The following information should be read in conjunction with "Selected Financial Data" contained in Item 6 of this Report, our consolidated financial statements and the notes thereto contained in Item 8 of this Report, the "Cautionary Notice Regarding Forward-Looking Statements" contained in Part 1 of this Report, "Risk Factors" contained in Item 1A of this Report, and the other information appearing elsewhere in, or incorporated by reference into, in this Report.

Overview

We are a career-focused post-secondary education services company. Our mission is to demonstrate a "we care" philosophy by preparing career-focused, community-minded graduates for the global workforce. We care about our students, our employees, and about the employers who hire our students. We strive to help our students build knowledge and skills for a specific career field, make professional connections through service learning experiences, and provide them with placement assistance.

We work to fulfill this mission by offering a variety of academic programs through Broadview University. Broadview University is accredited to award diplomas, undergraduate degrees, and master's degrees in various fields of study. The University delivers these programs through traditional classroom settings as well as through online instruction. Our campuses are located in the Utah cities of Layton, Orem, Salt Lake City and West Jordan, as well as Boise, Idaho. Our mission places the achievement of our students first, demonstrating the Company's focus on delivering a high quality product.

Key Financial Metrics and Trends

We are committed to a long-term program of sustainable revenue growth. We have endured a significant downturn in profitability over the past three fiscal years. Failure to successfully implement the strategies addressed in the following discussion of key financial metrics and trends could have a negative impact on our revenues, financial condition, results of operations and cash flows.

We believe our enrollments are influenced by a number of factors, including, but not limited to:

? the attractiveness of our program offerings;

? our ability to offer flexible class scheduling;

? the relative cost of our educational services compared to competitors;

? our mix of residential and online course offerings;

? the effectiveness of our marketing and recruiting efforts;

? the availability of federal and other financial aid;

? general economic conditions in the regions we operate; and

? the regulatory environment of our industry.

Set forth below are average enrollment, total credits billed and average tuition rates for the last two years:

                                    Years ended March 31,
                                     2014             2013
Average enrollment                        781            979
% Change from prior year                (20.2 )%       (16.9 )%

Credits billed                         32,745         35,810
% Change from prior year                 (8.6 )%       (15.7 )%

Average tuition cost per credit   $       403       $    430

Since October 2010, we opened two branch campuses, including our first campus outside the state of Utah. Despite these openings, Broadview University's average enrollment has declined over the past three years. We continue to experience declining new enrollments and average student population, a trend that has been evident throughout the for-profit post-secondary industry for the past few years. This industry-wide downturn has come after several years of industry growth, and thus the competition for high-quality leads has increased. Declining enrollments have adversely impacted our revenues, financial condition, results of operations and cash flows. We expect this trend to continue in the near term.

Additionally, our nursing program operated out of our West Jordan campus voluntarily ceased enrolling new students effective November 2011, in response to a warning letter from the Utah State Board of Nursing stating that our nursing graduates' average pass rate on the National Council Licensure Examination ("NCLEX") was not meeting required regulatory levels set by the Utah Administrative Code. After we did not achieve the mandated test score levels during a probationary period, we received formal communication from the Licensing Division that Broadview shall immediately begin transferring the majority of its nursing students to another institution pursuant to a teach-out agreement between Broadview and that institution. Broadview's nursing program effectively ceased operations on December 31, 2012. This action has adversely impacted our revenues, financial condition, results of operations and cash flows. Broadview had 87 nursing students enrolled for our quarter ended March 31, 2012 (7.8% of total enrollments).

In reaction to these negative trends, we have taken a variety of actions, including:

? Effective July 1, 2012, we implemented a tiered tuition rate program with a goal of increasing the average number of credits taken per student. Numerous studies have shown that students who carry higher credit loads per quarter have a greater likelihood of completing their academic program. Upon rollout of this program, students attending full-time (taking between 11 and 16 credits) were charged a tuition rate of $400 per credit. Students attending at less than full time were charged a tuition rate of $435 per credit. Effective July 1, 2013, the tiered tuition program was modified, where students taking 12 or more credits are charged a tuition rate of $375 per credit. As in prior years, all credits taken above 16 credits in a quarter are free of tuition charges.

? In September 2013, we introduced a technology-focused learning model where our students and instructors began utilizing portable electronic devices in the classroom. We believe this learning model will transform how our students learn and help differentiate Broadview University from our competitors. This model connects our students with the latest technology to make the classroom experience more interactive and engaging, and has marked a transformation from textbook learning. We believe the job markets demand professionals who have in-depth knowledge of the latest technology, and our model will help students be prepared.

