Notes to SEFA
Title: Basis of accounting
Accounting Policies: BASIS OF ACCOUNTING Cen-Tex uses the accrual basis of accounting. Contracts and grants are recorded as revenue when the funds are considered earned, regardless of when cash is received. Cost reimbursement contracts are recorded as revenue when the costs are incurred and contributions are recorded as support when the funds are awarded. Expenses are recorded when incurred regardless of when cash is disbursed. A significant portion of Cen-Tex’s revenue is derived from cost reimbursable federal
grants, which are conditioned upon certain performance requirements and/or the incurrence
of allowable qualifying expenses. Amounts received are recorded as revenue when CenTex has incurred expenditures in compliance with specific contract or grant provisions.
Amounts received prior to incurring qualifying expenditures are reported as unearned
revenue in the statement of financial position.
De Minimis Rate Used: N
Rate Explanation: The Auditee did not elect to use the 10% de minimus cost rate.
Cen-Tex uses the accrual basis of accounting. Contracts and grants are recorded as revenue when the funds are considered earned, regardless of when cash is received. Cost reimbursement contracts are recorded as revenue when the costs are incurred and contributions are recorded as support when the funds are awarded. Expenses are recorded when incurred regardless of when cash is disbursed.
Title: Revenue and receivables
Accounting Policies: BASIS OF ACCOUNTING Cen-Tex uses the accrual basis of accounting. Contracts and grants are recorded as revenue when the funds are considered earned, regardless of when cash is received. Cost reimbursement contracts are recorded as revenue when the costs are incurred and contributions are recorded as support when the funds are awarded. Expenses are recorded when incurred regardless of when cash is disbursed. A significant portion of Cen-Tex’s revenue is derived from cost reimbursable federal
grants, which are conditioned upon certain performance requirements and/or the incurrence
of allowable qualifying expenses. Amounts received are recorded as revenue when CenTex has incurred expenditures in compliance with specific contract or grant provisions.
Amounts received prior to incurring qualifying expenditures are reported as unearned
revenue in the statement of financial position.
De Minimis Rate Used: N
Rate Explanation: The Auditee did not elect to use the 10% de minimus cost rate.
A significant portion of Cen-Tex’s revenue is derived from cost reimbursable federal grants, which are conditioned upon certain performance requirements and/or the incurrence of allowable qualifying expenses. Amounts received are recorded as revenue when CenTex has incurred expenditures in compliance with specific contract or grant provisions. Amounts received prior to incurring qualifying expenditures are reported as unearned revenue in the statement of financial position. Cen-Tex has contracts for cost reimbursable grants of $1,387,127 for which qualifying expenditures have not been incurred and accordingly have not been recognized at year-end, with advance payments of $667,707 recorded in the statement of financial position as unearned revenue. Cen-Tex considers all recorded receivables to be fully collectible. Accordingly, no allowance for doubtful accounts is required.