Audit 33619

Title: Loan/loan guarantee outstanding balances Accounting Policies: NOTE 1 - BASIS OF PRESENTATION The accompanying schedule of expenditures of federal awards (the Schedule) includes the federal grant activity of Pejepscot Housing, Inc. under programs of the federal government for the year ended December 31, 2022. The information in this Schedule is presented in accordance with the requirements of Title 2 U.S. Code ofFederal Regulations Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirementsfor Federal Awards (Uniform Guidance). Because the Schedule presents only a selected portion of the operationsof Pejepscot Housing, Inc., it is not intended to and does not present the financial position of the Organization,as of December 31, 2022, and the changes in its financial position for the year then ended in accordance with accounting principles generally accepted in the United States of America.NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES A. 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. B. Pass-through entity identifying numbers are presented where available. C. Pejepscot Housing, Inc. has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance. D. The outstanding balance of the capital advance covenant at December 31, 2022 with continuing compliance requirements which are reported as Federal Expenditures on the accompanying Schedule of Expenditures of Federal Awards was $1,031,900.00.NOTE 3 - AWARDS TO SUBRECIPIENTS During the year ended December 31, 2022, there were no awards passed through to subrecipients.NOTE 4 - CAPITAL ADVANCE The outstanding balance of the capital advance at December 31, 2022 was $1,031,900.00. De Minimis Rate Used: N Rate Explanation: The auditee did not use the de minimis cost rate. SUPPORTIVE HOUSING FOR THE ELDERLY (14.157) - Balances outstanding at the end of the audit period were 1031900. Upon completion of the construction project for Phase IV of Pejepscot Terrace the Director signed a mortgage deed with the Department of Housing and Urban Development. The deed was executed to cover the capital advance of $1,031,900.00 provided to fund the project. After 40 years the mortgage deed will be discharged (November 1, 2042). Upon completion of the security agreement a contract was signed with the Department of Housing and Urban Development for rental assistance under Section 202 of the Housing Act of 1959. The contract is for a period of five years and can be extended upon expiration.