Notes to SEFA
Title: Reporting Entity
Accounting Policies: Basis of accounting refers to when revenues and expenditures or expenses are recognized in the accounts and reported in the
financial statements, regardless of the measurement focus applied. All governmental funds are accounted for using the modified accrual basis of accounting. All proprietary funds and agency funds are accounted for using the accrual basis of accounting. Expenditures of Federal Awards reported on the Schedule are recognized when incurred.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The schedule of expenditure of Federal Awards (The Schedule) includes expenditures of federal awards for the City of Milpitas, California, and its component units as disclosed in the notes to the Basic Financial Statements, except for federal awards of Terrace Gardens, Inc. Federal awards expended by the Terrace Gardens, Inc., if any, are excluded from the Schedule and are subject to a Single Audit performed by other auditors.