Washington Post 2009 Annual Report Download - page 19

measured the compliance of Kaplan Higher Education schools based on the composite score of the division. For the
2009 fiscal year, Kaplan’s Higher Education had a composite score of 2.45.
Department of Education Program Reviews. In September 2008, the Department of Education began a Program
Review at Kaplan’s Higher Education division’s CHI-Broomall campus. The Program Review is ongoing. The reviewers
have completed their field work. CHI-Broomall and Kaplan have responded to a preliminary report issued by the
Department of Education, are responding to a February 12, 2010 request by the Department of Education for additional
information and are cooperating fully in the review. The Department of Education has not yet issued a final report on this
review. No assurance can be given that the Department of Education’s final report will not have a significant adverse
effect on Kaplan’s ability to continue to operate this school.
The Department of Education has also conducted Program Reviews at Kaplan’s Higher Education division’s Pittsburgh and
Baltimore locations, which began in October 2007 and May 2008, respectively. Kaplan has responded to all requests
for information and is cooperating fully in these reviews. The Department of Education has not yet issued final reports on
these reviews. No assurance can be given that the Department of Education’s final report will not have a significant
adverse effect on Kaplan’s ability to continue to operate these schools.
In September 2009, the Department of Education began a Program Review of Kaplan University at its offices in Fort
Lauderdale, FL. Kaplan University is continuing to respond to all requests for information and is cooperating fully in the
review. The reviewers completed their field work, are reviewing documentation already submitted and are gathering
additional documentation. The Department of Education has not issued the final Program Review report. No assurance
can be given that the Department of Education’s final report will not have a significant adverse effect on Kaplan’s ability
to continue to operate this school.
In January 2010, the Department of Education began a program review at Kaplan Higher Education’s Bauder campus.
That same month, the Department of Education issued an expedited final determination letter, closing its program review
with no significant finding.
The Company is presently not aware of any proceeding by the Department of Education to fine any Kaplan school for a
failure to comply with any Title IV requirement, or to limit, suspend or terminate the Title IV eligibility of any Kaplan school.
Institutional Accreditation. As noted previously, to remain eligible to participate in Title IV programs, a school must
maintain its accreditation by an accrediting agency recognized by the Department of Education. In 2009, no Kaplan
Higher Education division school received notice from its institutional accreditors indicating that the school’s accreditation
was being withdrawn or that the school was being issued an order to show cause why its accreditation should not be
withdrawn.
Congressional Reauthorization of Title IV Programs. All of the Title IV financial aid programs are subject to periodic
legislative review and reauthorization. In addition, while Congress historically has not limited the amount of funding
available for the various Title IV student loan programs, the availability of funding for the Title IV programs that provide for
the payment of grants is primarily contingent upon the outcome of the annual federal appropriations process.
Whether as a result of changes in the laws and regulations governing Title IV programs, a reduction in Title IV program
funding levels or a failure of schools within Kaplan Higher Education to maintain eligibility to participate in Title IV
programs, a material reduction in the amount of Title IV financial assistance available to the students attending those
schools would have a significant negative impact on Kaplan’s operating results. In addition, any development that has the
effect of making the terms on which Title IV financial assistance is made available materially less attractive could also
adversely affect Kaplan’s operating results.
Test Preparation
Kaplan Test Preparation (“KTP”) includes the following businesses: Test Preparation and Tutoring; Professional and
Licensure; and Kaplan Publishing. Each of these businesses is discussed briefly below.
Test Preparation and Tutoring
The test preparation and tutoring business prepares students for a broad range of college and graduate school
admissions examinations, including the SAT, ACT, LSAT, GMAT, MCAT and GRE. During 2009, these courses were
offered at numerous locations throughout the U.S., Canada, Puerto Rico, Mexico, London and Paris. KTP also offers
courses online, which are delivered in a live online classroom and a self-study format. In addition, KTP licenses material
for certain of its courses to third parties and a Kaplan affiliate, which, during 2009, offered courses at 55 locations in 11
countries outside the U.S. KTP also offers programs and services, including college admissions examination preparation
courses, directly to schools and school districts for students in kindergarten through 12th grade. These offerings were
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