The financial statements for the year ended June 30, 2012 were restated to correct errors relating to grants receivable, prepaid expenses, accrued sick leave, bad debt expense and other miscellaneous items. The net effect of these items is as follows. Net position as of the beginning of the year ended June 30, 2012 was decreased by $1,784,207; reducing net position from $115,979,215 (as originally reported) to $114,195,008. Change in net position for the year ended June 30, 2012 was decreased by $809,127, from $1,112,276 (as originally reported) to $303,149. The restatement is described in Note 1 to the financial statements. The detailed adjustments are also listed in the audit adjustments section of this report.

Management has the ultimate responsibility for the appropriateness of the accounting policies used by the University. The University did not adopt any significant new accounting policies, nor have there been any changes in existing significant accounting policies during the current year.

We did not identify any significant or unusual transactions or significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus.

Allowance for Doubtful Accounts: The University provides an allowance for doubtful accounts based upon the anticipated collectability of each specific account. In evaluating the collectability of accounts receivable, the University considers a number of factors, including past experiences, current aging information, contacts with the students and other available data including geographical and economic factors. We evaluated the key factors and assumptions used to develop the allowance for doubtful accounts. Our evaluation of the allowance resulted in a recommended allowance that is approximately $500,000 more than the amount that is recorded as of June 30, 2013.

Useful Lives of Capital Assets: Capital assets are recorded at cost on the acquisition date or, in the case of gifts, at fair value at date of gift, and depreciated using the straight-line method over an asset's estimated useful life. Management has elected categories to depreciate certain assets based on type and estimated the useful lives based on past experience. We have reviewed the lives assigned by management, tested the underlying information within the fixed asset register and concluded that they are reasonable in relation to the financial statements taken as a whole.

Fair Value of Investments: Investments are stated at fair value. We evaluated the key factors and assumptions used to develop the fair value of investments in determining that it is reasonable in relation to the financial statements taken as a whole. Management's estimate of the fair value of investments is based on net asset value of shares as reported by the investment manager.