? In November 2011, we rebranded our Salt Lake City campus to focus solely on academic programs in the fields of studio arts, production arts, and the entertainment business. The Salt Lake City campus was rebranded as Broadview Entertainment Arts University, or BEAU. Programs offered include Music Production and Engineering, Comic and Sequential Art, and various other visual design programs. Average enrollments at BEAU increased 94.2% from 2012 to 2013, and 38.9% from 2013 to 2014.

We believe this strategic move will better position us to capitalize on the demand for such skills in the workforce, and provide a clear focus for the BEAU campus while our other campuses will continue to offer our variety of traditional academic programs.

? We are focused on achieving an appropriate ratio of our instruction costs to our revenue. Our management team has recently undertaken efforts to improve our coordinated scheduling of courses offered both residentially and online to ensure that we achieve adequate class sizes.

? We continue to review and adjust our program and degree offerings to match the demand in the marketplace.

Critical Accounting Policies and Estimates

The discussion and analysis of the Company's financial condition and results of operations is based upon the Company's consolidated financial statements, which have been prepared in accordance with accounting principles generally accepted in the United States of America. The preparation of these consolidated financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements, and reported amount of expenses during the period reported. Management bases its estimates and judgments on historical experience, observance of trends in the industry, information provided by outside sources and on various other factors that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. Our significant accounting policies are described in Note 2 to the consolidated financial statements contained in Item 8 of this Report. The most significant estimates include allowance for uncollectible student receivables, accrued expenses and the provision for income taxes.

Revenue and Expense Categories

? Revenue - Approximately 91% of our revenues are tuition collected from Broadview University's students. The academic year of Broadview University is divided into four quarters, which approximately coincide with the four quarters of the calendar year. Students make payment arrangements for their tuition and related charges prior to the beginning of each quarter.

The University bills students during the second week of each quarter for that quarter's tuition and related charges; billings for tuition are recorded as deferred revenue and are recognized over the course of the quarter. Other revenue sources include learning resource fees, application fees, merchandise sales and other miscellaneous income; the University recognizes revenue for these items when earned.

If a student withdraws from a course prior to completion, the University refunds a portion of the tuition. The refunded amount is dependent on the timing of the withdrawal. Tuition revenue is shown net of any refunds. Because the University bills its students quarterly for tuition and other academic services, and 100% of these services are generally completed by each quarter end, the University has no deferred revenue at the end of each quarter.

? Educational Services and Facilities Expense - Our educational services and facilities expenses generally consist of expense items directly attributable to the educational activities of Broadview University. These items include campus administrative and instructional salaries and related costs, student materials, academic program supplies, and facility rent and maintenance.

Payroll and related expenses represent our single largest expense category, accounting for 47.0% and 51.5% of our revenues for the years ended March 31, 2014 and 2013. While the largest individual expense category, such expenses also should be driven by revenue levels. Maintaining an appropriate payroll as a percentage of revenue ratio is a critical focus for management as we adjust to declining enrollments in the near term. Management is continuing to explore additional measures to bring payroll costs in line with revenue levels, while maintaining a focus on exceptional student service.

? Selling, General and Administrative Expense - Our selling, general and administrative costs primarily include marketing and promotional expenses incurred through various forms of advertising and distribution of promotional materials. We also utilize executive, administrative, accounting and consulting services provided by related parties pursuant to a Service Level Agreement. Some of the services provided by the related parties under this arrangement include chief financial and chief executive officer services, information technology support, finance and accounting services, human resources support, student financial aid consulting and curriculum consulting. See Note 7 to the consolidated financial statements contained in Item 8 of this Report for further detail of related party transactions.

Marketing expenses accounted for 23.2% and 23.8% of revenues for the years ended March 31, 2014 and 2013. Management recognizes that spending wisely on advertising will be critical to our efforts to increase our student population. We intend to aggressively seek out the most effective means of promoting the value of our programs.

Results of Operations

The following table presents consolidated statements of operations data as percentages of revenues for each of the periods indicated:

                                            Year ended March 31,
                                       2014         2013         2012
Revenues                                100.0 %      100.0 %      100.0 %
Operating expenses
Educational services and facilities     104.0        101.1         87.5
Selling, general and administrative      32.3         33.8         34.0
Total operating expenses                136.3        134.9        121.5
Operating loss                          (36.3 )      (34.9 )      (21.5 )
Other income (expense)                    0.0          0.0          0.0
Loss before income taxes                (36.3 )      (34.9 )      (21.5 )
Income tax expense                          -            -          1.9
Net loss                                (36.3 )%     (34.9 )%     (23.4 )%

Year ended March 31, 2014 compared to year ended March 31, 2013

Revenues



The following table presents year-over-year changes in our primary revenue
components.



