Foundation for Educational Services Inc.

“Voting members of the governing body elizabeth koop and randy heesacker are not board members of fes. They are part of the retirement plan committee. They do not vote on normal board matters and generally do not attend board meetings. As such, they are not considered voting members of the governing body and are not counted here but are still disclosed on part vii.”

“Guy sanders, member of the fes board, is father to elizabeth koop who serves as president of educationquest and member of the retirement plan committee.”

“The 990 is prepared by the external accountants, reviewed by cfo or other appropriate staff, and mailed to all board members. The 990 is presented to the audit committee and the board.”

“Process for monitoring compliance with conflict of interest policy fes maintains a comprehensive conflicts of interest policy for directors and officers. The policy exists to identify potential instances in which an individual could obtain a direct or indirect personal gain or advantage to the detriment of the organization, or where an individual's conduct could have an adverse or potentially adverse effect on the interests of the organization. The policy contains an affirmative duty to disclose, as well as a specific process for disclosures of potential conflicts of interest, a protocol in which independent, outside legal counsel is used to evaluate whether a conflict exists, procedures for addressing actual conflicts of interest, and consequences for violations of the policy. The policy requires all directors and officers to complete and submit an annual conflicts disclosure form to outside legal counsel. In addition, the conflict of interest policy is included in the employee handbook which all employees must acknowledge and agree to abide by.”

“Review of ceo or top mgmt official compensation outside legal counsel undertakes a comprehensive evaluation of the compensation and benefits packages for officers and other affected employees of the organization, comparing the same to relevant industry and other market comparables. Counsel then provides to the board of directors a summary of the comparability data, an analysis of the data relative to the organizational employees, and a reasoned opinion concerning his conclusion. The board of directors then confirms and ratifies all compensation/benefits packages, with the decision process properly documented as required by the regulations. On a routine basis we engage an independent compensation specialist to provide comparable data for key positions.”

“Review of other officer or key employees compensation same as line 15a”

“Governing documents available to the public fes does not make its governing documents, conflict of interest policy, or financial statements available to the public.”

“Fes provides marketing and security consulting services. These activities are considered unrelated business income.”

“Program service expenses ----------------- maintenance 30,373 taxes 15,201 pension plan administration 1,810 fees and charges 4,168 business development 40,815 charitable contributions 15,858 miscellaneous 29,309 sponsorships 500 consulting fees 91,245 dues and subscriptions 7,146 other expenses 51,375 postage and freight 63,151 printing and publications 11,454 registration fees 48,888 meals and entertainment 19,122 expense reimbursement (376,607) software expense 115,249 security services 3,436 ` ----------------- total 172,493”