Audit 295162

Title: General Information Accounting Policies: 1. GENERAL INFORMATION The accompanying schedule of expenditures of federal awards presents the activities in all the federal financial assistance programs of Alternatives Homes 2005, Inc. All financial assistance received directly from federal agencies as well as financial assistance passed through other governmental agencies or notfor- profit organizations are included on the schedule. 2. BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported in this schedule as expenditures may differ from certain financial reports submitted to federal funding agencies due to those reports being submitted on either a cash or modified accrual basis of accounting. 3. RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Expenditures of federal awards are generally reported on the statement of activities as program services. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of expenditures of federal awards due to program expenditures exceeding grant or contract budget limitations, matching or in-kind contributions or capitalization policies required under accounting principles generally accepted in the United States of America. 4. INDIRECT COST RATE There was no indirect cost rate nor was the de minimis rate applied to the federal awards. 5. NON-CASH EXPENDITURES The Project was financed by a capital advance from HUD in the amount of $889,300. The advance is secured by an enforcement mortgage on the property. The mortgage, which matures in February 2049, bears no interest, and repayment is not required so long as the housing remains available to eligible lowincome persons with disabilities. There was no change in the mortgage payable from September 30, 2022 to September 30, 2023. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying schedule of expenditures of federal awards presents the activities in all the federal financial assistance programs of Alternatives Homes 2005, Inc. All financial assistance received directly from federal agencies as well as financial assistance passed through other governmental agencies or notfor-profit organizations are included on the schedule.

Title: Basis of Accounting Accounting Policies: 1. GENERAL INFORMATION The accompanying schedule of expenditures of federal awards presents the activities in all the federal financial assistance programs of Alternatives Homes 2005, Inc. All financial assistance received directly from federal agencies as well as financial assistance passed through other governmental agencies or notfor- profit organizations are included on the schedule. 2. BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported in this schedule as expenditures may differ from certain financial reports submitted to federal funding agencies due to those reports being submitted on either a cash or modified accrual basis of accounting. 3. RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Expenditures of federal awards are generally reported on the statement of activities as program services. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of expenditures of federal awards due to program expenditures exceeding grant or contract budget limitations, matching or in-kind contributions or capitalization policies required under accounting principles generally accepted in the United States of America. 4. INDIRECT COST RATE There was no indirect cost rate nor was the de minimis rate applied to the federal awards. 5. NON-CASH EXPENDITURES The Project was financed by a capital advance from HUD in the amount of $889,300. The advance is secured by an enforcement mortgage on the property. The mortgage, which matures in February 2049, bears no interest, and repayment is not required so long as the housing remains available to eligible lowincome persons with disabilities. There was no change in the mortgage payable from September 30, 2022 to September 30, 2023. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported in this schedule as expenditures may differ from certain financial reports submitted to federal funding agencies due to those reports being submitted on either a cash or modified accrual basis of accounting.

Title: Relationship to Basic Financial Statements Accounting Policies: 1. GENERAL INFORMATION The accompanying schedule of expenditures of federal awards presents the activities in all the federal financial assistance programs of Alternatives Homes 2005, Inc. All financial assistance received directly from federal agencies as well as financial assistance passed through other governmental agencies or notfor- profit organizations are included on the schedule. 2. BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported in this schedule as expenditures may differ from certain financial reports submitted to federal funding agencies due to those reports being submitted on either a cash or modified accrual basis of accounting. 3. RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Expenditures of federal awards are generally reported on the statement of activities as program services. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of expenditures of federal awards due to program expenditures exceeding grant or contract budget limitations, matching or in-kind contributions or capitalization policies required under accounting principles generally accepted in the United States of America. 4. INDIRECT COST RATE There was no indirect cost rate nor was the de minimis rate applied to the federal awards. 5. NON-CASH EXPENDITURES The Project was financed by a capital advance from HUD in the amount of $889,300. The advance is secured by an enforcement mortgage on the property. The mortgage, which matures in February 2049, bears no interest, and repayment is not required so long as the housing remains available to eligible lowincome persons with disabilities. There was no change in the mortgage payable from September 30, 2022 to September 30, 2023. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. Expenditures of federal awards are generally reported on the statement of activities as program services. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of expenditures of federal awards due to program expenditures exceeding grant or contract budget limitations, matching or in-kind contributions or capitalization policies required under accounting principles generally accepted in the United States of America.

Title: Indirect Cost Rate Accounting Policies: 1. GENERAL INFORMATION The accompanying schedule of expenditures of federal awards presents the activities in all the federal financial assistance programs of Alternatives Homes 2005, Inc. All financial assistance received directly from federal agencies as well as financial assistance passed through other governmental agencies or notfor- profit organizations are included on the schedule. 2. BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported in this schedule as expenditures may differ from certain financial reports submitted to federal funding agencies due to those reports being submitted on either a cash or modified accrual basis of accounting. 3. RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Expenditures of federal awards are generally reported on the statement of activities as program services. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of expenditures of federal awards due to program expenditures exceeding grant or contract budget limitations, matching or in-kind contributions or capitalization policies required under accounting principles generally accepted in the United States of America. 4. INDIRECT COST RATE There was no indirect cost rate nor was the de minimis rate applied to the federal awards. 5. NON-CASH EXPENDITURES The Project was financed by a capital advance from HUD in the amount of $889,300. The advance is secured by an enforcement mortgage on the property. The mortgage, which matures in February 2049, bears no interest, and repayment is not required so long as the housing remains available to eligible lowincome persons with disabilities. There was no change in the mortgage payable from September 30, 2022 to September 30, 2023. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. There was no indirect cost rate nor was the de minimis rate applied to the federal awards.

Title: Non-cash Expenditures Accounting Policies: 1. GENERAL INFORMATION The accompanying schedule of expenditures of federal awards presents the activities in all the federal financial assistance programs of Alternatives Homes 2005, Inc. All financial assistance received directly from federal agencies as well as financial assistance passed through other governmental agencies or notfor- profit organizations are included on the schedule. 2. BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported in this schedule as expenditures may differ from certain financial reports submitted to federal funding agencies due to those reports being submitted on either a cash or modified accrual basis of accounting. 3. RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Expenditures of federal awards are generally reported on the statement of activities as program services. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of expenditures of federal awards due to program expenditures exceeding grant or contract budget limitations, matching or in-kind contributions or capitalization policies required under accounting principles generally accepted in the United States of America. 4. INDIRECT COST RATE There was no indirect cost rate nor was the de minimis rate applied to the federal awards. 5. NON-CASH EXPENDITURES The Project was financed by a capital advance from HUD in the amount of $889,300. The advance is secured by an enforcement mortgage on the property. The mortgage, which matures in February 2049, bears no interest, and repayment is not required so long as the housing remains available to eligible lowincome persons with disabilities. There was no change in the mortgage payable from September 30, 2022 to September 30, 2023. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. The Project was financed by a capital advance from HUD in the amount of $889,300. The advance is secured by an enforcement mortgage on the property. The mortgage, which matures in February 2049, bears no interest, and repayment is not required so long as the housing remains available to eligible low income persons with disabilities. There was no change in the mortgage payable from September 30, 2022 to September 30, 2023.