The Board proposes the amendment to the rule to clarify when a postsecondary educational institution shall provide a compiled financial statement and controlling principles.

 

DEPARTMENT OF EDUCATION
Commission for Independent Education

RULE NO: RULE TITLE
6E-2.004: Standards and Procedures for Licensure
PURPOSE AND EFFECT: The Board proposes the amendment to the rule to clarify when a postsecondary educational institution shall provide a compiled financial statement and controlling principles.
SUMMARY: This rule is being amended to clarify which institutions have to submit what type of financial statement.
SUMMARY OF ESTIMATED REGULATORY COSTS: No Statement of Estimated Regulatory Cost was prepared.
Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.
SPECIFIC AUTHORITY: 1005.22(1)(e), 1005.31(2), 1005.31(3), 1005.34, 1005.39 FS.
LAW IMPLEMENTED: 1005.04, 1005.31, 1005.33(1), 1005.34, 1005.39 FS.
IF REQUESTED WITHIN 21 DAYS OF THE DATE OF THIS NOTICE, A HEARING WILL BE SCHEDULED AND ANNOUNCED IN FAW.
THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Samuel Ferguson, Executive Director, Commission for Independent Education, 325 West Gaines Street, Suite 1414, Tallahassee, Florida 32399-0400.

THE FULL TEXT OF THE PROPOSED RULE IS:

6E-2.004 Standards and Procedures for Licensure

(1) through (5) No change.

(6) Standard 6: Finances.  All institutions must demonstrate that the financial structure of the institution is sound, with resources sufficient for the proposed operations of the institution and the discharge of its obligations to the students.  To demonstrate this, the school shall provide the following:

(a) 1. No change

2. Annual License. Extended Annual License, or Annual Review:

a. Licensed nondegree schools shall provide annually a review or audit, prepared in accordance with Generally Accepted Accounting Principles by an independent certified public accountant, Licensed colleges and universities shall provide annually an audit, prepared in accordance with Generally Accepted Accounting Principles by an independent certified public accountant. This annual financial statement shall demonstrate that the current assets of the institution exceed the current liabilities, and that there was a positive net working capital and a profit or surplus for the prior year. If an institution does not meet the above requirements, the Commission shall require an explanation of the financial condition of the institution including a financial improvement plan or teach‑out plan or form of surety guaranteeing that the resources are sufficient to protect the current students. If the Commission determines that the institution does not have sufficient resources, it shall take actions up to and including revocation of licensure.

b. If an independent postsecondary educational institution earns less than $100,000 gross tuition revenue per the institution’s fiscal year, the institution shall provide both a compiled financial statement of the institution and of the controlling principles. The financial statement shall be compiled, reviewed, or audited by an independent certified public accountant. These statements must demonstrate sufficient resources to ensure appropriate institutional development.

3. through 4. No change.

(b) through (12) No change.

Specific Authority 1005.22(1)(e), 1005.31(2), (3), 1005.34, 1005.39 FS. Law Implemented 1005.04, 1005.31, 1005.33(1), 1005.34, 1005.39 FS. History–Promulgated 12-5-74, Formerly 6E-3.01(1), Readopted 11-11-75, Amended 3-7-77, 5-7-79, 10-13-83, Formerly 6E-2.04, Amended 11-27-88, 11-29-79, 12-10-90, 10-19-93, 4-2-96, 4-11-00, 1-7-03, 4-5-04, 5-24-04, 5-18-05,________.