LIFE UNIVERSITY, INC.

Federal Program Information: Student Financial Assistance Cluster: Federal Pell Grant Program (Assistance Listing #84.063), Federal Direct Loan Program (Assistance Listing #84.268) Criteria or Specific Requirement: N. Special Tests and Provisions – Enrollment Reporting: Federal regulation 34 CFR 685.309 states that the institution shall accurately report a change in a student’s enrollment status directly to the lender or guarantee agency within 30 days if a student has graduated, withdrawn, or ceased to be enrolled (or failed to enroll) at least half-time and the school does not expect its next Roster File to NSLDS within 60 days. Condition: The University did not report students’ status changes accurately and within the required timeframe. Cause: Administrative oversight. Effect or Possible Effect: The University was not in compliance with required federal guidelines. Questioned Costs: None. Context: Program Level: Based on a sample of 40 students, 1 student’s program begin date was not accurately reported to the NSLDS. 1 student’s program enrollment effective date was not accurately reported to the NSLDS. Campus Level: Based on a sample of 40 students, 4 student’s campus level enrollment effective date was not reported to the NSLDS within the required timeframe. Identification of Repeat Finding: Yes, see finding 2024-002. Recommendation: The University should implement procedures to ensure that student status changes are reported in a timely manner. Views of Responsible Officials: The University will report to the National Student Clearing (NSC) House using regularly scheduled enrollment reports every 30 days. Suppose a student’s enrollment status is not captured in the regularly scheduled enrollment reports with the NSC. In that case, the enrollment reporting will be reported directly to the National Student Loan Database Service (NSLDS), such as after the end of the term once grades are processed. The enrollment reporting in which a student receives a failing grade of all “Fs” for a quarter will be adjusted to meet the reporting time frame.

Individuals Responsible for Corrective Action Plan: •Dr. Lee Skinkle, VPAA •Elizbeth Geisz, Registrar •Melissa Waters, Senior Director Student Administration and Compliance Condition: The University did not report students’ status changes accurately and within the required timeframe. Management’s Corrective Action Plan: 1.Improved Identification of Withdrawals Per the University’s attendance policy, the Academics team promptly reviews students who haveceased academic activity for 14 consecutive days. Students meeting this criterion are identified androuted to the Registrar’s Office for processing as unofficial withdrawals within the required federaltimeframe. This procedure ensures timely and accurate reporting of enrollment status changes andeliminates the need to backdate information in the SIS, NSC, and NSLDS. 2.Refined Enrollment and Registration Deadlines Enrollment and registration deadlines have been tightened and communicated across alldepartments. Reducing late registration activity minimizes backdated actions that can result ininaccurate program-level and campus-level effective dates in NSC and NSLDS reporting. 3.Review and Adjustment of the Dismissal Timeline The dismissal process timeline is being reviewed and updated to ensure students have sufficienttime to meet enrollment and registration deadlines for subsequent academic periods. This reduceslate or retroactive enrollment-status changes that affect NSLDS timeliness. 4.Enhanced Quality Assurance for Enrollment Reporting Monthly quality checks will be performed on reports related to withdrawals, graduations, programchanges, and registration activity prior to submission to the NSC. These checks will specificallyverify: •Accuracy of program begin dates and program enrollment effective dates, •Accuracy and timeliness of campus-level enrollment status changes, and •Compliance with the 30-day/60-day federal reporting requirement. 5.Monitoring of NSC Transmission and NSLDS Reporting Timelines The University will monitor NSC transmission cycles and verify that all required enrollment changesare submitted in time to meet federal requirements under 34 CFR 685.309. 6.Updated Procedures and Staff Training Revised procedures outlining updated deadlines, reporting expectations, and QC steps will bedocumented and shared with all Enrollment, Registrar, and Deans. Targeted training will beprovided to ensure consistent and accurate implementation of these requirements. Anticipated Completion Date: The University intends to institute these beginning of January of 2026.

