Title: ORGANIZATION AND BUSINESS
Accounting Policies: Expenditures on the schedule of expenditures of federal awards are generally reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Per the guidance provided under May 2023 U.S. Office of Management and Budget (OMB) Compliance Supplement for the Provider Relief Fund (PRF) (ALN 93.498), the amount reported on the schedule of expenditures of federal awards was based on the PRF reporting that was submitted to the Health Resources and Services Administration reporting portal for the time periods January 1, 2023 to March 31, 2023 and July 1, 2023 to September 30, 2023 for PRF funding received between July 1, 2021 through December 31, 2021 and January 1, 2022 through June 30, 2022, respectively.
De Minimis Rate Used: N
Rate Explanation: Texas Children’s did not elect to use the 10% de minimis indirect cost rate for the year ended September 30, 2023, since it either charge indirect cost specifically approved in a grant award document or, when allowed, charges indirect cost rate previously approved from U.S. Department of Health and Human Services, it is oversight agency.
Texas Children’s is a not-for-profit organization with a mission to create a healthier future for children and women throughout its global community by leading in patient care, education, and research. The consolidated financial statements of Texas Children’s include numerous entities; those entities which received federal and state grant awards are described below.
Texas Children’s Hospital (TCH) primarily provides direct patient care and conducts educational and research activities within Houston and its surrounding communities. It is comprised of a 626 licensed-bed comprehensive tertiary care pediatric facility and a 119 licensed-bed facility, providing obstetrics and gynecological care, both located in Houston’s Texas Medical Center, an 86 licensed-bed full-service pediatric facility located in west Houston, and a 74 licensed-bed full service pediatric facility located in The Woodlands.
Texas Children’s Pediatrics (TCP) is a group of pediatric practices that provide primary care services and conduct educational activities. It acquires, manages, and affiliates with pediatric practices primarily in Houston and Austin and their surrounding counties.
Texas Children’s Urgent Care (TCUC) is a group of clinics that provides pediatric urgent care primarily in Houston and Austin and their surrounding counties.
Texas Children’s Health Plan, Inc. (TCHP) operates a health maintenance organization, the first of its kind for pediatrics in the nation, and has a Certificate of Authority from the Texas Department of Insurance. It improves the quality, cost, and access of pediatric and obstetrical services delivered to health plan members in its service area.
Texas Children’s Physician Group (TCPG) provides services in support of Texas Children’s for Baylor College of Medicine (Baylor) faculty and other affiliated health care professionals who provide services at Texas Children’s or participate in Texas Children’s programs.
Texas Children’s is the sole corporate member of TCH, TCP, TCHP and TCPG. TCP is the sole corporate member of TCUC. All Texas Children’s entities described above are exempt from federal income taxes under Section 501(c)(3) of the Internal Revenue Code.
Title: BASIC FINANCIAL STATEMENTS
Accounting Policies: Expenditures on the schedule of expenditures of federal awards are generally reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Per the guidance provided under May 2023 U.S. Office of Management and Budget (OMB) Compliance Supplement for the Provider Relief Fund (PRF) (ALN 93.498), the amount reported on the schedule of expenditures of federal awards was based on the PRF reporting that was submitted to the Health Resources and Services Administration reporting portal for the time periods January 1, 2023 to March 31, 2023 and July 1, 2023 to September 30, 2023 for PRF funding received between July 1, 2021 through December 31, 2021 and January 1, 2022 through June 30, 2022, respectively.
De Minimis Rate Used: N
Rate Explanation: Texas Children’s did not elect to use the 10% de minimis indirect cost rate for the year ended September 30, 2023, since it either charge indirect cost specifically approved in a grant award document or, when allowed, charges indirect cost rate previously approved from U.S. Department of Health and Human Services, it is oversight agency.
The consolidated financial statements of Texas Children’s include the entities described above as well as other entities. Intercompany balances and transactions have been eliminated in consolidation. The consolidated basic financial statements of Texas Children’s were audited by Ernst & Young, LLP (E&Y), whose report dated December 14, 2023, except for the schedule of expenditures of federal awards for which the date is June 7, 2024, was furnished to McConnell & Jones LLP. Such report indicated that the schedule of expenditures of federal awards was subjected to the auditing procedures applied in E&Y’s audit of the basic financial statements, and that the schedule of expenditure of federal awards is fairly stated, in all material respects, in relation to the consolidated basic financial statements as a whole.
