Audit 16352

Title: Note 1.Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are recognized on the accrual basis of accounting. Such expenditures are reported following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. *Note 2 in the Final Report* De Minimis Rate Used: N Rate Explanation: The College has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. *Note 3 in the Final Report* The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Pacific Oaks Education Corporation (the College) under programs of the federal government for the year ended May 31, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Uniform Guidance). Because the Schedule presents only a selected portion of the operations of the College, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the College. No funds were identified as having been provided to subrecipients by the College, and accordingly, no funds identified in the Schedule are attributable to subrecipient entities. There were no federal awards expended for non-cash assistance or insurance at year-end.

Title: Note 4.Federal Student Loan Program Accounting Policies: Expenditures reported on the Schedule are recognized on the accrual basis of accounting. Such expenditures are reported following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. *Note 2 in the Final Report* De Minimis Rate Used: N Rate Explanation: The College has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. *Note 3 in the Final Report* During the fiscal year ended May 31, 2022, the College issued new loans to students under the Federal Direct Student Loan Program (FDLP). The loan program includes subsidized and unsubsidized Stafford Loans, Parent PLUS Loans, and PLUS Loans for graduate and professional students. The value of loans issued for the FDLP is based on disbursed amounts. The loan amounts issued during the year are disclosed on the Schedule. The College is responsible only for the performance of certain administrative duties with respect to the federally guaranteed student loan programs and, accordingly, balances and transactions relating to these loan programs are not included in the Colleges basic financial statements. Therefore, it is not practicable to determine the balance of loans outstanding to students and former students of the College at May 31, 2022.In addition, the College participates in the Federal Perkins Loan Program through the Department of Education. This loan program is directly administered by the College and is considered a revolving loan program whereby collections received on past loans, including interest, are loaned out to current students. The beginning balance on these loans is disclosed in the Schedule. There were no loans issued through the Federal Perkins Loan Program during the year ended May 31, 2022. The Federal Perkins Loan Program was liquidated by the College during the fiscal year ended May 31, 2022.