2024-002

Federal Program Information: Student Financial Assistance Cluster: Federal Direct Loan Program (Assistance Listing #84.268) Criteria or Specific Requirement:N. Special Tests and Provisions – Award notification: Federal regulation 34 CFR 668.165 states if an institution credits a student ledger account with Direct Loan, Federal Perkins Loan, or TEACH Grant program funds, the institution must notify the student or parent of (i) The anticipated date and amount of the disbursement; (ii) The student's or parent's right to cancel all or a portion of that loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement and have the loan proceeds or TEACH Grant proceeds returned to the Secretary; and (iii) The procedures and time by which the student or parent must notify the institution that he or she wishes to cancel the loan, loan disbursement, TEACH Grant, or TEACH Grant disbursement, (3)(i) No earlier than 30 days before, and no later than 30 days after, crediting the student's ledger account at the institution, if the institution obtains affirmative confirmation from the student. Condition: The University did not send an award disbursement notification to the student borrower within the required timeframe. Cause: Administrative oversight. Effect or Possible Effect: The University was not in compliance with required federal guidelines. Questioned Costs: None. Context: Award Disbursement Notification: For 1 of 25 direct loan disbursements tested, the university did not provided timely notification to the student of (1) the date and amount of the disbursement; (2) the student's/parent's right to cancel; and (3)the procedure and time by which the student or parent must notify the institution that he or she wishes to cancel. Identification of Repeat Finding: No. Recommendation: The University should implement procedures to ensure that award notifications are reported in a timely manner. Views of Responsible Officials: Incident Response and Process Impact Assessment: •Develop a standard protocol for identifying and reviewing business processes that may be impactedduring or after a data security event. •Document any suspended or delayed processes duringan incident and report to IT and follow-up. • Conduct a post-incident reconciliation of all financial aid transactions (disbursements, notifications, adjustments) to ensure completeness and compliance. • Collaborate with IT to include critical Student Account processes in the business continuity and recovery plan, ensuring prioritized restoration after any system outage or data event.

Individuals Responsible for Corrective Action Plan: •Director of Student Accounts •IT Systems Administrator •CIO •Senior Director of Student Administration and Compliance Cause: The notification for this student was not generated due to timing and process gaps associated with the data security incident that occurred on July 30, 2024. The disbursement posted on Thursday, July 25, one day after the automated report selection window closed. As the team worked to assess the impact of the security incident, this process was not reviewed and this record fell outside of the reporting cycle and was not manually identified for notification. Management’s Corrective Action Plan: Incident Response and Process Impact Assessment: •Develop a standard protocol for identifying and reviewing business processes that may beimpacted during or after a data security event. •Document any suspended or delayed processes during an incident and report to IT andfollow-up. •Conduct a post-incident reconciliation of all financial aid transactions (disbursements,notifications, adjustments) to ensure completeness and compliance. •Collaborate with IT to include critical Student Account processes in the business continuityand recovery plan, ensuring prioritized restoration after any system outage or data event. Anticipated Completion Date: 2/9/2026

