Audit 16138

Title: U.S. Department of Housing and Urban Development Loan Program Accounting Policies: The accompanying schedule of expenditures of federal awards (Schedule) includes the federal award activity of North East Manor, Inc., HUD Project Number 033-EE135 under programs of the federal government for the year ended June 30, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, UniformAdministrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the Schedule presents only a select portion of the operations of North East Manor, Inc., it is not intended to and does not present the financial position, changes in net assets (deficit), or cash flows of North East Manor, Inc. De Minimis Rate Used: N Rate Explanation: Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. North East Manor, Inc., has elected not to use the 10 percent de minimis indirect cost rate allowed under the Uniform Guidance. HUD has made a Section 202 Capital Advance to North East Manor, Inc., for thepurpose of funding the major portion of the cost of the apartment building. Thetotal amount of the advance is $ 4,096,800. No interest or repayment of theadvance is required as long as the Organization operates the apartment buildingfor very low - income elderly persons for not less than 40 years from March 8,2010. Until April 1, 2051, the Section 202 Capital Advance will continue to bereported on the Schedule as a major program for the full amount of the advance.