in compliance with NCAA Bylaw 15.4.1, the audit report must indicate a consistent distribution of financial aid among the athlete and non-athlete general student population in regard to the following:

• Average amount and type of financial aid provided to students who attended the institution during the prior year.
• Average need of students who attended the institution during the prior year.
• The percentage of the total dollar value of institutionally administered grants awarded to student-athletes shall be closely equivalent to the percentage of student-athletes within the student body.

In the case of non-compliance reports, the audit results shall be reported on a form approved by the Management Council, and shall be reported on an annual basis to the NCAA. member conferences of the Association or, in the case of an independent member institution, The NCAA shall verify the accuracy of the report and forward the results to the Financial Aid and Awards Committee. The committee will review the report and Reports of non-compliance shall determine whether the report should be forwarded to the enforcement staff for appropriate review and disposition.

The form shall be kept on file in the office of financial aid, and shall be available for examination upon request by an authorized representative of another member institution; the NCAA., and, if the institution is a member of a conference, an authorized representative of the conference. The institution shall indicated on the Notice of Completion Form whether it has had any non-compliance audit reports in the previous 5 years.