Federal Program Information: Student Financial Assistance Cluster: Federal Perkins Loans (Assistance Listing # 84.038) Criteria or Specific Requirement: N. Special Tests and Provisions – Perkins Loan Recordkeeping and Record Retention: Federal regulation 34 CFR 674.19.(e) states an institution shall keep the original promissory notes and repayment schedules until the loans are satisfied. If required to release original documents in order to enforce the loan, the institution must retain certified true copies of those documents. Condition: The University did not maintain copies of student’s promissory notes for the required timeframe. Cause: Administrative oversight. Effect or Possible Effect: The University was not in compliance with required federal guidelines. Questioned Costs: None. Context: Based on a sample of 10 Perkins Loans tested, 2 instances of a student’s Perkins master promissory note was not retained by the university as required. Identification of Repeat Finding: Yes, see finding 2024-004. Recommendation: The University should implement procedures to ensure that Perkins promissory notes are properly maintained. Views of Responsible Officials: The following steps outline the corrective actions that will be taken to resolve this issue: 1.Contact the Borrower - Life University will initiate contact with the borrower to inform them of the need to update or establish a new MPN or equivalent documentation. This will be done via the following communication channels: •Phone call (if available) •Email notification •Postal mail (if no response is received through other means) 2.Provide Clear Instructions for Documentation - The university will send a formal notice to the borrower detailing the need for a new MPN or equivalent documentation. This will include instructions on how to sign the new agreement, the importance of the MPN, and a clear explanation of the implications for the outstanding loan amount. 3. Reassign Collection Rights - Once the borrower has completed the required documentation, Life University will work with ECSI to reassign the university’s right to collect on the remaining balance. 4. Documentation Review and Verification - After the MPN is completed by the borrower, Life University will review the new MPN for completeness and accuracy. This review will ensure that the terms are correctly documented, that the borrower’s consent is properly obtained, and that the right to collect on the outstanding amount is clearly assigned. 5. Update Financial Records - Life University will update its financial records to reflect the new MPN and the re-assigned collection rights. The university will also ensure that any outstanding amounts and repayment schedules are updated accordingly. 6. Ongoing Communication and Monitoring - The university will maintain communication with the borrower throughout the process, providing reminders if necessary.

Individuals Responsible for Corrective Action Plan: •Collections Coordinator •Director of Student Accounts Condition: Life University transitioned from UAS services to ECSI. In the transition of that service provides, documentation that was to be maintained to remain compliant with the Federal Perkins loan program was lost. The university has attempted on numerous occasions to assign the defaulted loans using alternative documentation to verify the debt. All attempts have been denied. The university has now been in practice with the current corrective action plan to address the deficiencies in documentation and reestablish the validity of the debt. Management’s Corrective Action Plan: Life University has implemented and continues to maintain the following corrective measures to ensure ongoing compliance: 1.Borrower Contact and Notification Life University has initiated and continues to conduct proactive outreach to borrowersrequiring an updated or newly established MPN (Master Promissory Note) or equivalentdocumentation. Communication is conducted through multiple channels, including: •Phone •Email 2.Clear Documentation Instructions The University will continue to issue formal notices to affected borrowers outlining therequirement for a new MPN or equivalent documentation. Each notice includes step-by-stepinstructions for completion, a clear explanation of the purpose and importance of the MPN,and information regarding its impact on the borrower’s outstanding loan balance. 3.Reassignment of Collection Rights Upon borrower completion of the required documentation, Life University has coordinatedwith ECSI to reassign the University’s right to collect on any remaining balances. This processcontinues to be applied as additional borrowers complete their documentation. 4.Documentation Review and Verification The University has established and continues to follow a review process to verify that eachnew MPN is complete, accurate, and properly executed. This ensures that borrower consentis valid and that all collection rights are appropriately reassigned. 5.Financial Record Updates Life University has updated and continues to maintain accurate financial records reflectingthe new MPNs and reassigned collection rights. Outstanding amounts, repayment schedules,and related data are verified and recorded to ensure consistency with federal andinstitutional requirements. 6.Ongoing Communication and Monitoring The University continues to monitor borrower compliance and maintain communicationthroughout the process. Regular follow-ups and reminders are sent as needed to ensuretimely completion and documentation integrity. At the conclusion of a 12 month outreach,students who have not verified their debt to come within compliance will be written off. Anticipated Completion Date: ongoing

