| (a) A school shall submit annual financial statements
as set forth in this section that shall be:
(1) audited;
(2) reviewed (except for the first renewal, which must
be audited or compiled); or
(3) compiled, containing at least one note disclosing
the current and long-term liabilities. This note shall be similar
to that required by GAAP for reviewed and audited statements. Compiled
statements are acceptable under the following conditions:
(A) the gross annual revenue from student tuition and
fees, less refunds, is less than or equal to $100,000; or
(B) the programs are less than 30 consecutive calendar
days in length.
(b) Each school shall furnish true and correct financial
statements annually and not later than 180 days from the close of
the school's fiscal year. These statements shall include the following:
(1) balance sheet;
(2) statement of results of operation, which includes
a statement of income and retained earnings;
(3) statement of cash flows; and
(4) the gross amount minus refunds of annual student
tuition and fees for each school, separated from other revenues unrelated
to training.
(c) A school with a gross annual revenue from student
tuition and fees, less refunds, less than or equal to $100,000 may
submit all of the following in lieu of the financial statements required
in this section:
(1) an unearned tuition affidavit;
(2) a copy of the annual federal income tax form(s)
filed specifically for the business; and
(3) an owner's sworn statement certifying that the
unearned tuition affidavit and the copy of the annual federal income
tax form(s) are true and correct.
(d) A school that is a subsidiary of a corporation
may submit, in lieu of the statements required in this section, the
annual audited financial statements of the parent corporation provided
that:
(1) said statements are accompanied by an audited list
of any student tuition refunds payable by the subsidiary school at
the close of its fiscal year. The statements shall also be accompanied
by an owner's sworn statement reflecting the gross amount minus refunds
of student tuition and fees earned during the fiscal year on all programs
approved under the Act; and
(2) the parent corporation ensures that each student
enrolled in the subsidiary school receives either the training agreed
upon or a refund as provided in the Act and submits either a certified
resolution of its board of directors to this effect or any other evidence
as deemed appropriate by the Agency to establish financial responsibility
by the parent corporation.
(e) A school or college that fails to provide financial
statements that comply with the requirements in this section and the
standards identified in §807.32 of this subchapter, within 60
days of the date that they receive notice of any deficiencies, may
have their certificate of approval revoked.
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| Source Note: The provisions of this §807.35 adopted to be effective August 16, 1998, 23 TexReg 8479; amended to be effective February 24, 2003, 28 TexReg 1651; amended to be effective April 26, 2004, 29 TexReg 3970; amended to be effective November 28, 2022, 47 TexReg 7914 |
