Audit 1135

Title: Note 1 - Relationship to CACC's Financial Statements Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards presents the activity of all federal award programs of Capital Area Career Center (CACC) and its related organization, Capital Area School of Practical Nursing (CASPN). Federal awards passed through other government agencies are included on the schedule. Such amounts received as pass-through awards are specifically identified on the Schedule of Expenditures of Federal Awards. The accompanying Schedule of Expenditures of Federal Awards is presented using the modified accrual basis. Basis of accounting refers to when revenues received and expenditures disbursed are recognized in the accounts and how they are reported on the financial statements. CACC maintains its accounting records for all funds and account groups on the modified accrual basis of accounting. Accordingly, revenue is recognized when it becomes measurable and available. Measurable means the amount can be determined. Available means collectable within the current period, or expected to be collected soon thereafter to pay liabilities of the current period. Such time thereafter normally shall not exceed 90 days. Also, under the modified accrual basis of accounting, expenditures are recorded when the related fund liability is incurred, except for general obligation bond principal and interest which are reported as expenditures in the year due. De Minimis Rate Used: Y Rate Explanation: The auditee used the de minimis cost rate. Career and Technical Education - Basic Grants to States V.W. Carl D. Perkins and WIOA Youth Program are reflected in the basic financial statements as income and expenditures in the Education Fund. For the Federal Direct Student Loans (FDSL), Federal Pell Grant, WIOA Adult Program, Veterans Education Assistance Program and Rehabilitation Grants to States (DORS), CACC and CASPN act as an administrative agent to the students. FDSL awards are not reflected in the basic financial statements. These awards are not reflected in the basic financial statements. They are treated as an asset and liability item only. See Notes to Schedule of Expenditures of Federal Awards, Note 1 in the reporting package.

Title: Note 3 - Contingencies Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards presents the activity of all federal award programs of Capital Area Career Center (CACC) and its related organization, Capital Area School of Practical Nursing (CASPN). Federal awards passed through other government agencies are included on the schedule. Such amounts received as pass-through awards are specifically identified on the Schedule of Expenditures of Federal Awards. The accompanying Schedule of Expenditures of Federal Awards is presented using the modified accrual basis. Basis of accounting refers to when revenues received and expenditures disbursed are recognized in the accounts and how they are reported on the financial statements. CACC maintains its accounting records for all funds and account groups on the modified accrual basis of accounting. Accordingly, revenue is recognized when it becomes measurable and available. Measurable means the amount can be determined. Available means collectable within the current period, or expected to be collected soon thereafter to pay liabilities of the current period. Such time thereafter normally shall not exceed 90 days. Also, under the modified accrual basis of accounting, expenditures are recorded when the related fund liability is incurred, except for general obligation bond principal and interest which are reported as expenditures in the year due. De Minimis Rate Used: Y Rate Explanation: The auditee used the de minimis cost rate. CACC receives awards under various federal grant programs which must be expended according to provisions established by the various grants. Compliance with the grant provisions are subject to audit by the various granting agencies which may impose sanctions in the event of non-compliance. Management believes they have complied with all aspects of the grant provisions and they feel the results of any adjustments would have an immaterial impact on the financial statements taken as a whole.

Title: Note 4 - Calculation of Title IV 90/10 Revenue & Related Party Transactions Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards presents the activity of all federal award programs of Capital Area Career Center (CACC) and its related organization, Capital Area School of Practical Nursing (CASPN). Federal awards passed through other government agencies are included on the schedule. Such amounts received as pass-through awards are specifically identified on the Schedule of Expenditures of Federal Awards. The accompanying Schedule of Expenditures of Federal Awards is presented using the modified accrual basis. Basis of accounting refers to when revenues received and expenditures disbursed are recognized in the accounts and how they are reported on the financial statements. CACC maintains its accounting records for all funds and account groups on the modified accrual basis of accounting. Accordingly, revenue is recognized when it becomes measurable and available. Measurable means the amount can be determined. Available means collectable within the current period, or expected to be collected soon thereafter to pay liabilities of the current period. Such time thereafter normally shall not exceed 90 days. Also, under the modified accrual basis of accounting, expenditures are recorded when the related fund liability is incurred, except for general obligation bond principal and interest which are reported as expenditures in the year due. De Minimis Rate Used: Y Rate Explanation: The auditee used the de minimis cost rate. Capital Area School of Practical Nursing (CASPN), a related organization to Capital Area Career Center derives a substantial portion of its revenues from Student Financial Aid (SFA) received by its students under the Title IV programs administered by the U.S. Department of Education pursuant to the Higher Education Act (HEA) of 1965, as amended. To continue to participate in the SFA programs CASPN must comply with the regulations promulgated under the HEA. The regulations restrict the proportion of cash receipts for tuition and fees from eligible programs to not more than 90 percent from the Title IV programs. The failure of CASPN to meet the 90 percent limitation will result in the loss of CASPN’s ability to participate in SFA programs. For the year ended June 30, 2023, CASPN received $1,009,916 of Title IV Funds, total eligible cash receipts of $813,631 resulting in a percentage of 49.68 percent. This information is required by the U.S. Department of Education and is presented for purposes of additional analysis and is not a required part of the basic financial statements. CASPN participates in the SFA under the Title IV programs administered by the U.S. Department of Education pursuant to the Higher Education Act (HEA) of 1965, as amended. CASPN must comply with the regulations promulgated under HEA. Those regulations require that all related party transactions be disclosed, regardless of their materiality to the financial statements. Accounts receivable – officers for the year ended June 30, 2023 is $-0-. This information is required by the U.S. Department of Education and is presented for purposes of additional analysis and is not a required part of the basic financial statements.