Audit 319758

Title: BASIS OF PRESENTATIN Accounting Policies: For purposes of the Schedule, expenditures for federal award programs are recognized on the accrual basis of accounting. Federal expenditures are primarily for administering a Headstart program for disadvantaged children within Morgan County, Tennessee. The Agency also administers a childcare food program, which is funded with pass-through monies from the USDA. De Minimis Rate Used: N Rate Explanation: THE AGENCY HAS ELECTED TO NOT USE THE 10% DE MINIMIS INDIRECT COST RATE. The accompanying Schedule of Expenditures of Federal Awards (the Schedule) summarizes the federal expenditures of Community Action Services of Morgan County, Tennessee, Incorporated (the Agency) under programs of the federal government for the years ended June 30, 2024. The amounts reported as federal expenditures were obtained from the Agency’s general ledger. Because the Schedule presents only a selected portion of the operations of the Agency, they are not intended to and do not present the assets, liabilities and net assets, and current support, revenues and expenses of the Agency. For the purposes of the Schedule, federal awards include all grants and contracts entered into directly between the Agency and agencies and departments of the federal government. The awards are classified into major program categories in accordance with the provision of Office of Management and Budget (OMB) Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance).

Title: NON-CASH ASSISTANCE Accounting Policies: For purposes of the Schedule, expenditures for federal award programs are recognized on the accrual basis of accounting. Federal expenditures are primarily for administering a Headstart program for disadvantaged children within Morgan County, Tennessee. The Agency also administers a childcare food program, which is funded with pass-through monies from the USDA. De Minimis Rate Used: N Rate Explanation: THE AGENCY HAS ELECTED TO NOT USE THE 10% DE MINIMIS INDIRECT COST RATE. The Agency expended $269,904 of Federal Awards in the form of donated goods and services for the years ended June 30, 2024.

Title: MATCHING PORTION OF THE GRANT Accounting Policies: For purposes of the Schedule, expenditures for federal award programs are recognized on the accrual basis of accounting. Federal expenditures are primarily for administering a Headstart program for disadvantaged children within Morgan County, Tennessee. The Agency also administers a childcare food program, which is funded with pass-through monies from the USDA. De Minimis Rate Used: N Rate Explanation: THE AGENCY HAS ELECTED TO NOT USE THE 10% DE MINIMIS INDIRECT COST RATE. One of the requirements of the United States Department of Health and Human Services Headstart Grant is that recipients obtain an additional 20 percent of the granted amount as a local matching portion unless the Agency receives a waiver allowing a lesser portion. For the year ended June 30, 2024, Community Action Services of Morgan County, Tennessee, Incorporated received a waiver allowing 10 percent matching.