Audit 342910

Title: Note 1 - Basis of Presentation Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the City's financial statements. 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. Pass-through entity identifying numbers are presented where applicable and have been identified in the Schedule. For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance. The accompanying schedule of expenditures of federal awards (the “Schedule”) includes the federal grant activity of the City of Cheboygan (the “City”) under programs of the federal government for the year ended June 30, 2024. The information in this schedule is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. Because the schedule presents only a selected portion of the operations of the City, it is not intended to and does not present the financial position, changes in net position, or cash flows of the City. The City’s reporting entity is defined in Note 1 of the City’s financial statements.

Title: Note 2 - Summary of Significant Accounting Policies Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the City's financial statements. 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. Pass-through entity identifying numbers are presented where applicable and have been identified in the Schedule. For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance. Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the City's financial statements. 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. Pass-through entity identifying numbers are presented where applicable and have been identified in the Schedule. For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance.

Title: Note 3 - Reconciliation to the Financial Statements Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the City's financial statements. 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. Pass-through entity identifying numbers are presented where applicable and have been identified in the Schedule. For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance. The following reconciles federal sources reported in the basic financial statements to the federal expenditures reported in the Schedule: See page 83 of the pdf or page 81 of the audit report.

Title: Note 4 - Federal Program Loans Accounting Policies: Expenditures reported on the Schedule are reported on the accrual basis of accounting, which is described in Note 1 to the City's financial statements. 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. Pass-through entity identifying numbers are presented where applicable and have been identified in the Schedule. For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance. De Minimis Rate Used: N Rate Explanation: For purposes of charging indirect costs to federal awards, the City has not elected to use the 10% de minimis cost rate as permitted by §200.414 of the Uniform Guidance. The City had outstanding federal loan balances as of June 30, 2024 as follows: See page 84 of the pdf or page 82 of the audit report.