2024-004

Federal Program Information: Student Financial Assistance Cluster: Federal Supplemental Education Opportunity Grants (Assistance Listing #84.007), Federal Work-Study Program (Assistance Listing #84.033), Federal Pell Grant Program (Assistance Listing #84.063), Federal Direct Loan Program (Assistance Listing #84.268) Criteria or Specific Requirement: N. Special Tests and Provisions – Enrollment Reporting: Federal regulation 34 CFR 685.309 states that the institution shall accurately report a change in a student’s enrollment status directly to the lender or guarantee agency within 30 days if a student has graduated, withdrawn, or ceased to be enrolled (or failed to enroll) at least half-time and the school does not expect its next Roster File to NSLDS within 60 days. Condition: The University did not report students’ status changes accurately and within the required timeframe. Cause: Administrative oversight. Effect or Possible Effect: The University was not in compliance with required federal guidelines. Questioned Costs: None. Context: Program Level: Based on a sample of 25 students, 1 student’s program begin date was not accurately reported to the NSLDS. Campus Level: Based on a sample of 25 students, 2 students selected were not reported to the NSLDS within the required timeframe. Identification of Repeat Finding: This is a new finding for FY2024. Recommendation: The University should implement procedures to ensure that student status changes are reported in a timely manner. Views of Responsible Officials: The University will report to the National Student Clearing (NSC) House using regularly scheduled enrollment reports every 30 days. Suppose a student’s enrollment status is not captured in the regularly scheduled enrollment reports with the NSC. In that case, the enrollment reporting will be reported directly to the National Student Loan Database Service(NSLDS), such as after the end of the term once grades are processed. The enrollment reporting in which a student receives a failing grade of all “Fs” for a quarter will be adjusted to meet the reporting time frame.

Individuals Responsible for Corrective Action Plan: Jana Holwik- Chief Academic Officer Elizabeth Geisz- Registrar Melissa Waters- Senior Director of Student Administration and Compliance Condition: Federal regulation 34 CFR 685.309 states that the institution shall accurately report a change in a student’s enrollment status directly to the lender or guarantee agency within 30 days if a student has graduated, withdrawn, or ceased to be enrolled (or failed to enroll) at least half-time and the school does not expect its next Roster File to NSLDS within 60 days. Management’s Corrective Action Plan: The University will report to the National Student Clearing (NSC) House using regularly scheduled enrollment reports every 30 days. Suppose a student’s enrollment status is not captured in the regularly scheduled enrollment reports with the NSC. In that case, the enrollment reporting will be reported directly to the National Student Loan Database Service (NSLDS), such as after the end of the term once grades are processed. The enrollment reporting in which a student receives a failing grade of all “Fs” for a quarter will be adjusted to meet the reporting time frame. Anticipated Completion Date: January 1st, 2025

Federal Program Information: Student Financial Assistance Cluster: Federal Supplemental Education Opportunity Grants (Assistance Listing #84.007), Federal Work-Study Program (Assistance Listing #84.033), Federal Pell Grant Program (Assistance Listing #84.063), Federal Direct Loan Program (Assistance Listing #84.268) Criteria or Specific Requirement: N. Special Tests and Provisions – Disbursement to or on Behalf of Students: Federal regulation 88 FR 41092 states an institution must submit Pell Grant, Iraq and Afghanistan Service Grant, Direct Loan, and TEACH Grant disbursement records to COD, no later than 15 days after making the disbursement or becoming aware of the need to adjust a previously reported disbursement. Condition: The University did not report student’s direct loan disbursement to the COD within the required timeframe. Cause: Administrative oversight. Effect or Possible Effect: The University was not in compliance with required federal guidelines. Questioned Costs: None. Context: Direct Loan COD disbursement: Based on a sample of 25 Direct loan disbursements tested, 1 instance of a student’s Direct Loan disbursement was not reported to COD within 15 days as required. Identification of Repeat Finding: This is a new finding for FY2024. Recommendation: The University should implement procedures to ensure that student status changes are reported in a timely manner. Views of Responsible Officials: After speaking with a Common Origination and Disbursement (COD) system representative, she stated that schools will receive a Warning Edit 055 when record of disbursement has not been received after 30 days. She verified that we did not receive this Warning Edit 055 from COD because we had not exceeded 30 days. The COD rep went on to share that this 15-day regulation used to be a 30-day regulation, but COD has not updated their Warning Edit 055 process to notify schools. It’s only done after 30 days. COD rep did identify a report Michelle will run to identify anyone who is not showing up with a disbursement record prior to the 15 days. The COD report is called the Anticipated Disbursement Queue and will be ran every 14 days to identify any potential issues.

