Audit 29238

Title: Note 4 Indirect Cost Rate Accounting Policies: Note 1 Reporting EntityThe financial reporting entity consists of the primary government, City of Madera (the City), organizations for which the primary government is financially accountable, and other organizations for which the nature and significance of their relationship with the primary government are such that exclusion would cause the reporting entitys financial statements to be misleading or incomplete.The City Council acts as the governing body and is able to impose its will on the following organizations, establishing financial accountability:?Madera Public Financing AuthorityThe following entity is a discretely presented component unit in the Citys basic financial statements but federal awards from federal agencies are not included in the Schedule of Expenditures of Federal Awards because they are a separate legal entity. The audit of these federal awards under Uniform Guidance is conducted by other auditors:?Housing Authority of the City of MaderaNote 2 Basis of AccountingFunds received under the various grant programs have been recorded within the general fund and special revenue funds of the City. The City utilizes the modified accrual method of accounting for the general fund and special revenue funds. The accompanying Schedule of Expenditures of Federal Awards (Schedule) is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Therefore, some amounts presented in the schedule may differ from amounts presented in, or used in, the preparation of the Citys basic financial statements.Note 3 Schedule of Expenditures of Federal AwardsThe accompanying Schedule presents the activity of all federal financial assistance programs of the City. Federal financial assistance received directly from federal agencies as well as federal financial assistance passed through the State of California are included in the Schedule. The Schedule was prepared from only the accounts of various grant programs and, therefore, does not present the financial position, change in net position or fund balance, or results of operations and cash flows of the City. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The City has not elected to use the 10-percent de minimis indirect rate as allowed under the Uniform Guidance.