Audit 297796

Title: NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: Basis of Accounting: 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. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. De Minimis Rate Used: Both Rate Explanation: The Agency has elected to use the 10-percent de minimis indirect cost rate unless restricted by specific agreements. Basis of Presentation: The accompanying schedule of expenditures of federal awards (the "Schedule") includes the federal award activity of Appalachian Educational Service Agency (the “Agency”) 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 the Agency, it is not intended to and does not present the financial position or changes in net position of the Agency. Basis of Accounting: 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. Negative amounts shown on the Schedule represent adjustments or credits made in the normal course of business to amounts reported as expenditures in prior years. The Agency has elected to use the 10-percent de minimis indirect cost rate unless restricted by specific agreements. Subrecipients: Of the federal expenditures presented in the schedule, the Agency provided the following federal awards to subrecipients: Gaining Early Awareness and Readiness for Undergraduate Programs (GEAR UP) AL# 84.334A Partners for Rural Impact, Inc. $ 14,767,301 Berea College 8,917,464 Total Subrecipient payments $ 23,684,765 Loans and Loan Guarantees: There were no federal loans outstanding for the year ended June 30, 2023. Insurance: The Agency has no federal insurance for the year ended June 30, 2023.