Audit 301567

Title: Note 4. Federally Funded Insurance Accounting Policies: Note 1. Basis of Presentation The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal award activity of the Anthony Water and Sanitation District 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 or the operations of the District, it is not intended to and does not present the financial position, changes in net position or cash flows of the District. Note 2. Summary of Significant Accounting Policies 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. De Minimis Rate Used: N Rate Explanation: Note 3. 10% de minimus Indirect Cost Rate The District did not elect to use the allowed 10% indirect cost rate. The District has no federally funded insurance.

Title: Note 5. Loan Accounting Policies: Note 1. Basis of Presentation The accompanying Schedule of Expenditures of Federal Awards (Schedule) includes the federal award activity of the Anthony Water and Sanitation District 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 or the operations of the District, it is not intended to and does not present the financial position, changes in net position or cash flows of the District. Note 2. Summary of Significant Accounting Policies 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. De Minimis Rate Used: N Rate Explanation: Note 3. 10% de minimus Indirect Cost Rate The District did not elect to use the allowed 10% indirect cost rate. The District entered into an agreement with the United States Department of Agriculture (“USDA”) in May 12, 2020 for the wastewater treatment plant upgrades and expansion project. The outstanding balance of the loan as of June 30, 2023 is as follows: Assistance Listing No. Amount Outstanding Program Title: Water and Waste Disposal Loans and Grants 10.770 $9,069,902 See independent auditor's report and accompanying notes to schedule of expenditures of federal awards