Title: BASIS OF PRESENTATION
Accounting Policies: Expenditures on the schedule of expenditures of federal awards are generally reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Per the guidance provided under May 2023 U.S. Office of Management and Budget (OMB) Compliance Supplement for the Provider Relief Fund (PRF) (ALN 93.498), the amount reported on the schedule of expenditures of federal awards was based on the PRF reporting that was submitted to the Health Resources and Services Administration reporting portal for the time periods January 1, 2023 to March 31, 2023 and July 1, 2023 to September 30, 2023 for PRF funding received between July 1, 2021 through December 31, 2021 and January 1, 2022 through June 30, 2022, respectively.
De Minimis Rate Used: N
Rate Explanation: Texas Children’s did not elect to use the 10% de minimis indirect cost rate for the year ended September 30, 2023, since it either charge indirect cost specifically approved in a grant award document or, when allowed, charges indirect cost rate previously approved from U.S. Department of Health and Human Services, it is oversight agency.
The accompanying schedule of expenditures of federal awards include the federal grant expenditures of Texas Children’s under programs of the federal government for the year ended September 30, 2023. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule present only a selected portion of the operations of Texas Children’s, the schedule is not intended to and do not present the financial position, changes in net assets, or cash flows of Texas Children’s.
Title: SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Accounting Policies: Expenditures on the schedule of expenditures of federal awards are generally reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Per the guidance provided under May 2023 U.S. Office of Management and Budget (OMB) Compliance Supplement for the Provider Relief Fund (PRF) (ALN 93.498), the amount reported on the schedule of expenditures of federal awards was based on the PRF reporting that was submitted to the Health Resources and Services Administration reporting portal for the time periods January 1, 2023 to March 31, 2023 and July 1, 2023 to September 30, 2023 for PRF funding received between July 1, 2021 through December 31, 2021 and January 1, 2022 through June 30, 2022, respectively.
De Minimis Rate Used: N
Rate Explanation: Texas Children’s did not elect to use the 10% de minimis indirect cost rate for the year ended September 30, 2023, since it either charge indirect cost specifically approved in a grant award document or, when allowed, charges indirect cost rate previously approved from U.S. Department of Health and Human Services, it is oversight agency.
Expenditures on the schedule of expenditure of federa awards is generally reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Per the guidance provided under May 2023 U.S. Office of Management and Budget (OMB) Compliance Supplement for the Provider Relief Fund (PRF) (ALN 93.498), the amount reported on the schedule of expenditures of federal awards was based on the PRF reporting that was submitted to the Health Resources and Services Administration reporting portal for the time periods January 1, 2023 to March 31, 2023 and July 1, 2023 to September 30, 2023 for PRF funding received between July 1, 2021 through December 31, 2021 and January 1, 2022 through June 30, 2022, respectively.
Title: INDIRECT COST RATE
Accounting Policies: Expenditures on the schedule of expenditures of federal awards are generally reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Per the guidance provided under May 2023 U.S. Office of Management and Budget (OMB) Compliance Supplement for the Provider Relief Fund (PRF) (ALN 93.498), the amount reported on the schedule of expenditures of federal awards was based on the PRF reporting that was submitted to the Health Resources and Services Administration reporting portal for the time periods January 1, 2023 to March 31, 2023 and July 1, 2023 to September 30, 2023 for PRF funding received between July 1, 2021 through December 31, 2021 and January 1, 2022 through June 30, 2022, respectively.
De Minimis Rate Used: N
Rate Explanation: Texas Children’s did not elect to use the 10% de minimis indirect cost rate for the year ended September 30, 2023, since it either charge indirect cost specifically approved in a grant award document or, when allowed, charges indirect cost rate previously approved from U.S. Department of Health and Human Services, it is oversight agency.
Texas Children’s did not elect to use the 10% de minimis indirect cost rate for the year ended September 30, 2023, since it either charge indirect cost specifically approved in a grant award document or, when allowed, charges indirect cost rate previously approved from U.S. Department of Health and Human Services, it is oversight agency.
