Audit 328507

Title: Note 1 – Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. When applicable, 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. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Authority does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal award activity of Towner County Hospital Authority (Authority) under programs of the federal government for the year ended June 30, 2024. The information 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 Authority, it is not intended to and does not present the financial position, changes in net assets, or cash flows of the Authority.

Title: Note 4 – Loan Programs Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting. When applicable, 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. No federal financial assistance has been provided to a subrecipient. De Minimis Rate Used: N Rate Explanation: The Authority does not draw for indirect administrative expenses and has not elected to use the 10% de minimis cost rate. Expenditures reported in this Schedule consist of the following items as noted below. Beginning of Year, Loan Balance $ 12,760,648 Plus current year loan advances 39,681,432 Plus expenditures incurred through year-end 6,076,337 Amount Reported on the Schedule of Expenditures of Federal Awards $ 58,518,417 The outstanding loan balance as of June 30, 2024 was $49,994,797.