2011-03-14T15:33:57-05:00 2010-09-30 BDO USA LLP 7101 Wisconsin Ave Suite 800 Bethesda MD 208144827 990 2009-10-01 581757969 Educational Funding of the South Inc EDUC 8653420684 501 Corporate Centre Drive No 320 Franklin TN 37067 Ron Gambill 8653420684 2011-03-14 1 Michael Sorrells CPA 3016544900 2009 2016-02-24 21:20:13Z EDSouth Ron Gambill 501 Corporate Centre Drive No 320 Franklin TN 37067 233352112 0 X www.edsouth.org X 1985 TN Acquisition and origination of student loans. 4 3 6 0 0 0 0 156176508 190982242 47165497 41537698 845329 832172 204187334 233352112 0 0 789789 893557 0 0 171889488 210727740 172679277 211621297 31508057 21730815 5157185919 4769291017 4984985133 4575359416 172200786 193931601 Educational Funding of the South, Inc. (the company) is a non-for-profit public benefit corporation formed in 1985. The company acquires and funds loans to students and parents of students throughout the United States pursuant to title IV of the Higher Education Act of 1965. 0 0 211309932 190982242 Acquisition of Student Loans made to students and parents pursuant to Title IV of the Higher Education Act of 1965, as amended. The amount of loans acquired during fiscal year 2010 was $14,366,087. 211309932 1 0 0 0 0 0 0 0 0 1 1 0 0 0 0 0 0 0 0 0 0 0 0 1 1 1 0 0 0 0 0 0 0 0 0 0 0 0 0 1 1 0 0 0 1 12 0 1 6 1 0 0 0 0 0 0 0 0 0 4 3 0 0 0 0 0 0 0 1 1 0 0 1 1 1 1 1 1 1 0 0 X Eric Stewart 8653420684 178 N Seven Oaks Dr Knoxville TN 37922 Ron Gambill 35.00 X X 325814 102019 20499 John Arnold 25.00 X X 298844 127068 15999 John Mays 0.20 X 10000 0 0 John Griess 0.20 X 9000 0 0 Mike Ragsdale 0.20 X 9000 0 0 Dwight Kessel 0.20 X 7000 11000 0 Bill Thompson 50.00 X 196460 14837 9923 Eric Stewart 50.00 X 5172 0 0 861290 254924 46421 3 0 1 0 Edfinancial Services 120 N Seven Oaks Drive Knoxville TN 37922 Student Loan Servicing 29064917 Morgan Stanley & Co Inc 1585 Broadway 4th Floor New York NY 10036 Bond Refinancing 8038793 RBC Capital Markets LLC RBC Plaza 60 S Sixth St Minneapolis MN 55402 Bond Remarketing 2141436 Nixon Peabody LLP 437 Madison Avenue New York NY 10022 Legal 1407614 CrossPoint Capital LLC 700 Alexander Park Suite 201 Princeton NJ 08540 Bond Remarketing 1271133 15 Borrower Interest 525990 189710694 189710694 Late Fee Income 525990 1271548 1271548 190982242 41537698 41537698 Miscellaneous 525990 832172 832172 832172 233352112 190982242 0 42369870 759627 516546 243081 80075 54451 25624 23201 15777 7424 3220 2190 1030 27434 18655 8779 31222811 31222811 1173960 1173960 345000 345000 361750 361750 420026 420026 5268 5268 11148 7581 3567 1314 1314 90846 90846 50693 34471 16222 17619 11981 5638 49682293 49682293 36332896 36332896 55236 55236 Dept of Education Inter 59901564 59901564 Consol Loan Rebate Fees 28184735 28184735 Bond Remarketing Fees 1521983 1521983 1348598 1348598 211621297 211309932 311365 0 215735809 308185427 98662452 83358576 4751149331 4286321716 218764 295174 172079 124947 35063 47132 91384500 91082992 5157185919 4769291017 50603947 47487903 2611725000 2355575000 276805958 2322656186 1895490555 4984985133 4575359416 X 172200786 193931601 172200786 193931601 5157185919 4769291017 X 0 1 1 X 1 1 X 288777160 266586070 260800838 156176508 190982242 1163322818 288777160 266586070 260800838 156176508 190982242 1163322818 0 0 0 1163322818 23151186 32458681 18763308 47165497 41537698 163076370 23151186 32458681 18763308 47165497 41537698 163076370 2775147 1396466 1382563 845329 832177 7231682 314703493 300441217 280946709 204187334 233352117 1333630870 0.87230 0.89040 0.12230 0.10370 X Schedule A, Part II, Line 12, Explanation of Other Income: Late Fee Income Miscellaneous 137769 119129 18640 