Audit 24803

Title: Note 2 Summary of Significant Accounting Policies Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) includes the federal grant activity of Child & Family Services, Inc. of Lea County (the Organization) under programs of the federal government for the year ended July 31, 2022. The information in this schedule is presented in accordance with the requirements of the Office of Management and Budget (OMB) Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents only a selected portion of the operations of the Organization, it is not intended to and does not present the financial position, changes net assets or cash flows of the Organization. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. See Note 2, last sentence. Expenditures reported in the Schedule are reported on the accrual basis of accounting. See Note B of the notes to the financial statements for Child & Family Services, Inc. of Lea Countys significant accounting policies. Expenditure reports to funding agencies are prepared based on award periods. Such expenditures are recognized following the cost principles in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement. Child & Family Services, Inc. of Lea County has elected not to use the 10percent de minimis indirect cost rate allowed under the Uniform Guidance.