Audit 319733

Title: Basis of Presentation Accounting Policies: Expenditures reported on the Schedule 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: Davenport Residence, Inc. (Davenport Residence and Dunbar Residence) did not recover its indirect costs using the 10 percent de minimis indirect cost rate allowed under Section 200.414 of the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Davenport Residence, Inc. (Davenport Residence and Dunbar Residence), HUD Project No. 017-11230, under programs of the federal government for the fiscal year ended May 31, 2024. 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 Davenport Residence, Inc. (Davenport Residence and Dunbar Residence), it is not intended to and does not present the financial position, changes in net assets, or cash flows of Davenport Residence, Inc.

Title: U.S. Department of Housing and Urban Development Loan Program Accounting Policies: Expenditures reported on the Schedule 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: Davenport Residence, Inc. (Davenport Residence and Dunbar Residence) did not recover its indirect costs using the 10 percent de minimis indirect cost rate allowed under Section 200.414 of the Uniform Guidance. Davenport Residence, Inc. has received a U.S. Department of Housing and Urban Development FHA insured loan under Section 223(f) of the National Housing Act. The loan balance outstanding at the beginning of the year is included in the federal expenditures presented in the Schedule. The balance of the loan outstanding at May 31, 2023 consists of: CFDA Number 14.155; Program Name Section 223(f) FHA Insured Loan; Outstanding Balance at May 31, 2024 $13,109,526.