34310 5818 28492 47132 Taxable Bonds 1870700000 Rebatable Earnings Payable 24668603 Other Liabilities 121952 1895490555 233352112 211621297 21730815 0 21730815 83150820 -24277225 -24277225 107428045 125924067 125924067 233352112 85697230 0 85697230 125924067 125924067 211621297 Part X: Description of Uncertain Tax Positions Under FIN 48: EDUCATIONAL FUNDING OF THE SOUTH, INC. ADOPTED FIN 48 AS OF JANUARY 1, 2007 AND UPDATED FIN 48 FOR YEAR ENDED Septembr 30, 2010, HOWEVER, THE ADOPTION AND SUBSEQUENT UPDATE OF FIN 48 DID NOT HAVE A MATERIAL EFFECT ON THE COMPANY'S FINANCIAL POSITION, THE CHANGES IN ITS NET ASSETS OR ITS CASH FLOWS. IN ACCORDANCE WITH FIN 48, THE COMPANY CLASSIFIES ANY INTEREST AND PENALTY EXPENSE IN INTEREST EXPENSE AND GENERAL AND ADMINISTRATIVE EXPENSE, RESPECTIVELY. Part XII, Line 2d - Other Adjustments: Amortization of loan funding and acquisition costs: -24277225. Part XII, Line 4b - Other Adjustments: Expense Reclass to Revenue: XXX-XX-XXXX. Part XIII, Line 4b - Other Adjustments: Expense Reclass to Revenue: XXX-XX-XXXX. X 1 1 X X X X X 0 0 0 1 1 0 0 0 0 Ron Gambill 209167 102019 110401 0 6246 0 15458 5041 0 0 341272 107060 0 0 John Arnold 183333 127068 110401 0 5110 0 9378 6621 0 0 308222 133689 0 0 Bill Thompson 156372 14837 35000 0 5088 0 9031 892 0 0 205491 15729 0 0 Part I, Line 1a Health club fees are paid per written policy and are paid once substantiated. Part I, Line 5 A portion of compensation was based on revenues of the company. Educational Funding of the South Inc 581757969 28148NBW2 2005-12-22 189775000 Student Loan Revenue Bonds 0 1 Educational Funding of the South Inc 581757969 28148xaA9 2003-10-10 124200000 Student Loan Revenue Bonds 0 1 Educational Funding of the South Inc 581757969 28148NCA9 2007-12-06 399000000 Student Loan Revenue Bonds 0 1 Educational Funding of the South Inc 581757969 28148XAU5 2007-11-07 600000000 Student Loan Revenue Bonds 0 1 Educational Funding of the South Inc 581757969 28148XAD3 2004-12-17 300000000 Student Loan Revenue Bonds 0 1 189858728 1897750 745938 2006 0 0 1 1 125244933 1907000 558581 2005 0 0 1 1 399183748 3465935 2106720 2007 1 0 1 1 605844731 2008 0 0 1 1 302020688 2691500 1257000 2006 0 0 1 1 0 0 0 0 0 1 0 0 0 0 0 1 0 0 0 0 0 1 0 0 0 0 0 1 0 0 0 0 0 1 1 1 0 1 AIG Matched Funding Corporation 34.000000000000 1 0 1 1 1 0 1 XL Asset Funding Company LLC 33.000000000000 1 1 0 0 1 0 0 1 0 0 1 0 0 1 0 0 1 0 1 aIG Matched Funding Corporation 33.000000000000 1 1 0 Educational Funding of the South Inc 581757969 28148XAJ0 2005-12-21 300000000 Student Loan Revenue Bonds 0 1 Educational Funding of the South Inc 581757969 28148NBh5 2003-08-28 336000000 Student Loan Revenue Bonds 0 1 Educational Funding of the South Inc 581757969 28148NBq5 2004-12-16 215400000 Student Loan Revenue Bonds 0 1 302392512 2582250 1210000 2007 0 0 1 1 337468081 2006 0 0 1 1 215676869 2005 0 0 1 1 0 0 0 0 0 1 0 0 0 0 0 1 0 0 0 0 0 1 1 1 0 1 aIG Matched Funding Corporation 33.000000000000 1 1 0 0 1 0 1 aIG Matched Funding Corporation 1.000000000000 1 1 0 0 1 0 0 0 1 Form 990, Part VI, Section B, line 11 THE CONTROLLER AND CEO OF EDUCATIONAL FUNDING OF THE SOUTH, INC., REVIEW THE 990 PRIOR TO IT BEING FILED. A FINAL COPY OF THE 990 IS PROVIDED TO EACH BOARD MEMBER PRIOR TO IT BEING FILED. Form 990, Part VI, Section B, line 12c ALL EMPLOYEES OF EDUCATIONAL FUNDING OF THE SOUTH, INC., ARE REQUIRED TO SIGN A CONFLICT OF INTEREST STATEMENT EACH YEAR STATING THAT THERE ARE NO DUTIES OR RESPONSIBILITIES THAT ARE MUTUALLY INCOMPATIBLE OR THAT THERE ARE NO DIRECT OF INDIRECT FINANCIAL INTERESTS. IF A POTENTIAL ACTIVITY IS IN QUESTION OR AN EMPLOYEE IN