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COA and Accreditation

A Few Words on the Council on Accreditation (COA) and Why It's Important to Creditors and the National Foundation for Credit Counseling (NFCC)...

Any consumer can encounter financial difficulty. But is every credit counseling agency equipped to help those in need? Each member agency of the National Foundation for Credit Counseling is accredited by the Council on Accreditation , an independent not-for-profit organization. The COA accredits over 4,000 programs throughout the United States and Canada, including nearly 200 credit counseling services - NFCC and non-NFCC alike.

THE IMPORTANCE OF ACCREDITATION... You would choose an accredited college for your son or daughter. You would choose an accredited hospital for an ailing loved one. Wouldn't you prefer to choose an accredited credit counseling agency for your clients experiencing financial difficulties?

WHO CAN BE ACCREDITED? Not every credit counseling agency can be accredited by the COA. Before even being considered for accreditation, a credit counseling agency must first meet four minimum requirements. An agency must demonstrate that it: Provides credit counseling services according to best practice standards. Holds all applicable licenses required by the state and locality in which it operates. Has engaged in providing services for at least one year at the time of an initial site visit. Identifies itself as a business entity or a sub-unit of a larger corporation.

THE COA ACCREDIATION CERTIFICATE: What it means... Once an agency is identified as worthy of accreditation, the COA grants its accreditation certificate. This certificate signifies that the credit counseling agency you work with employs the appropriate checks and balances to protect your customer. COA accreditation takes the guesswork and the need for internal due diligence processes out of the equation by mandating that all NFCC members adhere to a rigid set of standards. Examples of Standards...Specifically, a few of these standards mandate that: Agencies have annual audits of operating and trust accounts. The agency must be licensed, bonded and insured. The agency supports and delivers a variety of consumer education programs. Agencies meet all consumer disclosure requirements as set forth by the Federal Trade Commission.

Debt Management Plans include a detailed review of current and prospective income, as well as present and anticipated financial obligations. In addition, the plan represents the client's best effort in payment of all debts, and assures that all lines of credit are closed. Funds are disbursed at least twice per month and funds are disbursed promptly in emergencies. An organization discontinues a client's Debt Management Plan after two consecutive missed payments and notifies the creditor of this discontinuation within 10 days.

Creditors receive fair and equitable distribution of funds, and the agency offers electronic funds transfer to those creditors who request it. Clients have a variety of deposit options including electronic methods, and are offered immediate correction of improper posting. Persons with immediate needs are served immediately or referred to another organization for immediate service. Each consumer receives an assessment of how he/she got into trouble, a comprehensive financial plan, and a written action plan. Clients receive (at minimum) a quarterly statement. Clients are encouraged to increase deposits if their financial situation improves so they may speed the liquidation of their debt.

THE COA ACCREDITATION PROCESS: How It's Done... The COA process is orderly, sequential, and facilitative. Throughout the process COA provides a series of opportunities for the counseling agency to demonstrate compliance with COA's standards, beginning with the self-study and continuing through the peer review site-visit. Additionally, if COA identifies areas for remediation, it gives the organization a reasonable period of time for making required changes.

SCOPE... All agencies seeking accreditation are reviewed in eight specific areas:

Mission & Purpose - Determines whether consumer needs and preferences guide the organization in its design and delivery of services.

Quality Assurance - Evaluates the effectiveness and efficiency of services provided and corrects any observed deficiencies.

Governance & Administration - Determines whether the organization is governed and administered according to legal requirements and sound principles of effective management and ethical practice. This is evaluated by neutral oversight through a diversified board.

Human Resources - Evaluates the organization's ability to deploy personnel and foster efficient, effective service delivery for clients.

Service Environment - Ensures safe, accessible, and appropriate delivery for the needs of clients, employers, and other stakeholders.

Financial Management - Ensures that an organization manages its fiscal affairs according to sound financial practices and applicable statutory and professional requirements.

Professional Practices - Determines whether services are conducted with due regard to ethical and professional requirements and protects confidential information regarding clients.

Service Delivery - Ensures that an organization focuses its services on identifying the needs and problems of clients. Agencies must be re-accredited every four years. Fees for accreditation are based on a percentage of agency income.

WHY ACCREDITATION IS IMPORTANT... In short, COA has developed standards of best practice which: Identify agencies in which clients and creditors can have confidence. Identify which agencies are worthy of funding support. Protect agencies against pressure to lower standards. Provide a solid risk-management strategy. Demonstrate accountability in management of resources.

DO YOU KNOW HOW YOUR FAIR SHARE CONTRIBUTIONS ARE BEING USED? When dealing with a COA-accredited agency you will. Accreditation allows you to do due diligence just by looking for the COA Accreditation Certificate.

For more information on COA accreditation or NFCC member agencies, please contact NFCC Creditor Relations. You can also visit the COA web-site at: http://www.coanet.org/home.html