Audit 296138

Title: Note A – Basis of Presentation Accounting Policies: ACCRUAL BASIS OF ACCOUNTING, COST BASIS PRINCIPLES CONTAINED IN UNFIORM GUIDANCE De Minimis Rate Used: N Rate Explanation: Fixed rate The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Clarion University Foundation, Inc. (the Organization) under programs of the federal government for the year ended June 30, 2023. The information in this 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). Because the Schedule presents only a selected portion of the operations of Clarion University Foundation, Inc., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Clarion University Foundation, Inc.

Title: Note B – Summary of Significant Accounting Policies Accounting Policies: ACCRUAL BASIS OF ACCOUNTING, COST BASIS PRINCIPLES CONTAINED IN UNFIORM GUIDANCE De Minimis Rate Used: N Rate Explanation: Fixed rate Expenditures reported on the Schedule are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.

Title: Note C – Community Facilities Loans and Grants Accounting Policies: ACCRUAL BASIS OF ACCOUNTING, COST BASIS PRINCIPLES CONTAINED IN UNFIORM GUIDANCE De Minimis Rate Used: N Rate Explanation: Fixed rate The value of federal awards expended under the USDA Community Facilities loan programs of $41,502,846 are loans outstanding at the beginning of the audit period and loans made during the year for which the federal government imposes continuing compliance requirements. The loan proceeds from the United States Department of Agriculture (USDA) were used to refinance a portion of the Student Housing Project of the Clarion University Foundation in 2016. The loan proceeds of $45,000,000 were used to refinance a portion of the student housing project. The USDA has a first lien position on the real property and furniture, and a pledge of all revenues and receivables. The debt service reserve fund is subject to a deposit control agreement with the USDA. The balance of USDA loans outstanding as of June 30, 2023 amounted to $40,763,967. The loan is for a term of 40 years and matures on July 1, 2056. Interest accrues on the outstanding principal balance at 2.875% per year.

Title: Note D – Indirect Cost Rate Accounting Policies: ACCRUAL BASIS OF ACCOUNTING, COST BASIS PRINCIPLES CONTAINED IN UNFIORM GUIDANCE De Minimis Rate Used: N Rate Explanation: Fixed rate Clarion University Foundation, Inc. has elected not to use the 10% de minimis indirect cost rate allowed under the Uniform Guidance.