The nature and extent of misreporting by applicants for the Basic Educational Opportunity Grant program was investigated. Types of potential program abuse were assessed, along with the accuracy of income estimates that students make on Supplemental Basic Grant applications, which are the basis for determining a student's eligibility. Attention was directed to: characteristics of a sample of 2,479 students using the Supplemental Basic Grant application in 1975-1976, types of changes made to applicants' Student Eligibility Reports between the regular and supplemental applications submitted in 1975-1976, and the kinds of applications the sample filed in 1974-1975 and 1976-1977. The supplemental application recognizes that students' previous year financial resources are not always a valid basis for predicting current financial strength and determining eligibility. Findings of the report include: applicants made failry accurate estimates of their 1975 adjusted gross income; 58 percent of the sample were dependent and 42 percent were independent students; the predominant reasons for filing 1975-1976 supplemental applications related to unemployment of the student, parent, or spouse; and less than one-fourth filed a 1974-1975 application, while almost two-thirds filed a 1976-1977 application. (SW)