Audit 18566

Accounting Policies: Notes to Schedule of Expenditures of Federal Awards:1.The Schedule of Expenditures of Federal Awards presents the activity of federal award programs expendedby the City of Brainerd and its discretely presented component unit the Brainerd Lakes Regional Airport.This schedule does not include the federal expenditures of the Housing and Redevelopment Authority of Brainerdor Brainerd Public Utilities. The City's reporting entity is defined in Note 1 to the basic financial statements.2. The expenditures on this schedule are on the modified accrual basis of accounting, which is describedin Note 1 to the basic financial statements of the City. The City has not elected to use the 10% de minimisindirect cost rate as allowed under Uniform Guidance.3.Reconciliation of the Schedule of Expenditures of Federal Awards to cash basis note proceeds:Federal Expenditures $12,846,980 Plus Expenditures Reimbursed for Prior Years - Less Expenditures Reimbursed in Future Years (252,153)Cash Basis Note Proceeds (Note Balance) $12,594,827 De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate.