Audit 340793

Title: GENERAL INFORMATION Accounting Policies: 1) GENERAL INFORMATION The accompanying schedule of expenditures of federal awards presents the activities in all the federal grant programs of Stephen Smith Towers Apartments for the Elderly, Inc. (the Project). All financial assistance received directly from federal agencies as well as financial assistance passed through other government agencies or not-for-profit organizations are included on the schedule. 2) BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported on this schedule as expenditures may differ from certain financial reports submitted to the funding agencies due to those reports being submitted on the cash basis of accounting. 3) RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Federal awards expenditures are reported on the statement of activities as expenses. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of federal awards due to program expenditures exceeding grant or contract budget limitations which are not included as federal awards. De Minimis Rate Used: N Rate Explanation: The Project has not elected to use the 10% de minimis indirect cost rate. The accompanying schedule of expenditures of federal awards presents the activities in all the federal grant programs of Stephen Smith Towers Apartments for the Elderly, Inc. (the Project). All financial assistance received directly from federal agencies as well as financial assistance passed through other government agencies or not-for-profit organizations are included on the schedule.

Title: BASIS OF ACCOUNTING Accounting Policies: 1) GENERAL INFORMATION The accompanying schedule of expenditures of federal awards presents the activities in all the federal grant programs of Stephen Smith Towers Apartments for the Elderly, Inc. (the Project). All financial assistance received directly from federal agencies as well as financial assistance passed through other government agencies or not-for-profit organizations are included on the schedule. 2) BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported on this schedule as expenditures may differ from certain financial reports submitted to the funding agencies due to those reports being submitted on the cash basis of accounting. 3) RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Federal awards expenditures are reported on the statement of activities as expenses. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of federal awards due to program expenditures exceeding grant or contract budget limitations which are not included as federal awards. De Minimis Rate Used: N Rate Explanation: The Project has not elected to use the 10% de minimis indirect cost rate. The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported on this schedule as expenditures may differ from certain financial reports submitted to the funding agencies due to those reports being submitted on the cash basis of accounting.

Title: RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Accounting Policies: 1) GENERAL INFORMATION The accompanying schedule of expenditures of federal awards presents the activities in all the federal grant programs of Stephen Smith Towers Apartments for the Elderly, Inc. (the Project). All financial assistance received directly from federal agencies as well as financial assistance passed through other government agencies or not-for-profit organizations are included on the schedule. 2) BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported on this schedule as expenditures may differ from certain financial reports submitted to the funding agencies due to those reports being submitted on the cash basis of accounting. 3) RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Federal awards expenditures are reported on the statement of activities as expenses. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of federal awards due to program expenditures exceeding grant or contract budget limitations which are not included as federal awards. De Minimis Rate Used: N Rate Explanation: The Project has not elected to use the 10% de minimis indirect cost rate. Federal awards expenditures are reported on the statement of activities as expenses. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of federal awards due to program expenditures exceeding grant or contract budget limitations which are not included as federal awards.

Title: INDIRECT COST RATE Accounting Policies: 1) GENERAL INFORMATION The accompanying schedule of expenditures of federal awards presents the activities in all the federal grant programs of Stephen Smith Towers Apartments for the Elderly, Inc. (the Project). All financial assistance received directly from federal agencies as well as financial assistance passed through other government agencies or not-for-profit organizations are included on the schedule. 2) BASIS OF ACCOUNTING The accompanying schedule of expenditures of federal awards is presented using the accrual basis of accounting. The amounts reported on this schedule as expenditures may differ from certain financial reports submitted to the funding agencies due to those reports being submitted on the cash basis of accounting. 3) RELATIONSHIP TO BASIC FINANCIAL STATEMENTS Federal awards expenditures are reported on the statement of activities as expenses. In certain programs, the expenditures reported in the basic financial statements may differ from the expenditures reported in the schedule of federal awards due to program expenditures exceeding grant or contract budget limitations which are not included as federal awards. De Minimis Rate Used: N Rate Explanation: The Project has not elected to use the 10% de minimis indirect cost rate. The Project has not elected to use the 10% de minimis indirect cost rate.