                                               Year Ended March 31,                    Change
                                               2014             2013            Amount         Percent
Tuition                                    $ 12,622,605     $ 14,567,763     $ (1,945,158 )        (13.4 )%
Fees, commissions and other revenue           1,277,288          576,285          701,003          121.6
Refunds                                        (444,048 )       (552,381 )        108,333          (19.6 )
Total revenue                              $ 13,455,845     $ 14,591,667     $ (1,135,822 )         (7.8 )%

Tuition

Our tuition revenue decrease was primarily attributable to decreased enrollments. Average enrollments for 2014 were 781, a decrease of 20.2% from the average of 979 for the prior year. This decrease was partially offset by an increase in average credits taken per student. Our credits billed for the year ended March 31, 2014 were 32,745 compared to 35,810 for the prior year, a decrease of 8.6%.

Fees, Commissions and Other Charges

During our year ended March 31, 2014, we introduced a technologically focused learning model. Broadview students and instructors began utilizing portable electronic devices in the classroom during the quarter ended December 31, 2013. These devices mark a transformation from textbook learning. The increase in this revenue category is primarily related to fees charged in relation to electronic content and learning devices, which totaled $951,250 for the year ended March 31, 2014.

This change in fee structure also led to the elimination of various other fees, as our miscellaneous student charges decreased $105,607 year over year. Previously, our students purchased textbooks directly from a third-party service provider and we received commission revenue from the service provider based on the overall net sales. Commission revenue decreased to $57,388 for the year ended March 31, 2014 compared to $182,327 for the prior year.

Educational services and facilities operating expenses

Expenses related to educational services and facilities decreased 5.2% to $13,980,771 for the year ended March 31, 2014, from $14,754,797 for the previous year. The $774,026 decrease was primarily due to decreased payroll-related expenses, which decreased $1,203,678, or 16.0%, year over year. Health insurance expense decreased 54.3% to $249,850 for the year ended March 31, 2014 from $546,532 for the previous year, primarily due to the decreased payroll. These decreases were offset primarily by the new costs related to the electronic content and learning devices that were introduced during the year ended March 31, 2014. Such costs totaled $834,112.

The following table summarizes certain educational services and facilities expenses as a percentage of revenue:

                                                Percentage of Revenue
                                                Year Ended March 31,
Expense                                         2014             2013
Payroll and related                                47.0 %           51.5 %
Rent and other facility                            27.9 %           26.1 %
Student materials and electronic resources          9.2 %            2.9 %
Scholarships                                        7.0 %            6.5 %

Selling, general and administrative expenses

Expenses related to selling and general administrative activities decreased 11.9% to $4,342,982 in 2014 from $4,928,852 for the previous year. The $585,870 decrease was primarily due to decreased marketing expenditures and a decrease in our monthly management fee. Marketing costs decreased $360,460, or 10.4%, to $3,113,379 in 2014 from $3,473,838 for the previous year, primarily due to management's efforts to be more selective with advertising buys. As a percentage of revenues, marketing expense was 23.2% and 23.8% for the years ended March 31, 2014 and 2013.

Effective October 1, 2012, our monthly management fee paid under the SLA decreased to $50,000 from $75,000. As such, annual management fee expense decreased $150,000, or 20.0%, from $750,000 in 2013 to $600,000 in 2014. The management fee is reviewed as needed, but at a minimum, on an annual basis. As a percentage of revenues, the management fee was 4.5% and 5.1% for the years ended March 31, 2014 and 2013. We believe the monthly charges under the SLA are competitive with, or less than, what the Company would have to pay to provide these services or to obtain them from another third party.

Operating income (loss)

Operating income (loss) is the primary measure used by management in assessing the Company's performance. Our operating loss decreased $214,074, or 4.2% from $5,091,982 in 2013 to $4,877,908 in 2014. The variance was primarily the result of the aforementioned factors.

