FINANCING RECEIVABLES

9 Months Ended

Mar. 31, 2016

NOTE 5: FINANCING RECEIVABLES

DeVry Group’s institutional loan programs are available to students at its AUC, RUSM, RUSVM, Chamberlain, Carrington and DeVry University institutions. These loan programs are designed to assist students who are unable to completely cover educational costs by other means. These loans may be used for tuition, books and fees and are available only after all other student financial assistance has been applied toward those purposes. In addition, AUC, RUSM and RUSVM loans may be used for students’ living expenses. Repayment plans for institutional loan program balances are developed to address the financial circumstances of the particular student. Interest charges accrue each month on the unpaid balance. Chamberlain, Carrington and DeVry University require that students begin repaying loans while they are still in school with a minimum payment level designed to prove their capability to repay and reduce the possibility of over borrowing and targeted to minimize interest being accrued on the loan balance. Payments may increase upon completing or departing the program. After a student leaves school, the student typically will have a monthly installment repayment plan. In addition, the Becker CPA Review Course can be financed through Becker with a zero percent, 18-month term loan program.

Reserves for uncollectible loans are determined by analyzing the current aging of accounts receivable and historical loss rates of loans at each institution. Management performs this analysis periodically throughout the year. Since all of DeVry Group’s financing receivables are generated through the extension of credit to students to fund educational costs, all such receivables are considered part of the same loan portfolio.

The following table details the institutional loan balances along with the related allowances for credit losses as of March 31, 2016 and 2015 (in thousands).

	As of March 31,
	2016				2015
Gross Institutional Student Loans			$	71,915			$	67,199

Allowance for Credit Losses

Balance at Beginning of Period	$	(20,630)			$	(19,868)
Charge-offs and Adjustments		6,290				7,798
Recoveries		(141)				(618)
Additional Provision		(5,691)				(7,193)
Balance at End of Period				(20,172)				(19,881)

Net Institutional Student Loans			$	51,743			$	47,318

Amounts as of March 31, 2015 have been revised from those reported in the third quarter of fiscal year 2015 for correction of errors in the table.

Of the net balances above, $25.9 million and $23.1 million were classified as Accounts Receivable, Net in the Consolidated Balance Sheets at March 31, 2016 and 2015, respectively, and $25.8 million and $24.2 million, representing amounts due beyond one year, were classified as Other Assets in the Consolidated Balance Sheets at March 31, 2016 and 2015, respectively.

The following tables detail the credit risk profiles of the institutional student loan balances based on payment activity and provide an aging analysis of past due institutional student loans as of March 31, 2016 and 2015 (in thousands).

	As of March 31,
	2016		2015
Institutional Student Loans:
Performing	$	52,775	$	49,573
Nonperforming		19,140		17,626
Total Institutional Student Loans	$	71,915	$	67,199

							Greater						Total
	30-59		60-89		90-119		Than 120						Institutional
	Days Past		Days Past		Days Past		Days Past		Total Past				Student
	Due		Due		Due		Due		Due		Current		Loans
Institutional Student Loans:
March 31, 2016	$	5,882	$	2,896	$	1,130	$	19,140	$	29,048	$	42,867	$	71,915
March 31, 2015	$	4,321	$	1,554	$	1,217	$	17,626	$	24,718	$	42,481	$	67,199

Loans are considered nonperforming if they are more than 120 days past due. At March 31, 2016, nonperforming loans totaled $19.1 million, of which $18.8 million had a specific allowance for credit losses. At March 31, 2015, nonperforming loans totaled $17.6 million, of which $15.9 million had a specific allowance for credit losses.