Notes to SEFA
Title: Sub-Recipients
Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) presents the
activity of all federal awards programs of Wartburg Housing Development Fund Corporation,
Project No. 012-EH-706 (the Company) under programs of the federal government for the year
ended December 31, 2023. Federal awards received directly from federal agencies, as well as
federal awards passed through other government agencies, are included in the schedule.
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 the Company, it is not intended
to and does not present the financial position, change in net assets, or cash flows of the
Company. The accompanying schedule is presented using the accrual basis of accounting and is
presented in accordance with accounting principles generally accepted in the United States
used by the Company to report to the federal government. 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: Y
Rate Explanation: The auditee used the de minimis cost rate
Of the federal expenditures presented in the schedule, the Company provided no federal
awards to sub-recipients.
Title: Capital Advance
Accounting Policies: The accompanying schedule of expenditures of federal awards (the schedule) presents the
activity of all federal awards programs of Wartburg Housing Development Fund Corporation,
Project No. 012-EH-706 (the Company) under programs of the federal government for the year
ended December 31, 2023. Federal awards received directly from federal agencies, as well as
federal awards passed through other government agencies, are included in the schedule.
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 the Company, it is not intended
to and does not present the financial position, change in net assets, or cash flows of the
Company. The accompanying schedule is presented using the accrual basis of accounting and is
presented in accordance with accounting principles generally accepted in the United States
used by the Company to report to the federal government. 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: Y
Rate Explanation: The auditee used the de minimis cost rate
In October 1992, the Company executed a capital advance building agreement with HUD for
$7,290,100. The maximum advance was subsequently reduced to $6,977,200. The Company
recognized the capital advance into revenue ratably over the life of the forty-year advance
agreement until a change in accounting principle discontinued the recognition and left a capital
advance liability of $2,412,950. The capital advance shall bear no interest and is not required
to be repaid as long as the property’s apartments remain available to eligible very low-income
households and in accordance with Section 202 for a period of forty years. If, during the term
of the forty-year advance agreement, the property’s apartments are not available to eligible
very low-income households, the entire capital advance of $6,977,200 is due and payable to
HUD. The capital advance is secured by a mortgage on the Company’s land, building, and
equipment.