Title: RELATIONSHIP TO FINANCIAL REPORTS SUBMITTED TO GRANTOR AGENCIES
Accounting Policies: Expenditures on the schedule of expenditures of federal awards are generally reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Per the guidance provided under May 2023 U.S. Office of Management and Budget (OMB) Compliance Supplement for the Provider Relief Fund (PRF) (ALN 93.498), the amount reported on the schedule of expenditures of federal awards was based on the PRF reporting that was submitted to the Health Resources and Services Administration reporting portal for the time periods January 1, 2023 to March 31, 2023 and July 1, 2023 to September 30, 2023 for PRF funding received between July 1, 2021 through December 31, 2021 and January 1, 2022 through June 30, 2022, respectively.
De Minimis Rate Used: N
Rate Explanation: Texas Children’s did not elect to use the 10% de minimis indirect cost rate for the year ended September 30, 2023, since it either charge indirect cost specifically approved in a grant award document or, when allowed, charges indirect cost rate previously approved from U.S. Department of Health and Human Services, it is oversight agency.
Amounts reflected in the financial reports submitted to grantor agencies for the programs and the schedule of expenditures of federal awards may not agree because of accruals which would be included in the next reports filed with grantor agencies and because of the different program year-ends.
Title: ASOCIATION ORGANIZATION
Accounting Policies: Expenditures on the schedule of expenditures of federal awards are generally reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Per the guidance provided under May 2023 U.S. Office of Management and Budget (OMB) Compliance Supplement for the Provider Relief Fund (PRF) (ALN 93.498), the amount reported on the schedule of expenditures of federal awards was based on the PRF reporting that was submitted to the Health Resources and Services Administration reporting portal for the time periods January 1, 2023 to March 31, 2023 and July 1, 2023 to September 30, 2023 for PRF funding received between July 1, 2021 through December 31, 2021 and January 1, 2022 through June 30, 2022, respectively.
De Minimis Rate Used: N
Rate Explanation: Texas Children’s did not elect to use the 10% de minimis indirect cost rate for the year ended September 30, 2023, since it either charge indirect cost specifically approved in a grant award document or, when allowed, charges indirect cost rate previously approved from U.S. Department of Health and Human Services, it is oversight agency.
Texas Children’s has an affiliation agreement with Baylor. Under the terms of this agreement, Baylor conducts research and educational activities, and its physicians provide patient care services while utilizing the Texas Children’s facilities in the practical application of the teaching process. Mutual commitments include sharing operational and research costs, including residents’ and physicians’ salaries.
The following summarizes expenses included in the schedule of expenditures of federal awards that represent payments made to Baylor for reimbursement of professional fees for physicians’ time under this affiliation agreement: “See the Notes to the SEFA for chart/table”.
Title: CONTINGENCIES
Accounting Policies: Expenditures on the schedule of expenditures of federal awards are generally reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in Subpart E of the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Per the guidance provided under May 2023 U.S. Office of Management and Budget (OMB) Compliance Supplement for the Provider Relief Fund (PRF) (ALN 93.498), the amount reported on the schedule of expenditures of federal awards was based on the PRF reporting that was submitted to the Health Resources and Services Administration reporting portal for the time periods January 1, 2023 to March 31, 2023 and July 1, 2023 to September 30, 2023 for PRF funding received between July 1, 2021 through December 31, 2021 and January 1, 2022 through June 30, 2022, respectively.
De Minimis Rate Used: N
Rate Explanation: Texas Children’s did not elect to use the 10% de minimis indirect cost rate for the year ended September 30, 2023, since it either charge indirect cost specifically approved in a grant award document or, when allowed, charges indirect cost rate previously approved from U.S. Department of Health and Human Services, it is oversight agency.
Texas Children’s federal program is subject to review and audit by grantor agencies. Consequently, Texas Children’s may become liable to refund money to funding agencies where it fails to comply with contract provisions. In addition, Texas Children’s may not fully collect federal grant receivables as at September 30, 2023, related to the reported federal grant expenditures as these receivables may be subject to the grantors’ compliance approval process. Texas Children’s management believes that the results of these reviews and audits will not have a material effect on the amounts reported in the schedule of expenditures of federal awards.