Audit 316363

Title: 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Accounting Policies: All Federal grant operations of the American Association of Community Colleges (AACC) are included in the scope of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Single Audit or Uniform Guidance) for the year ended December 31, 2023. The Single Audit was performed in accordance with the provisions of the U.S. Office of Management and Budget (OMB) Compliance Supplement (the Compliance Supplement). Compliance testing of all requirements, as described in the Compliance Supplement, was performed for the major grant programs noted below. The programs on the Schedule of Expenditures of Federal Awards represent all Federal award programs for fiscal year 2023 with cash or non-cash expenditure activities. For our Single Audit testing, we tested Federal award programs to ensure coverage of at least 40% of Federally granted funds. Our actual coverage was 83%. Expenditures reported on the Schedule of Expenditures of Federal Awards (the Schedule) 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. Management has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: Management has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. All Federal grant operations of the American Association of Community Colleges (AACC) are included in the scope of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Single Audit or Uniform Guidance) for the year ended December 31, 2023. The Single Audit was performed in accordance with the provisions of the U.S. Office of Management and Budget (OMB) Compliance Supplement (the Compliance Supplement). Compliance testing of all requirements, as described in the Compliance Supplement, was performed for the major grant programs noted below. The programs on the Schedule of Expenditures of Federal Awards represent all Federal award programs for fiscal year 2023 with cash or non-cash expenditure activities. For our Single Audit testing, we tested Federal award programs to ensure coverage of at least 40% of Federally granted funds. Our actual coverage was 83%. Expenditures reported on the Schedule of Expenditures of Federal Awards (the Schedule) 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. Management has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance.

Title: 2. BASIS OF PRESENTATION Accounting Policies: All Federal grant operations of the American Association of Community Colleges (AACC) are included in the scope of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (the Single Audit or Uniform Guidance) for the year ended December 31, 2023. The Single Audit was performed in accordance with the provisions of the U.S. Office of Management and Budget (OMB) Compliance Supplement (the Compliance Supplement). Compliance testing of all requirements, as described in the Compliance Supplement, was performed for the major grant programs noted below. The programs on the Schedule of Expenditures of Federal Awards represent all Federal award programs for fiscal year 2023 with cash or non-cash expenditure activities. For our Single Audit testing, we tested Federal award programs to ensure coverage of at least 40% of Federally granted funds. Our actual coverage was 83%. Expenditures reported on the Schedule of Expenditures of Federal Awards (the Schedule) 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. Management has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: Management has elected not to use the 10-percent de minimis indirect cost rate as allowed under the Uniform Guidance. The accompanying Schedule includes the Federal award activity of AACC under programs of the Federal government for the year ended December 31, 2023 and is recorded on the accrual basis of accounting. The information in this Schedule is presented in accordance with the requirements of the Uniform Guidance.