Title: Note 1: BASIS OF PRESENTATION
Accounting Policies: This Schedule was prepared on the modified accrual basis of accounting. The modified accrual basis differs from the full accrual basis of accounting in that expenditures for property and equipment are expensed when incurred, rather than being capitalized and depreciated over their useful lives, and expenditures for the principal portion of debt service are expensed when incurred, rather than being applied to reduce the outstanding principal portion of debt, which conforms to the basis of reporting to grantors for reimbursement under the terms of the Agency’s federal grants.
De Minimis Rate Used: N
Rate Explanation: The Agency has not elected to use the 10% de Minimis cost rate for the year ended June 30, 2023.
The accompanying Schedule of Expenditures of Federal Awards and State Financial Assistance (the Schedule) summarizes the federal expenditures and state financial assistance of South Central Human Resource Agency (the “Agency”) under programs of the federal government and State of Tennessee for the year ended June 30, 2023. The amounts reported as federal expenditures and state financial assistance were obtained from the Agency’s general ledger. Because the Schedule presents only a selected portion of the operations of the Agency, it is not intended to and does not present the financial position and changes in net position of the Agency.
For purposes of the Schedule, federal awards include all grants, contracts, and similar agreements entered into directly with the federal government and other pass through entities. The Agency has obtained Assistance Listing Numbers (ALN) to ensure that all programs have been identified in the Schedule. AL numbers have been appropriately listed by applicable programs. Federal programs with different AL numbers that are closely related because they share common compliance requirements are defined as a cluster by the Uniform Guidance. Three clusters are separately identified in the Schedule and are the following:
Clusters
Head Start/Early Head Start (ALN 93.600) is reported as the Head Start Cluster, the Foster Grandparent Program (ALN 94.011) is reported as the Foster Grandparent/Senior Companion Cluster and the Emergency Food Assistance Program (ALN 10.568 and 10.569) is reported as the Food Distribution Cluster in the Schedule.
Title: Note 3: RELATIONSHIP OF THE SCHEDULE TO PROGRAM FINANCIAL REPORTS
Accounting Policies: This Schedule was prepared on the modified accrual basis of accounting. The modified accrual basis differs from the full accrual basis of accounting in that expenditures for property and equipment are expensed when incurred, rather than being capitalized and depreciated over their useful lives, and expenditures for the principal portion of debt service are expensed when incurred, rather than being applied to reduce the outstanding principal portion of debt, which conforms to the basis of reporting to grantors for reimbursement under the terms of the Agency’s federal grants.
De Minimis Rate Used: N
Rate Explanation: The Agency has not elected to use the 10% de Minimis cost rate for the year ended June 30, 2023.
The amounts reflected in the financial reports submitted to the awarding Federal, State and/or pass-through agencies and the Schedule may differ. Some of the factors that may account for any difference include the following:
• The Agency’s fiscal year end may differ from the program's year end.
• Accruals recognized in the Schedule, because of year-end procedures, may not be reported in the program financial reports until the next program reporting period.
• Fixed asset purchases and the resultant depreciation charges are recognized as fixed assets in the Agency's financial statements and as expenditures in the program financial reports.
Title: Note 4: FEDERAL PASS-THROUGH FUNDS
Accounting Policies: This Schedule was prepared on the modified accrual basis of accounting. The modified accrual basis differs from the full accrual basis of accounting in that expenditures for property and equipment are expensed when incurred, rather than being capitalized and depreciated over their useful lives, and expenditures for the principal portion of debt service are expensed when incurred, rather than being applied to reduce the outstanding principal portion of debt, which conforms to the basis of reporting to grantors for reimbursement under the terms of the Agency’s federal grants.
De Minimis Rate Used: N
Rate Explanation: The Agency has not elected to use the 10% de Minimis cost rate for the year ended June 30, 2023.
The Agency is also the sub-recipient of federal funds that have been subjected to testing and are reported as expenditures and listed as federal pass-through funds. Federal awards other than those indicated as “pass-through” are considered direct and will be designated accordingly.
