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Bureau for Private Postsecondary Education

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Annual Renewal

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The BPPE requires Vocational Schools to submit annual financial statements that meet the requirements of 5 CCR §74115 as follows (5 CCR §71475(e)):

o For Institutions with annual gross revenues of $500,000 and over, statements shall be audited. o For Institutions with annual gross revenues less than $500,000, statements shall be reviewed.

o Compiled financial statements, internal financial statements, tax returns, and bank statements are not acceptable for determining compliance with this section.

 

Audited and reviewed financial statements shall be conducted and prepared in accordance with the generally accepted accounting principles established by the American Institute of Certified Public Accountants by an independent certified public accountant (CPA) who is not an employee, officer, or corporate director or member of the governing board of the institution. (5 CCR §74115(b)(1))

 

A set of financial statements shall contain, at a minimum, a balance sheet, an income statement, and a cash flow statement. (5 CCR §74115(b))

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The institution must maintain a ratio of current assets to current liabilities of 1.25 to 1.00 or greater at the end of the most recent fiscal year when using generally accepted accounting principles, or for an institution participating in Title IV of the federal Higher Education Act of 1965, meet the composite score requirements of the U.S. Department of Education. For the purposes of this section, current assets does not include: intangible assets, including goodwill, going concern value, organization expense, startup costs, long-term prepayment of deferred charges, and non-returnable deposits, or state or federal grant or loan funds that are not the property of the institution but are held for future disbursement for the benefit of students. Unearned tuition shall be accounted for in accordance with general accepted accounting principles. (5 CCR §71745(a)(6))