Audit 332040

Title: Scope of Presentation Accounting Policies: The expenditures included in the accompanying schedule were reported on the modified accrual basis of accounting. Under the modified accrual basis of accounting, expenditures are incurred when SELACO becomes obligated for payment as a result of the related goods and services. Expenditures reported included any property or equipment acquisitions incurred under the federal/state programs. Additionally, capitalized lease payments for the California State Preschool Program are treated as rent expense. De Minimis Rate Used: N Rate Explanation: SELACO has not elected to use the ten (10%) percent de minimis cost rate as covered in Section 200.44 indirect (F&A) Cost of the Uniform Guidance. The Schedule of Expenditures of Federal and State Awards includes the expenditures of federal awards of Workforce Development Corporation Southeast Los Angeles County, Inc. The federal information in this schedule is presented in accordance with the requirements of the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards, 2 CFR Part 200, Subpart F. Thus, some amounts presented in this schedule may differ from amounts presented, or used in the preparation of the financial statements, For the purposes of this schedule, awards include both financial assistances received directly from the state agency, as well as funds received indirectly from a non-state agency or other organization. SELACO has not elected to use the ten (10%) percent de minimis cost rate as covered in Section 200.44 indirect (F&A) Cost of the Uniform Guidance.

Title: Basis of Accounting Accounting Policies: The expenditures included in the accompanying schedule were reported on the modified accrual basis of accounting. Under the modified accrual basis of accounting, expenditures are incurred when SELACO becomes obligated for payment as a result of the related goods and services. Expenditures reported included any property or equipment acquisitions incurred under the federal/state programs. Additionally, capitalized lease payments for the California State Preschool Program are treated as rent expense. De Minimis Rate Used: N Rate Explanation: SELACO has not elected to use the ten (10%) percent de minimis cost rate as covered in Section 200.44 indirect (F&A) Cost of the Uniform Guidance. The expenditures included in the accompanying schedule were reported on the modified accrual basis of accounting. Under the modified accrual basis of accounting, expenditures are incurred when SELACO becomes obligated for payment as a result of the related goods and services. Expenditures reported included any property or equipment acquisitions incurred under the federal/state programs. Additionally, capitalized lease payments for the California State Preschool Program are treated as rent expense.

Title: Sub-recipients Accounting Policies: The expenditures included in the accompanying schedule were reported on the modified accrual basis of accounting. Under the modified accrual basis of accounting, expenditures are incurred when SELACO becomes obligated for payment as a result of the related goods and services. Expenditures reported included any property or equipment acquisitions incurred under the federal/state programs. Additionally, capitalized lease payments for the California State Preschool Program are treated as rent expense. De Minimis Rate Used: N Rate Explanation: SELACO has not elected to use the ten (10%) percent de minimis cost rate as covered in Section 200.44 indirect (F&A) Cost of the Uniform Guidance. There was one subrecipient awarded pass-through monies in the current year as follows: California State Preschool Program: Quality Children's Services, Inc. (Q-8620): CSPP-3275 $3,896,567 To further assist the program, Quality Children’s Services, Inc provided $201,733 under its Childcare Food Program.