Liquidity and Capital Requirements

A significant portion of our revenues are derived from Title IV programs administered by the USDE. Federal regulations dictate the timing of disbursements under Title IV programs. Students must apply for new loans and grants each award year, which starts July 1. Loan funds are generally provided by lenders in multiple disbursements for each academic year. The disbursements are usually received beginning in the second week of each academic quarter. These factors, together with the timing of our students beginning their programs, affect our operating cash flow.

Cash was $4,858,394 at March 31, 2014 compared to $6,340,609 at March 31, 2013. Most of our excess cash is typically held in an interest-bearing bank savings account. Our capital position has been significantly influenced by transactions with Mr. Terry Myhre, the Company's Chairman and majority shareholder ("Mr. Myhre"). Since March 2012, Mr. Myhre has executed transactions with the Company that have resulted in cash inflows from financing activities totaling $13,937,500. These cash infusions have come against a three-year total of $10,580,736 of cash used in operating activities for the fiscal years ended March 31, 2012 to 2014. The transactions with Mr. Myhre are as follows:

On March 28, 2014, the Company issued 70,000,000 shares of Common Stock to Mr. Myhre for $4,900,000, or $0.07 per share.

On March 29, 2013, Mr. Myhre purchased 4,500,000 shares of Series B Preferred Stock at a price of $1.00 per share. Each share of Series B Preferred Stock included a detachable warrant to purchase two shares of the Company's Common Stock for $0.50 per share. Additionally, on the same date, Mr. Myhre purchased 4,500,000 shares of Common Stock at a price of $0.25 per share. Total cash proceeds from the two transactions were $5,625,000.

On March 30, 2012, Mr. Myhre exercised his right under a warrant to purchase 650,000 shares of Common Stock from the Company at an exercise price of $1.25 per share, for a total cash payment of $812,500.

Also on March 30, 2012, we entered into a Line of Credit Authorization agreement (the "Line of Credit") with Mr. Myhre. The Line of Credit is unsecured, and allows for the Company to borrow from Mr. Myhre up to $3,000,000 of aggregate principal borrowings upon the request of the Company. The Line of Credit has a fixed annual interest rate of 4.0% and, effective June 13, 2013, the expiration date was extended from March 31, 2014 to April 1, 2015. The Company has borrowed a total of $2,600,000 under the Line of Credit through March 31, 2014, and $600,000 remained outstanding at March 31, 2014. This balance was paid in full on June 23, 2014.

Without the financial support from Mr. Myhre, the Company would likely have been unable to meet its current obligations, absent material changes to the Company's operations. Additionally, these transactions have greatly aided the Company's ability to comply with various regulatory requirements that concern an institution's financial health. Due to projected losses continuing in the near future, we anticipate that the Company may continue to rely on Mr. Myhre for financial support, the degree of such support depending on management's ability to adequately contain costs against projected future revenue.

The net cash provided by (used in) each of the operating, investing and financing activities are summarized in the following table and discussed in further detail below:

                                                            Year Ended March 31,
                                                   2014             2013            Change
Net cash used in operating activities          $ (4,154,142 )   $ (4,176,837 )   $     22,695
Net cash used in investing activities              (288,410 )       (110,139 )       (178,271 )
Net cash provided by financing activities         2,960,337        8,085,292       (5,124,955 )
Net decrease in cash                           $ (1,482,215 )   $  3,798,316     $ (5,280,531 )

Our cash flows used in operating activities has been primarily driven by net losses of $4,883,630 and $5,093,932 for the years ended March 31, 2014 and 2013. Offsetting the 2014 and 2013 net losses were depreciation and amortization of $654,312 and $697,809.

The variance in cash flows related to investing activities is primarily due to fewer property and equipment additions in 2013.

The variance in cash flows related to financing activities is primarily due to the transactions with Mr. Myhre described more fully above, as well as lower amounts due to affiliates at March 31, 2014.

Management anticipates that the Company will use a substantial portion of its cash reserves available at March 31, 2014 to fund operating losses in its fiscal year ending March 31, 2015. However, the combination of cash provided by the March 28, 2014 transactions with Mr. Myhre and the available borrowings under the Line of Credit leads management to believe the Company will be able to fund operations for the next 12 months.

A portion of our revenues is received from students who receive financial loans from Myhre Investments, LLC, an entity owned by Mr. Myhre. As of March 31, 2014, Myhre Investments, LLC had $1,337,256 in loans outstanding to Broadview University students.

Management believes that inflation will not have a significant impact on our business.

Off-Balance Sheet Arrangements

As of March 31, 2014, the Company does not have any off-balance sheet arrangements as defined by Item 303(a)(4) of Regulation S-K.