DOUBT, THEY SHOULD DISCUSS WITH THEIR MANAGER, THE PRESIDENT, OR CHAIRMAN OF THE BOARD. IF THE BOARD OF DIRECTORS HAS REASONABLE CAUSE TO BELIEVE THAT A DIRECTOR, OFFICER, OR AN EMPLOYEE HAS FAILED TO DISCLOSE AN ACTUAL OR A POSSIBLE CONFLICT OF INTEREST, IT SHALL INFORM THE DIRECTOR OR OFFICER OF THE BASIS FOR SUCH BELIEF AND AFFORD THE DIRECTOR, OFFICER, OR EMPLOYEE AN OPPORTUNITY TO EXPLAIN THE ALLEGED FAILURE TO DISCLOSE. IF IT IS DETERMINED THAT THE DIRECTOR, OFFICER, OR EMPLOYEE HAS IN FACT FAILED TO DISCLOSE AN ACTUAL OR POSSIBLE CONFLICT OF INTEREST, THE BOARD OF DIRECTORS SHALL CONSIDER APPROPRIATE DISCPLINARY AND CORRECTIVE ACTION. IF A CONFLICT IS FOUND TO EXIST OR OTHERWISE DISCLOSED, THE RELEVANT BOARD MEMBER IS PRECLUDED FROM VOTING AND PROHIBITED FROM INFLUENCING THE VOTE ON ANY MATTER TO WHICH THE CONFLICT RELATES. Form 990, Part VI, Section B, line 15a THE PROCESS FOR DETERMINING COMPENSATION FOR CEO, PRESIDENT BEGAN IN 2006. THE BOARD OF DIRECTORS USES OUTSIDE CONSULTANTS IN DETERMINING THE COMPENSATION FOR THE ABOVE POSITIONS BY COMPARING COMPENSATION PAID TO OTHER COMPARABLE SIZED NON-PROFITS. A COMPENSATION COMMITTEE COMPRISED FROM MEMBERS OF THE BOARD OF DIRECTORS USES THE COMPENSATION INFORMATION FROM OUTSIDE CONSULTANTS IN DETERMINING THE COMPENSATION. THERE IS AN ANNUAL REVIEW OF COMPENSATION BY THE COMMITTEE. EXECUTIVE MANAGEMENT ALSO EVALUATES PERFORMANCE OF OTHER OFFICERS AND KEY EMPLOYEES IN CONNECTION WITH MARKET FACTORS TO ADJUST COMPENSATION. EFS FOLLOWED THIS POLICY FOR THE YEAR ENDED 9/30/10. SEE SCHEDULE O STATEMENT FOR PART VII AND SCHEDULE J FOR ADDITIONAL INFORMATION. Form 990, Part VI, Section C, line 19 EDUCATIONAL FUNDING OF THE SOUTH, INC PROVIDES COPIES OF ITS GOVERNING DOCUMENTS, CONFLICT OF INTEREST POLICY, AND FINANCIAL STATEMENTS UPON REQUEST AT ITS KNOXVILLE TN LOCATION. Form 990, Part XI, Line 2c Oversight of audit There have been no changes during the year in the process for oversight of the audit of the financial statements. Reasonable Cause Statement The organization has reasonable cause for penalties to be abated for late filing of it 2009 form 990. The organization has always relied upon its accounting firm to file its extensions. For the 2009 tax year, the organization changed accounting firms at the end of its tax year. The new accounting firm, by a simple administrative error did not get this new client on its tax due date sytem and thus the first extension was not prepared or filed by 2/15/11. As soon as this mistake was discovered, the organization and its accounting firm made a good faith effort to prepare and file the return as fast as it could. The organization does not have a history of late filing. There is no harm to the government since the Form 990 is an informational return with no tax being due. Payment of penalties would divert funds that could better be used in the organizations exempt purpose of providing student loans and thus easing the burden of government and providing a benefit to society. EFS Volunteer LLC 501 Corporate Centre Drive Suite 32 Franklin TN 37067 Acquiring and financing student loan activities DE -492000 224970000 Educational Funding of the South Inc EFS Conduit Funding LLC 501 Corporate Centre Drive Suite 32 franklin TN 37067 funding note issuer DE 184000 54616000 Educational Funding of the South Inc EFS Interim Funding LLC 501 Corporate Centre Drive Suite 32 franklin TN 37067 Temporary Debt Holding DE 972694 18365 Educational Funding of the South Inc Educational Services of America Inc 104 N Seven Oaks Drive Knoxville TN 37922 621586836 Loans TN 501(c)(3) Line 9 N/A 0 0 0 0 0 1 0 0 0 1 0 0 0 1 0 0 0 0