Consolidated Statement of Cash Flows

Net Cash Provided (Used) by Operating Activities

Operating Cash Provided

     Operating Claims Collected                             $2,013,058      Loan Origination and Other Fees                         1,146,894      Interest Income, Federal                                  804,695      Interest and Penalty Income, Non-Federal                   51,808      Other Operating Cash Provided                                 295                                                              ---------           Total Operating Cash Provided                      4,016,750 

Operating Cash Used

     Interest and Penalties, Non-Federal                           (54)      Interest, Federal                                        (525,993)      Default Claim Payments                                 (2,521,173)      Interest Subsidy Payments                              (2,185,647)      Special Allowance Payments                               (615,496)      Mandatory Administrative Expenses                        (257,862)      Grant, Advances, and Contributions                    (25,014,693)      Salaries and Benefits                                    (308,682)      Rent, Communications, and Utilities                       (53,444)      Contractual Program Services                             (658,288)      Printing and Reproduction                                 (15,718)      Travel and Transportation                                 (11,954)      Materials, Supplies, and Equipment                        (21,679)      Guaranty Agency Collection Fees                          (285,376)      Other Operating Cash Used                                  (4,585)                                                             -----------           Total Operating Cash Used                        (32,480,644)  Net Operating Cash Used by Operating Activities            (28,463,894) 

Cash Provided (Used) by Investing Activities

     Collection of Advances                                        750      Loan Repayments Received                                   73,847      Loan Disbursements                                     (3,267,940)                                                             ----------- Net Cash Used by Investing Activities                       (3,193,343) 

Cash Provided (Used) by Financing Activities

     Appropriated Funds Received                            33,274,634      Appropriations Transferred from Others                     34,218      Appropriated Funds Returned                              (875,040)                                                             -----------           Net Appropriations                                32,433,812      Repayments to U.S. Treasury for Borrowings               (759,319)      Borrowing from U.S. Treasury                            4,892,496                                                             ----------- Net Cash Provided by Financing Activities                   36,566,989  Net Cash Provided by Operating, Investing, and Financing Activities                                     4,909,752  Fund Balances with U.S. Treasury, Beginning of Year         34,465,500                                                             ---------- Fund Balances with U.S. Treasury, End of Year              $39,375,252 

Reconciliation of Net Operating Activity Before
Appropriations to Net Cash Used by Operating Activity

Net Operating Activity                                    $(29,355,915)                                                           -------------      Adjustments to Reconcile Net Operating Activity      to Net Cash Used by Operating Activities:
      Allowance for Subsidy                                     507,069      Changes in:           Decrease (Increase) in Credit Program             Receivable, Net:                Defaulted Guaranteed Loans                      301,843                Direct Loans                                    (66,552)                Facilities Loans                                (14,032)           Decrease in Advances to Guaranty Agencies, Net             1           Increase in Accounts Receivable, Net                  (2,123)           Decrease in Advances and Prepayments                  59,808           Increase in Other Receivables, Net                   (39,267)           Increase in Interest Payable to U.S. Treasury          1,910           Increase in Liabilities for Loan Guarantees           81,529           Increase in Accrued Grant Liability                   16,501           Increase in Accrued Contractual Services Liability    12,136           Increase in Accrued Salaries and Benefits            (10,980)           Increase in Other Accrued Liabilities                 42,799           Increase in Accrued Workers Compensation Liability     1,379                                                                -------- Net Adjustments                                                892,021                                                             ----------- Net Cash Used by Operating Activities                     $(28,463,894)  Supplemental Schedule of Noncash Investing Activities
           School disbursements included in accounts payable   $(18,450)           Writeoff of Principal/Adjustments/Cancellations         (833)           Interest Capitalized to Principal                      1,190                                                            ------------                Total Supplemental Schedule of                  Noncash Investing Activities                 $(18,093) 

NOTE: The accompanying notes are an integral part of these statements
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[Consolidated Statement of Operations and Changes in Net Position]

[Notes to Principal Financial Statements]