Individuals Responsible for Corrective Action Plan: Michelle Nixon- Assistant Director of Financial Aid Systems. Melissa Waters- Senior Director of Student Administration and Compliance Condition: Finding related to disbursement record to Common Origination and Disbursement (COD) system in excess of 15 days This student’s disbursement occurred on 10/2/23 and LU verified that a disbursement record was sent to COD on 10/2/23; however, this student was not included in that record. We are unable to determine why the student was not included in that disbursement record. We send up disbursement records to COD 3 times a week. The student’s disbursement was transmitted to COD on 10/20/23. Management’s Corrective Action Plan: After speaking with a Common Originations and Disbursement (COD system representative, she stated that schools will receive a Warning Edit 055 when record of disbursement has not been received after 30 days. She verified that we did not receive this Warning Edit 055 from COD because we had not exceeded 30 days. The COD rep went on to share that this 15-day regulation used to be a 30-day regulation, but COD has not updated their Warning Edit 055 process to notify schools. It’s only done after 30 days. COD rep did identify a report Michelle will run to identify anyone who is not showing up with a disbursement record prior to the 15 days. The COD report is called the Anticipated Disbursement Queue and will be ran every 14 days to identify any potential issues. Anticipated Completion Date: January 1st, 2025

Federal Program Information: Student Financial Assistance Cluster: Federal Perkins Loans (Assistance Listing # 84.038) Criteria or Specific Requirement: N. Special Tests and Provisions – Perkins Loan Recordkeeping and Record Retention: Federal regulation 34 CFR 674.19.(e) states an institution shall keep the original promissory notes and repayment schedules until the loans are satisfied. If required to release original documents in order to enforce the loan, the institution must retain certified true copies of those documents. Condition: The University did not maintain copies of student’s promissory notes for the required timeframe. Cause: Administrative oversight. Effect or Possible Effect: The University was not in compliance with required federal guidelines. Questioned Costs: None. Context: Based on a sample of 25 Perkins Loans tested, 2 instances of a student’s Perkins master promissory note was not retained by the university as required. Identification of Repeat Finding: This is a new finding for FY2024. Recommendation: The University should implement procedures to ensure that Perkins promissory notes are properly maintained. Views of Responsible Officials: The following steps outline the corrective actions that will be taken to resolve this issue: 1. Contact the Borrower - Life University will initiate contact with the borrower to inform them of the need to update or establish a new MPN or equivalent documentation. This will be done via the following communication channels: • Phone call (if available) • Email notification • Postal mail (if no response is received through other means) 2. Provide Clear Instructions for Documentation - The university will send a formal notice to the borrower detailing the need for a new MPN or equivalent documentation. This will include instructions on how to sign the new agreement, the importance of the MPN, and a clear explanation of the implications for the outstanding loan amount. 3. Reassign Collection Rights - Once the borrower has completed the required documentation, Life University will work with ECSI to reassign the university’s right to collect on the remaining balance. 4. Documentation Review and Verification - After the MPN is completed by the borrower, Life University will review the new MPN for completeness and accuracy. This review will ensure that the terms are correctly documented, that the borrower’s consent is properly obtained, and that the right to collect on the outstanding amount is clearly assigned. 5. Update Financial Records - Life University will update its financial records to reflect the new MPN and the re assigned collection rights. The university will also ensure that any outstanding amounts and repayment schedules are updated accordingly. 6. Ongoing Communication and Monitoring - The university will maintain communication with the borrower throughout the process, providing reminders if necessary.

