Audit 308042

Title: Loan/loan guarantee outstanding balances Accounting Policies: The accompanying Schedule of Expenditures of Federal Awards (the Schedule) includes the federal award activity of Walnut Housing Corp., HUD Project No. 014-EE269, and is presented on the accrual basis of accounting. 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 Walnut Housing Corp., it is not intended to and does not present the financial position, changes in net assets, or cash flows of Walnut Housing Corp. Expenditures reported on the Schedule of Expenditures of Federal Awards 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: Walnut Housing Corp. has elected not to use the 10-percent de minimis indirect cost rate allowed under the Uniform Guidance. Supportive Housing for the Elderly (14.157) - Balances outstanding at the end of the audit period were 6110900.