Notes to SEFA
Title: Basis of Presentation
Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable,expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certaintypes of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance hasbeen provided to a subrecipient.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The accompanying consolidated schedule of expenditures of federal awards (schedule) includes the federalaward activity of Recovery Innovations, Inc. and Subsidiaries (the Organization) under programs of the federalgovernment for the year ended June 30, 2022. The information is presented in accordance with therequirements of Title 2 U.S. Code of Federal Regulations Part 200, Uniform Administrative Requirements, CostPrinciples, and Audit Requirements for Federal Awards (Uniform Guidance). Because the schedule presents onlya selected portion of the operations of the Organization, it is not intended to and does not present the financialposition, changes in net assets, or cash flows of the Organization.
Title: Provider Relief Funds
Accounting Policies: Expenditures reported on the schedule are reported on the accrual basis of accounting. When applicable,expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certaintypes of expenditures are not allowable or are limited as to reimbursement. No federal financial assistance hasbeen provided to a subrecipient.
De Minimis Rate Used: N
Rate Explanation: The auditee did not use the de minimis cost rate.
The Organization received $6,928,613 from the U.S. Department of Health and Human Services (HHS) throughthe Provider Relief Fund and American Rescue Plan (ARP) Rural Distribution program (Federal FinancialAssistance Listing #93.498) (PRF program) during the years ended June 30, 2022 and 2021. The Organizationincurred eligible expenditures, including lost revenue, and therefore, recognized revenues on the consolidatedfinancial statements during the each of the years ended June 30, 2022 and 2021, as noted below. However, thePRF program expenditures were not recognized on the schedule until the expenditures were included in thereporting to HHS, as required under the PRF program. The following summarizes the timing of when the PRF program amounts were recognized in the consolidatedfinancial statements. (see table in report)The amount of PRF expenditures included on the schedule requires management to make estimates andassumptions that affect the reported amounts. Accordingly, such expenditures are considered a significantestimate. Estimates and assumptions may include reducing actual expenses by amounts that have beenreimbursed or are obligated to be reimbursed by other sources, estimating marginal increases in expensesrelated to coronavirus, and calculating lost revenues. Actual amounts could differ from those estimates.