Individuals Responsible for Corrective Action Plan: Collections Coordinator (Victoria Beeston)- Responsible for initiating contact with the borrower, providing documentation instructions, and reviewing completed forms. Director of Student Accounts (Ti Jolly)- Responsible for ensuring compliance with all applicable regulations and reviewing the re-assignment documentation. ECSI (Angela Johnson)- Responsible for updating financial records and confirming the reassignment of collection rights. Condition: Federal regulation 34 CFR 674.19(e) and 34 CFR 674.31 indicates that the institution is responsible for creating and maintaining the Master Promissory Note to indicated specifications. The university has found that the existing Master Promissory Note (MPN) or equivalent documentation that acknowledges the debt is either incorrect, incomplete, or missing. Management’s Corrective Action Plan: The following steps outline the corrective actions that will be taken to resolve this issue: 1. Contact the Borrower - Life University will initiate contact with the borrower to inform them of the need to update or establish a new MPN or equivalent documentation. This will be done via the following communication channels: • Phone call (if available) • Email notification • Postal mail (if no response is received through other means) 2. Provide Clear Instructions for Documentation - The university will send a formal notice to the borrower detailing the need for a new MPN or equivalent documentation. This will include instructions on how to sign the new agreement, the importance of the MPN, and a clear explanation of the implications for the outstanding loan amount. 3. Reassign Collection Rights - Once the borrower has completed the required documentation, Life University will work with ECSI to reassign the university’s right to collect on the remaining balance. 4. Documentation Review and Verification - After the MPN is completed by the borrower, Life University will review the new MPN for completeness and accuracy. This review will ensure that the terms are correctly documented, that the borrower’s consent is properly obtained, and that the right to collect on the outstanding amount is clearly assigned. 5. Update Financial Records - Life University will update its financial records to reflect the new MPN and the re-assigned collection rights. The university will also ensure that any outstanding amounts and repayment schedules are updated accordingly. 6. Ongoing Communication and Monitoring - The university will maintain communication with the borrower throughout the process, providing reminders if necessary. Verification of Effectiveness: Upon completion of the corrective actions, the university will verify that: • The borrower has submitted the new MPN or equivalent documentation. • The collection rights have been successfully reassigned. • Financial records have been updated accurately. The university will conduct a follow-up review in February 2025 to verify the effectiveness of the corrective action plan and to ensure that no further issues remain. Anticipated Completion Date: January 1st, 2025

FINDING 2019-001 Information on Federal Program: Student Financial Assistance Cluster (84.007, 84.003, 87.063, 84.268) Criteria or specific requirement (including statutory, regulatory or other citation): Special Tests and Provisions - Award Notification: Institutions that implement an affirmative confirmation process must make this notification to the student or parent no earlier than 30 days before, and no later than 30 days after, crediting the students? account at the institution with Direct Loans, FPL funds, or TEACH Grants. Institutions that do not implement an affirmative confirmation process must notify a student no earlier than 30 days before, but no later than 7 days after, crediting the students? account and must give the student 30 days to cancel all or part of the loan. Condition: The University?s controls did not operate effectively, therefore, a student was not notified within the required time frame of 7 days after funding was received by the student. Cause: The report parameters used in the query that identifies students who received an award were changed without proper approval. Effect: The University is not in compliance with the award notification requirements. Questioned costs: None Context: One of the total 25 students selected for testing that received funding during the year ended June 30, 2019. Repeat Finding: This is a repeat finding from prior year. This was reported as finding 2018-001 in the 2018 report. Recommendation: We recommend that the University enhances its internal controls by implementing an approval for all queries that are utilized as part of the control environment. Specifically, we recommend that any changes to the query associated with award notifications should be approved by Melissa Waters, Director of Student Administrative Services. Views of responsible officials and planned corrective actions: As of August 22, 2019, the University expanded the time frame used in the query to identify which students to notify to ensure the system was properly capturing all students who received funding. Further, the University will implement an approval process for all changes to queries.

Notification of Disbursement is processed no later than 7 days after the students? account has been credit per regulations. The Director of Student Accounts receives an automated report weekly on Thursday mornings of all students who have received a loan disbursement within the last 7 days. Then an email is sent to students through a mail merge to their student.life.edu email notifying them the term, disbursement date, loan type and amount. In addition, the email informs the student about their rights to cancel their loan and the timeframe. The University will implement a review control to ensure all changes made to the query are properly reviewed and capture the applicable criteria. Individual Responsible for Corrective Action Phyllis Shropshire Student Accounts 770-426-2759 Student Account Procedures for Disbursement Notifications to students have been updated as of August 22, 2019.

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