Title: Note 6: CONTINGENCIES
Accounting Policies: This Schedule was prepared on the modified accrual basis of accounting. The modified accrual basis differs from the full accrual basis of accounting in that expenditures for property and equipment are expensed when incurred, rather than being capitalized and depreciated over their useful lives, and expenditures for the principal portion of debt service are expensed when incurred, rather than being applied to reduce the outstanding principal portion of debt, which conforms to the basis of reporting to grantors for reimbursement under the terms of the Agency’s federal grants.
De Minimis Rate Used: N
Rate Explanation: The Agency has not elected to use the 10% de Minimis cost rate for the year ended June 30, 2023.
Grant monies received and disbursed by the Agency are for specific purposes and are subject to review by the grantor agencies. Such audits may result in requests for reimbursement due to disallowed expenditures. Based upon prior experience, management does not believe that such disallowance, if any, would have a material effect on the financial position of the Agency. As of June 30, 2023, there were no material questioned or disallowed costs as a result of grant audits in process or completed.
Title: Note 7: NONCASH ASSISTANCE AND OTHER
Accounting Policies: This Schedule was prepared on the modified accrual basis of accounting. The modified accrual basis differs from the full accrual basis of accounting in that expenditures for property and equipment are expensed when incurred, rather than being capitalized and depreciated over their useful lives, and expenditures for the principal portion of debt service are expensed when incurred, rather than being applied to reduce the outstanding principal portion of debt, which conforms to the basis of reporting to grantors for reimbursement under the terms of the Agency’s federal grants.
De Minimis Rate Used: N
Rate Explanation: The Agency has not elected to use the 10% de Minimis cost rate for the year ended June 30, 2023.
Food commodities are expended when the food is distributed. The amount expended is based on food commodity values provided by the State of Tennessee, Department of Agriculture. At June 30, 2023, the Agency had food commodities totaling $389,290.
Title: Note 8: SUBRECIPIENTS
Accounting Policies: This Schedule was prepared on the modified accrual basis of accounting. The modified accrual basis differs from the full accrual basis of accounting in that expenditures for property and equipment are expensed when incurred, rather than being capitalized and depreciated over their useful lives, and expenditures for the principal portion of debt service are expensed when incurred, rather than being applied to reduce the outstanding principal portion of debt, which conforms to the basis of reporting to grantors for reimbursement under the terms of the Agency’s federal grants.
De Minimis Rate Used: N
Rate Explanation: The Agency has not elected to use the 10% de Minimis cost rate for the year ended June 30, 2023.
The Agency did not provide federal funds to subrecipients for the fiscal year ending June 30, 2023.
Title: Note 9: LOANS AND LOAN GUARNTEES DISTRIBUTED TO OTHERS
Accounting Policies: This Schedule was prepared on the modified accrual basis of accounting. The modified accrual basis differs from the full accrual basis of accounting in that expenditures for property and equipment are expensed when incurred, rather than being capitalized and depreciated over their useful lives, and expenditures for the principal portion of debt service are expensed when incurred, rather than being applied to reduce the outstanding principal portion of debt, which conforms to the basis of reporting to grantors for reimbursement under the terms of the Agency’s federal grants.
De Minimis Rate Used: N
Rate Explanation: The Agency has not elected to use the 10% de Minimis cost rate for the year ended June 30, 2023.
The Agency did not have any loans or loan guarantee programs required to be reported on the Schedule for the fiscal year ending June 30, 2023.
Title: Note 10: FEDERALLY FUNDED INSURANCE
Accounting Policies: This Schedule was prepared on the modified accrual basis of accounting. The modified accrual basis differs from the full accrual basis of accounting in that expenditures for property and equipment are expensed when incurred, rather than being capitalized and depreciated over their useful lives, and expenditures for the principal portion of debt service are expensed when incurred, rather than being applied to reduce the outstanding principal portion of debt, which conforms to the basis of reporting to grantors for reimbursement under the terms of the Agency’s federal grants.
De Minimis Rate Used: N
Rate Explanation: The Agency has not elected to use the 10% de Minimis cost rate for the year ended June 30, 2023.
The Agency did not have any federally funded insurance required to be reported on the Schedule for the fiscal year ending June 30, 2023.